Global Wood Pellets Market Insights Forecasts to 2033

• The Global Wood Pellets Market Size was Valued at USD 18.06 Billion in 2023
• The Market Size is Growing at a CAGR of 6.70% from 2023 to 2033
• The Worldwide Wood Pellets Market Size is Expected to Reach USD 34.53 Billion by 2033
• Asia Pacific is Expected to Grow the fastest during the forecast period.

The Wood Pellets Market Size is Anticipated to Exceed USD 34.53 Billion by 2033, Growing at a CAGR 6.70% from 2023 to 2033.

Market Overview

Wood pellets are compressed wood particles produced primarily from wood waste and agricultural waste, such as straw. When compared to unprocessed biomass, they are dense, contain minimal moisture and ash, and have high energy content. Apart from that, wood pallets are widely used in the household and commercial sectors for cooking, grilling, and supplying heat due to their low cost and low maintenance requirements. They are also utilized in large-scale biomass supply chains to help reduce costs for biomass storage, handling, and transportation. Wood pellets are a type of fuel derived from sawdust and industrial waste from the production of wood products such as furniture, construction, and timber milling. They are viewed as a feasible alternative to fossil fuels such as natural gas or coal. Virgin trees are ideal for the production of wood pellets. Wood pellets are cylindrical, measuring 6-12 mm in diameter and 1-3 cm in length. They are dry and easy to keep. Rapid increasing numbers of people, a thriving industrial sector, and quick infrastructural development have all contributed to a significant increase in electricity demand. As power demand rises, regions around the world enhance their electricity-producing capacity by expanding existing facilities or building new ones. Due to rigorous government policies addressing CO2 emissions, industry participants are more inclined to adopt renewable energy sources to create electricity, particularly bioenergy, solar energy, and wind power. Government schemes are also helping to grow the wood pellet industry. Many countries' regulatory agencies promote the usage of wood pellets to meet their renewable energy targets. Subsidies, prizes, and policies that benefit both wood producers and consumers help to drive market growth.

Report Coverage

This research report categorizes the market for the wood pellets market based on various segments and regions forecasts revenue growth and analyzes trends in each submarket. The report analyses the key growth drivers, opportunities, and challenges influencing the wood pellets market. Recent market developments and competitive strategies such as expansion, product launch, and development, partnership, merger, and acquisition have been included to draw the competitive landscape in the market. The report strategically identifies and profiles the key market players and analyses their core competencies in each sub-segment of the wood pellets market.

Driving Factors

The demand for renewable energy is a major factor driving the expansion of the wood pellet market. Wood pellets are a renewable energy source that is widely available. Wood pellets are carbon dioxide (CO2) neutral, which means that the carbon emitted during the combustion process contributes to the natural carbon cycle. A significant reduction in greenhouse gas emissions across the world is increasing the demand for wood pellets in the industrial sector.

Restraining Factors

Government certification assures buyers that the wood pellets are sourced from sustainably managed forests, demonstrating that it is an effective tool. Increasing certification processes for export to European countries and other countries where numerous directives require the generation of renewable energy is a major limitation on the wood pellets market's growth.

Market Segmentation

The wood pellets market share is classified into feedstock, application, and end-user.

• The forest waste segment is anticipated to hold the largest revenue share over the forecast period.

Based on the feedstock, the wood pellets market is categorized into forest waste, agriculture waste, and others. Among these, the forest waste segment is anticipated to hold the largest revenue share over the forecast period. Forest waste materials, such as sawdust and wood shavings, are being used to promote environmental safety and the shift to circular economy principles. Diversifying feedstocks through eco-friendly waste use corresponds with numerous global activities striving at responsible and safe resource utilization, and also sustainable biomass development.

• The power generation is predicted to grow at the fastest CAGR during the forecast period.

Based on the application, the wood pellets market is categorized into heating, combined heat & power (CHP), and power generation. Among these, the power generation segment is predicted to grow at the fastest CAGR during the forecast period. Demand is expected to rise due to urbanization, industrialization, and population expansion. Furthermore, biomass gasifiers are in high demand as rural electrification enables localized power generation. Wood pellets are used in the power generation industry to provide power similar to coal.

• The industrial segment dominated the market with the highest market share through the forecast period.

Based on the end-user, the wood pellets market is categorized into residential, commercial, and industrial. Among these, the industrial segment dominated the market with the highest market share through the forecast period. The product can be utilized as a renewable energy source in a variety of industrial operations, including food processing, drying, and manufacturing. They can be utilized in industrial dryers, thermal equipment, and boilers to provide energy for specific operations while reducing reliance on fossil fuels.

Regional Segment Analysis of the Wood Pellets Market

• North America (U.S., Canada, Mexico) 
• Europe (Germany, France, U.K., Italy, Spain, Rest of Europe)
• Asia-Pacific (China, Japan, India, Rest of APAC)
• South America (Brazil and the Rest of South America) 
• The Middle East and Africa (UAE, South Africa, Rest of MEA)

North America is anticipated to hold the largest share of the wood pellets market over the predicted timeframe.

North America is projected to hold the largest share of the wood pellets market over the forecast period. The primary factors driving demand for wood pellets in North America are regional price competitiveness with propane and domestic heating oil, and the rising replacement of traditional burners to improve automatic feed-in and comfort. The favorable climatic conditions for heating in residential and commercial buildings are projected to contribute to driving market expansion. North America, specifically the United States and Canada, is a major producer and consumer of wood pellets. The region's vast forest resources give an abundance of raw materials for pellet manufacture. In the United States, wood pellets are primarily utilized for household heating and, to a lesser extent, electricity generation.

Asia Pacific is expected to grow at the fastest CAGR growth in the wood pellets market during the forecast period. The Asia-Pacific area is seeing a rapidly increasing wood pellet market, driven by a desire to diversify energy sources and reduce dependence on coal. Countries such as South Korea, Japan, and China are becoming increasingly interested in wood pellets for power generation and industrial heating. Demand in this region is mostly driven by government regulations focused on lowering greenhouse gas emissions and promoting the usage of renewable energy.

Competitive Analysis:

The report offers the appropriate analysis of the key organizations/companies involved within the wood pellets market along with a comparative evaluation primarily based on their product offering, business overviews, geographic presence, enterprise strategies, segment market share, and SWOT analysis. The report also provides an elaborative analysis focusing on the current news and developments of the companies, which includes product development, innovations, joint ventures, partnerships, mergers & acquisitions, strategic alliances, and others. This allows for the evaluation of the overall competition within the market.

List of Key Companies

• The Westervelt Company
• Snow Timber Pellets
• Energex Inc. 
• Wood Pellet Energy 
• Farm Fuels
• Lignetics Inc.
• Mallard Creek Inc.
• Pacific BioEnergy Corporation
• Drax Group Plc
• SINGPELLET Pte. Ltd.
• Enviva LP
• Georgia Biomass, LLC
• Pinnacle
• AVP Group
• Others

Key Target Audience

• Market Players
• Investors
• End-users
• Government Authorities 
• Consulting And Research Firm
• Venture capitalists
• Value-Added Resellers (VARs)

Recent Developments

• In May 2023, Andritz AG presented several new and established technologies, including the world's first autonomous logyard crane, the ANDRITZ PM30-6 biomass pellet mill, and an adjustable plug screw feeder.
• In April 2023, Enviva Inc., an acknowledged wood pellet producer, stated that it has executed a new long-term supply arrangement with Drax Group, a leading renewable energy firm. The arrangement calls for Enviva to supply Drax with 1.5 million metric tons of wood pellets each year for the next 10 years.

Market Segment

This study forecasts revenue at global, regional, and country levels from 2020 to 2033. Spherical Insights has segmented the wood pellets market based on the below-mentioned segments: 

Global Wood Pellets Market, By Feedstock

• Forest Waste
• Agriculture Waste
• Others

Global Wood Pellets Market, By Application

• Heating
• Combined Heat & Power (CHP)
• Power Generation

Global Wood Pellets Market, By End-User

• Residential
• Commercial
• Industrial

Global Wood Pellets Market, By Regional Analysis

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • Qatar
  • South Africa
  • Rest of the Middle East & Africa