The global biomass pellets market size was valued at USD 9.60 billion in 2024 and is projected to grow from USD 10.17 billion in 2025 to reach USD 16.27 billion by 2033, growing at a CAGR of 6.04% during the forecast period (2025–2033). As an alternative to fossil fuels, biomass pellets are gaining traction globally for power generation, heating, and industrial applications, supporting the worldwide transition towards carbon neutrality and sustainability.
The principal driver supporting biomass pellets market expansion is the growing urgent need to reduce greenhouse gas emissions and shift towards carbon-neutral energy sources. Biomass pellets, derived from organic waste like agricultural residues, wood chips, and sawdust, offer a sustainable and renewable energy solution. Their carbon-neutral nature and efficient combustion characteristics make them a compelling alternative to coal and natural gas in power plants and heating systems.
Additionally, the volatility and rising costs of fossil fuels have accelerated corporate and residential adoption of biomass pellets, as they provide a more stable and economical energy source. The circular economy principles encouraging waste-to-energy conversion further bolster biomass pellets’ appeal. Growing government initiatives, subsidies, and policy backing to promote clean energy and reduce environmental impact are also significant contributors to the market's growth.
Innovations in biomass pellet production technologies such as steam explosion treatment, torrefaction, and densification have improved pellet quality, energy density, and uniformity. These advancements enable the use of a wider range of raw materials, improve combustion efficiency, and promote integration of biomass pellets in industrial and power sectors.
Modern pellet machines offer higher throughput, multi-material processing capabilities, lower maintenance costs, and longer operational life, facilitating large-scale production and supporting the rapid growth of the biomass pellets market while enhancing sustainability.
