NOVEMBER 2008

Wood Biomass Market Report dispels ‘overabundant waste wood’ myth

The Wood Biomass Market Report released in October dispelled a widespread thought in regards to the availability and cost of wood fiber for wood biomass projects.

The Report, published monthly by RISI, an information provider for the global forest products industry, reported that operators of new wood biomass projects, often industry newcomers, are finding that their wood cost projections were unrealistic and that to their surprise, existing mills are willing to fight with dollars to preserve their wood supplier loyalty. The Report also stated that these operators, hungry for large volumes of wood, and frequently armed with government subsidies, are finding that the perceived overabundance of “waste wood” in the nation’s forests is simply not there. As a result, the increased demand for more traditional forms of wood fiber has already triggered wood price spikes and cross-grade competition in the tightest markets.

William Perritt, editor of the Wood Biomass Market Report, commented, “Recent and upcoming project starts in the energy, pellet, and biofuels sectors will add an estimated 37 million tons per year to existing wood fiber demand in North America, and that number could easily jump to 50 million tons in short order.”

He continued, “In the rush and excitement to develop North America’s largest renewable energy source, established low-grade wood consumers have not always responded positively to the appearance of new players, and these new players should understand that they are going to have to fight much harder than they might have planned to procure enough wood fiber to run at their capacity.”