From the Director's Desk:

A January Fizzle

Last week the EIA published their first wood pellet production and sales data of 2022 with their release of the January 2022 Monthly Densified Biomass Fuel Report. The lackluster Heating Degree Day data we have been tracking all year seems to have finally come to a head with January sales and production. The month saw U.S. sales totals at just 116,046 tons, well off the 3-year average (2019-21) of 185,831. No region escaped the soft market conditions January offered with the biggest outlier being the south with just 12,281 tons showing up in the sales column. This figure was a sizeable enough departure from the three-year rolling average (44,207) that I’ve inquired with the EIA about a missed data point. Producers rolled out of the production throttle and produced just 129,081 tons, the lightest January production total since 2016.

The decision for skinny production was no doubt informed by producers watching their own inventories grow in December and despite lackluster sales, stored inventories did move (roughly 16,000 tons) in January. We finished the month with roughly 170,000 tons, a far more manageable number than the 200,000-plus tons we would have had if producers had logged even an average January from a production standpoint. The data accumulating this year is a stark reminder that in this business its all about the weather. I’m putting a note on my calendar for July 20 to see if the April 2022 data that is scheduled for release that day offer any indication of a month that found much of the country mired in a cool, slow to warm spring.

Looking at the Wood Pellet Sector through a Drinking Straw

Last Friday the broader wood pellet industry found itself once again in the crosshairs of the mainstream press as a major network ran a nearly 8-minute piece on industrial wood pellet production in the southeast. I’ve decided not to offer a link to the story as I rankle when other wood energy outlets amplify negative stories about our sector, so I’m not doing it. It's out there if you want to look for it. 

At this point in my career, I could write the script for these stories. I could certainly list the video and photo shots that will be featured. The selected imagery exposes the motivations of the reporter and this story was no different. The frustrating reality is that the story misses the big picture and this is, of course, intentional. I’m a big fan of magic and magicians will tell you that their art hinges on their ability to command your attention and look at what they want you to look at and more precisely and importantly, not look at what they don’t want you to look at. The story of wood pellet production, industrial or residential and BBQ pellets, cannot be told in an 8-minute spot. I did author a rebuttal which I delivered to the reporter and directed him to our “3-Facts” document. Truthfully, I doubt it gets much traction or even a response from the outlet. However, these documents can and should offer some utility to you and I’ve already heard from members that their customers and sales teams have found both helpful. 

I’ll close with this thought, all of the rancor around industrial wood pellet production can be connected to an unfortunate misunderstanding in the general population that our forests are at risk because of markets for wood products and the media has been co-opted into perpetuating this myth. The fundamental truth is that forest inventories in this country have grown in the last 100 years not in spite of, but because of strong markets. Talk to any forest products manufacturing association, forest landowner or forester or staff member at the U.S. Forest Service and you will hear the same thing. Every summer the impact of unmanaged forests is on full display in the American West. 

Be proud of our industry’s contribution to the forest products sector. We extend the value of every tree, capturing energy from what would otherwise be a waste stream and provide clean, renewable heating fuel for a million American households. Spoiler alert: you’ll hear none of that in the TV spot that aired last week.