AIDA Seminar, 18 th and 19 th February 2016 Visit us @ www ... · AIDA Seminar, 18 th and 19 th February 2016 Visit us @ www. vsisugar .com CLASSIFICATION

AIDA Seminar, 18th and 19th February 2016 Visit us @ www.vsisugar.com


Produce enough sugar for domestic consumption as well

as for export (whenever opportunity arises).

Produce enough ethanol to make 10 % and 20 % EBP

successful and sustainable (National Biofuels Policy).

Continuous growth of liquor industry (10-12 % growth). INCRESING DEMAND FOR ETHANOL IN THE COUNTRY.

Though world sugar market will be in deficit (5.2 mln

tonnes) in 2015/16 for the first time in six years, stocks will still remain high.

Stock % consumption ratio will be still above the critical

level of 35 % indicating less chances of improvement in International sugar price. NO SCOPE FOR EXPORT UNLESS IT IS SUBSIDIESED.

Even after mandatory export of 4.00 mln tonnes of sugar, ending stocks in India will still remain high.


Can we overcome this problem with our conventional route of sugar and ethanol production? WE REQUIRE ALTERNATIVE RAW MATERIALS/SUPPLEMENTERY FEEDSTOCK.

Feedstock which can be made available and can be

possibly crushed/processed in our existing sugar mills and attached distilleries.

Recent price hike offered by the OMCs in India for fuel ethanol. THIS OFFERS AN INTERNAL OPPORTUNITY.


CLASSIFICATION

ORGANIC

MOLECULE TO BE

CONVERTED TO

ETHANOL

RAW MATERIAL

1st Generation

Sugary

(Glucose, Fructose,

Sucrose)

C and BH molasses

SJ and MCJ

Sweet sorghum (stalks) juice

Starch

Grains (Corn, Sorghum, Rice,

Wheat, Millet)

Cassava

2nd Generation

Cellulose and

Hemicellulose

Lignocelluosic biomass

(Bagasse, Sugar cane trash,

Corn cobs, Rice straw etc.)

Complex Mixed

Organics

Pet coke and Municipal solid

waste


USA 55.98 Brazil 28.99

China 8.37

India 2.29 Canada

1.97

U.S.A.

Brazil

China

India

Canada

Billion Liters

Total World Ethanol production in 2015 was 113.41 Billion liters

Global ethanol production to grow by 4 % and consumption to grow by 6 %


Coarse

Grains 56%

Wheat 3%

Cane juice

32%

Beet 2%

Molasses 4% Synthetic 3%


Final –C molasses to be produced in 2015/16: 11.21 mln

MT.

Maximum Ethanol to be produced from C molasses: 2500-

2600 million liters.

Molasses based installed capacity : + 5.0 bln lit. (Capacity

utilization is about 50 %).

Grain based installed capacity : 1.8 bln lit.

Total installed capacity: 6.8 bln lit.

Fuel Ethanol price offered by OMCs Rs. 45.0-46.0/lit (From

1st October 2015 (Ex-factory).


Sector Year

2012-13

(5 % EBP)

2013-14

(5 % EBP)

2014-15

(5 % EBP)

2015-16E

(10 % EBP)

2020E

(10 % EBP)

Liquor Industry 1100.00 1150.00 1200.00 1250.00 1650.00

Chemical Industry 750.00 750.00 750.00 750.00

Fuel purpose (EBP) 360.00 350.00 800.00 2660.00 4450.00

(ISO)

Export -- 175.00 200.00 200.00

Total Demand 2210.00 2425.00 2950.00 4860.00 +10000.00

(20 % EBP)

Production from

molasses 2587.20 2500.00 2550.00 2600.00

Production from

grains ---- ----- 900.00 1000.00

Total Production ----- ----- 3450.00 3600.00


Ethanol blending in 2014-15 – 674 million liters.

Ethanol demand by OMCs for 2015-16 -2660 million

liters.

Quantity of ethanol finalized so far – 1200 million liters.

Reduce crude oil imports by Rs 5,500-6,000 Cr.

Will also bring down emissions.

Expected to achieve 5 % in 2015-16.

Possibility of inclusion of ethanol in priority sector

lending of banks to boost production.



Particulars Recovery

(%)

Sugar

Production

Reduction

(%)

Ethanol

Production

Increase

(Times)

Advantages

/Drawbacks

Conventional 11.49 --- ---

BH 10.14

11.0-20.0 1.72-2.21 No

investment

Total SJ 6.97

40.0 3.37 Additional

investment

Partial SJ

10.41

09.3 1.59 Additional

investment

WCJ -- -- 6.84


Switch over from (C) final molasses to BH molasses is fast.

Increase in distillery capacity (70 KLPD 100KLPD)

Production of BH molasses will reduce steam consumption in

sugar mill and results in bagasse saving.

Sugar colour and size can be improved.

Increased export of power from cogeneration unit.

Saving in gunny bags because of reduced sugar production.

Reduction in interest burden on sugar stock with sugar mill.

Reduction in transport cost of purchased molasses.

Saving in working days of sugar mill because of additional crushing capacity.

Reduction in per liter effluent treatment cost in distillery.


Sr.

N

o.

Particulars At Rs.

2800/Qtl

At Rs.

3000/Qtl

At Rs.

3200/Qtl

At Rs.

3400/Qtl

At Rs.

3500/Qtl

1

Income from

Direct benefits,

Rs. Lac

221.8 153.3 84.8 16.3 -17.9

2

Income from

Indirect

benefits, Rs. Lac

196.8 196.8 196.8 196.8 196.8

3 Total Income,

Rs. Lac 418.6 350.1 281.6 213.1 178.9

4 Net Profit/MT

Crushing, Rs. 166.2 139.0 118.8 84.6 71.0


1. SJ or WCJ cannot be stored as it is perishable.

2. Requires additional investment for pretreatment.

3. Generally, all SJ or WCJ can’t be used in typical Indian distilleries (small capacities) attached to sugar mills.

4. Therefore, we will have to adopt partial SJ or WCJ route (depending on the capacity of the attached distillery).

5. Spent wash characteristics will change (Lower COD/BOD) and therefore may not suit to the existing ETP of the distilleries.

6. Partial SJ becomes the next choice after BH molasses route.


Corn can be used for

Human and animal

consumption

Manufacture of starch

Corn syrup (glucose)

HFCS (Fructose 55%, glucose 45%)

Beer and whisky

Potable and fuel ethanol + animal feed

Corn Oil FOOD Vs FUEL

Distillers’ Dried Grains with

Solubles (DDGS)

OR

Distillers’ Wet Grains with

Solubles (DWGS)


Ethanol yield from corn is about 380-400 Liters/MT.

Corn ethanol production cost in the country is varying in

between. Rs. 38/Lit. (Punjab) – Rs. 45 /Lit.(Maharashtra)

This mainly depends on feedstock cost (80-84%).

Followed by Fuel cost (15-16 %).

Corn price in USA at present is ranging in between Rs. 8900 to Rs. 11000/MT Vs Rs. 15000/MT in Maharashtra.

Oil recovery (corn oil) in dry milling is not yet explored in India. It

can offer additional revenue and bring down the cost of production further.

World: Corn ethanol and sugar cane ethanol price gap is widening as feedstock price gap is closing. Corn ethanol is

becoming cheaper and sugarcane ethanol is becoming costlier.


Short duration crop (120 – 140 days).

Cheaper to grow. Gives stalks + grains (40 and 2 MT/ha).

Less water requirement than any other crop.

Has a good tolerance to wide range of climatic & soil

conditions.

This crop can be taken at least twice in a year.

Alcohol Recovery is 50 to 63 liters/MT of stalk.

Can be processed in existing sugar mill with attached distillery.

The effluent volume can be reduced to 3 lit/lit.

Sweet Sorghum is grown in – Africa, South & Central

America, China, India, Pakistan, Philippines, Indonesia

and United States.


Season Sowing Cultivation

period

Harvesting and crushing in

existing sugar mill

Kharip June June, July, August and

September October

Rabbi November

November, December,

January and February

March


Planting and harvesting programme is important so as to

match the mill and distillery capacity.

Manual harvesting and de-trashing is difficult. Therefore, mechanical harvesting is recommended.

Because of bulky nature of the stalks, transportation is

difficult. About 3-4 MT/ trolley instead of 7-8 MT/ trolley.

Harvesting schedule is very important. Otherwise,

detoriation (self fermentation) of stalks with loss of sugar

takes place.

Similarly, fast transportation after harvesting is also very important.

Reduction in carbon emission (80-90 %) compared with

fossil fuels.


S.

N.

Particulars Sugar

cane

Sweet

Sorghum

(Two crops)

Grain +

Green stalk

1. No of crops

per year

1 2

2. Crop period

(months)

12 4 + 4

3. Average yield

/ ha.

75 t 40qtls + 80 t

4. Average price

(Rs.) 2000/t 1500/qtl

+

861.75/t

S.

N.

Particulars Sugar

cane

Sweet

Sorghum

(Two crops)

Grain + Green stalk

5. Total income

(Rs./ ha) 150000 128940

6. Cost of

cultivation

(Rs/ ha)

82920 55860

7. Net profit (Rs/ha)

67080 73080

8 Net returns

(Rs/ha /

month)

5590 9135



Produced from non-food agro waste or agro residue

or from Muncipal Solid Waste (MSW) or Petcoke etc.

Technology of production of 2G ethanol is under

extensive development in many countries including

USA, EU, Brazil, India and many more.

There are about half a dozen commercial plants

under operation in USA, EU and Brazil.

In India, there are three pilot plants under operation.

For sugar industry, bagasse and sugar cane trash are

readily available lignocellulosic raw materials.

Present cost of production of 2nd generation ethanol is

higher than 1st generation ethanol.



One US company has approached VSI for installing 2G

ethanol plant in one of our member sugar mills with

distillery and cogen units.

Indian Oil Corporation has announced its plan to install

petcoke to ethanol plant in collaboration with Celanese

of USA at an investment of Rs. 1000 Cr.

MoP & NG is also very serious on 2G ethanol.

IGL, Kashipur is now setting up a 10 KLPD demonstration

ethanol plant in association with ICT and DBT.

At VSI, we are working on both the routes (Enzymatic

hydrolysis and Syngas) with encouraging results.

No Food Vs Fuel conflict.



Wholesale (Ex-mill) ethanol price in USA is around USD

0.43 to 0.46/Liter (Rs. 28 to Rs. 30/Liter).

USA is now most economic and competitive ethanol

producer of the world.

Ethanol producers in India are expected to get Wholesale

(Ex-mill) ethanol price of Rs. 45 to Rs. 46/Liter which

translates in to minimum Rs. 30/Kg of sugar equivalent .

This is a GOLDEN OPPOERTUNITY for the sugar mills to

reduce their sugar stocks and still earn higher profits.

Implementing successfully 10 % EBP presently and 20 %

EBP in future is must for SURVIVAL of sugar industry in India.

Promoting fuel ethanol production can be a long term

solution for cash-starved sugar mills.


Corn: At present, cost of production seems to be on higher

side to meet the target price of ethanol.

Corn: Returns from by-products (DDGS or DWGS, CO2 and

Corn oil) can be the deciding factor.

New sweet sorghum varieties are now available with ICRISAT

& State Universities (stalks + grains).

Requires substantially less irrigation water and at least two

crops can be taken in one year.

Most potential crop under tropical conditions for ethanol

production.

Real challenge is to convince the farmers. To motivate the

farmers, Assured fixed price on weight basis should be

offered.

Cellulosic ethanol is also bound to come in next few years.


Documents

AIDA Seminar, 18 th and 19 th February 2016 Visit us @ www ... · AIDA Seminar, 18 th and 19 th February 2016 Visit us @ www. vsisugar .com CLASSIFICATION