Broken rice market affected as the ethanol industry shifts towards maize.
Rice millers in Punjab are facing mounting financial stress as the stock of 100% broken rice continues to grow, with limited buyers and falling prices. The ethanol industry, previously the largest consumer of broken rice, has shifted to maize this year, which is currently cheaper at around ₹1,700 per quintal. This has made ethanol production from rice less viable. The government has fixed the disposal price of 15% broken rice obtained during milling of Common Mild Rice (CMR) at ₹2,370 per quintal. However, in the open market, 100% broken rice is fetching only ₹1,900-₹2,000 per quintal, deterring potential buyers. Millers say the problem of disposing of 15% broken rice has persisted over the past two years, but the situation has worsened this year as stock continues to accumulate over the last two months. Ranjit Singh Josan, Vice President of the Punjab Rice Industry Association, has urged the government to reduce the controlled price of 100% broken rice to ₹1,900 per quintal. He also recommended allowing stock in mill complexes to be lifted under a simple Release Order (RO) system to cut unnecessary handling and transportation costs. Josan further suggested linking ethanol and animal feed industries directly with rice mills or providing mill-wise allocations under the Open Market Sale Scheme (OMSS), ensuring timely lifting of stock and smooth supply chains. Millers have warned that if the current stock remains idle, it will affect processing of new paddy. The government has set storage charges at ₹1.23 per quintal per month, but millers claim the actual cost is much higher. Bharat Bhushan Binta, President of the Punjab Rice Industry Association, said demand for 100% broken rice has almost disappeared and the widening price gap has severely disrupted mill economics, increasing cash flow pressure and highlighting the urgent need for a workable solution.