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Wood Bioenergy Update: Global Industrial Wood Pellet Demand

This is the sixth in a series related to the Q1 2021 Forisk Research Quarterly (FRQ), which includes forest industry analysis and timber price forecasts for North America.

Forisk projects global demand for industrial wood pellets to reach 31 million metric tons in 2025.

Based on project and sector analysis, growth in global demand for industrial wood pellets is expected through 2025, growing at a compound annual rate of 7% and reaching 31 million metric tons before declining. The largest projected increases are expected in Asia, with demand for industrial wood pellets in South Korea and Japan projected to advance 19%, approaching 13.4 million metric tons by 2025. Despite these increases, Europe continues to lead the industrial wood pellet market through 2026. Material declines in European demand are expected in 2027 as European subsidies expire. Refer to the “Forisk Facts and Figures” in the Q1 2021 FRQ for more detail.

North American wood pellet exports increased 6% year-over-year through November, reaching 9.3 million metric tons.

Canadian wood pellet exports rose over 10% year-over-year through November 2020. Wood pellet exports to the Netherlands offset declines to the UK, among others. Despite an 11% year-over-year decline, the UK imported 1.35 million metric tons and remained the largest importer of Canadian wood pellets with 51% of the market share. Exports to Japan, the second largest importer, were up 2% year-over-year. The Netherlands returned to co-firing in 2018. Exports picked back up in March 2020 and were approaching 400 thousand metric tons through November.

Through November 2020, U.S. wood pellet exports increased 5% year-over-year. The UK remained the largest importer of U.S. wood pellets. The 5.2 million metric tons imported, representing 78% of total U.S. volumes, was a 5% year-over-year increase. U.S. export volumes to the Netherlands continued to increase; year-over-year volume more than tripled. The country was the third largest importer of U.S. wood pellets with over 8% market share.

To learn more about the Forisk Research Quarterly (FRQ), click here or call Forisk at 770.725.8447. To download the most recent Wood Bioenergy Summary, click here.

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