Prices of wood pellets have reached a historical high in Europe

Prices of wood pellets have been extremely consistent in Europe over the past decade. For instance, the average annual growth of wood pellet prices in Germany was only 0.24% from 2012 to 2021. The prices have actually dropped by 1.44% when corrected for inflation. Over this time, oil prices have leaped up and down considerably, but the value of wood pellets has never changed along with them. This obviously demonstrates the lack of a direct relationship between the trends of wood pellet and fossil fuel prices.

The year 2022 shocked European consumers with biofuel prices. As a rule, the price of wood pellets would always reduce by summer, but in 2022, the seasonal trend was reversed. The global disturbances in energy markets, the higher logistics costs, switching heating systems to biofuel and the Russian–Ukrainian conflict which resulted in a ban on importing HS Code 44 from Russia to the EU: all this caused a staggering growth of wood pellet prices in Europe.

In September 2022, European wood pellet prices reached historical highs: in many EU countries, they surged by two or more times compared to September 2021. For instance, the average price in Germany more than tripled over the year: from €225 to €747 per ton (for 26-ton shipments).