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UK's demand for wood pellets to fall

The quantity of wood pellets exported from North America to Europe in the second quarter of this year rose again for the seventh consecutive quarter, according to data from Wood Resources International and reported by the North American Wood Fiber Review.

Between Q3 2011 and Q2 2013 volumes exported to Europe have more than doubled, going from around 500,000 tonnes to over 1.1 million tonnes, respectively.

Southern US saw the highest increase of exports, while shipments from the key supply region of British Columbia in Canada have also been growing 'at a fairly modest rate' since early 2011.

However, the quantity of wood pellets exported from Canada as a whole remained relatively unchanged in the second quarter of this year. This suggests the nation has almost reached its production capacity, while limited investment in new capacity has led to pellet export volumes remaining static.

Nevertheless, wood pellet shipments from Canada are expected to rise in 2014 as additional capacity is planned for British Columbia, Ontario, Quebec and Nova Scotia. Of the total wood pellets exported from North America, those from Canada account for 38% today. This is a 24% decrease from 2011 when this figure stood at 62%.

The UK has been a major importer of wood pellets coming from North America. While consumption in the nation is still expected to rise as biomass power plants increase their pellet volumes, the rate of increase will not be a substantial as we have seen in the past. This is attributed to the closure of RWE's large-scale Tilbury biomass-fired plant in August this year.