Notes

Vietnam timber pellet manufacturing as well as exports<br>
In the past 7 years, Vietnam timber pellet export grows from no to around 2.75 million loads each year, with the majority of to Korea as well as Japan. Yet as ring die pellet mill for sale lessen, will it continue to expand? What's the pattern of Vietnam wood pellet market?



John Swan, a procedure professional that has been guiding the style and tools option for new pellet plants in Vietnam, evaluated the current circumstance and future trend of Vietnam wood pellet export.



Vietnam timber pellet production gain from low cost

Timber pellets in Vietnam are primarily made of the spin-offs of furniture production. These sawdust has low dampness material and also tiny dimension. Many very early wood pellet factories don't require drying or crushing devices. With reduced labor price, they can save a lot of production cost.



For a long time, there are a lot of container freights delivered from Korea to Vietnam and only small quantities from Vietnam to Korea. machine for making chicken feed can use the excess empty container for shipment at low cost. The transport expense is less than $10 per lot.



Vietnam timber pellet manufacturing cost will increase

The shipping cost is mosting likely to increase. The fast growth of cargos from Vietnam to Korea decrease the excess containers. The delivery cost will certainly rise to $20/ton from Vietnam to Japan.



The raw material price is going to rise. The furniture manufacture in Vietnam rise from 2.1 million heaps to 7.2 million loads in the past 10 years, with the yearly development rate of 13%. By comparison, the wood pellet export raises from 160,000 to 2.46 million lots, with the annual development rate of 61%. So the demand for furniture handling waste development a lot more than the supply.




To broaden manufacturing, Vietnam manufacturers will increasingly count on woodland residuals and logs. These materials set you back greater as well as require peeling off, damaging, crushing and also drying out for making pellets. So the limited expense will certainly rise up.



Vietnam timber pellet export cost will certainly raise

A lot of Vietnam's wood pellets are exported to Korea and also Japan.



In the graph below, the green line shows the weighted cost of the top 6 wood pellet vendors to Korea, and the red line shows the price of Vietnam wood pellets. As Vietnam domains the Korea wood pellet market, various other 5 distributors just take up less than 20% market share. We can locate that the development of Vietnam wood pellet cost pushes up the ordinary weighted cost.



Japan timber pellet market also show the rise of Vietnam wood pellet rate. The majority of Japan's wood pellets are imported from Canada as well as Vietnam, with Canada using up 65% -70%. The eco-friendly line reveals the weighted price of Canada and also Vietnam timber pellet export. The red line reveals Vietnam's wood pellet export cost rebound.



The development of Vietnam timber pellet industry is restricted

We can examine the growth possible based on the manufacturing strength of a certain area. It describes the overall timber pellet production split by the production area. The manufacturing location does not consists of the land that is not forested or is not offered for tree harvesting.



According to stats, Vietnam timber pellet manufacturing proliferates, with the manufacturing strength from 8ton/squre km to 13.4 ton/squre kilometres. It has go beyond the largest wood pellet production states in America, Georgia and also north Carolina.



This procedure doesn't make up various other markets depending on forestry resources, like paper mills as well as wood items mills. Some locations have big readily available forestry location yet reduced pellet manufacturing intensity. They might be prospects for brand-new timber pellet export capacity.



In all areas, the initial batch of wood pellet manufacturing facilities have the best mix of raw material distribution price as well as mill-to-port logistics, while new factories do not have these advantages. Their cost of raw materials and also logistic is higher than existing factories. Compared with America and Canada, Vietnam don't have large locations of potential forestry.




What's the future of timber pellet export in Vietnam?

With even more timber pellet plants are constructed in Vietnam, their competition on raw materials will certainly increase. With the increase of production expense, the timber pellet cost will certainly expand and also approach the worldwide market balance cost. Back then, the size of the Vietnam pellet export field will certainly maintain.



There will certainly be loan consolidation in Vietnam timber pellet market. Preponderant producers will get strong and also well-located plants, and the much less affordable plants will shut.



Newly constructed wood pellet plants will adopt first-rate design, devices, as well as procedures. They will certainly make high-quality wood pellets with lasting sources.



The capacity of Vietnam timber pellet producers is going to match with lasting contracts. Much more manufacturers will certainly export timber pellets to Japan according to long-term supply arrangements, and Korea policy will certainly evolve to sustain lasting supply agreements.


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