N American wood pellet exports rise in December

  • Spanish Market: Biomass
  • 09/02/24

Combined North American wood pellet exports rose in December from a year earlier, as higher US loadings that month offset a small drop in Canadian exports.

Pellet loadings out of US ports in December rose by 92,000t on the year to 1mn t, as a significant jump in shipments to the UK and Denmark more than offset slower exports to the Netherlands, Belgium and Japan, trade data show (see table).

Combined US and Canadian exports to the UK that month rose primarily because of stronger generation at units operating under the contracts-for-difference (CfD) support mechanism. Output at these units, with combined capacity of more than 1GW, had been zero or minimal in the 12 months to September 2023, during which time the scheme was unprofitable.

Combined December exports to Denmark also rose as the 380MW Studstrup 3 power plant was available for generation this heating season, but had been unavailable for pellet firing during the winter 2022-23 season following a fire at the pellet silo in September 2022.

US exports to France climbed to 10,000t, from nearly zero in December 2022, while Canadian shipments to the European country fell by a similar amount to 11,000t.

There have been a number of planned and unplanned outages at Dutch co-fired units that pared consumption and probably weighed on North American shipments to the country. And overall exports to Belgium dropped significantly last year from 2022 after the Engie-operated 205MW Rodenhuize plant was shut down in March.

Exports to Asia-Pacific in December dropped both from the US and Canada, with shipments to Japan accounting for the largest decrease, mostly because of commissioning delays at a number of new Japanese pellet-fired plants, as well as unplanned outages and limited vessel traffic through the Panama Canal.

US deliveries to Japan surge in 2023

US wood pellet exports surged significantly across all of last year to an all-time high of 9.5mn t, mostly because of quicker shipments to Asia-Pacific. Loadings destined for Japan more than doubled to 1.4mn t, and a 31,000t cargo was exported to South Korea in July, from zero a year earlier.

The jump in US exports to Japan last year were the result of more long-term contracts between US pellet suppliers and Japanese buyers taking effect. Contract volumes rose to 2.7mn t/yr last year, from 1.8mn t/yr in 2022. Only some of these volumes were delivered from the US, while the remainder were shipped out of southeast Asia to Japan.

By contrast, total Canadian exports last year fell by 6.4pc on the year to 3.3mn t, mostly because of a large drop in shipments to the UK and South Korea, with loadings destined for the Netherlands and Italy also down, by nearly 100,000t combined.

Canada's loadings to the UK were hit because of lower pellet burn at the CfD units. And loadings from the west coast of Canada may have been affected by restrictions to vessel transit at the Panama Canal, particularly in the second half of last year. Finally, the drop in Canadian exports to South Korea was probably caused by the latter securing more supplies from Russia at discounted prices.

US exports by destination'000t
CountryDec-23Dec-2220232022
UK6543615,2885,288
Japan1312211,394647
Denmark12731748561
Netherlands812131,4241,757
France111324232
Germany2081
Canada233631
Italy226320
Belgium080140429
Ireland00190
Poland00600
South Korea00310
Total1,2531,17312,80412,464
Canadian exports by destination'000t
CountryDec-23Dec-2220232022
UK92295621,102
Japan791401,6931,395
Denmark4930307114
US1315176194
France1122203103
Netherlands002577
South Korea012280426
Italy07853
Total2442563,2633,487

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