Thailand’s biodiesel production and consumption to rise 22% in 2026

Thailand’s biodiesel production and consumption are forecast to increase by 22% in 2026 compared with the previous year, driven by a higher mandatory blending rate and government support, according to USDA. In March, the government raised the biodiesel blending requirement from 5% (B5) to 7% (B7) to reduce dependence on petroleum product imports and limit fuel price increases amid conflicts in the Middle East. As of October, B7 remained the country’s standard diesel blend.

Palm oil remains Thailand’s main biodiesel feedstock, meaning government policy directly affects its domestic consumption and exports. In April 2026, authorities introduced restrictions on crude palm oil (CPO) exports to ensure sufficient feedstock supplies for biofuel production. According to USDA, the shift from B5 to B7 increased domestic biodiesel demand and created a need to conserve available supplies. As a result, biodiesel imports rose while exports declined.

Meanwhile, Thailand continues to attract investment in expanding production capacity. Construction has reportedly begun on a large-scale bioenergy facility in Chonburi province, designed to produce 300 thsd tons of biodiesel annually. Under the draft Alternative Energy Development Plan for 2024–2037 (AEDP), the government has also set a biodiesel consumption target of 900 mln litres by 2037. Overall, the country aims to meet 36% of its domestic energy consumption from renewable and alternative energy sources.

Sustainable aviation fuel (SAF) production is becoming another important area of biofuel development. On January 1, 2026, Thailand introduced a requirement for gradually increasing SAF blending in aviation fuel, starting at 1% and reaching 8% by 2036. At the final stage, SAF production is expected to reach approximately 2.22 mln litres per day, potentially reducing carbon emissions by around 2.3 mln tons annually. Currently, HEFA technology using used cooking oil remains the main pathway for SAF production.

Major SAF producers in Thailand include Bangchak and PTT Global Chemical. In May 2026, Bangchak launched commercial operations at a facility with a capacity of 1 mln litres per day, while PTT Global Chemical produces approximately 16.4 thsd litres daily. However, USDA notes that high production costs and limited feedstock availability remain the main obstacles to further industry development. Expanding biodiesel and SAF production could strengthen domestic demand for palm oil and used cooking oil, affecting Thailand’s feedstock balance and export potential.

Tags: Thailand, biodiesel