The announcement on formation of an expert committee for modernisation of the Amaravathi Cooperative Sugar Mill by Chief Minister M.K. Stalin during his recent visit to Udumalpet has been welcomed by cane farmers in the command area in Coimbatore, Tiruppur and Dindigul districts.
A proposal readied by the mill management seeking sanction of ₹160 crore by the government for revamp of facilities and replacement of old machinery has been pending for over two years. The old machinery installed in 1955 had worn out and had to be discarded during 2023.
The committee will formulate the plan of action for revival of the cane crushing infrastructure. The mill has, for the last couple of years, been extracting rectified spirit and ethanol by sourcing molasses from other mills in the State.
The distillery unit in the mill has a capacity to process 100 metric tonnes of molasses per day, generating 225 litres of rectified spirit and 215 litres of ethanol.
Sale of rectified spirit was 42.50 lakh litres valued at ₹21.55 crore during 2023-24. During the year, 7.09 lakh litres of ethanol was produced and ₹3.71 crore was realised.
It was a quantum jump from 24.40 lakh litres (₹11.60 crore) of rectified spirit, during 2022-23. Ethanol production was high during the year at 15.10 lakh litres valued at ₹7.14 crore).
Farmers’ associations have been emphasising on revival of cane crushing in the mill, to derive the benefit of highest extent of 11% recovery rate in the western region.
The Tamil Nadu Karumbu Vivasayigal Sangam mooted modernisation of the mill with a crushing capacity of 2,500 metric tonnes a day.
They are now constrained to transport their produce to other mills.
Against this backdrop, farmers have urged the State Government to tap into the utility of the loan scheme of National Cooperative Development Corporation (NCDC) for strengthening of the cooperative sugar mills (CSMs).
For the benefit of the cooperative sugar mills, NCDC has reduced its floating rate of interest for term loan to 8.50% under the grant-in-aid scheme of the Ministry of Cooperation.
Oil Marketing Companies (OMCs) are required to prioritise CSMs participating in ethanol procurement cycles.
On March 6, 2025, the Department of Food and Public Distribution, Government of India, issued a Gazette Notification notifying the revised scheme titled ‘Scheme for financial assistance to CSMs for converting their existing sugarcane-based feedstock ethanol plants into multi-feedstock-based plants to utilise grains such as maize and damaged foodgrains for enhancing and augmenting ethanol production capacity’, exclusively for cooperative sugar mills.
Under the scheme, Central Government will bear the interest subvention on the loan availed by them at a rate of either 6% per annum or 50% of the interest rate charged by the lending institution, whichever is lower, for a period of five years, including a one-year moratorium. Cooperative sugar mills availing of the benefit of interest subvention will be prioritised by OMCs for ethanol procurement.
Published – August 16, 2025 11:17 pm IST
