Wood Pellets Market Size, Share & Trends Report

Wood Pellets Market Size, Share & Trends Analysis Report By Application (Power Plants, Residential Heating, Commercial Heating, CHP Heating), By Region (APAC, Europe, MEA), And Segment Forecasts, 2019 - 2025

  • Published Date: Jan, 2019
  • Base Year for Estimate: 2017
  • Report ID: GVR-2-68038-745-2
  • Format: Electronic (PDF)
  • Historical Data: 2014 - 2016
  • Number of Pages: 118

Industry Insights

The global wood pellets market size was valued at USD 7.67 billion in 2017 and is expected to register a CAGR of 9.2% over the forecast period. Increasing awareness regarding the use of renewable energy sources for power generation is likely to augment the demand for wood pellets over the forecast period. Product quality and costs are dependent on the prices of raw materials obtained from the timber industry and forests.

Factors affecting the product quality include calorific value, Moisture Content (MC), amount of fines, particle density, mechanical durability, ash melting point, and ash content. The industry is witnessing growth on account of increased consumer awareness regarding the product benefits, such as complete combustion, cleaner burning fuel as compared to fossil fuels, and reduction in Greenhouse Gas (GHG) emissions.

China wood pellets market

On the other hand, the wood pellets market may witness sluggish growth on account of health effects caused by it, which include constitute round-the-clock noise pollution, release of particulate matter in the air, fires and spontaneous explosions when subjected to high temperature in the storage facilities. In addition, exposure to wood dust generated during the manufacturing process can cause respiratory problems, such as asthma and lung cancer, allergic reactions, irritation to skin, and nasal cancer.

Since the manufacturing process also creates wood dust, which has various harmful effects including as respiratory problems, key companies are focusing on R&D for the development of novel processes for the production of wood pellets with low moisture and high heating value. This factor is projected to augment the growth of the global market over the next few years.

Application Insights

The residential heating segment accounted for over 45% of the global market share on account of increasing penetration of wood pellets in the European and American economies for space heating during winters. In addition, simple pellet heating technology coupled with minimum operation and maintenance requirements is expected to aid the market growth. Power plant was the second-largest application segment owing to the ability of the product to replace fossil fuels as it is eco-friendly, sustainable, and carbon neutral.

Global wood pellets market

In addition, the nature of wood pellets is similar to fossil fuels with the significant advantage of reduced GHG and carbon dioxide emissions, which majorly contributes to its application in heating, fuel, and power generation. Demand for wood pellets in commercial heating is expected to witness a significant growth owing to broadened application areas including federal or municipal buildings, office buildings, educational facilities, and other commercial buildings. In addition, availability of the bulk fuel supply and advanced technologies, such as pellet stoves, in the European and North American countries is projected to augment the segment growth.

Regional Insights

North America is expected to witness a CAGR of 8.5% on account of the presence of price competitiveness with propane and residential heating oil coupled with increasing replacement of traditional burners for improving automatic feed-in and comfort. Favorable climatic conditions in these regions are also boosting the product demand.

Europe is the largest market, in terms of volume, as well as revenue. Growing product penetration in the residential heating applications in countries, such as Germany, Italy, Austria, and France, drives the regional market. In addition, subsidies offered by local and federal governments in some member states of the region for using wood pellets in residential heating is projected to complement market growth.

Asia Pacific market is estimated to witness the fastest growth at a CAGR of 11.0% from 2018 to 2025 owing to the favorable policies in China, Japan, and South Korea regarding CHP and power generation. In addition, the rapid growth of the renewable energy sector in China coupled with the rising number of power plants in the country is projected to fuel the market demand.

The demand for wood pellets in Central & South America is primarily generated from the residential and commercial segments. Growing product usage in heating applications in the residential and commercial buildings is also expected to contribute to the industry growth.

Wood Pellets Market Share Insights

Some of the key companies in this market are Drax Group PLC; THE WESTERVELT COMPANY, INC.; Georgia Biomass, LLC; Pinnacle Renewable Energy, Inc.; and Vermont Wood Pellet Co. Large-scale companies aim at expanding their manufacturing facilities in developing economies where the raw material is available in abundance. They also invest more in R&D to improve the manufacturing processes and offer high-quality products. Majority of these companies are regional or local and focus on reducing their manufacturing costs and broadening customer base by serving industrial applications.

Report Scope

Attribute

Details

Base year for estimation

2017

Actual estimates/Historical data

2014 - 2016

Forecast period

2018 - 2025

Market representation

Volume in Kilotons, Revenue in USD Million, and CAGR from 2018 to 2025

Regional scope

North America, Europe, Asia Pacific, Central & South America, Middle East & Africa

Country scope

U.S., Canada, Mexico, Germany, U.K., China, India, Japan, Brazil, and Egypt

Report coverage

Volume forecast, Revenue forecast, competitive landscape, growth factors and trends

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Segments Covered in the Report

This report forecasts revenue and volume growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global wood pellets market report on the basis of application and region:

  • Application Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)

    • Power Plants

    • Residential Heating

    • Commercial Heating

    • Combined Heat and Power (CHP)

  • Regional Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • U.K.

    • Asia Pacific

      • China

      • India

      • Japan

    • Central & South America

      • Brazil

    • Middle East & Africa

      • Egypt

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