Wood fuel market in MERCOSUR

Earlier Report Observations

The wood fuel market in MERCOSUR saw its volume decline slightly from 133.7 M m³ in 2018 to 130.7 M m³ in 2019, then recover and grow steadily to reach 141.8 M m³ by 2022 before a minor correction to 141.2 M m³ in 2023. In monetary terms, the market value increased more markedly, from $9.7 billion in 2018 to $12.7 billion in 2023, suggesting a rise in unit prices over the six-year period.

Recent developments are set to influence the market further. The implementation of the EU-MERCOSUR trade agreement grants preferential access for wood products to the European Union, contingent on meeting strict deforestation-free certification requirements. At the same time, strong export growth to destinations like India and Chile, supported by the region's consolidated industrial infrastructure, is driving external demand for wood fuel and related biomass.

Production wood fuel in MERCOSUR

In kind, 2017-2020, M m³

Top producers of wood fuel, 2017-2020

World map of production of wood fuel, 2017-2020

In 2020, MERCOSUR produced 135.9 million cubic meters of wood fuel, marking a modest year-on-year increase of 0.6%. The largest decline occurred in 2019, with a drop of 2.2%, while the peak production was recorded in 2018 at 138.2 million cubic meters, which also saw the highest increase of 2.7%.

Annual dynamics of production in MERCOSUR in kind, 2017-2020, M m³

In value, 2017-2020, M $ US

Following two consecutive years of growth, MERCOSUR's wood fuel production value experienced a decline. In 2020, the output was valued at 10,150 million US dollars, reflecting a 5.2% decrease compared to the previous year. Over the 2017-2020 period, production value rose by 5.9%, with a compound annual growth rate of 1.9%. The highest value was recorded in 2019 at 10,708 million US dollars, which also saw the largest increase of 7.1%.

Annual dynamics of production in MERCOSUR in value, 2017-2020, M $ US

Exports wood fuel from MERCOSUR

Exports in kind, K m³

MERCOSUR's wood fuel export volumes declined for the second year in a row. In 2020, exports totaled 3,778 thousand cubic meters, showing a 15.9% decrease from the previous year. Over the 2017-2020 period, exports fell by 7.2%, with a compound annual growth rate of -2.5%. The peak volume was recorded in 2018 at 4,728 thousand cubic meters, which also experienced the largest increase of 16.1%.

Annual dynamics of product's exports from MERCOSUR in kind, 2017-2020, K m³

From 2017 to 2020, Portugal, Japan, and China were the leading destinations for MERCOSUR's wood fuel exports in volume terms. Portugal accounted for 28.2% of exports, Japan for 26.5%, and China for 21.5%, together representing 76.2% of total export flows.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from MERCOSUR in kind, 2017-2020

Exports in value, M $ US

After two years of growth, MERCOSUR's wood fuel export value declined. In 2020, exports amounted to 282.3 million US dollars, down by 20.7% year-on-year. Over the 2017-2020 period, export value decreased by 2.6%, with a compound annual growth rate of -0.9%. The highest value was recorded in 2019 at 356.0 million US dollars, while the largest increase occurred in 2018 at 18.0%.

Annual dynamics of product's exports from MERCOSUR in value, 2017-2020, M $ US

Between 2017 and 2020, the top destinations for MERCOSUR's wood fuel exports in value terms were Portugal, Japan, and China. Portugal held 26.2% of export value, Japan 22.7%, and China 16.1%, collectively accounting for 65.1% of total export flows.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from MERCOSUR in value, 2017-2020

Imports wood fuel to MERCOSUR

Imports in kind, K m³

MERCOSUR's wood fuel import volumes showed significant fluctuations during the period. In 2017, imports reached their lowest point, while the peak was recorded in 2018 at 246 thousand cubic meters, representing a 6.9-fold difference between these years. In 2020, imports stood at 226 thousand cubic meters, which is 265.9% higher than in 2019. The largest decline occurred in 2019 at 75.0%, and the largest increase was in 2018 at 594.1%.

Annual dynamics of product's imports to MERCOSUR in kind, 2017-2020, K m³

Throughout 2017-2020, Indonesia and the United States were the top sources for MERCOSUR's wood fuel imports in volume terms, together accounting for 7.8% of total import flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to MERCOSUR in kind, 2017-2020

Imports in value, M $ US

After a two-year upward trend, MERCOSUR's wood fuel import value declined. In 2020, imports totaled 15.8 million US dollars, showing a sharp decrease of 21.3% compared to 2019. Over the 2017-2020 period, import value increased by 5.1%, with a compound annual growth rate of 1.7%. The highest value was recorded in 2019 at 20.1 million US dollars, and the largest increase occurred in 2018 at 17.6%.

Annual dynamics of product's imports to MERCOSUR in value, 2017-2020, M $ US

From 2017 to 2020, Indonesia, the United States, and France were the leading suppliers of wood fuel to MERCOSUR in value terms. Indonesia accounted for 42.1% of imports, the United States for 12.6%, and France for 5.9%, jointly representing 60.7% of total import value.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to MERCOSUR in value, 2017-2020