An Econometric Model of Oil Palm Plantation Area in Thailand

Abstract

     Thai oil palm plantation areas have increased continuously in order to meet increasing derived demands for food and nonfood applications. This quantitative research aimed at studying the existing situation of oil palm plantation, and analyzing determinants of oil palm plantation area in Thailand. Quantitative data used were annual time-series data during 1989 to 2010. The derived data were analyzed using appropriate descriptive statistics, and enter and backward multiple regression analyses. The results showed that Thai oil palm plantation and harvested areas have increased for more than 3 decades. They have been significantly increasing in southern Thailand. Statistically significant determinants of Thai oil palm plantation areas at the .05 level were the domestic demand for crude palm oil, the farm price of fresh bunches of oil palm fruit, the price of diesel oil and the farm price of unsmoked rubber sheet 3. These determinants could be used to create conservation and sustainable management guidelines for the expansion policy on future oil palm plantation area.