Legal hurdle delays fresh ethanol tender

Oil marketing companies (OMCs) are expected to issue a fresh ethanol procurement tender for the 2025-26 ethanol supply year after a key legal dispute pending before the Karnataka High Court reaches its conclusion, a senior government official said, Informist has reported on Monday.

The final hearing is expected after the Supreme Court resumes work in mid-July following its summer vacation. The case involves ethanol producer Vinp Distilleries and Sugars Pvt Ltd, which challenged OMCs over alleged non-compliance with preferential supply commitments promised to dedicated ethanol plants under long-term contracts. While the Karnataka High Court had earlier ruled in favour of the company, the Supreme Court later set aside that verdict. However, the main writ petition remains pending before the High Court.

OMCs procure ethanol through tenders to support India's Ethanol Blended Petrol Programme, which aims to reduce crude oil imports and promote cleaner fuel use. In the first tender round for the current supply year, OMCs sought around 10.5 billion litres of ethanol and received bids totalling 17.76 billion litres.

Maize remains the largest feedstock source, contributing nearly 45% of ethanol supplies, followed by Food Corporation of India rice at 22%, sugarcane juice at 16%, and B-heavy molasses at 11%. Industry experts believe a fresh tender could further strengthen ethanol availability and help maintain blending momentum. With surplus production capacity available, higher procurement may support investments across the biofuel value chain.