India’s exports of dried distillers grains with solubles (DDGS), a key byproduct of ethanol production, have seen a sharp increase in the financial year 2023–24, driven by the country’s growing ethanol industry and rising demand for alternative animal feed in global markets, reported S&P Global.
According to data from the Agricultural and Processed Food Products Export Development Authority (APEDA), India exported 166,069.97 metric tonnes (mt) of DDGS in FY24, up by over 132,000 mt from the previous year.
DDGS, made from corn and rice used in ethanol production, is emerging as a cost-effective substitute for traditional animal feeds like soybean and corn. Industry participants note that this shift is driven by its competitive pricing, especially in the poultry and livestock sectors.
A recent report by the U.S. Department of Agriculture (USDA) pointed out that India’s expanding economy and rising demand for poultry and dairy products are boosting the need for animal feed. While high feed prices have caused a slowdown in growth in 2024, the country’s grain-based ethanol industry is supplying increasing quantities of DDGS to meet this demand.
With India targeting an ethanol blend rate of over 20% by 2030, numerous grain-based ethanol plants are currently under development. These facilities are expected to significantly boost DDGS production in the coming years.
“Many new ethanol plants will begin operations next year. One of our plants will start soon, and we plan to focus on exporting DDGS made from corn,” said Rajesh Paharia, Chief Manager of Business Development at Kribhco Agri. “We are looking to export from our Hazira plant to markets like Iran.”
He added that India is well-placed to serve price-sensitive and logistically convenient markets in the Middle East and Asia, despite challenges such as high moisture content and aflatoxin levels in corn-based DDGS.
A senior trader from Bangalore echoed this view: “India is actively working on improving DDGS quality. Geographically, we have an edge when it comes to supplying markets in the Middle East and the Far East.”
Currently, Indian DDGS is priced at around $230 per metric tonne (CFR Ho Chi Minh City), according to traders.
While the U.S. remains a dominant global supplier of DDGS, Indian exporters acknowledge that quality issues, especially concerning aflatoxin levels, need to be addressed before India can compete at a global level.
“The domestic feed market is growing by 4-5% annually, and DDGS has largely replaced soybean meal in poultry feed due to lower prices. However, we’re still working on quality to match global standards,” said a Mumbai-based trader.
The USDA report forecasts India’s animal feed demand to grow by 3% in the marketing year 2025–26. It also estimates that grain-based ethanol plants will supply 3.2 million mt of DDGS to the feed sector in 2024–25, rising to 4.2 million mt the following year.
Despite growing domestic demand, international buyers are increasingly attracting Indian DDGS exports.
“There’s better profit in exporting DDGS to countries like Vietnam and Malaysia than selling it locally right now,” said a Delhi-based supplier.
