In terms of growth and pricing, 2018 was one of the strongest years for the global wood pellet market in quite some time.

From 2014 to 2016 the growth in global wood pellet trade slowed to 7% per year, accompanied by a low pricing environment and limited capacity expansion. In 2017 market conditions greatly improved and global trade increased 13% to 18.9 million tonnes. That market improvement continued in full force through 2018 as the growth in global pellet trade accelerated to 26%. FutureMetrics projects 2018 pellet trade will have increased to 23.8 million tonnes in 2018 up from 18.9 million tonnes in 2017 (Figure 1). That growth is primarily fueled by increased demand in the UK, Denmark, South Korea and Japan.

United Kingdom

In 2018, UK pellet demand increased with the commissioning of EPH’s 396 MW Lynemouth Power Station conversion and the conversion of a 4th unit at the Drax Power Station. 2019 growth will be primarily driven by a ramp up to full operation at Lynemouth and increased availability at the Drax power station.