Isan biofuel windfall from cassava crops
By Jon Fernquest |
Today's Bangkok Post business section has a story on cassava as a promising biofuel crop in Isan:
"Cassava plantations will continue to expand on huge demand from new ethanol plants, which aim to produce two million litres a day.The booming ethanol industry has drawn substantial investments in alternative-fuel production to the Northeast, boosting the price and production of cassava, the region's key crop, to its highest level."
(See photo on right of cassava roots)
Cassava has advantages over other crops grown as biofuel substitutes for oil:
The crop has a strong advantage in that it is much easier to grow and quicker to yield, at only seven months, compared with five years for other energy crops like palm oil
Companies already producing cassava and tapioca which is made from cassava, are jumping on the bandwagon:
"Investors, not only newcomers but existing operators, have been trying to make more money from the crop. Tapioca-products manufacturers, for instance, have expanded into the alternative-fuel industry and produce biogas from its waste water."Of some 30 flour and modified-starch plants in the region, half are expanding into the biogas business," said Mr Suvich, who oversees investment in the region where Nakhon Ratchasima is the centre."
Cassava prices have risen with its use as biofuel:
"...strong demand has doubled the price of the crop to over two baht a kilogramme from the average price of the past decade. The price is so attractive that planters are selling their output to ethanol plants rather than producers of chips or pellets for exports."
As prices have risen, cassava production has also risen:
Driven by the boom, the planted area of cassava in Thailand rose to 7.47 million rai last year, up 12% from 2005. Yields in 2007 increased by 36% in the same period to 26.41 million tonnes, and from only 15 million tonnes the country produced 10 years ago.Based on a report of the Office of Agricultural Economics, cassava is now grown on 3.96 million rai in 19 northeastern provinces. Fresh-cassava output exceeds 14 million tonnes, up strongly from 8.7 million tonnes the region harvested two years ago. Its farm value last year increased to 29.58 billion baht, up from 29.13 billion in 2006 and 22.52 billion baht in 2005.
Cassava plantations will continue to expand on huge demand from new ethanol plants, which aim to produce a combined two million litres or more a day.
But Mr Suvich dismissed talk of a possible shortfall of output since farmers could adjust quickly to the current strong demand.
Investment in biofuel ventures accounts for a larger and larger share of foreign investment in Thailand:
"Ethanol projects have largely dominated investments seeking promotional privileges from the Board of Investment (BoI) in the region last year, which totalled 62 billion baht.The approved projects - five ethanol plants at a combined cost of 16.5 billion baht - would be built in Nakhon Ratchasima, Ubon Ratchathani, Chaiyaphum, and Kalasin over the next few years, according to Suvich Churvichien, director of BoI's Northeastern Region Investment and Economic Center.
Among them are joint ventures between Thai and foreign investors, the highest value of which are the 5.3-billion-baht project of Boon-Anek Co in Nakhon Ratchasima and the 4.2-billion-baht plant of Palang Kaset Industry Co in Ubon Ratchathani.
A clearer state policy on alternative fuel has made investors more confident and the northeastern provinces have been chosen as their destinations thanks to plentiful supplies of cassava and sugarcane to feed the ethanol industry, Mr Suvich said.
The BoI-promoted investments in farm and agro-industry ventures in the region have now outpaced those in the electronic and electrical sectors such as hard disk drive production and supporting factories, which have concentrated in the region, especially Nakhon Ratchasima, for years."
(Source: Bangkok Post, business section, 30-01-08, temp-link)
Vocabulary:
cassava - a woody shrubgrown in tropical regions for its root which is starchy, can be eaten, and has a lot of carbohydrates (also known as: manioc, yuca) (See Wikipedia on cassava and Wikimedia photos)
tapioca - a flavourless starchy food ingredient used in cooking produced from dried cassava (manioc) root, used to make a milky pudding (See Wikipedia on tapioca)
a windfall - money received unexpectly or by luck
plantations - large farms with lots of land growing crops such as sugar, tobacco, or rubber
ethanol - "the most widely used renewable biofuel today. Ethanol is made by converting starch crops into sugars, the sugars are fermented into ethanol which is then distilled into its final form" (See Wikipedia on ethanol fuel)
alternative-fuel - fuels that are used instead of oil or gas, cheaper substitutes
jumping on the bandwagon - start to do what everyone else is doing
starch - a type of energy giving food group that includes bread, potatoes, pasta, and rice
oversees - manages
chips - a small piece of something (for example, wood chips)
a pellet - a small ball of material (for example, dog food pellets)
shortfall - did not produce enough
privileges - a special right or permission to do something that only a restricted group of people has
promotional privileges - giving businesses special rights or permissions to encourage them to do something, to promote an industry
Board of Investment (BoI) - the Thai government agency that creates incentives to attract investment in Thailand
agro-industry - when large companies engage in agriculture, as opposed to smaller farmers (agro-industry often provides opportunities to contract farming opportunities to these farmers)
ventures - small risky new businesses
X outpaced Y - X moves faster than Y
