Mint Explainer | Crop loss or diversion for ethanol: what’s driving sugar prices?
How much sugar is diverted to make ethanol?
As per Crisil’s analysis, over the past five years, increasing quantities of sugar have been used to produce ethanol. The quantity diverted shot up from a meagre 0.8 mt in sugar season 2019-20 to over 3 mt by 2025-26, or a near four-fold increase. This tightened supplies amid a production shortfall, which, in addition to the rising cost of sugarcane due to higher support prices to farmers, led to the current spike.
