Government Facilitates Agreed Price for Locally Produced Potash Derived from Molasses

The Central Government has played a facilitating role in establishing a mutually agreed-upon price of Rs 4263 per metric ton (MT) for Potassium Derived from Molasses (PDM) to be sold by sugar mills to fertilizer companies for the ongoing year. Furthermore, PDM manufacturers can claim a subsidy of Rs 345 per ton under the current rates through the Nutrients Based Subsidy Scheme (NBS) administered by the Department of Fertilizers. Currently, discussions are underway between sugar mills and fertilizer companies to finalize long-term sale and purchase agreements for PDM.

PDM, a potassium-rich fertilizer produced from ash in molasses-based distilleries, is a by-product of the sugar-based ethanol industry. The distilleries generate spent wash during ethanol production, which is incinerated in an Incineration Boiler (IB) to achieve Zero Liquid Discharge (ZLD). The ash, rich in potash, can be processed to yield PDM with a 14.5% potash content, providing farmers with an alternative to Muriate of Potash (MOP) with 60% potash content.

Currently, India entirely relies on imported MoP for potash fertilizer. The domestic production of PDM is seen as a strategic move to reduce import dependency, contributing to India’s self-reliance in PDM production. The existing sale of approximately 5 LMT (Lakh Metric Tons) of Potash Ash generated from ethanol distilleries domestically could potentially increase to 10-12 LMT.

The introduction of PDM manufacturing and sales serves as an additional revenue stream for sugar mills, enhancing their cash flows and ensuring timely payments to farmers. This initiative aligns with the Central Government’s broader goal of reducing import dependence in the fertilizer sector.