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US sees biomass prices increase

During the recession, as the cost of fossil fuels went down, so did the prices of woody biomass used for energy. However in the third quarter of 2010 biomass prices have risen in the south, the northwest and the southwest of the US, according to the North American Wood Fiber Review.

Compared to the previous quarter prices for woody biomass, including sawmill by-products, forest residues and urban wood waste were higher in Q3 2010 in most regions throughout the US.

The North America Wood Fiber Review reported that the northwest saw the biggest increase, where forest biomass prices have increased 19% from the second quarter.

Over the past few years an expansion of the biomass-consuming sector has seen a decline in open-market volumes of sawmill biomass (bark and wood fibre) and there is starting to be an increased need to source additional volumes of higher-cost forest biomass.

However in the northwest cheap fossil fuels delayed this increase in biomass consumption and prices for both mill and forest biomass were lower in Q3 compared to the same quarter in 2008 and 2009. But with plans in the pipeline for six new energy facilities in western Washington, these figures may be set to change in the near future.

In the northeast of the US the Q3 found biomass plants receiving lower income due to relatively low demand for power in the region. Prices for feedstock decreased due to plentiful inventories left over from Q2. Forest biomass prices have trended downwards since early 2009 and currently stand at 22% below the Q1/2009.

And demand for wood biomass in the south has slowly increased during the past few years as more energy plant owners are adding green energy to their portfolio of alternative energy sources. As a result biomass prices have risen throughout the last four years and were almost 50% higher in Q3 2010 compared to early 2007. The North America Wood Fiber Review expects this trend to continue because of the expansion of biomass plants that are due to come online in the region in the coming years.