Unlikely to be an immediate surge in ethanol demand due to the E-85 program

16-Jun-2026 12:16 PM

New Delhi: Indian ethanol manufacturers do not anticipate a significant spike in ethanol demand during the current 2025-26 marketing season (November–October) despite the rollout of the E-85 program; however, demand and consumption could rise rapidly in the coming years.

The government has decided to permit the blending of up to 85% ethanol in petrol—classified as biofuel—for flex-fuel vehicles (FFVs). It remains to be seen how the adoption of FFVs evolves this year and in the future.

Nevertheless, the demand for ethanol for blending up to 20% in petrol will remain robust. Currently, the use of sugarcane-based feedstocks for ethanol production has been limited, and there has been no substantial increase in production from maize, rice, and other inputs. Furthermore, the number of FFVs in the country is currently limited.