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Production of pellets: The billion-dollar industry of the future

Recently, in Nghe An and Quang Nam, there have been many large-scale pellet production factories with modern production lines, with an investment capital of 200-300 billion VND/factory. Although still quite new in Vietnam, according to forecasts, Vietnam’s wood pellet exports saw rapid increases in recent years and were expected to become one of the agro-forestry products which touched a revenue of $1 billion.

Mr. Nguyen Thanh Phong, general director of Phu Tai Bioenergy JSC (Binh Dinh), said: In 2021, Vietnam's export of pellets will reach 3.5 million tons with a turnover of more than $413 million.

In 2022, the export of this product will reach nearly 4.7 million tons, with an export turnover of more than USD700 million, up 35% in volume and 81% in value compared to 2021. Currently, Vietnam has become the second-largest exporter of pellets in the world. It is forecasted that Vietnam's pellet exports will reach USD1 billion in 2023.

In Nghe An, Biomass Fuel Vietnam Co., Ltd., invested by a Japanese corporation to build a pellet factory in 2016 and completed it in 2019 with a total investment of VND300 billion. The plant start operating in 2020, with a design capacity of 160,000 tons of pellets per year.

Mr. Eisuke Nomura, General Director of Biomass Fuel Vietnam Co., Ltd., said that the pellet production line was imported from Europe. Planted wood is chopped into small chips then finely ground, cooled, and pressed into pellets.

Regarding the output market, Mr. Eisuke Nomura said that currently 100% of pellets are exported to Japan by Biomass Fuel. In the near future, together with the Japanese market, the company will export pellet products to the EU.

Mr. Nguyen Kim Vui, CEO of the pellet plant of Dung Quat Energy Corporation, said that two machinery lines at the factory were imported from the Netherlands, with an investment of VND250 billion. The factory's capacity reaches 20,000 tons of pellet products per month, ie 240,000 tons per year. The factory's pellet products are exported to Japan, Korea, and the EU.




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