In 11 months of 2023, the export turnover of wood pellets reached 597 million USD. It is forecast to reach only 660 – 665 million USD in 2023 which is down 16% compared to 2022. Thus, the export goal of one billion USD this year has not come true…

Vietnam’s wood pellet exports have increased 28-fold in volume and 34-fold in value over the past decade, since 2013. In 2022, Vietnam exported 4.9 million tons of wood pellets with a turnover of 790 million USD. This result was up 30%  in volume and 67% in value compared to 2021.

At the beginning of 2023, the Vietnam Wood and Forest Products Association (Viforest) set a target of one billion USD in wood pellet export turnover. However, after a “hot” period in 2022, pellet exports declined in 2023.

Wood pellet exports have slowed down and declined.


According to Viforest, the export value of pellets in November 2023 only reached 58 million USD. Accumulated in 11 months, the figure is 597 million USD, down 14% over the same period in 2022.

The latest report of Forest Trends said that in the first three quarters of 2023, Vietnam’s pellet exports to Japan reached 02 million tons, equivalent to nearly 82% of exports to this market in 2022.

Meanwhile, the volume of pellets exported to Korea in the three quarters was only 1.3 million tons, equivalent to 56% of the export volume to this market in the whole year 2022. The decrease in Vietnam’s wood pellets exported to Korea is not due to a decrease in demand in this market. The reason is that Korean enterprises imported pellets from other sources, including Russia.

“In Korea, there is not much room for development for Vietnamese enterprises in the future. Now, some Korean businesses, mostly small businesses, continue to buy pellets from Russia. Korea is the only country in the world that still uses supplies from Russia, ”said Mr. To Xuan Phuc, Forest Trend.

Vietnamese exporters said that major Korean buyers are requiring proof of traceability. According to these enterprises, in the next 4-5 years, the traceability requirement will be mandatory for products exported to Korea.

For the Japanese market, Mr. To Xuan Phuc said that Vietnam’s pellet industry still has the opportunity to expand its export market. Pellets exported to Japan have always required a sustainable certificate. According to the evaluation of pellet enterprises, the demand for wood pellets in Japan will expand three times compared to the present. Currently, Vietnam is supplying about 80% of pellets to this market. The opportunity to expand market share here is huge.

Exports of wood pellets miss the target of one billion USD.

“The supply of pellets made from palm shells originating from Indonesia may not be certified and therefore cannot meet the requirements of the Japanese market. Vietnam’s enterprises will have the opportunity to replace the supply from Indonesia”

Mr. To Xuan Phuc, Forest Trends.

The input materials of the pellet manufacturing industry are now by-products of the wood processing industry and of planted forest wood. As a by-product, this part of the material is often not appreciated in terms of economic value. In some localities where a pellet manufacturing facility is not yet present, this by-product is even being burned.

However, Forest Trends said that the pellet industry has not received any policies to promote sustainable development. Pellet enterprises deserve to receive dedicated mechanisms. This can be direct support for manufacturing enterprises, for example, incentives in capital, technology, and land…


According to Mr. To Xuan Phuc, one of the biggest difficulties of exporting pellets is the unsustainability of input wood sources in terms of quantity, standards, and quality. It requires the Government to have a reasonable policy, especially on balancing processing capacity and plantation material areas.

Each decision for licensing pellet production projects should be based on calculation, ensuring that the processing capacity of enterprises and the input material (planted forest wood) do not exceed the raw material supply capacity of the region.

Wood pellet production technology in the world is being improved daily.

“This decision also requires calculations of the interaction and competition between the processing components of enterprises using planted forest wood – including facilities processing wood, plywood, chips, and pellets… This will contribute to making the pellet industry (and other components of the wood industry) more sustainable, ” Mr. Phuc emphasized.

According to Grand View Research, the global demand for wood pellets will have a compound annual growth rate (CAGR) of 6.85% between 2022-2027.  It is forecast to reach 17.33 billion USD by 2027. Vietnam is the second-largest exporter of pellets in the world, after the US. Because it has advantages such as reducing carbon emissions, saving costs, and increasing efficiency compared to fossil fuels.

Grand View Research said that countries around the world are looking for solutions to reduce their dependence on fossil energy sources, such as coal, oil, and gas. This is the main reason for promoting the market of wood pellets in clean energy production, especially in the EU.

However, Grand View Research said: “The increasing adoption and deployment of alternative renewable energy sources such as solar photovoltaics, wind power, and geothermal power in different parts of the world are likely to hinder the growth of the pellets market in the future.

On the other hand, wood pellet production technology in the world is being improved daily to increase efficiency and reduce costs and emissions. New equipment such as presses, dryers, and packaging machines have been applied to create higher quality products and meet market requirements.

Wood pellet technology has been upgraded to increase energy conversion efficiency, and reduce ash and emissions. With these developments, the export market of pellets in the coming years will be fiercely competitive in terms of technology and product quality.

If pellet manufacturers in Vietnam are slow to innovate technology to reduce costs, increase efficiency, and reduce emissions, other countries may win the pellet export market. Therefore, technological innovation in pellet production is very important to keep and expand the market./.