Vietnam’s Eastwood Energy JSC and Sweden’s CellMark Group signed a long-term contract in Ho Chi Minh City on August 8 to supply wood pellets to the Japanese market.

At the signing ceremony (Photo: VNA) 

Under the contract, the first of its kind inked by the two sides, at least 300,000 tonnes of wood pellets will be shipped to Japan each year as from 2021. 

 Pham Trung Cang, Chairman of Eastwood Energy, said Vietnam has huge potential for wood pellets production, adding that with a wooden furniture market worth about 20 billion USD, the production of pellets from by-product of wood processing will bring about many opportunities to businesses. 

 Eastwood Energy aims to export over 500,000 tonnes of wood pellets to the Republic of Korea (RoK) and Japan in 2019, and at least 300,000 tonnes to the Japanese market alone in 2021, he said. 

 According to Cang, wood pellets exported to Japan must satisfy technical standards set by the picky market and be certified by the Forest Stewardship Council that requires businesses and consumers to identify, purchase and use wood, paper and other forest products made with materials from well-managed forests and/or recycled sources.

 Craig Jackson from CellMark said Japan is expected to overcome the RoK to become the largest wood pellets consumer in Asia in 2021 and its demand may double that of the RoK in 2023. 

 Last year, CellMark purchased 324,600 tonnes of wood pellets from Eastwood Energy, up from over 19,800 tonnes in 2015. 

 In Vietnam, the Swedish group is one of the pioneers in promoting the export of wood pellets, accounting for 25 percent of Vietnam’s total wood pellet export volume last year.

 The group is seeking Vietnamese suppliers of this product for the Japanese market on a long-term basis.