A few weeks ago, we've conducted a survey to gather data on the current impact of coronavirus pandemic on ENplus® certified companies and to provide information on possible future fluctuations in the market of high-quality wood pellets. A total of 93 certified companies from 21 countries (most of which based in Europe) have participated, ensuring a good representation of the pandemic impact on the small and medium-sized wood pellet business.
The results found that 75% of the certified producers and traders have been negatively affected by the COVID-19 pandemic, with 2 out 3 companies already planning the introduction of new pellet prices for end users.
More than half of the negatively affected producers and traders point out the reduction in end user demand as the most significant consequence so far. An assumption could be made that this will be the main reason for a decrease in production and trade that more than half of the participating companies expect in the coming months until the end of the year.
Alongside the negative trend, it should also be noted that the pandemic brought some opportunities for a limited amount of certified companies (about 5% of respondents). Contrary to the majority, most of these companies report an unusual increase in end-user demand during the first half of 2020.
In fact, these market variations could be one of the reasons for the expected changes of pellet prices for end users. Almost 36% of the respondents plan a small price increase, while another 26% of companies intend to decrease the prices till the end of 2020. In both cases the new pellet prices will most probably introduce a difference of up to 20%. The collected data indicates also that the chances for a price increase or decrease are expected in all parts of Europe so all end users on the continent might be affected by these changes almost equally.
The survey also found that local government aid is available according to 71% of respondents but less than half of them plan to apply for it. Government aid was reported for countries like Italy, Spain, Poland, Netherlands, the United Kingdom, Belgium, Hungary, Croatia and more.