# Maize and Starch and cellulose derivatives

Maize is the main raw material for starch: wet milling turns a 56 lb bushel into about 31.5 lb of starch plus feed and oil co-products, and the starch goes on to food, paper, textiles and pharmaceuticals. In India, fast-growing maize demand from ethanol distilleries now competes directly with starch makers for the grain.

Source page: https://www.materialinsights.org/links/maize-and-starch-and-cellulose-derivatives/

[Maize](https://www.materialinsights.org/commodities/maize/) (commodity) and [Starch and cellulose derivatives](https://www.materialinsights.org/chemicals/starch_derivatives/) (chemical): 4 relationships.

## How they are linked

### 1. Wet milling feedstock

*Physical flow · Strong · Maize to starch and derivatives*

About 70% of a maize kernel is starch, which wet millers free by steeping the grain and separating germ, fibre and protein, so maize is the dominant raw material and cost.

- **about 31.5 lb** starch from a 56 lb bushel of maize
- **30 to 40 hours** steeping in warm water before separation

Much of the starch is sold as native or modified starch for food, paper sizing, adhesives and pharmaceuticals, and much is converted into glucose syrups and dextrose. Each tonne of starch therefore embodies well over a tonne and a half of maize.

Sources: [Corn Refiners Association](https://corn.org/?p=314); [Kansas State University, Department of Agricultural Economics](https://agmanager.info/sites/default/files/CornRefining_02-16-09.pdf)

### 2. Feed and oil co-products

*Joint production · Medium · Maize to starch plus gluten feed, gluten meal and oil*

Wet milling splits the kernel into several saleable streams, so a starch plant is also a producer of animal feed and edible oil.

- **12.5 lb** corn gluten feed per bushel
- **2.5 lb and 1.6 lb** corn gluten meal and corn oil per bushel

Co-product sales offset part of the maize cost, so the net cost of starch depends on feed and vegetable oil prices as well as on maize. When feed prices are high, wet millers can absorb dearer maize more easily.

Sources: [Kansas State University, Department of Agricultural Economics](https://agmanager.info/sites/default/files/CornRefining_02-16-09.pdf)

### 3. Price link: feedstock cost

*Cost and price · Medium · Both ways, maize leads*

Maize is the main cost of starch, but many starch and syrup sales are on annual contracts, so maize price changes pass through with a delay.

- **0.05** monthly change correlation
- **0.33** 12-month change correlation
- **0.41** fitted elasticity

Monthly moves are almost unrelated, while yearly moves show a moderate link. An elasticity of about 0.4 fits a product in which maize is a large but not the only cost, with co-product credits and processing costs damping the effect.

Sources: [Material Insights (World Bank, FRED, IMF data)](https://www.materialinsights.org/chemicals/starch_derivatives/correlation/)

### 4. Ethanol competes for maize

*Substitution · High in India · Ethanol distilleries and starch makers bid for the same maize*

India's ethanol blending programme has made maize a major distillery feedstock, so starch makers now compete with distilleries, as well as poultry feed, for the crop.

- **1.49 billion litres** ethanol from maize in India, 2023-24 supply year, supplies to mid-July 2024
- **2.50 billion litres** projected maize ethanol, 2024-25
- **Rs 2,225 per quintal** maize minimum support price, kharif 2024-25

Maize became the largest single feedstock for Indian ethanol in 2023-24, and by the end of August 2026 maize had supplied about 3.45 billion litres in the current supply year. A 2026 trade report notes that distillery demand can raise starch processing costs and tighten feedstock supply for starch and glucose makers.

Sources: [Business Standard](https://business-standard.com/industry/agriculture/can-maize-maintain-its-newfound-supremacy-in-ethanol-production-124081901077_1.html); [ChemAnalyst](https://www.chemanalyst.com/NewsAndDeals/NewsDetails/indias-liquid-glucose-market-at-a-turning-point-as-ethanol-44541)

## For investors

### Key learnings

1. Maize is the main cost for starch makers, but contract pricing and co-product credits mean margins react to maize with a lag of months.
2. In India, ethanol procurement prices and blending targets now affect maize costs for starch makers alongside the size of the harvest.
3. Starch makers with strong co-product sales and pricing power in modified starches cope better with dearer maize than commodity native starch producers.

### What to track

- **Indian maize mandi prices against the minimum support price**: Prices well above MSP signal tight supply and margin pressure for starch makers (Weekly · Agmarknet)
- **Maize allocated to ethanol in oil marketing company tenders**: Larger allocations tighten maize for starch and feed (Each tender cycle · oil marketing companies, Ministry of Petroleum)
- **US corn price**: Sets world maize costs and the price of imported starch (Daily · CBOT; monthly · World Bank Pink Sheet)

## For policymakers

### Key learnings

1. India's ethanol programme has created a new large buyer of maize, so blending targets have side effects on starch, feed and food industries.
2. Raising maize yields and area eases the conflict between fuel and industrial uses more than import duty changes alone.
3. Maize import duties and tariff-rate quotas decide whether starch makers can turn to world supply when domestic maize is tight.

### What to track

- **Maize production and yield estimates**: A larger crop eases competition between ethanol, feed and starch (Seasonal · Ministry of Agriculture advance estimates)
- **Ethanol procurement price for maize-based ethanol**: A higher price draws more maize into distilleries (Annual · Ministry of Petroleum and Natural Gas)
- **Maize import volumes and duty changes**: More imports signal domestic shortage for industrial users (Monthly · DGCI&S; as notified · Ministry of Finance)

## India

India has a sizeable maize starch industry, but since 2023-24 maize has become the leading feedstock for its ethanol programme, so starch makers now compete with distilleries and poultry feed for the crop.

## Sources

1. [Price correlation, Material Insights](https://www.materialinsights.org/chemicals/starch_derivatives/correlation/), Material Insights (World Bank, FRED, IMF data)
2. [Corn refining process](https://corn.org/?p=314), Corn Refiners Association
3. [Corn refining (wet milling) market notes](https://agmanager.info/sites/default/files/CornRefining_02-16-09.pdf), Kansas State University, Department of Agricultural Economics
4. [Can maize maintain its newfound supremacy in ethanol production?](https://business-standard.com/industry/agriculture/can-maize-maintain-its-newfound-supremacy-in-ethanol-production-124081901077_1.html), Business Standard (2024)
5. [India's liquid glucose market at a turning point as ethanol tightens maize competition](https://www.chemanalyst.com/NewsAndDeals/NewsDetails/indias-liquid-glucose-market-at-a-turning-point-as-ethanol-44541), ChemAnalyst (2026)