Saturday, April 12, 2008

Little steps that matter

Forget the big sugar mills. They are busy fixing their forex gaffes with bankers. It’s the rural sugar farmers’ cooperatives that get innovative in their efforts to beat the glut.

Satara-based Veer Kisan Ahir Sugar Cooperative (VKASCL) has signed a MOU with the German bio-fuel company, Biogas-Nord, to set up the country’s first plant to produce CNG from spent-wash, a by-product. It is a semi-solid waste and its disposal is agony for sugar manufacturers. Biogas-Nord, aided by Elephant Equity PE fund plan to set up a Rs.27 crore plant to produce CNG equaling 7,000 liters of diesel per day. VKASCL will make available land, infrastructure and raw material for the project and, in return, Biogas-Nord will give 5 per cent commission to the sugar cooperative on total sales plus royalty on raw material.

Facing massive over-supply, sugar industry globally is in shambles. The only way to stay competitive is to invest in innovation, discover alternative uses for the crop – power generation, ethanol and biogas fuel production. The costly crude oil [$100+ a barrel] is clearly unaffordable, yet continues to power vehicles, run factories and heat up cold homes. With an oil guzzling world desperately searching for alternatives, every little step helps.

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