India’s ethanol boom deepens corn shortage and pressures feed sector

India’s growing use of corn for ethanol production is intensifying competition for grain from the poultry and feed sectors. Corn’s contribution to ethanol production rose from 0% in 2021/22 to around 37% in 2025/26, equivalent to about 4.8 bln litres of ethanol and requiring roughly 12.6 mln tons of corn.

Despite a record corn crop of 55 mln tons in 2025/26, the domestic market remains tight due to rising demand from the food sector, livestock and the ethanol industry. Corn prices for poultry farmers have increased from around Rs12–14/kg in 2019 to Rs27–28/kg, and can reach Rs32/kg in the off-season.

Higher feed costs are already squeezing the economics of poultry and egg production. Farmers estimate that the cost of producing one egg has risen from about Rs2.5–2.6 to Rs4–4.5, while producer margins remain limited.

Risks could increase in the new season due to a weaker monsoon and reduced corn and soybean planting. Industry estimates point to a potential corn shortfall of up to 17 mln tons, prompting calls for duty-free imports and greater use of alternative feed ingredients.

Another challenge is the changing crop mix, as expansion of corn area could come at the expense of oilseeds and pulses. This is particularly sensitive for India, which spends more than $20 bln a year on edible oil imports while seeking to reduce its dependence on foreign supplies.

Tags: corn, India, ethanol, compound feed, feed sector