German Pellets goes to America. The largest wood pellet manufacturer in Europe is building its first pellet plant in the United States. In Tyler County, East Texas, the company intends to manufacture 500,000 metric tons of wood pellets per year. This was announced by the company this week in the context of the Interpellets exhibition in Stuttgart. The first pellets will be produced in the third quarter of 2012. In the coming years, German Pellets plans to further expand its production capacities in the U.S.

The United States is an attractive location due to its timber resources. The southeastern U.S., with its mild climate and fertile soils, has significantly higher forest-growth rates in cubic feet per acre than Europe. “This high volume of raw materials makes the region attractive for us and supplements our existing sources of supply,” said Peter Leibold, CEO of German Pellets. In addition, the paper and pulp industry in the region has significantly reduced its production levels and even closed entire facilities, meaning that sufficient quantities of wood are available on a long-term basis and at reasonable prices. Supply contracts for the required quantities have already been signed with local forest owners.


Canada is currently the largest exporter for the European power plant market. Last year, the Canadians exported roughly one million metric tons of wood pellets to the European market, which accounted for approx. 75 percent of the total Canadian production volume. Canada plans to start using a larger percentage of its wood pellets for its own energy production. Furthermore, producers from British Columbia are exporting more pellets to Asia. This opens up new sales opportunities for German Pellets in Europe. The shipping distance from the new German Pellets facility is just over half of the distance pellets are shipped by Canadian competitors.

The pellet plant for German Pellets Texas, LLC, is being built on the approx. 80-hectare (198-acre) site of a former wood-chip mill. “One advantage of building on this site is the possibility of using the existing supply structures and infrastructures, especially with respect to raw material supply,” said Peter Leibold. German Pellets can also take advantage of the large number of skilled workers from the local wood industry. Roughly 250 jobs will be created, both directly and indirectly, through the construction of the pellet plant in Tyler County. The pellets from the U.S. plant will be transported by ship to Europe via a nearby port.