Wood pellets market in South Korea

Earlier Report Observations

Between 2018 and 2023, South Korea's wood pellet market volume expanded from 3.6 million tonnes to 4.6 million tonnes, albeit with some yearly variations. Domestic production surged more than fourfold, from 188 thousand tonnes to 886 thousand tonnes, driven by targeted policy support and significant investment announcements.

A pivotal shift occurred in 2021 when three major bio-co-firing companies declared they would cease using imported wood pellets from 2025, accelerating demand for domestic fuel. This was reinforced by a government policy to gradually reduce Renewable Energy Certificate (REC) incentives for imported pellets, creating a direct financial motive to expand local manufacturing capacity.

The policy environment encouraged new production facilities, including a planned 300 thousand tonne-per-year plant in Jincheon-gun announced in 2018. The feedstock mix also evolved, with the share of unused forest biomass rising from 11% in 2019 to 39% in 2024, supporting production growth while overall market volume stabilized near 4.6 million tonnes by 2023.

Production wood pellets in South Korea

In kind, 2017-2020, K t

Top producers of wood pellets, 2017-2020

World map of production of wood pellets, 2017-2020

South Korea's wood pellets production has grown for three consecutive years. In 2020, the country produced 331.0 K t of wood pellets, marking a 36.2% increase from 2019. From 2017 to 2020, production surged by 386.8%, with a compound annual growth rate of 69.5%.

Annual dynamics of production in South Korea in kind, 2017-2020, K t

Exports wood pellets from South Korea

Exports in kind, K t

The market displayed volatility during the observed period. Exports reached their peak in 2018 at 3 K t and fell to their lowest point in 2020 at 0.0 K t, representing a dramatic 99.7% drop from the previous year. The fluctuation between these years was 13 805-fold. The largest increase occurred in 2018, with a growth of 64 665.9%.

Annual dynamics of product's exports from South Korea in kind, 2017-2020, K t

From 2017 to 2020, South Korea's wood pellets exports were primarily directed toward Vietnam and Malaysia, which together accounted for 99.8% of total export volumes.

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

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

Exports in value, M $ US

The market trend was unstable throughout the timeframe. Exports in value terms peaked in 2018 at 0.4 M $ US and hit a low in 2020 at 0.0 M $ US, showing a sharp 99.8% decline from the prior year. The ratio between the peak and trough was 10 131 times. The largest increase was recorded in 2018, with a rise of 35 533.2%.

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

In the period 2017–2020, Vietnam dominated South Korea's wood pellets exports in value terms, capturing 86.4% of total flows, while other markets made up the remainder.

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

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

Imports wood pellets to South Korea

Imports in kind, K t

In 2020, South Korea's wood pellets imports amounted to 3 004 K t, remaining relatively stable compared to the previous year. Over the 2017-2020 period, imports grew by 23.6%, with a compound annual growth rate of 7.3%. The highest import volume was in 2018 at 3 445 K t. The largest decrease occurred in 2019, falling by 12.9%, while the largest increase was in 2018, up by 41.7%.

Annual dynamics of product's imports to South Korea in kind, 2017-2020, K t

From 2017 to 2020, Vietnam and Malaysia were the leading sources for South Korea's wood pellets imports in volume, jointly representing 80.6% of total flows, with other countries accounting for the rest.

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

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

Imports in value, M $ US

The market exhibited volatility over the observed period. Import values reached their maximum in 2018 at 521.8 M $ US and their minimum in 2017, with a 1.9-fold difference between these years. In 2020, imports totaled 329.1 M $ US, down 9.2% from the previous year. The largest decline was in 2019, dropping by 30.6%, while the largest increase was in 2018, rising by 86.1%.

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

During 2017–2020, Vietnam, Malaysia, and Indonesia were the main suppliers of wood pellets to South Korea in value terms. Vietnam accounted for 62.1% of imports, Malaysia for 17.3%, and Indonesia for 7.5%, together making up 86.9% of total import value.

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

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