Wood pellets are growing into a potential export good for Vietnam because of the increasing international need for fuel for thermal power plants and industrial production facilities.
Vietnam experienced a high surge in tablet exports in the first quarter of 2022 in response to a decline in global supplies.
What are Wood Pellets?
Wood pellet is a commonly used renewable fuel which is made of waste of pine wood or rubber wood (sawdust and wood chips…). These materials are compressed under intense pressure by a pellet line to create wood pellets.
Advantages of Using Wood Pellets
When compared to fossil fuels, wood pellets are considered to be:
- more environmentally friendly
- more cost-effective
- a more sustainable supply of heating
The wood pellet industry reduces waste by creating wood pellets from fiber that was once burned or forgotten (or from timber stock) and transforms that waste into valuable, low-carbon energy.
Moreover, the use of wood pellets not only has major environmental benefits and obvious financial benefits for the consumer, but it also offers a stable future market for domestic businesses that deliver the fuel, make the heating appliances, install, and maintain them.
How are wood pellets made?
Producing wood pellets requires the removal of moisture from entering wood fiber, grinding the fiber into dust, and compressing the dust into tiny cylinders, or pellets, typically 6 or 8 mm in diameter and up to 40 mm in length.
During this procedure, heat is used, which causes the natural polymer lignin, which may be found in wood, to function as a glue to hold the compressed particles together.
The outcome is a dry, tightly compressed product with a high energy value that is manageable and effective for long-distance transportation.
Global Demand of Wood Pellets
Expert predictions state that the present global demand for biomass pellets is 12–15 million tons per year and will increase to roughly 50 million tons by 2030.
This results from the fact that nations have started the required phase of emission reductions under the Paris Agreement about climate change.
The use of renewable energy is gradually replacing the use of fossil fuels like coal and oil.
Notable Statistic of the Vietnamese Wood Pellets Market
Pellets have grown to be a significant product from Vietnam’s wood sector with a high export volume and turnover.
With a capacity of 2.5 million tons annually, Vietnam is the world’s second-largest exporter of wood pellets, after the United States, and its output and price are both steadily rising, according to the Wood and Forest Products Association (Viforest).
This product’s export turnover has increased the greatest since 2018, with export revenue nearly doubling from the prior year (2017).
Volume of pellets Vietnam exported over the years (ton)
Following that, the growth rate remained unchanged at 10–20% per year.
Recently, in 2021, exports exceeded 3.5 million tons, worth $ 400 million.
Vietnam’s export volume and value of pellets, 2013 – August 2021
The advantages of Vietnam are that:
- It has readily accessible inputs, which are mobilized from plantation timber, particularly from households on forest plantations;
- Fully utilizes wood by-products of the processing industry;
- The production investment capital scale is small (1–2 million USD), management level and production technology is not very demanding while the market demand is large.
Demand for Vietnam’s Wood Pellets from Various Markets
The high price and request for importing wood pellets on the global market have given this Vietnamese product the chance to increase production and export.
From Asia
Asia countries such as South Korea and Japan are the main importers of Vietnam’s wood pellets.
In these nations, coal is still being replaced by clean electricity, including biomass power, which leads to a growth in wood pellet demand.
Additionally, the Chinese market is developing similarly and there is a significant need for this product.
From The EU, which has a “Thirst for Energy”
Due to reduced gas supplies from Russia to EU countries as a result of the Russia-Ukraine crisis, there is a significant increase in demand for wood pellets in the EU, especially Vietnamese wood pellets.
For the upcoming winter, many EU residents will switch to utilizing pellets heated in a furnace.
40 percent of wood pellets are used in the EU for home heating, 36 percent as a fuel for power plants, and 14 percent are used to heat commercial buildings, according to Wood Resources International LLC.
Within the next five years, there will likely be a 30-40% increase in demand for wood pellets. Depending on its pace of growth, Europe’s demand for wood pellets may reach 10 million tonnes.
** To know more products that the EU most import from Vietnam, read the blog below:
https://viec.nl/what-does-vietnam-export-the-most-to-europe/ **
Top 10 Vietnamese Producers of Wood Pellets
Below are the names and contact information of businesses that sell wood pellets to Vietnam and have massive, modern production facilities to suit the market’s demand for natural fuels that are safe to use.
These trustworthy producers create wood pellet goods at affordable costs and ensure their high quality and safety.
- Golden Star – One Member Co., Ltd
Contact Info
Address: C-08, 12th floor, Luxcity Block C Building, 528 Huynh Tan Phat, Binh Thuan Ward, District 7, HCM
Email: [email protected]
- Hung Thinh Phat Tien Giang Investment and Development – One Member Co., Ltd
Business information
Address: No. 32, Group 1, An Thien Hamlet, An Cu Commune, Cai Be District, Tien Giang
Email: [email protected]
Website: www.cuitrauviet.vn
- iHome Vietnam Joint Stock Company
Business information
Address: CCN Tham Len, Hamlet Hoang Xa, Kieu Ky Commune, Gia Lam District, Hanoi
Email: [email protected]
Website: www.cuimuncua.bizz.vn
- Luong Son BIOMASS Co., Ltd
Business information
Address: Hoang Xa Hamlet, Quyet Thang Commune, Hai Phong
Email: [email protected]
- Hung Thinh Import-Export Co., Ltd
Business information
Address: Hong Minh Commune, Phu Xuyen District, Hanoi
Email: [email protected]
Website: www.chatdothungthinh.com
- Hoang Ngoc Rice husk Firewood Co., Ltd
Business information
Address: 69 Tan Lap Hamlet, Tan Quy Tay Commune, Sa Dec City, Dong Thap Province
Email: [email protected]
Website: www.cuitraudongthap.com
- Huy Phat Construction Materials Trading One Member Co., Ltd
Business information
Address: B3/6A National Highway 1A, Hamlet 2, Tan Kien Commune, Binh Chanh District, HCMC
Email: [email protected]
Website: www.cuitrauhuyphat.com
- Dai Phat Trading Investment Production Co., Ltd
Business information
Address: Thach That, Hanoi
Website: www.cuimuncuahanoi.bizz.vn
Email: [email protected]
- Thien Phuc An Trading Co., Ltd
Business information
Address: 62/417B Phan Huy Ich, Ward 12, Go Vap District, HCM
Email: [email protected]
Website: www.thienphucan.bizz.vn
- Thuy Linh Wood Pellet Factory
Business information
Address: Nam Tan Uyen Industrial Park, Tan Uyen Town, Binh Duong Province
Email: [email protected]
Website: www.viennengothuylinh.bizz.vn
Prices of Wood Pellets in Vietnam
Export Price from 2013 to 2020
The value and volume of wood pellets exported from Vietnam have been rising rapidly, although the export product’s unit price decreased slightly between 2014 and 2020.
Price of wood pellets exported from Vietnam (FOB, US$/ton)
Average Export Price of Vietnamese Wood Pellets
Following are some statistics regarding the import of wood pellets from Vietnam that you may find helpful:
Sawdust and waste pellets used as fuel for boilers: 0.1 USD/ kg
100% new pellet: 126.42 USD/ ton
Wood pellets without heat treatment: 127.46 USD/ ton
Wood pellets from trash sawdust (rubberwood, yellow cotton Melaleuca): 152 USD/ ton
Sawdust pellets from rubber mulch: 138 USD/ ton
Wood pellets from sawdust, pine, and melaleuca: 137 USD/ ton
The EU Starves for Energy, the Export Price Increased Sharply
In 2022, when consumption is estimated to reach 24.3 million tons, the record level is anticipated to be broken once again.
The export price of wood pellets from various nations, including Vietnam, climbed along with the increase in the EU market’s demand.
“At the end of 2021, the export price of wood pellets sometimes decreases below 100 USD/ton, but now (2022) the price is at 180-200 USD/ton,” stated Mr. Ngo Sy Hoai, Vice President and General Secretary of the Vietnam Timber and Forest Products Association (Viforest).
How To Import Wood Pellets From Vietnam? Shipping Process
Ensure that the phytosanitary registration documents have been prepared before continuing.
This document often includes a contract, a sample delivery for quarantine, a plant quarantine registration application, and a few other relevant documents.
Following that, you must disclose the shipping details on the Region II Plant Quarantine Department website.
The agency will then provide you with a draft of the certificate and instructions for exporting sawdust pellets after you wait for roughly 24 hours.
The phytosanitary draft must then be sent to the import receiving agency for information evaluation as soon as the procedures are finished and you have received it.
If everything is okay, kindly go back to the plants of the quarantine sub-department for quarantine and payment.
Generally, you must provide the information we just mentioned in detail before you want to export or import any goods.
Additionally, you must carefully compile other extra paperwork and approve the customs statement. Select a reliable assistance provider so they can clarify your issues if you are still unclear or need additional information.
Conclusion
Vietnam’s wood pellet business, which has been a part of the wood sector for around ten years, has experienced remarkable growth in terms of export volume and value.
Also, the increasing global need for fuel for thermal power plants and industrial production facilities has pushed Vietnamese wood pellets as a potential export good for Vietnam.
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Read about the differences between Vietnam’s and China’s sourcing
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