Evaluating quality and price dynamics of wood pellets in the Portuguese market: Impacts of geopolitical and economic factors

The 1970s oil crisis led to a chase for alternative fossil fuel alternatives in Europe and the wood pellets were invented, though only in de 1990s gained acceptance as a dependable source of energy and needed standards to ensure quality and fair-trade conditions. Our study focused on the standard ISO 17225-2, a worldwide standard focused on evaluating pellet quality. For this work, data about prices of pellets in Germany, France, Austria and Portugal were collected. Raw materials are limited in Europe as a result of the conflict between Russia and Ukraine, which raises wood pellets prices. Portuguese prices are oddly high compared to the rest of Europe as Portuguese producers prefer to export instead of internal consumption. These findings uncovered that 3 brands of pellets don't meet the requirements for A1 class pellet. • Unprecedented price increases observed in the Portuguese wood pellet market, peaking at €10.2 per bag in November 2022. • Price fluctuations reflect rising demand, raw material scarcity, and geopolitical tensions, aligning with EU market trends. • Over half of Portugal's wood pellet production exported, highlighting the market's significant role in international trade. • Maritime pine and eucalyptus are main raw materials, and its increased demand impacts pine wood industry's sustainability. • Portugal's high VAT rates compared to other European countries rises wood pellet prices, affecting domestic affordability.