North American pellet industry pushes sawdust and chip prices up

14 December 2009

The North American wood pellet industry has grown six-fold from a capacity of just over one million tons to more than six million tons in the last five years, according to the North American Wood Fiber Review.

And, it adds, this expansion has caused sawdust and wood chip prices to rise in the regions experiencing the most dramatic growth, including western US and Canada.

It is thought that the US south will become the leading pellet-producing region in North America – it will have produced around two million tons this year – with much of the investment in the region being driven by the export market to Europe.

Sawdust prices in the US north-west have risen from US$28/odmt in 2004 to US74/odmt in late 2008, before falling to an average of US$64/odmt in the third quarter of this year. These price increases are likely to be seen in other regions that are experiencing rapid expansion of their pellet industries.