Business Visit to Indonesia: Wood Pellets Market Potential

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abc machinery Indonesia Wood Pellet Market Research

Indonesia is well known for its wealth of wood and palm oil. This gives it a great market potential for wood/sawdust pellets production, palm fiber pellets production and palm oil processing.Owing to this, we sent our representative team during Aughust 19th and September 2nd 2018 to Indonesia with an aim of gaining close insight into the biomas fuel pellet manufacturing industry as well as animal feed industry. The visit team was made of the technical team and sales team representatives.

During the visit, our team conducted market research in local wood pellet manufacturing plant and feed mill plant as well as having a one on one discussion with our clients. Local clients from major corporations expressed pleasure in our visit siting our sincerity and strength in relevant areas. Talks with Indonesian clients revealed that some are very satisfied with our business project plan and made the initial payment on the spot.

Indonesia wood pellet mill business talks
Business Talks with our Clients

discuss about the wood pelletizing factory design with our customer
Project Discussion

our visiting team with our indonesia pellet mill clients
Face-to-face Communication with Local Customers


The Indonesia business trip bore fruits we can be proud of as a nation as besides making new partners, we gained a clearer understanding of local biofuel and animal feed market as well as promoting our own market and that of our clients.

Biomass Energy Potentials in Indonesia

forest cover of Indonesia
Forest Cover of Indonesia

Indonesia is located in the southern part of the Asian continent. According to the geographic description, Indonesia lies in a tropical region which makes its climate tropical. In a tropical climate, region forests grow very fast which makes that region suitable for agriculture and plantation.

Indonesia Total Primary Energy Consumption (2017)
Petroleum 38%
Coal 25%
Biomass & Wastes 18%
Natural Gas 15%
Hydropower 3%
Geothermal and other renewables 1%

In Indonesia plantation of a palm tree, rubber tree, coconut tree, and sugarcane is a very high level. As their production capacity is counted in millions every year till now date. Basic production of palm, rice, rubber tree, coconut tree, and sugar cane gives a big amount of residue which is actually a biomass. And this huge amount of biomass in Indonesia is an appropriate resource for producing biomass energy.

palm tree, rubber tree, coconut tree, sugarcane in indonesia

Main biomass resources in Indonesia are rice residue, palm oil residue, palm tree wood, sugar mill residue, veneer residues, and plywood residues. Apart from these main resources, there are many more sources from which biomass is generated in Indonesia that is logging residues, sawn residues, and agricultural residues. We can include municipal waste also because developing nation like Indonesia has lower and middle class living so the count of municipal residue is also high.

Abundant Bio-energy Resources in Indonesia

In Indonesia, palm trees are grown for industrial purpose only. As palm oil is used for cooking, cosmetics, industry, fuel, and export. So residue from palm oil tree is very high in a quantity which creates a big amount of biomass which is useful for generating biomass energy. Another source is palm oil wood which is of no use for any other products because it is poor in quality and its durability is very bad. So it is mainly used for making wood pellets. And wood pellets have very high demand in international market mainly from Belgium, Denmark, Netherlands, Sweden, and the USA.

compressing wood wastes into fuel pellets or briquettes
Compressing Biomass Wastes into Fuel Pellets or Briquettes

In fact, Indonesia gets financial benefits from exporting of wood pellets every year. Factors which makes Indonesia a big source of biomass There are many factors which makes Indonesia a big producer of biomass some of them are:

  • Availability of labor at cheaper cost.
  • Easy availability of raw material with lower cost.
  • Automatic wood pellet machines which reduce material waste.
  • High-quality machines reduce production cost and increase efficiency.
  • The demand for biomass generated pellets in the local and international market.
  • Plenty of raw material available all around the nation.


Utilization of Oil Palm Residues for Biofuel Purpose

If we see in over all the potential of Indonesia is very high in the production of biomass. Every year it is counted in millions and approximately it is going to increase in next two years more and more because as per environmentalists palm oil farm becomes useless for any other farming and to meet environment challenge more trees are to be replanted every year to stop the land from getting a barrel.

And replantation of palm oil tree means more and more palm oil and palm oil residue.
More palm oil wood and more production of wood pellets which is a good source of biomass energy.

Indonesia business houses from worldwide are investing just because of its palm oil tree and biomass potential of them. As they can easily count profit from Indonesia. Palm is in demand worldwide and because of biomass energy in Indonesia processing is palm oil is cheap and easily available.

making biomass pellets from oil palm fiber for burning
Turn Palm Wastes into Biofuel Pellets

Today Indonesia stands among big nations when the biomass potential of each nation is measured. Another reason of biomass potential of Indonesia is local people as in Indonesia even today local people live a life of normal middle class or if we compare to the developed nation they are at the lower level of living and this reduced labor costs in Indonesia and made raw material and less expensive. In Indonesia biomass is not only scattered in particular area but it is scattered all over the country and biggest sources are Kalimantan, Sumatera, Sulawesi, and lrian Jaya. These are the areas from where the big source of biomass is available and these are the places where biomass is kept to use for different purposes. This now clearly shows that Indonesia has biomass potential and in upcoming years Indonesia can compete for big nations in biomass production and its usage.

If you are planning to set up a wood pellet manufacturing factory in Indonesia and need suggestions about the business plan, plant design and equipment selection , don't hesitate to get in touch with us!