Wood pellet trade has doubled due to biomass-fueled power generation
December 21, 2016 | 12:28 pm CST
Wood Pellets
Wood pellet shipments at the Port of Baton Rouge, Louisiana.
BOSTON — Wood pellets are playing a key role in decarbonizing electric power generation, as the world works to replace fossil fuels. Global trade in pellets has doubled since 2012, with U.S., Canadian, and European producers all playing a roles, according to a new study by RISI. 
 
European nations, in particular, have invested heavily in pellets for both heating and electricity generation. To supply this increased demand, the pellets supply stream is evolving, and is the focus of  RISI's "European Pellet Supply and Cost Analysis" research report.
 
“Over the past five years, the wood pellet industry has expanded more than any other forest product industry, both in terms of wood consumed and dollars invested,” said Seth Walker, RISI Bioenergy Economist and author of the new study. “Pellet imports by power plants in England, Belgium, and Denmark are driving demand and investment for pellet-producing countries like the US, Canada, and European suppliers like Latvia, Estonia, and Portugal.”
 
While much of Europe’s appetite for pellets has been met by the U.S. South, the new study sees potential for this to change going forward.
 
“The strength of the US dollar means that its producers now have a higher cost structure than many competing European countries,” says study author Walker. “Our analysis looks at how exchange rates factor into competitiveness, along with production and shipping costs.”
 
The European Pellet Supply and Cost Analysis is the first fine-grained analysis of the regions supplying this large and growing market. For each major exporter of pellets to Europe, it provides details on pellet output, fiber furnish shares, production costs, facility ownership and market share, information on logistics and trade, and more, including:
  • Cost models for major supply regions to Europe
  • Supply curves featuring cash costs for pellets delivered to major centers of trade
  • Sensitivity analysis of how shifts in exchange rates affect the competitiveness of key pellet-supplying regions and countries.
RISI is the leading information provider for the global forest products industry. The company works with clients in the pulp and paper, packaging, wood products, timber, biomass, tissue and nonwovens industries to help them make better decisions. For more information on the study, visit www.risi.com/europeanpellet

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About the author
Bill Esler | ConfSenior Editor

Bill wrote for WoodworkingNetwork.com, FDMC and Closets & Organized Storage magazines. 

Bill's background includes more than 10 years in print manufacturing management, followed by more than 30 years in business reporting on industrial manufacturing in the forest products industries, including printing and packaging at American Printer (Features Editor) and Graphic Arts Monthly (Editor in Chief) magazines; and in secondary wood manufacturing for WoodworkingNetwork.com.

Bill was deeply involved with the launches of the Woodworking Network Leadership Forum, and the 40 Under 40 Awards programs. He currently reports on technology and business trends and develops conference programs.

In addition to his work as a journalist, Bill supports efforts to expand and improve educational opportunities in the manufacturing sectors, including 10 years on the Print & Graphics Scholarship Foundation; six years with the U.S. WoodLinks; and currently on the Woodwork Career Alliance Education Committee. He is also supports the Greater West Town Training Partnership Woodworking Program, which has trained more than 950 adults for industrial wood manufacturing careers. 

Bill volunteers for Foinse Research Station, a biological field station staddling the border of Ireland and Northern Ireland, one of more than 200 members of the Organization of Biological Field Stations.