Canadian Biomass Magazine

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Future wood pellet demand delayed: webinar explores impact of COVID-19 on industry


April 17, 2020
By FutureMetrics

On April 13, Canadian Biomass partnered with FutureMetrics to present a free, one-hour webinar (sponsored by the Wood Pellet Association of Canada) about the potential impact of COVID-19 on the industrial wood pellet industry. More than 230 people tuned in to hear insights from William Strauss, Ph.D., president of FutureMetrics.

During the webinar, Strauss presented a comprehensive overview of the global industrial wood pellet industry. He then discussed several ways in which the COVID-19 pandemic will likely impact the pellet sector. The presentation contained almost 70 slides of information and analysis. Many of the slides are complimented with charts.

If you missed the webinar, no worries. You can watch the recording here.

Strauss’s conclusions (which are explained in detail in the webinar) are as follows:

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  • The industrial wood pellet industry has matured into an integral part of the global renewable energy sector.
  • The pandemic will significantly negatively impact the global economic system. But the supply and demand for industrial wood pellets should be minimally impacted.
  • Increased costs of wood pellet production and some logistics frictions will impair cash flows but should not stop the supply and use of pellets that are under long-term off-take agreements.
  • The spot markets may be soft – at least until next winter’s heating demand returns. But they also may be tight as heating market-certified industrial producers are reticent to produce more than their contractual off-take obligations.
  • It is unlikely that governmental policy tweaks will change wood pellet demand.
  • It is likely that some future demand will be delayed, but not permanently removed, as work on new or retrofitted power plants has stopped during the COVID-19 crisis.

Watch the webinar here.