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.
Report Attribute
Base Year: 2022
Wood Pellets Market Size in 2022: USD 12 Billion
Forecast Period: 2023 to 2032
Forecast Period 2023 to 2032 CAGR: 17.5%
2032 Value Projection: USD 35 Billion
Growth Drivers:
• Rising demand for renewable energy in major European countries
- Policy changes in Canada related to coal-fired plants
- Superior product characteristics compared to fossil fuels
- Increasing energy demand in Asia Pacific
- Ongoing trends related to outdoor kitchens in developed nations
Pitfalls & Challenges:
- Implementing sustainable standards
- Trade challenges in emerging economies
- Lack of awareness related to product in developing nation
What are the growth opportunities in this market?
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 prim restraints associated with the wood pellets industry. To manage the production of biomass products, several Europe governments have adopted their own systems, including voluntary agreements or laws with the sector. Although ma governments have set sustainability requirements for biomass and renewable energy sources, the business will face signific challenges in the coming years due to a lack of integrity about sustainability standards.
Wood Pellet 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.
Source:
Gminsights
Overc Team synthesize, analyze and write articles.
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OVERC was established in Vietnam, which has 17 FTA (Free Trade Agreement).
Vietnam is one of the countries with the most FTAs in the world.
Our main activities are manufacturing and distributing Wood Pellets and Wood Waste. Our wood pellets products, which are made from Accacia veneer residual 100% or wood waste (logs, sawdust, wood chips, wood shavings,…), have been exported to many countries around the world such as Japan, Korea, EU, etc.
OVERC Co.,Ltd would like to wish you all the best at this time.
For more information on our products, please visit our website at OVERC.VN – Renewable World.