The Commerce Ministry is proposing three measures to the cabinet over the next few weeks to tackle the domestic oil palm price slump.
The ministry also plans to call a joint meeting with modern trade operators to scrap sales promotions for bottled palm oil for cooking.
Commerce Minister Sontirat Sontijirawong said the measures include a request for a central budget set aside for emergencies worth 525 million baht to subsidise participating exporters who agree to increase shipments of 300,000 tonnes of crude palm oil within 3-4 months.
The ministry is also committed to promoting the use of B20 biodiesel among heavy trucks and agricultural machinery and working closely with the Energy Ministry to address obstacles. The Commerce Ministry wants to introduce incentives for car manufacturers to develop small trucks that use B20, aiming to stabilise palm nut prices in the long term.
B20 is an alternative fuel for transport and logistics systems. It is blended with 20% methyl ester (ME) or crude palm oil.
Mr Sontirat said the ministry is looking to cooperate with the Industry Ministry to speed up announcing the compulsory industrial standard on raw materials and product quality of oil refinery plants by requiring A-grade refinery plants to crush palm nuts with palm oil content under 18%.
Whichai Phochanakij, director-general of the Internal Trade Department, said it plans to call a joint meeting next week with modern trade operators to ask for cooperation to help sell bottled cooking palm oil in line with the crude palm oil costs.
He said many operators have steep discounts and giveaways for bottled cooking palm oil for consumers. This practice does not reflect real production cost and affects the overall palm oil industry.
Most recently, in a joint move to absorb surplus palm oil, the Energy Ministry also aimed to increase the blended proportion of crude palm oil in biodiesel from 7%.
Kulit Sombatsiri, the ministry's permanent secretary, said it is considering increasing the ME content in biodiesel following an order from Energy Minister Siri Jirapongphan.
Mr Kulit said the new fuel will be called B7 plus, and would be blended with 7.2-7.3% ME. The ministry still needs to talk with many stakeholders on this matter, such as oil traders and car assemblers, he said.
Supply of the new biodiesel will be mandatory at every filling station, said Mr Kulit.
