The Centre has announced its Open Market Sales Scheme (OMSS) policy for 2026-27, fixing the price of rice for ethanol production at Rs 2,320 per quintal while leaving the quantity to be supplied to distilleries undecided. The move is being seen as a cautious approach amid concerns that a possible super El Niño could affect India’s foodgrain production.
Under the policy, which will remain in force until June 30, 2027, the quantity of rice to be supplied for ethanol production will be decided by a committee of ministers headed by Union Home Minister Amit Shah, The Hindu Businessline reported.
The government has fixed the price of rice for ethanol distilleries at Rs 2,320 per quintal until October 31 and Rs 2,390 per quintal from November 1. The same rates will apply to the sale of 48 lakh tonnes of rice to eligible State governments, their corporations and community kitchens without the need for e-auctions.
The allocation of 48 lakh tonnes has been reserved only for non-surplus States that require additional rice for their welfare schemes.
Under the OMSS policy, rice prices include freight charges, while wheat prices do not cover transport costs.
Rice sold to Central cooperative organisations, including National Agricultural Cooperative Marketing Federation of India, National Cooperative Consumers’ Federation of India and Kendriya Bhandar, for retail sale under the Bharat brand through stores, mobile vans, e-commerce platforms and major retail chains such as Jio, will be priced at Rs 2,480 per quintal until October 31 and Rs 2,550 per quintal from November 1.
For small private traders, entrepreneurs and individuals purchasing directly from depots of the Food Corporation of India, the rice price has been fixed at Rs 2,890 per quintal until October 31 and Rs 2,970 per quintal from November 1.
The reserve price for rice with 25 per cent broken grain in e-auctions for private buyers and cooperatives has been set between Rs 2,660 and Rs 2,890 per quintal until October 31, rising to Rs 2,740-2,970 per quintal from November 1 depending on the procurement season.
Following the Union Cabinet’s July 1 decision to reduce the permissible broken grain content in rice to 10 per cent from 25 per cent, the government has also introduced a separate category for higher-quality rice. The reserve price for this category has been fixed at Rs 3,090 per quintal until October 31 and Rs 3,180 per quintal from November 1 for private buyers through e-auction.
The policy also sets a minimum price of Rs 2,000 per quintal for 100 per cent broken rice, which will be sold to private buyers through e-auction.
Distillers have sought greater clarity over the pricing, pointing out that rice for ethanol has been priced at Rs 2,320 per quintal while broken rice has been fixed at Rs 2,000 per quintal. The government order also states that old and broken rice should be used for ethanol production wherever feasible.
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