Fuel wood in chips and particles market in Japan

Earlier Report Observations

Between 2018 and 2023, Japan's market volume for fuel wood in chips and particles showed significant fluctuation, initially reaching 15.7 million tons in 2018 before contracting. A primary long-term driver was the introduction of the Feed-in Tariff (FIT) system, which from 2018 incentivized the construction of biomass power plants and rapidly expanded demand for fuel wood, particularly from domestic sources. This policy shift helped increase the domestic wood self-sufficiency rate from historic lows toward 41.1% by 2021, fundamentally altering the supply structure toward more local feedstock.

The market volume dropped sharply to 12.3 million tons in 2020, primarily due to the COVID-19 pandemic. Global wood market disruptions and soaring freight costs led to a significant increase in import wood chip prices and a contraction in import volumes. This price shock simultaneously heightened demand for domestic wood, supporting local production. A strong recovery to 14.5 million tons followed in 2021, fueled by rising oil and natural gas prices, which made wood chips more competitive for energy generation. Concurrent yen weakness further elevated import chip costs, intensifying efforts to secure domestic supply and leading to regional shortages.

In the subsequent period, the market stabilized around 14.5 million tons. Persistent shortages of wood for chipping, high costs for log transport and electricity, and continued yen depreciation kept import prices elevated and squeezed profitability for biomass power plants. With fixed electricity selling prices, operators faced difficulties passing on higher fuel costs, creating a challenging environment that limited market growth despite sustained underlying demand from the biomass energy sector.

Production fuel wood in chips and particles in Japan

In kind, 2018-2021, K t

Japan was one of the world's leading producers of fuel wood in chips and particles from 2018 to 2021, ranking 13th globally by production volume during this period.

Top producers of fuel wood in chips and particles, 2018-2021

World map of production of fuel wood in chips and particles, 2018-2021

After two years of decline, Japan's production of fuel wood in chips and particles rebounded in 2021, reaching 3 554 K t, a 26.7% increase compared to the previous year. Over the 2018-2021 period, production grew by 8%, with a compound annual growth rate of 2.6%. The lowest production level was recorded in 2020 at 2 804 K t, following the largest decline of 12.5% in 2019.

Annual dynamics of production in Japan in kind, 2018-2021, K t

Exports fuel wood in chips and particles from Japan

Exports in kind, K t

The export market for fuel wood in chips and particles from Japan showed significant volatility from 2018 to 2021. Exports reached their lowest point in 2018 and peaked in 2020, with an 81-fold difference between these years. In 2021, exports dropped sharply to 0.1 K t, a 98.4% decrease from 2020. The highest export volume was recorded in 2020 at 6 K t, which also saw the largest increase of 4 476.4%.

Annual dynamics of product's exports from Japan in kind, 2018-2021, K t

From 2018 to 2021, Hong Kong was the dominant destination for Japan's exports of fuel wood in chips and particles in kind, accounting for 85.2% of total flows, with the remainder distributed among other trading partners.

Structure of product's exports in kind by countries, 2018-2021

World map of product's exports from Japan in kind, 2018-2021

Exports in value, M $ US

Export values for fuel wood in chips and particles from Japan experienced notable fluctuations between 2018 and 2021. The lowest value was recorded in 2018, while the highest occurred in 2020, showing a three-fold gap. In 2021, exports amounted to 0.1 M $ US, a 41.4% decrease from 2020. The peak value was 0.2 M $ US in 2020, following the largest increase of 114.6% in 2019.

Annual dynamics of product's exports from Japan in value, 2018-2021, M $ US

From 2018 to 2021, the main markets for Japan's exports of fuel wood in chips and particles in value terms were Thailand (50.6% of exports), Hong Kong (14.7%), and South Korea (12.0%). Together, these three countries accounted for 77.2% of total export flows.

Structure of product's exports in value by countries, 2018-2021

World map of product's exports from Japan in value, 2018-2021

Imports fuel wood in chips and particles to Japan

Imports in kind, K t

After a two-year decline, Japan's imports of fuel wood in chips and particles increased in 2021, totaling 9 491 K t, a 15.9% rise from the previous year. Over the 2018-2021 period, imports decreased by 11.7%, with a compound annual growth rate of -4.1%. The lowest import volume was recorded in 2020 at 9 491 K t, which also saw the largest decline of 22.0%.

Annual dynamics of product's imports to Japan in kind, 2018-2021, K t

From 2018 to 2021, Vietnam (32.0% of imports in kind), Australia (18.8%), and Chile (13.1%) were the primary sources for Japan's imports of fuel wood in chips and particles, together representing 63.9% of total import flows.

Structure of product's imports in kind by countries, 2018-2021

World map of product's imports to Japan in kind, 2018-2021

Imports in value, M $ US

Japan's imports of fuel wood in chips and particles in value terms reached approximately 1 969 M $ US in 2021, a 12.0% increase compared to 2020. Over the 2018-2021 period, imports declined by 13.7%, with a compound annual growth rate of -4.8%. The lowest value was recorded in 2020 at 1 758 M $ US, while the highest was in 2019 at 2 385 M $ US. The largest decline occurred in 2020, dropping by 26.3%.

Annual dynamics of product's imports to Japan in value, 2018-2021, M $ US

From 2018 to 2021, Vietnam (27.3% of imports in value terms), Australia (21.0%), and Chile (14.8%) were the key partners for Japan's imports of fuel wood in chips and particles, collectively accounting for 63.1% of total import flows.

Structure of product's imports in value by countries, 2018-2021

World map of product's imports to Japan in value, 2018-2021