Wood fuel market in Sri Lanka

Earlier Report Observations

The wood fuel market in Sri Lanka, measured by physical volume, experienced a steady contraction from 2018 to 2023. Market size decreased from 4 642 thousand cubic meters in 2018 to 4 222 thousand cubic meters in 2023. In value terms, the market showed volatility, falling to $1 159 million in 2020 before a partial recovery, then declining again to $1 075 million in 2023.

In 2022, a severe energy crisis and skyrocketing LPG prices significantly increased consumer demand for firewood. However, simultaneous supply constraints, particularly weather-related shortages of firewood and clay stoves, limited market availability. This mismatch between heightened demand and constrained supply contributed to the continued decline in overall market volume that year.

The shift to wood fuel persisted into 2023 due to ongoing LPG shortages, yet market volume kept falling. Structural limitations within the industry, such as a lack of modern technology, likely restrained supply growth. Concurrently, rupee depreciation affected the dollar value of the market, even as it made wood-based exports more competitive.

Production wood fuel in Sri Lanka

In kind, 2017-2020, K m³

Top producers of wood fuel, 2017-2020

World map of production of wood fuel, 2017-2020

Sri Lanka's wood fuel production has declined for three consecutive years. In 2019, the country produced 4,449 thousand cubic meters of wood fuel, which decreased by 1.7% to 4,449 thousand cubic meters in 2020. Over the period from 2017 to 2020, production fell by 5%, with an average annual decline of 1.7%.

Annual dynamics of production in Sri Lanka in kind, 2017-2020, K m³

In value, 2017-2020, M $ US

Sri Lanka's wood fuel production value has declined for two consecutive years. In 2019, the output was valued at 1,162 million US dollars, dropping by 0.7% to 1,162 million US dollars in 2020. From 2017 to 2020, production value decreased by 6.5%, with an average annual decline of 2.2%. The highest value was recorded in 2018 at 1,564 million US dollars, which saw a 25.9% increase. However, the largest decline occurred in 2019 with a 25.2% drop.

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

Exports wood fuel from Sri Lanka

Exports in kind, m³

The market showed volatility during the observed period. Exports reached their lowest point in 2018 at 10,419 cubic meters, with a 50.9% decline. In 2019, they surged by 121.3% and peaked in 2020 at 29,021 cubic meters, marking a 25.9% increase from the previous year. The gap between the peak in 2020 and the trough in 2018 was 2.8-fold.

Annual dynamics of product's exports from Sri Lanka in kind, 2017-2020, m³

From 2017 to 2020, Oman, India, and the Netherlands were the leading destinations for Sri Lanka's wood fuel exports in volume terms. Oman accounted for 18.9% of exports, India for 18.8%, and the Netherlands for 16.4%. Together, these three countries represented 54.1% of total export flows.

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

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

Exports in value, K $ US

Sri Lanka's wood fuel export value has increased for two consecutive years. In 2018, exports hit a low of 3,540 thousand US dollars, declining by 37.2%. In 2019, they rose by 68.4% and reached 7,580 thousand US dollars in 2020, a 27.2% increase from the previous year. Between 2017 and 2020, exports grew by 34.5%, with an average annual growth rate of 10.4%.

Annual dynamics of product's exports from Sri Lanka in value, 2017-2020, K $ US

From 2017 to 2020, the Netherlands, India, and South Korea were the top destinations for Sri Lanka's wood fuel exports in value terms. The Netherlands accounted for 20.7% of exports, India for 20.4%, and South Korea for 15.0%. Collectively, these three markets made up 56.2% of total export flows.

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

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

Imports wood fuel to Sri Lanka

Imports in kind, m³

The market exhibited an unstable trend throughout the timeframe. Imports reached their lowest point in 2020 at 16,050 cubic meters, down by 54.8% from 2019. In 2018, they peaked at 49,293 cubic meters with a 192.4% increase. The fluctuation between the peak in 2018 and the trough in 2020 was 3.1-fold.

Annual dynamics of product's imports to Sri Lanka in kind, 2017-2020, m³

Over the period from 2017 to 2020, Indonesia and India were the dominant sources for Sri Lanka's wood fuel imports in volume terms. Together, they accounted for 81.5% of total import flows, with the remaining volume distributed among smaller markets.

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

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

Imports in value, K $ US

Volatility characterized the market behavior during these years. Imports dropped to a minimum in 2020 at 4,912 thousand US dollars, a 51.3% decrease year-over-year. In 2018, they climbed to a maximum of 15,652 thousand US dollars with a 175.3% increase. The shift between the peak in 2018 and the trough in 2020 was 3.2-fold.

Annual dynamics of product's imports to Sri Lanka in value, 2017-2020, K $ US

From 2017 to 2020, Indonesia and India were the two leading markets for Sri Lanka's wood fuel imports in value terms. Together, they accounted for 80.5% of total import flows, while the remaining volume was dispersed across a wide range of other countries.

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

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