China to subsidize jatropha planting for Biodiesel

BEIJING (Reuters) - China will promote planting of jatropha, a woody plant, across southwestern provinces to help produce biodiesel and reduce China's dependency on imported crude oil, a spokesman for the State Forestry Administration said.
By 2020, jatropha and other forestry products will be able to provide 6 million tonnes of biodiesel and generate 1,500 megawatts of power, he said in a news conference on Tuesday.
Farmers will get subsidies and seedlings in Yunnan, Guangxi, Sichuan, Hunan and Guizhou provinces and regions to plant jatropha, Cao Qingyao told Reuters.
Chinese oil giant China National Petroleum Corp., or CNPC, and grains trader Cofco will invest in plants to process the biodiesel.
Jatropha can grow in dry areas and is used to produce non-edible oil for making candles and soap, as well as biodiesel. It is seen as a promising plant for making biofuels since it is able to grow on poor land, and therefore is less likely to displace food crops.
China has not yet released a long-awaited blueprint for biofuel development in the five years through 2010, amid debate over how to balance biofuels with other energy and agricultural policies. Planners concerned that grains-based biofuels would unacceptably lift grains prices have already shifted the focus of the plan to other crops.
Total acreage planted with jatropha could reach 13 million hectares, or about the size of England.
Other promising plants include sugar grass, which can grow in saline and other low-quality land across northern China, the China Daily said this week.
Jatropha will be grown on land reserved for forestry, as well as on land "unsuitable for agriculture," including reclaimed mining areas and oil fields, Cao said, but would not displace remaining original forests
Vast swathes of Yunnan and Guizhou have been completely denuded of trees since the mid-1990s. Some of the plans to replant have focused on crop trees, while in other areas villages have been paid to allow regrowth on critical areas like hilltops above rice paddies.
A unit of offshore oil firm China National Offshore Oil Corp., or CNOOC, already plans a $290 million, 100,000 tonne-per- year biodiesel plant in Panzhihua, Sichuan Province.