WOOD PELLETS GLOBAL MARKET OVERVIEW
According to experts of Forest Trends, the abundant supply and high quantity of goods in unique markets in Japan and Korea are directly affecting the export price of tablets.
According to a report by the Research Group of Timber Associations and Forest Trends in 2023, some factors that can affect the export and production of pellets are the supply and demand of this product globally.
Currently, Vietnam is the second largest supplier of pellets in the world (after the US), and the supply-demand picture of this product will directly affect Vietnam’s production and export activities.
Specifically, in 2023, the supply of tablets to the EU market from the US and Canada tends to expand strongly again after a period of supply scarcity due to the Russia-Ukraine war and high shipping rates.
Read more: https://enviroliteracy.org/what-type-of-wood-pellets-are-best-for-cat-litter/
In the first half of 2022, North American manufacturing enterprises must redirect their supply flow from the Japanese and Korean markets to supply to the EU to capture the advantage of high prices from the EU. Supply from North America dropped sharply, forcing Japanese and Korean enterprises to find alternative sources.
This creates opportunities for Vietnamese businesses to expand their export markets here. In addition, war-related uncertainties and high freight rates also made stockpiling sentiments in Japan and Korea.
Up to now, the quantity of goods in these two markets is at a high level. In this context, Vietnamese exporters will hardly be able to expand their markets in Korea and Japan in 2023.
According to experts, the abundant supply and high volume of goods in particular markets in Japan and South Korea directly affect export prices. The export price of tablets from Vietnam is on a downward trend.
Assessment information from some exporters shows that in the coming time, the export price to Korea may drop to 11-120 USD/ton and Japan 150-160 USD/ton. This will be an extreme reduction compared to the current export price.
In 2022, when the supply to these markets is in short supply, many importers here under supply pressure have no choice but to accept products of lower quality than expected.
This creates opportunities for many Vietnamese manufacturers and traders, with products of limited quality, to enter the market. However, at the present time, this opportunity for Vietnamese manufacturers and traders is no longer available.
“Some Japanese businesses are asking suppliers from Vietnam to standardize quality standards, including sustainable products. Some ships from Vietnam exported to Japan have been returned because they did not. meet these requirements. In the coming time, the requirements in the export market will be stricter,” said experts of Forest Trends.
Wood pellets demand is expected to grow year-on-year from 2023-2028
Reason 1: Pellet fuel has become a more economical option
Wood pellets production is mainly used in the residential and commercial sectors for food, cooking and grilling, and for heating homes. Since the cost of pellet fuel has long been lower than other fuels, biomass pellet fuel has become a more economical option that addresses a major concern in the residential and commercial departments.
Reason2: Russia-Ukraine war stimulates wood pellets to become the first choice for export
In recent years, with the continuous progress of society and industrial development, the demand for energy has been increasing worldwide. However, the reserves of conventional coal, oil and natural gas are decreasing. The global energy prices are also rising sharply due to the Russian-Ukrainian war. Therefore, wood pellets have been the indispensable green energy for daily energy and heating.
Reason3: wood pellet production business is supported by many governments
As a renewable resource, in recent years, many countries have introduced policies and plans related to wood pellet heating, strongly supporting the development of energy-saving and environmentally friendly wood pellet projects.
