Godavari Biorefineries recently announced the close of a $15 million equity financing deal with Mandala Capital, a private equity firm that invests in agribusiness companies located in the Indian subcontinent. Godavari, a sustainable manufacturer based in India, will use the funds to invest in the research and development of green chemicals and other products in addition to expanding its infrastructure.
Currently, Godavari produces over 70 million liters of ethanol and labels itself as “a pioneer in the manufacture of alcohol through molasses fermentation.” Additionally, the company produces a number of widely used chemicals like ethyl acetate, paraldehyde, and acetaldehyde. The company’s chemicals have found there way into many paints, pharmaceuticals, printing inks, packaging, fragrances, and cosmetics. Godavari contends that it is the preferred supplier of many Indian companies, including Hindustan Coca-Cola Beverages Limited. Godavari is also one of the largest manufacturers and exporters of sugar cane in India,
In recent years, the company has shifted its focus to the manufacturing of value added complex chemicals derived from ethanol and waste materials produced during the sugar refining process. According to Godavari chairman Samir Somaiya, the company has been focused “on developing new production processes to manufacture specialty and high performance chemicals using biomass as raw materials within the value chain.”
The company’s chemical development focus includes three aspects: farm to food, farm to chemicals, and farm to energy. Farm to food hones in on more effective utilization of existing agricultural resources like sugarcane, sugar, molasses, and starch to produce food products. Farm to chemical focuses on identifying renewable resources as new chemical building blocks. Finally, farm to energy looks for ways to utilize renewable resources as energy.
Some of the recently attained funding has been allocated to implementing the first development phase of a specialty chemicals manufacturing plant. Godavari currently maintains two chemical plants in India, located in Karnataka and Maharashtra respectively. The company hopes that the new plant will increase ethanol production capacity, eliminate bottlenecks in production, and strengthen the company’s infrastructure.
Join Us! Sign up for our next fund here.
According to the Energy Information Agency, ethanol production in the year 2015 is expected to reach 14.25 billion gallons. In April 2015 alone, an average of 927,000 barrels were produced per day. The Energy Information Agency also expects biodiesel production to reach 1.24 billion gallons in 2015. Ethanol is a fuel alternative that is primarily derived from corn and other cellulosic feedstocks. As more companies look for ways to make their practices environmentally sound and sustainable, ethanol derived from alternative sources like molasses has increased in popularity. Other potential sources of alternative ethanol production include sugarcane, sugar beet juice, and raw sugar.
A number of entities, including the United States Department of Agriculture (USDA) have conducted studies evaluating the economic feasibility of producing ethanol from these sugar feedstocks. According to the USDA’s report, a number of other countries such as Brazil have implemented successful and economically viable ethanol plants that use sugar feedstock. Some factors that have made these countries’ endeavors successful include “the relatively low price of raw sugar on the world market in most recent years and the use of molasses as a major feedstock.” Additionally, there are lower energy requirements associated with converting sugarcane feedstock into ethanol than converting it into raw sugar or molasses.
Have news or tips? Email [email protected].