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2020 Wood Pellets Market Brief In Polish

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Production

Poland is a growing market for wood pellets. According to industry estimates, 2019 production reached 1.3 MMT (Table 1). In 2019, the Polish wood pellet industry focused on growing exports to Germany, Italy, and Denmark, as well as increasing domestic demand among residential consumers. 80 percent of Polish wood pellets are derived from softwood, the vast majority of which come from sawdust, wood industry residues, and shavings. Polish wood pellet plants indicate that high prices and problems with sourcing sufficient raw materials are major constraints and limit production. In 2017 and 2018, in response to growing air pollution in Poland, many local governments introduced stricter regulations regarding home furnace certifications and fuel quality. In 2019, under the “Anti-smog Law”, the Polish Government launched a subsidy program for exchanging older, more inefficient home furnaces for newer higher-quality units, which resulted in increased wood pellet production for residential use in 2018 and 2019.

Polish industry uses the ENPlus and DINPlus quality-assurance certifications for wood pellets, which are managed by the Polish Pellet Council (PPC). Both quality standards are intended for heating purposes and are based on EN ISO 17225-2. The trademark owner of DINPlus is DIN CERTCO GmbH, while ENPlus is owned by the European Pellet Council. In 2018, 481,000 metric tons (MT) of wood pellets were certified the ENplus. Eurostat data (Graph 1) indicate a production decrease of certified wood pellets in 2017 and 2018. According to industry sources, that drop was related to lower straw pellet use following stricter biofuel regulatory changes which effectively, eliminated straw pellets.

Table 1: Production of Wood Pellets in Poland

  2017 2018 2019
Production capacity (000 MT) 1,200 1,400 1,400
Actual production (000 MT) 1,000 1,200 1,300
Number of operating Production plants 55 63 n/a

Sources: Data for 2017 and 2018 - Bioenergy Europe Statistical Report 2019 Data for 2019 - Polish Council of Pellets

Production of Certified Wood Pellets in Poland

Graph 1. Production of Certified Wood Pellets in Poland

Source: Eurostat

Consumption

In 2018, 62 percent of wood pellets were used by residential consumers (Table 2). About 25 percent of wood pellets were used by private businesses or institutions like schools and hospitals for generating their own energy or heat. The remaining 13 percent was used by commercial users producing energy or heat for sale. Consumption of pellets in Poland has grown since 2014. Poland is Europe’s biggest user of coal for home heating, which is a leading cause of air pollution. The Government of Poland offers partial compensation for consumers to replace older coal furnaces with new natural gas or wood pellet furnaces. Government subsidies for new furnaces are helping to drive consumer demand for wood pellets. So far, only two heating plants in Elbląg and Stalowa Wola are using industrial wood pellets. The heating plant in Elbląg was opened in October 2018 and its annual capacity is 200,000 MT of wood pellets.

Table 2. Consumption of Wood Pellets in Poland, (000 MT)

  2017 2018
Residential 233 280
Commercial 50 60
Central heating 30 30
Power only 30 80
Total 243 450

In 2018, the average price of bagged wood pellets per MT varied from €190 in the summer to €220 in winter (including 23 percent value added tax). Bulk 2018 pellet prices varied from €185 to €200 per MT.

Trade

Poland is a net exporter of wood pellets. In 2019, Polish wood pellet exports were valued at $110 million. Major export markets were Italy, Germany, and Denmark (Graph 2).

Value of Exports of Wood Pellets

Graph 2. Value of Exports of Wood Pellets

Source: Polish Statistical Office (Published by TDM In 2019, Poland imported 216,642 MT of wood pellets, a 56 percent increase over 2018. 2019 wood pellets imports totaled $40.5 million (Graph 3).

According to the National Energy Regulatory Office (Urzad Regulacji Energetyki), imported wood pellets used by the industry should be certificated, confirming the origin of the biomass used during production. To be eligible for such a certificate, wood pellet plants in the country of origin must be audited by an independent auditor. In Poland, the PPC is authorized to conduct on-site biomass origin authentication audits in the exporting production plants. The PPC contact point regarding audits is Mr. Adam Sarnaszek, Director of PPC (see contact info at the end of the report). Polish wood pellet importers are already associated with Canadian suppliers and the Canadian Wood Pellet Association is a member of European Pellet Association.

Value of Exports of Wood Pellets

Graph 3. Value of Imports of Wood Pellets

Source: Polish Statistical Office (Published by TDM)

In 2019, Poland imported wood pellets mainly from Ukraine, Estonia, and Germany (Table 3). 2019 imports grew significantly over 2018, notably from Estonia. Poland did not import any U.S. wood pellets in 2019.

Table 3. Quantity of Wood Pellets Imports (MT)

  2014 2015 2016 2017 2018 2019 %Δ 2019/18
World 55,615 60,945 64,969 74,150 141,166 216,642 53,47
Ukraine 40,250 49,392 48,475 58,043 122,503 128,671 5,03
Estonia 0 0 0 0 0 62,759 n/a
Germany 2,961 2,473 3,224 8,749 10,943 12,042 10,04
Belarus 1,890 2,566 3,842 3,455 4,213 4,334 2,87
Russia 1,337 3,500 3,910 3,711 3,433 8,728 154,24

Source: Polish Statistical Office (Published by TDM)

The average price of imported wood pellets in 2019 was $187 per MT (Table 4). Average prices of imported wood pellets in 2019 and 2018 were lower than in 2017, due to increasing imports of low-cost Ukrainian wood pellets.

Table 4. Average Price per MT of Imported Wood Pellets ($/MT)

  2014 2015 2016 2017 2018 2019 %Δ 2019/18
World 191 134 138 220 197 187 -5
Germany 858 715 705 998 1,046 1098 5
Italy 0 721 891 2766 945 893 -6
Slovakia 215 0 509 498 454 230 -49
Netherlands 0 0 0 381 363 383 5
Czech Republic 195 311 166 207 327 221 -32
Belarus 147 107 99 116 144 138 -4
Russia 148 109 109 119 135 140 4
Moldova 0 0 0 0 131 0 -100
Ukraine 144 112 115 116 125 124 -1
United States 0 2,531 2,436 2,972 0 0 0
Lithuania 100 58 44 169 0 187 0
Estonia 0 0 0 138 0 152 0

Source: Polish Statistical Office (Published by TDM)

Global biomass wood pellet market outlook in 2020 - Part 1
Global biomass wood pellet market outlook in 2020 - Industrial wood pellet market


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