Patna: Bihar’s grain-based ethanol industry is facing a severe downturn, with more than 10,000 jobs at risk after the closure of at least 10 major plants across the state.
The shutdowns have disrupted not only industrial output but also rural livelihoods, with workers and maize farmers among those most affected. Industry representatives cite supply restrictions of 50–55% and a sharp decline in procurement by oil marketing companies (OMCs) as the primary causes of the crisis.
One of the latest casualties is an ethanol plant in Nawanagar, in Buxar district, which ceased operations on March 17. Management has placed employees on leave for a month, with operations expected to resume only if fresh orders are secured for the May–July quarter.
Sources within the sector say the issue is not isolated. Nearly all ethanol plants in Bihar are facing similar challenges, raising concerns about the long-term viability of the state’s biofuel push.
Since November 2025, OMCs have reportedly scaled back ethanol purchases from Bihar while increasing procurement from other states, placing local producers under mounting financial pressure. Industry stakeholders argue that the shift has disproportionately affected Bihar, where investments in grain-based ethanol production had been growing in recent years.
Plant owners have approached both state and central authorities, writing to senior officials including the Bihar chief minister and industry minister, as well as the prime minister, home minister, petroleum minister and senior bureaucrats in the petroleum ministry. Despite these efforts, no concrete policy intervention has been announced so far.
The fallout has been particularly acute for workers, many of whom now face prolonged uncertainty over their employment. At the same time, maize farmers are reporting significant losses due to falling demand, as the crop is a key raw material in ethanol production.
