Higher long-term prices seen for wood biomass

purchasing.com
Tom Stundza -- Purchasing, 3/31/2010 2:14:48 PM

Forest Economic Advisors sees strong demand ahead
Production and prices of wood-based energy products will be on an upward trajectory from 2010 through 2024, forecasts Forest Economic Advisors of Westford, Mass. "A developed and diversified wood-based energy sector will have a profound impact on the economics of the entire forest products industry," says the research firms' senior economist, Erik Kankainen.

He says long-term demand will be strong for bioenergy from wood pellets, biomass-based electricity and other biofuels. Interestingly, he sees increased use ahead for logging residues in the years to come so that all biomass grades will experience price increases after 2012. His forecast predicts that a post-recession surge in housing starts in an improving economy over the next several years will boost residue production, returning almost 90% of the supply that was lost from 2005 to 2009 by the end of 2012.

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