Pellet prices rise 35 percent as wood processing slows

Pellet prices in Vorarlberg have risen 35 percent in a year as a decline in wood processing has reduced supplies of raw material, ORF reports. Pellets remain cheaper than heating oil, the industry says.

A tonne of pellets now costs an average of 420 euros net, up from 312 euros a year ago. An average detached house uses about five tonnes over a heating season.

Pellets are made from compressed wood shavings, a by-product of processing timber into products such as boards. Less wood is being exported and less is being built locally, reducing wood processing and the supply of shavings, said Bernd Hagen of Ländle Pellets.

At current prices, heating a detached house for a season with pellets costs about 2,400 euros gross. Heating it with the equivalent amount of oil would cost around 4,500 euros, about 80 percent more, Hagen said.