Wood Pellets Market - By Grade (Premium, Standard, Utility), By Application (Residential, Commercial, Industrial, Animal Bedding), Growth Prospects, Regional Outlook & Global Forecast, 2024 – 2032

Wood Pellets Market Size

Wood Pellets Market size was valued at USD 12 billion in 2023 and is projected to exhibit over 17.5% CAGR from 2024 to 2032, due to the growing consumer inclination towards renewable energy sources.
 

The ongoing climate change, policy transition, and market liberalization have accelerated consumer inclination toward clean energy sources with sustainable benefits. In addition, governments across developed economies, such as Europe, have been undertaking several R&D initiatives focused on reducing local air pollution and its impact on people's health, driving the expansion of RES (Renewable Energy Sources).
 

For instance, RES account for approximately 17% of the total energy consumption in Europe, while over 75% of clean energy research and innovation in the region is conducted by the private sector, which has increased its operating budget. The flourishing public-private partnerships and the growing emphasis on boosting the deployment of renewable energy sources globally will stimulate the demand for wood pellets over the forecast period.
 

Several governments have estimated that it may take more than a decade to totally restore the carbon emissions caused by the consumption of biofuels. Technological improvements aimed at increasing the energy density and quality of wood pellets to reduce greenhouse gas emissions during transportation and upgrading conversation technology may dramatically reduce GHG emissions. Torrefaction is another significant technical innovation that may shape the wood pellets market in the coming years.
 

Lack of sustainability standards may hamper market development

The lack of integration linked to sustainability standards for biomass products across different nations is one of the primary restraints associated with the wood pellets industry. To manage the production of biomass products, several European governments have adopted their own systems, including voluntary agreements or laws with the sector. Although many governments have set sustainability requirements for biomass and renewable energy sources, the business will face significant challenges in the coming years due to a lack of integrity about sustainability standards.
 

Wood Pellets Market Analysis

With respect to grade, wood pellets market is categorized into premium, utility, and standard segments. Utility segment is projected to grow at more than 18% CAGR through 2032, owing to the increasing usage of utility wood pellets in a variety of electronics applications. The product is gaining popularity in key European and Asian Pacific industrial sectors and thus may gain significant traction over the next ten years. However, on the flip side, the presence of more than 6% ash in the utility-grade wood pellets limits their usage in the residential heating sector.
 

Based on application, the industry divides into residential, commercial, industrial, and animal bedding. Industrial application segment of the wood pellets market is expected to account for more than $16.5 billion by the end of 2032. The industrial segment is expected to expand at an appreciable pace throughout the projected period, owing to growing product consumption in the utility and combined heat and power plant sectors across European nations. The recent trend of converting coal-fired facilities to biomass-based units is one of the key factors stimulating the industry revenue streams.
 

Asia Pacific wood pellets market is anticipated to grow at over 13.5% CAGR from 2023 to 2032. Major countries, including China, Japan, and South Korea, are driving product demand in the region. According to data provided by the Biomass Industry Society Network (BIN) and Solutions for Our Climate (SFOC), Japan and South Korea imported a total of 6 million metric tons of wood pellets in 2021. Increasing energy consumption in South Korea is likely to emerge as a primary factor contributing to the product's success in the APAC region.
 

Wood Pellets Market Share

Leading corporations operating in the wood pellets market are:

• LP
• Pacific BioEnergy
• Ecochipp
• AS Graanul Invest
• Lignetics
• Ecowood Pellets
• Land Energy
• Mallard Creek Inc.
• Enviva Partners
• The Westervelt Company

Companies are entering into acquisition and partnership agreements in order to deliver their services and broaden their global reach.
 

Impact of COVID-19 Pandemic

The COVID-19 pandemic hindered global economic operations in many sectors, including the forest industry. To combat the spread of COVID-19, governments implemented strict regulations such as border closures and the shutdown of all business dealing in non-essential commodities. Changes in demand for forest products during the pandemic have impacted both primary processors and downstream sectors that rely on residues, such as wood pellet makers. However, with declining cases and infection rates and the rapid transition toward renewable energy sources, the market is poised to gain traction over the forthcoming years.
 

The Wood Pellets market research report includes in-depth coverage of the industry with estimates & forecast in terms of volume in Kilo tons and revenue in USD Million from 2018 to 2032 for the following segments:

Click here to Buy Section of this Report

By Grade

• Premium
• Standard
• Utility

By Application

• Residential
• Commercial
• Industrial
• Animal-bedding

By Region

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Denmark
  • Sweden
  • Belgium
  • Austria
  • Russia
  • Poland
• Asia Pacific
  • China
  • Japan
  • South Korea
  • Australia
  • New Zealand
• Latin America
  • Brazil
  • Mexico
• Middle East & Africa
  • South Africa
  • Saudi Arabia
  • UAE