Global Wood Pellet Market Projected to Reach $26 Billion by 2031
Valued at $18.53 billion in 2026, the global wood pellet market is on a growth trajectory toward $26 billion by 2031. Driven by a shift in utilities toward lower-carbon fuel sources, the industry is expanding as companies seek to hedge against fossil fuel price volatility through long-term biomass supply agreements.
The sector's 7.01% compound annual growth rate is underpinned by government-backed co-firing programs, particularly in Asia-Pacific. While Europe maintains its status as the primary trading hub, rising import demand from Japan and South Korea, coupled with industrial projects in China and India, is reshaping the global flow of biomass. Producers are increasingly diversifying their feedstock, moving beyond traditional forest residues to incorporate agricultural waste and energy crops.
Sustainability requirements are acting as a primary catalyst for industry consolidation. Stricter traceability standards favor larger, certified suppliers, making market entry more challenging for smaller firms. According to Himanshu Vasisht, Senior Research Manager at Mordor Intelligence, the market is evolving rapidly alongside energy policy and supply dynamics, necessitating more transparent, evidence-based evaluation for industry decision-makers.
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