The dip in demand for wood pellets in 2023 and 2024, the resulting low prices, and the increased costs of inputs negatively affected the profit margins of the EU wood pellet sector. Even so, the current strong growth of residential demand is forecast to support a further increase in production in 2025. Below is a brief overview of the main pellet producers by region.<\/p>\n
In 2025, a strong production growth is forecast in Western Europe, led by France and Germany (after a temporary dip in 2024). Wood pellets, especially for residential use, are crucial for France to reach carbon neutrality by 2050. Reportedly, three new sites opened their doors in 2024, for an additional production capacity of 270,000 MT of pellets, and an additional actual production volume of 200,000 MT. These new facilities will help strengthen the industry's resilience and support the goal of doubling national production capacity to over four MMT per year by 2028 (French Wood Pellet Association). Post projects that by 2028, France will produce 3 MMT of pellets annually.<\/p>\n
Germany is the third largest wood pellet producer in the world after the United States and Canada. It has currently 40 companies with 50 production facilities for wood pellets with a total annual production capacity of 4.2 MMT. In 2024, production amounted to 4.0 MMT, 92 percent of which was produced from residues of the timber industry. The remaining eight percent consisted of non-sawable round logs.<\/p>\n
EU27 Main Pellet Producers (1,000 MT)<\/strong><\/p>\n Source: Eurostat (dataset Roundwood, fuelwood and other basic products), Bioenergy Europe, and Member State sector organizations, e = estimate EU FAS Posts.<\/em><\/p>\n The Nordic Region (Sweden and Finland) is a relatively isolated market for pellets but well connected with the Baltic Region (Latvia, Estonia, and Lithuania), and Poland. For the last decade, Swedish wood pellet production stagnated around 1.75 MMT. The Finnish pellet production fluctuates around 350,000 MT and is forecast to expand based on an increased demand by the residential as well as industrial market. In the near term, Finland plans to add 300,000 MT of new annual production capacity. Both Sweden and Finland are net importers of wood pellets and source the majority of their imports from the Baltics.<\/p>\n Wood pellet production has expanded rapidly in the Baltic Region between 2015 \u2013 2020 but has stagnated since 2020. Current production is estimated at about 2.0 MMT in Latvia, 1.4 MMT in Estonia, and 0.6 MMT in Lithuania. The main factor for the production stagnation is the limited availability of raw materials. In Latvia, increased wood harvesting was limited by a Constitutional Court ruling in 2024. As a result of this ruling, the administrative burden for the forest sector reportedly increased, and younger trees cannot be harvested.<\/p>\n In Estonia, wood pellet production is forecast to decline further in 2025 with reduced availability of raw materials, despite slightly recovering export demand. Another restriction for pellet production is the government\u2019s decision to forbid cutting trees in protected forest habitats. Early in 2025, the forestry sector requested the government to introduce changes to the legislation. Lithuanian wood pellet production is forecast to continue to grow in 2025. However, future production might be hampered by lower availability of raw materials.<\/p>\n The Baltics are producing both for the residential and industrial export markets, with the latter market mainly located in Denmark, the United Kingdom, and the Netherlands. In 2021, combined Baltic exports reached a record of 4.69 MMT, but plummeted during 2022 and 2023, and recovered to 3.39 MMT in 2024. During 2022 and 2023, a higher share of production remained in the Baltics because the ban on Russian gas boosted domestic demand.<\/p>\n In 2024 and 2025, Polish production is forecast to expand due to the developing residential use market. However, the wood pellet industry fears for the availability of raw materials due to the governmental policy of protecting the Polish forests from wood harvesting.<\/p>\n Portugal and Spain are net exporters of wood pellets. Post estimates Portugal\u2019s production at about 900,000 MT with an installed annual capacity at around 1.4 MMT of pellets. Over the last five years, Portuguese exports fell by 45 percent to 389,000 MT, far below the record volume of 709,000 MT achieved in 2019. Portuguese production is constrained by the limited availability of woody inputs. The main markets are France, the United Kingdom, Denmark, and Spain. Despite falling total exports, France has been the main growth market for Portuguese wood pellet exports over the past five years.<\/p>\n Spanish wood pellet production continued its ongoing expansion trend and amounted to currently about 800,000 MT. Pellet production is increasingly concentrated in large-capacity plants. Spain has a total theoretical capacity of 1,950,000 MT per year. In 2023 and 2024, Spanish exports fell by 43 percent to 119,000 MT. France and Italy were the main destinations.<\/p>\n The main wood pellet producer in Central Europe is Austria. In 2024, Austria produced 1.8 MMT of wood pellets, which is four percent more than in the previous year. Austria is a net exporter of wood pellets, but domestic demand is on a rising trend. Major destinations for Austrian pellets are Italy and Germany.<\/p>\n In 2023, Czech production fell by more than ten percent to 470,000 MT due to the lower sawlog production level because of lower construction activity and the improvement of the bark beetle situation. Production still exceeds consumption by three times, and therefore two thirds of Czech pellets are exported, mainly to Austria, Germany and Italy.<\/p>\n Slovakia\u2019s pellet production grew rapidly from around 100,000 MT between 2012 \u2013 2022 to nearly 400,000 MT but is stagnating at around 300,000 MT currently. A new Slovak forestry program identifies various sources of fuelwood biomass, including forests, wood processing industries, and municipal sectors, emphasizing the need to enhance the supply and utilization of biomass resources for energy generation.<\/p>\n Production in Romania is also stagnating, at about 350,000 MT annually. The more stringent Romanian forest legislation for sourcing fuel wood and the government incentives for the utilization of more efficient heating equipment may support the wood pellets industry. According to Eurostat, Hungarian production of wood pellets almost doubled in 2023 (to 109,000 MT), but the volume of wood pellet production and trade is still negligible compared to other biomass sources. In Hungary mostly firewood and other solid biomass such as wood industry waste, municipal waste, and agricultural byproducts (corn and sunflower husk and stem, oilseed cake, etc.) are used as renewable energy source.<\/p>\n Commercial wood pellet production was expanding rapidly in the Balkan Region, but production is not keeping up with increasing domestic demand. Croatia's wood pellet industry has experienced significant growth over the past decade, with annual production ranging between 430,000 and 550,000 MT. Approximately 80 percent of production is exported, primarily to EU countries such as Italy. In 2024, Croatia exported 297,000 MT, a decrease of more than ten percent compared to 2023. Based on expanding domestic and export demand, Croatian wood pellet production is forecast to increase.<\/p>\n In Bulgaria, manufacturers have made efforts to increase domestic supply, however, they face challenges related to much higher wood prices (30 percent average increase for the last two years) and reduced prices of pellets. Industry reports an increase in consolidations and mergers. The authorities have encouraged higher wood pellets production to meet the expectations of the rural population and its social needs. Due to the growing interest in alternative fuels, a stable increase in domestic production and trade can be expected in the future. Current production is estimated at 240,000 MT.<\/p>\n Overall, in the EU, local shortages of woody biomass supported the production of pellets made from other biomass sources. With increasing competition for sawdust resources, a broader sustainable raw material is becoming necessary. There is increased interest in agricultural residues for pellet production, but even the volume of these additional feedstocks will not be sufficient to satisfy the full demand. Overall, EU wood pellet production is not expected to be able to keep up with the increasing demand, particularly from the residential heating market.<\/p>","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":50743,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[5204,4715],"tags":[3291,3307,3283],"class_list":["post-96846","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-news","category-market-analysis","tag-eu","tag-production","tag-wood-pellets","topic-statistics","topic-wood-pellets","topic-wood-products","area-europe","area-global"],"acf":[],"yoast_head":"\n\n\n
\n \nCalendar Year<\/th>\n 2018<\/th>\n 2019<\/th>\n 2020<\/th>\n 2021<\/th>\n 2022<\/th>\n 2023<\/th>\n 2024e<\/th>\n<\/tr>\n<\/thead>\n \n Germania<\/td>\n 2,415<\/td>\n 2,820<\/td>\n 3,100<\/td>\n 3,300<\/td>\n 3,570<\/td>\n 3,710<\/td>\n 3,695<\/td>\n<\/tr>\n \n Fran\u021ba<\/td>\n 1,450<\/td>\n 1,600<\/td>\n 1,700<\/td>\n 1,860<\/td>\n 2,050<\/td>\n 2,230<\/td>\n 2,450<\/td>\n<\/tr>\n \n Latvia<\/td>\n 1,715<\/td>\n 2,210<\/td>\n 2,265<\/td>\n 2,140<\/td>\n 1,980<\/td>\n 1,980<\/td>\n 1,980<\/td>\n<\/tr>\n \n Austria<\/td>\n 1,345<\/td>\n 1,440<\/td>\n 1,540<\/td>\n 1,610<\/td>\n 1,640<\/td>\n 1,725<\/td>\n 1,800<\/td>\n<\/tr>\n \n Sweden<\/td>\n 1,640<\/td>\n 1,700<\/td>\n 1,660<\/td>\n 1,755<\/td>\n 1,810<\/td>\n 1,740<\/td>\n 1,650<\/td>\n<\/tr>\n \n Estonia<\/td>\n 1,345<\/td>\n 1,600<\/td>\n 1,600<\/td>\n 1,650<\/td>\n 1,540<\/td>\n 1,385<\/td>\n 1,350<\/td>\n<\/tr>\n \n Poland<\/td>\n 410<\/td>\n 1,105<\/td>\n 1,265<\/td>\n 1,280<\/td>\n 1,270<\/td>\n 1,265<\/td>\n 1,280<\/td>\n<\/tr>\n \n Portugal<\/td>\n 735<\/td>\n 1,010<\/td>\n 860<\/td>\n 730<\/td>\n 745<\/td>\n 750<\/td>\n 900<\/td>\n<\/tr>\n \n Spain<\/td>\n 593<\/td>\n 714<\/td>\n 616<\/td>\n 642<\/td>\n 716<\/td>\n 800<\/td>\n 810<\/td>\n<\/tr>\n \n Lithuania<\/td>\n 315<\/td>\n 605<\/td>\n 510<\/td>\n 530<\/td>\n 525<\/td>\n 605<\/td>\n 610<\/td>\n<\/tr>\n \n Total<\/strong><\/td>\n 15,772<\/td>\n 18,360<\/td>\n 18,713<\/td>\n 19,489<\/td>\n 20,227<\/td>\n 19,969<\/td>\n 19,900<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n
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