Wood fuel market in Western Europe

Earlier Report Observations

From 2018 to 2020, the wood fuel market in Western Europe experienced initial stability followed by a decline. Government subsidies for wood heating installations supported residential demand in 2018, keeping the market volume near 61.9 million m³. The following year, a drop in wood heating appliance sales, linked to lower gas prices, contributed to a slight market contraction to 61.6 million m³. The COVID-19 pandemic in 2020 further reduced appliance sales by 15% and slowed the construction of new heating plants, leading to a more pronounced decrease in market volume to 59.7 million m³.

A strong rebound occurred in 2021, with the market expanding to 65.6 million m³. This recovery was driven by a 21% surge in wood heating equipment sales, fueled by decarbonization goals and public support under the energy transition policy. The growth continued into 2022, reaching 69.0 million m³, as the energy crisis triggered by the war in Ukraine made wood fuel more attractive. Government measures like the electricity price shield and a freeze on gas prices encouraged substitution toward wood for domestic heating, despite soaring wood fuel prices.

In 2023, the market corrected to 63.3 million m³ after the price peak of the previous year. While pellet prices retreated from their 2022 highs, they remained elevated, likely tempering consumption. Government support persisted with the extension of the reduced VAT rate and direct premiums for low-income households, and the construction of industrial wood heating plants accelerated, indicating ongoing structural shifts toward wood energy.

Production wood fuel in Western Europe

In kind, 2017-2020, K m³

Top producers of wood fuel, 2017-2020

World map of production of wood fuel, 2017-2020

Wood fuel production in Western Europe declined for the second year in a row. In 2020, production reached 53 929 K m³, marking a slight decrease of 2.6% compared to 2019. Over the 2017-2020 period, production fell by 4.3%, with an average annual decline of 1.5%. The highest production level was recorded in 2018 at 56 474 K m³, which also saw the largest increase of 0.2% during this timeframe.

Annual dynamics of production in Western Europe in kind, 2017-2020, K m³

Exports wood fuel from Western Europe

Exports in kind, K m³

The export market showed an unstable trend over the period. The lowest exports were recorded in 2017, while the highest came in 2018, with a 1.9-fold difference between these years. In 2020, foreign wood fuel supplies from Western Europe totaled 8 027 K m³, representing a strong increase of 10.9% compared to 2019. The peak value was 10 368 K m³ in 2018. The largest decline occurred in 2019 at 30.2%, while the largest increase was in 2018 at 88.5%.

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

From 2017 to 2020, Italy (22.4% of exports in kind), Switzerland (5.0%), and Denmark (3.9%) were the top buyers of wood fuel from Western Europe. However, their combined share accounted for just 31.2% of total exports in kind, indicating a diversified country structure with many other markets involved.

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

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

Exports in value, M $ US

In 2020, Western Europe exported wood fuel worth 1 163 M $ US, up 0.9% from the previous year. Over the 2017-2020 period, exports grew by 20.9%, with an average annual growth rate of 6.5%. The highest value was recorded in 2018 at 1 180 M $ US. The largest decline was in 2019 at 2.3%, while the largest increase occurred in 2018 at 22.7%.

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

Between 2017 and 2020, exports in value terms were not heavily concentrated. Italy (26.3% of exports in value terms), Switzerland (5.3%), and Denmark (3.4%) together accounted for only 35.1% of total flows, with the majority distributed across numerous other countries.

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

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

Imports wood fuel to Western Europe

Imports in kind, K m³

Western Europe imported about 13 807 K m³ of wood fuel in 2020, a 2.5% increase from 2019. Over the 2017-2020 period, imports rose by 5.7%, with an average annual growth of 1.9%. The peak import volume was in 2018 at 15 817 K m³. The largest decline was in 2019 at 14.9%, while the largest increase was in 2018 at 21.1%.

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

From 2017 to 2020, the import landscape in kind was broad, with Poland (7.2% of imports in kind), the United States (7.0%), and Czechia (5.0%) together making up only 19.1% of total flows. The remaining 80.9% came from a wide range of other countries, highlighting the diversity of suppliers.

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

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

Imports in value, M $ US

In 2020, wood fuel imports into Western Europe were valued at 1 853 M $ US, a 14.7% increase compared to 2019. Between 2017 and 2020, imports grew by 31%, equivalent to an annualized rate of 9.4%. The largest decline was in 2019 at 0.6%, while the largest increase was in 2018 at 14.9%.

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

During 2017-2020, Poland (10.0% of imports in value terms), the United States (9.5%), and Latvia (5.0%) were key suppliers of wood fuel to Western Europe. However, their combined share reached just 24.4% of total imports in value terms, with the remaining 75.6% spread across many other partners.

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

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