Aug 04, 2008. /Lesprom.com/. Emerging biomass markets will significantly strengthen demand for wood fiber in the South, driving prices higher for forest products as the United States turns to alternative fuels for energy.

Lumber

Southern forest industry braces for bioenergy

Aug 04, 2008. /Lesprom.com/. Emerging biomass markets will significantly strengthen demand for wood fiber in the South, driving prices higher for forest products as the United States turns to alternative fuels for energy, Forest2Market reported. The new demand will be fueled by wood-burning power companies that produce and sell electricity to public utilities, as well as an increasing amount of wood pellets that are exported to European energy markets. The development of new facilities that turn biomass into cellulosic ethanol for transportation fuel will also impact the forest products industry. As a result, demand for wood fiber from these emerging markets is expected to climb from 2 million tons in 2008 to at least 13.5 million tons in 2020, according to Forest2Market, a provider of pricing information and analysis for forest products. However, the estimate is conservative, and it could be adjusted higher as more companies announce plans to build biomass facilities. The primary supply for the growing demand is pulpwood and wood chips, and prices for pulpwood and chips are expected to rise. Secondary sources include construction and demolition debris, as well as leftover woody biomass from harvesting operations, such as tree limbs.