A push by India to make more corn-based ethanol has turned Asia’s top corn exporter into a net importer for the first time in decades, squeezing local poultry producers and scrambling global supply chains. The jump in import demand comes after India in January hiked the procurement price of ethanol made from corn to drive a shift away from sugarcane-based ethanol for blending in gasoline. With the government promoting ethanol in gasoline to reduce carbon emissions and trying to ensure ample supply of cheap sugar in the world’s biggest market for the sweetener, India appears set to become a permanent net importer of corn. The prospect of India ramping up corn imports is likely to support global prices, which are trading near four-year lows.
Crushed by soaring feed costs as local corn prices rise far above global benchmarks, India’s poultry producers want the government to remove duties on imports and lift its ban on genetically modified (GM) corn. The ban severely limits their buying options.
India usually exports 2 MMT to 4 MMT of corn, but in 2024, exports are expected to drop to 450,000 MT, while the country is set to import a record 1 MMT, mainly from Myanmar and Ukraine, which grow non-GM corn. Meanwhile, traditional export markets such as Vietnam, Bangladesh, Nepal and Malaysia, which bought corn from India because of its prompt availability, are now compelled to source supplies from South America and the United States.
