Bank of Agriculture and Agricultural Cooperatives (BAAC) is ready to lend Bt7 billion to palm growers, to promote the plantation of more palm trees for biodiesel production as advised by His Majesty the King.
BAAC president Thirapong Tangthirasunan said on Thursday that half of the fund is contributed by the Energy Ministry and the other half from BAAC. The loan will carry the interest rate of 7 per cent, or 50 percentage points below minimum retail rate. The repayment period is maximum 15 years and farmers are entitled to a 4-year grace period.
BAAC plans to promote the plantation of palm trees on 700,000 rai in the next three years: 500,000 in the South and 200,000 in the East. Within this year, 100,000 rai would be achieved and the plantation areas would rise by 300,000 rai.
King Bhumibol suggested in his birthday speech that Thailand should grow more fuel corps like sugar canes, tapioca, and palm trees.
Energy Minister Piyasvasti Amranand said separately that right now Thailand has two types of biodiesel: the one produced from used vegetable oil by communities for own uses and the other from plam oil for commercial purpose.
He noted that palm oil is sufficient to meet demand, but a shortage could emerge next year. Thus, palm plantation areas must be expanded, he said.