Supply chain Flashcards
• What do they look like, smell like, feel like? Are they poisonous, can they explode, are they otherwise dangerous?
Not poisonous, but extremely flammable. The whole point of a wood pellet that it is there to be burnt. If you leave it alone in a silo, if you leave it alone and a spark is there it will make it go up in flames.
Three types: wood pellet, wood chip and pks
What is a wood chip?
Wood chip - Wood chips are small pieces of wood that have been cut to between 5mm and 50mm (measured in the direction of the grain). This is preferred over larger twigs and dust-like particles.
What is a wood pellet?
Wood pellet
Wood pellets are made up of sawdust or fine shavings of wood extruded under pressure so that the wood resin binds the material into cylindrical shapes between 6mm and 10mm in diameter and 10mm to 30mm long.
Less variation in moisture content and physical form than a wood chip
What is PKS?
Palm kernel shell: of the oil palm fruit. In the palm oil press the palm kernel shell is separated from the kernel and become biomass residue. Now making palm kernel shell pellets is becoming hot in pellet making industry in Southeast Asia and European countries.
How are they used?
Biomass is used for baseload grid demand - base load and peak load.
How are they transported?
V similar to agriculture,
Just like any other commodity, free flow put into a bulk carrier, it also trucked, and then shipped.
Pellets is done by tonne.
The bulk ones are loaded on, but some are bagged but that’s premium, ship in bulk and bag it when you get to the port is most popular.
We price on a CIF basis, Antwerp, Rotterdam, Amsterdam. (CIF - Cost insurance fright)
Flow characteristics make them easier to deliver (they can be blown through pipes from a long distance)
How are they stored?
Storage is really expensive because of the competition with grain and other commoditises that can afford to put in higher offers.
Cool conditions,
Larger storage facilities are in the ports themselves.
In the uk its liverpool, birmingham, Tyne.
What are the three largest producing countries and the three largest consuming countries?
Producing: USA, Canada,Baltics, Portugal, Russia, Belarus
Veeber - largest producer in the world, Fram renewables
Canada - pinnacle, were, but got bought by Drax.
We don’t have enough forestry in the UK
Baltics - graanul - Latvian origin, don’t talk to press or argus media. Black box. Produce a lot of pellets because of forestry
How much of the commodity is produced per year, and how much of that is traded?
60mn t is produced worldwide per year,
Eu is 30 mn, SK and japan is equal to that - and we don’t know how much is traded its so illiquid. Most of it is locked into long term contracts.
How are they produced?
Wood pellets are made of sunflower husks, bagas in brazil, waste from sugar cane industry, it’s a waste product that’s burnt that creates electricity.
All good wood goes to the furniture world etc, low quality and waste from the saw mills like when they
- cut up timber and logs the sawdust can be used and collected to make pellets which happens in the baltics.
- Any tree stumps or forest waste or fires or bark beetle infestation, in Sweden which kills the tree. Once it has killed the tree it cant be used for construction or furniture it can only be used for wood and energy purposes.
Dry it and press it into those pellets.
Some kind of pressing
