Wood Pellet Market Size (2024 - 2029)

The wood pellets market is projected to experience growth over the forecast period, driven by the rising demand for clean energy generation, particularly in Europe. Despite potential challenges from the increasing use of alternative renewable energy sources like solar and wind, the market's expansion is supported by advancements in technology that enhance the fuel properties of wood pellets, making them viable substitutes for coal. The Asia-Pacific region presents significant growth opportunities due to its high concentration of coal power plants. Europe is anticipated to maintain a substantial market share, reflecting its strong production capacity.

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Market Size of Wood Pellet Industry

Wood Pellet Market Summary
Study Period 2019-2029
Market Size (2024) USD 13.89 Billion
Market Size (2029) USD 19.61 Billion
CAGR (2024 - 2029) 7.15 %
Fastest Growing Market Asia-Pacific
Largest Market Europe

Major Players

Wood Pellet Market Major Players

*Disclaimer: Major Players sorted in no particular order

Wood Pellet Market Analysis

The Wood Pellet Market size is estimated at USD 13.89 billion in 2024, and is expected to reach USD 19.61 billion by 2029, growing at a CAGR of 7.15% during the forecast period (2024-2029).

Over the medium period, the primary drivers for the market include increasing demand for wood pellets in clean energy generation, especially in the European region.

On the other hand, the adoption and increasing deployment of alternative renewable energy sources such as solar photovoltaic, wind energy, and geothermal in various parts of the world is likely to hinder market growth during the forecast period.

Nevertheless, as per the World Bioenergy Association, wood pellets have the potential to replace coal in power generation facilities. With technology development in recent years, wood pellets have undergone thermal upgrading through various processes like torrefaction, hydrothermal carbonization, and steam explosion. The thermal upgrading enables wood pellets to act as a fuel with coal properties. The Asia-Pacific region, with the world's highest number of coal power plants, is expected to be an opportunity for the market to grow in the future.

With a significant production of wood pellets during 2022, Europe was expected to have a significant share of the market during the forecast period.

Wood Pellet Industry Segmentation

Wood pellets are renewable fuels manufactured from compressed sawdust or wood chips. They can be used to heat houses and businesses as a biomass fuel. Wood pellets can be made from forest residues and low-quality logs that can be handled as rubbish.

The wood pellet market is segmented by application and geography (North America, Europe, Asia-Pacific, South America, and the Middle East and Africa). By application, the market is segmented into heating and power generation. The report also covers the market size and forecasts for the wood pallet market across major regions. 

For each segment, the market sizing and forecasts have been done based on revenue (USD).

Application
Heating
Power Generation
Geography
North America
United States of America
Canada
Rest of the North America
Europe
France
Italy
Germany
United Kingdom
Spain
Nordic Countries
Turkey
Russia
Rest of the Europe
Asia-Pacific
China
India
Indonesia
Japan
South Korea
Malaysia
Thailand
Vietnam
Rest of the Asia-Pacific
South America
Brazil
Argentina
Colombia
Rest of the South America
Middle-East and Africa
Saudi Arabia
United Arab Emirates
South Africa
Nigeria
Qatar
Egypt
Rest of the Middle-East and Africa
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Wood Pellet Market Size Summary

The wood pellet market is poised for significant growth over the forecast period, driven primarily by the increasing demand for clean energy solutions, particularly in Europe. Wood pellets, as a renewable energy source, are gaining traction due to their ability to replace coal in power generation, supported by technological advancements that enhance their fuel properties. The Asia-Pacific region presents a substantial opportunity for market expansion, given its high number of coal power plants. However, the market faces challenges from the growing adoption of alternative renewable energy sources like solar and wind, which could potentially hinder growth. Despite these challenges, the economic advantages of wood pellets, especially in residential and commercial heating applications, continue to bolster their demand.

Europe is expected to dominate the wood pellet market, accounting for a significant share of global demand. The region's commitment to phasing out coal and transitioning to sustainable energy systems is driving the increased consumption of wood pellets, particularly in residential heating and industrial applications. The European Union's ban on Russian woody biomass has further accelerated the demand for imported wood pellets, with countries like the United States and Eastern Europe stepping in to fill the supply gap. The market is moderately consolidated, with key players like Enviva Partners LP and Drax Group Plc leading the charge. Recent developments, such as the conversion of coal-fired power plants to wood pellet use and the expansion of production facilities, underscore the region's strategic focus on enhancing its renewable energy infrastructure.

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Wood Pellet Market Size - Table of Contents

  1. 1. MARKET OVERVIEW

    1. 1.1 Introduction

    2. 1.2 Market Size and Demand Forecasts in USD, till 2029

    3. 1.3 Recent Trends and Developments

    4. 1.4 Government Policies and Regulations

    5. 1.5 Market Dynamics

      1. 1.5.1 Drivers

        1. 1.5.1.1 Increasing Demand for Wood Pellets in Clean Energy Generation

        2. 1.5.1.2 Growing Wood Pellet Manufacturing Infrastructure

      2. 1.5.2 Restraints

        1. 1.5.2.1 The Adoption and Increasing Deployment of Alternative Renewable Energy

    6. 1.6 Supply Chain Analysis

    7. 1.7 Industry Attractiveness - Porter's Five Forces Analysis

      1. 1.7.1 Bargaining Power of Suppliers

      2. 1.7.2 Bargaining Power of Consumers

      3. 1.7.3 Threat of New Entrants

      4. 1.7.4 Threat of Substitute Products and Services

      5. 1.7.5 Intensity of Competitive Rivalry

  2. 2. MARKET SEGMENTATION

    1. 2.1 Application

      1. 2.1.1 Heating

      2. 2.1.2 Power Generation

    2. 2.2 Geography

      1. 2.2.1 North America

        1. 2.2.1.1 United States of America

        2. 2.2.1.2 Canada

        3. 2.2.1.3 Rest of the North America

      2. 2.2.2 Europe

        1. 2.2.2.1 France

        2. 2.2.2.2 Italy

        3. 2.2.2.3 Germany

        4. 2.2.2.4 United Kingdom

        5. 2.2.2.5 Spain

        6. 2.2.2.6 Nordic Countries

        7. 2.2.2.7 Turkey

        8. 2.2.2.8 Russia

        9. 2.2.2.9 Rest of the Europe

      3. 2.2.3 Asia-Pacific

        1. 2.2.3.1 China

        2. 2.2.3.2 India

        3. 2.2.3.3 Indonesia

        4. 2.2.3.4 Japan

        5. 2.2.3.5 South Korea

        6. 2.2.3.6 Malaysia

        7. 2.2.3.7 Thailand

        8. 2.2.3.8 Vietnam

        9. 2.2.3.9 Rest of the Asia-Pacific

      4. 2.2.4 South America

        1. 2.2.4.1 Brazil

        2. 2.2.4.2 Argentina

        3. 2.2.4.3 Colombia

        4. 2.2.4.4 Rest of the South America

      5. 2.2.5 Middle-East and Africa

        1. 2.2.5.1 Saudi Arabia

        2. 2.2.5.2 United Arab Emirates

        3. 2.2.5.3 South Africa

        4. 2.2.5.4 Nigeria

        5. 2.2.5.5 Qatar

        6. 2.2.5.6 Egypt

        7. 2.2.5.7 Rest of the Middle-East and Africa

Wood Pellet Market Size FAQs

The Wood Pellet Market size is expected to reach USD 13.89 billion in 2024 and grow at a CAGR of 7.15% to reach USD 19.61 billion by 2029.

In 2024, the Wood Pellet Market size is expected to reach USD 13.89 billion.

Wood Pellet Market Report Snapshots

Wood Pellets Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)