Pellet Supply Chain Management: Analysis of Changes

Abstract

This article aims to identify changes in the components of pellet supply chain management (SCM). The following research question is explored: To what extent are pellet supply chains changing? A research gap was identified in the use of pellets for energy and the analysis of safe management of logistics processes in the pellet supply chain (PSC). The study uses theoretical and empirical research methods: literature analysis and statistical methods covering the years 2017–2023 and scientific observation to obtain information about the facts, phenomena, and components of safe management of logistics processes in the PSC. The results of the study suggest that supply chains play a role as one of the main drivers of energy transition, and the PSC may be one of them. A modified PSC can contribute to more environmentally friendly procurement, leaner logistics, and tighter scheduling, reducing waste and emissions in existing energy systems without immediately changing the electricity/fuel mix.

1. Introduction

Biomass has been used as an energy source since the dawn of humanity and has played an essential role in human development. Combustion was the earliest method of converting wood biomass into heat, forming the foundation of early human energy use. After years of use, the current goal of biomass management is to reduce organic waste, especially that which will be landfilled, but also to obtain energy from it. The use of biomass for energy is particularly important in countries where agriculture plays a significant role in the economic structure. Local installations serving smaller groups of consumers are particularly justified. Although biomass is widely studied, relatively few publications focus specifically on pellets as a renewable energy source. Renewable energy in Poland is currently entering a period of dynamic growth. The development of technologies for obtaining energy from renewable sources is dictated by the European Union’s policy of supporting electricity production from these sources. In Poland, biomass occupies a dominant position among renewable energy sources (RES) [1]. The wider use of pellets in Poland’s fuel and energy sector will greatly help Poland to comply with stringent international agreements, EU directives, and national regulations related to environmental protection. Innovation and identification of changes are a necessity in SCM, especially for pellet suppliers and producers. Supply chains (SCs) in logistics remain underestimated. While changes in SCs and processes can reflect innovation, applying this to pellet supply chains (PSCs) is particularly challenging. The SC cannot be analyzed in isolation from the context in which pellet producers, suppliers, distributors, and customers operate. Interconnections in the new environment, using the Internet and new advances in artificial intelligence and machine learning, are creating new PSC structures in individual countries and regions. The SC cannot be analyzed without considering the broader context in which pellet producers, raw material suppliers, distributors, and end users operate. In the new market conditions, with the use of the Internet, artificial intelligence, and machine learning methods, new PSC structures are emerging in individual countries and regions. The mutual relationships between the participants in these processes are becoming increasingly dynamic and complex, affecting both the operational efficiency and competitiveness of the entire sector [2]. The aim of this article is to identify changes in the components of pellet supply chain management (PSCM). The research question is formulated as follows: To what extent are changes taking place in PSC? The aim of SCM is to increase efficiency while reducing warehouse and operating costs and adapting energy production to customer needs. Given the direction of development in the energy sector, which involves the promotion of energy from renewable sources, including pellets, increasing attention is being paid to pellet quality assurance systems. This involves supporting the implementation of quality standards that can be assessed on the basis of specific requirements included in certification systems. Independent verification should cover the entire SC from suppliers through pellet producers to distributors and end customers.

2. Literature Review

Bioenergy is now recognized as having the potential to play a key role in future renewable energy supplies, providing significant amounts of biofuels in gaseous, liquid, or solid form, as well as electricity and heat [3,4]. One of the most common sources of energy is biomass, which is widely used in the production of electricity and heat, and its importance in the renewable energy sector is constantly growing [5]. Burning biomass is the oldest and simplest method of converting biomass into usable energy [6,7]. Energy generated from biomass is one of the more reliable sources of renewable energy compared to solar or wind energy, which increases its importance for the development of renewable energy [8]. There are many types of biomass, and each type is used in different energy sectors. However, biomass as an energy source differs from other types of renewable energy sources. Both Polish and EU law classify biomass as a RES. According to the International Energy Agency, bioenergy from biomass is the most common type of renewable energy in the world. Biomass accounts for more than half (55%) of the global renewable energy production and more than 6% of the total global energy production [9].

The current state of global economies, growing populations, changing consumer demands and expectations, and evolving production processes utilizing automation, robotics, and AI are significantly influencing the growing demand for energy. This directly impacts the need to increase energy production (Figure 1) [10].

The distribution of both production and consumption presented in Figure 1 indicates variability in the distributions. The data indicate that in 2020, during the COVID-19 pandemic, the upward trend was disrupted. A return to an upward trend has also been visible since 2020, with a faster pace in supply. An analysis of the energy mix shows a similar phenomenon, except for bioenergy and renewables (Figure 2) [11].

The growing importance of pro-environmental activities has led to an increasing awareness of the need to diversify energy sources, moving away from those that generate the most CO₂ and degrade the natural environment, mainly based on renewable sources and bioenergy. The change in approach to energy manufacturing from RES meant that in 2023 it reached a level of 8931TWh, with bioenergy accounting for approximately 8% of this. Energy generated from renewable energy sources reached 24.5% in 2023, an increase of 1.5% compared to 2022. The percentage distribution of individual energy sources is presented in

Table 1. Share of individual energy sources in 2020–2023 [%].

Year	Bioenergy	Hydro	Solar	Wind	Other Renewables
2020	8.1	58.0	11.4	21.3	1.1
2021	8.3	53.9	13.3	23.3	1.1
2022	8.0	50.7	15.6	24.7	1.0
2023	7.8	47.1	18.3	25.8	1.0

[10].

Regardless of the share of renewable sources, global energy demand is growing. This is particularly evident in the US, where despite changes in consumption patterns in individual years (Figure 3), the trend is still growing and continuing [12,13].

Europe, including Poland, is more stable despite the variable distribution. In the years 2017–2023, as shown in Figure 4, the trend is downward [14,15].

It is worth noting that despite the fact that the statistical demand for renewable energy per capita is falling, its share in energy production is increasing, as shown by the trends in Figure 5 [10,16].

The variability in the distribution of energy production from renewable sources (

Table 2. Changes in demand in selected European Union countries in 2010–2023 [14].

	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023
EU	14.4	14.5	16.0	16.7	17.4	17.8	18.0	18.4	19.1	19.9	22.0	21.9	23.1	24.5
Poland	9.3	10.3	11.0	11.5	11.6	11.9	11.4	11.1	14.9	15.4	16.1	15.6	16.8	16.5
Denmark	21.9	23.4	25.5	27.2	29.3	30.5	31.7	34.4	35.2	37.0	31.7	41.8	42.4	44.9
Germany	11.7	12.5	13.5	13.8	14.4	14.9	14.9	15.5	16.7	17.3	19.1	19.3	20.9	21.5
Ireland	5.8	6.6	7.0	7.5	8.5	9.1	9.2	10.5	10.9	12.0	16.2	13.0	13.1	15.3
Spain	13.8	13.2	14.2	15.1	15.9	16.2	17.0	17.1	17.0	17.9	21.2	20.5	21.9	24.9
France	12.7	10.8	13.2	13.9	14.4	14.8	15.5	15.8	16.4	17.2	19.1	19.3	20.4	22.3
Italy	13.0	12.9	15.4	16.7	17.1	17.5	17.4	18.3	17.8	18.2	20.4	18.9	19.1	19.6
Portugal	24.1	24.6	24.6	25.7	29.5	30.5	30.9	30.6	30.2	30.6	34.0	34.0	34.7	35.2
Slovenia	21.1	20.9	21.6	23.2	22.5	22.9	22.0	21.7	21.4	22.0	25.0	25.0	25.0	25.1
Sweden	46.1	47.6	49.4	50.2	51.2	52.2	52.6	53.4	53.9	55.8	60.1	62.5	66.3	66.4
Norway	61.9	64.6	64.9	66.5	68.4	68.5	69.2	70.0	71.6	74.4	77.4	74.0	75.9	75.6

) could be due to many variables, ranging from the emergence of the COVID-19 pandemic to the variability of financial support from the state (various programs supporting pro-environmental activities), changes in requirements related to energy installations, and the variability of legal conditions.

The data in Table 2 indicate that in the period 2010–2023, there is no European country in which the upward trend would not be interrupted (data in red). This may mean that all countries, within the framework of a free market economy, may encounter factors that are more or less decisive (influential) in a given period for the political or economic situation. The geopolitical (military) situation may also have an impact on the share, as evidenced by data from Kosovo (Figure 6) [14].

Among the fuels used in the energy and heating sectors, only biomass in the broad sense has practical potential for electricity and heat producers, allowing them to meet climate neutrality requirements and achieve the required levels of energy efficiency [17,18].

Biomass is one of the key renewable energy sources, and its main advantage is the possibility of short-term storage and palletization. However, the limitations of these technologies, primarily related to the susceptibility of biomass to microbial degradation, moisture variability, and processing costs, favor the intensive development of thermolysis technology [19,20]. The products of thermal conversion of biomass—torrefied biomass and biochar—have physicochemical parameters that allow them to be used directly in energy installations without the need to modernize boilers [21,22]. Compared to raw biomass, they are more chemically stable, have lower chlorine, alkali, and ash content, are easy to grind, and have a calorific value at least equivalent to that of fine coal, which allows for long-term storage without the risk of quality degradation [23].

Poland’s Energy Policy until 2040 (PEP2040) identifies the development of renewable energy sources as one of the country’s priorities [24,25]. By 2030, it is assumed that RES will account for at least 23% of gross final energy consumption, with a particular increase in the importance of biomass as a renewable fuel [26,27]. Biofuels–defined as fuels produced from biomass processing–can be solid, liquid, or gaseous [28,29,30]. Solid biomass is currently the most commonly used form for heat and electricity production and is obtained primarily from wood and energy crops. Solid biofuels include mainly wood, pellets, briquettes, and straw, while gaseous biofuels include, among others, wood biogas and animal biogas [31,32]. Liquid biofuels, produced mainly through alcoholic fermentation and esterification, include, among others, biodiesel and bio-gasoline [33,34].

Fuel pellets, produced by compressing biomass under strictly controlled conditions of pressure, temperature, and humidity, are currently one of the most widely used solid biofuels [35,36,37]. They are classified according to the type of biomass used, with wood, straw, and sunflower pellets being the most common [38]. The most popular in Poland are wood pellets, produced from compressed sawdust from both coniferous and deciduous trees. The lignin contained in sawdust acts as a natural binder, giving the granules mechanical durability. The calorific value of wood pellets is usually between 15 and 18 MJ/kg, depending on the input materials and their degree of processing [39].

The dynamic development of the pellet market, which now extends across continents, requires an in-depth analysis of the raw material potential and the possibilities for using alternative raw materials. Traditionally, dry wood chips are the most desirable raw material, but in practice, wet sawmill sawdust is also used, which requires an intensive drying process [40,41]. Additional sources of biomass include wood chips, roundwood, short rotation crops, and bark. The processing of raw materials containing bark and fine fractions requires an increased number of preparatory steps, including grinding, separation of foreign matter, and cleaning, and can also lead to a significant increase in the ash content of the final product [42,43,44]. Herbaceous biomass, due to its significantly higher ash, nitrogen, sulfur, chlorine, and potassium content, generates additional operational risks related to corrosion, sediment formation, and pollutant emissions [45].

An important aspect of pellet production and use remains occupational health and safety. Biomass undergoes microbial decomposition and chemical oxidation, which can lead to heat generation and potential self-heating. During decomposition, non-condensable gases (CO, CO₂, CH₄) and volatile hydrocarbons are emitted, which poses a risk during transport and storage. At the same time, most solid biofuels are brittle and susceptible to abrasion, generating highly flammable and explosive dust—this is particularly true of wood dust, which is one of the most common causes of fires and explosions in the wood processing sector [46,47].

There are also environmental arguments against the use of pellets in the public debate, often raised by the fossil fuel sector. Attention is drawn, among other things, to the energy intensity of the palletization process and air pollutant emissions, including fine dust, especially in the context of low-power biomass boilers. However, the results of the latest research indicate that advanced technological solutions enable a significant reduction in dust emissions and improve the efficiency of biomass-fired installations [48,49].

In the context of pellet quality, European standards that specify technical requirements for fuels intended for installations with a capacity of less than 100 kWth are of key importance. In addition to the highest quality class A1, the standards include classes A2 and B, with class B corresponding to industrial pellets used in boilers with a capacity of over 100 kWth (

Table 3. Specification of wood pellets for non-industrial applications.

Property Class	Unit	A1	A2	B
Origin and source		Stemwood Chemically untreated wood residues	Whole trees without roots Stemwood Logging residues Bark Chemically untreated wood residues	Forest, plantation and other virgin wood By-products and residues from wood processing industry Used wood
Diameter, D a and Length, L b	mm	D06 ± 1.0 3.15 ≤ L ≤ 40 D08 ± 1.0 3.15 ≤ L ≤ 40	D06 ± 1.0 3.15 ≤ L ≤ 40 D08 ± 1.0 3.15 ≤ L ≤ 40	D06 ± 1.0 3.15 ≤ L ≤ 40 D08 ± 1.0 3.15 ≤ L ≤ 40
Moisture, M (EN 14774-1 and -2)	wt.%ar	M10 ≤ 10	M10 ≤ 10	M10 ≤ 10
Ash, A (EN 14775)	wt.% (d.b.)	A0.7 ≤ 0.7	A1.5 ≤ 1.5	A3.5 ≤ 3.5
Mechanical durability, DU (EN 15210-1)	wt.%ar	DU97.5 ≥ 97.5	DU97.5 ≥ 97.5	DU96.5 ≥ 96.5
Particle size distribution, F (EN 15149-1)	wt.%ar	F1.0 ≤ 1.0	F1.0 ≤ 1.0	F1.0 ≤ 1.0
Additives	wt.% (d.b.)	≤ 2 Type c and amount to be stated	≤ 2 Type c and amount to be stated	≤ 2 Type c and amount to be stated
Net calorific value, Q (EN 14918)	MJ/kgar or kWh/kgar	16.5 ≤ Q ≤ 19.0 or 4.6 ≤ Q ≤ 5.3	16.3 ≤ Q ≤ 19.0 or 4.5 ≤ Q ≤ 5.3	16.0 ≤ Q ≤ 19.0 or 4.4 ≤ Q ≤ 5.3
Bulk density, BD (EN 15103)	kg/m3	BD600 ≥ 600	BD600 ≥ 600	BD600 ≥ 600
Nitrogen, N (prEN 15104)	wt.% (d.b.)	N0.3 ≤ 0.3	N0.5 ≤ 0.5	N1.0 ≤ 1.0
Sulphur, S (prEN 15289)	wt.% (d.b.)	S0.03 ≤ 0.03	S0.03 ≤ 0.03	S0.04 ≤ 0.04
Chlorine, Cl (prEN 15289)	wt.% (d.b.)	Cl 0.02 ≤ 0.02	Cl 0.02 ≤ 0.02	Cl 0.03 ≤ 0.03
Arsenic, As (prEN 15297)	mg/kg (d.b.)	≤1	≤1	≤1
Cadmium, Cd (prEN 15297)	mg/kg (d.b.)	≤0.5	≤0.5	≤0.5
Chromium, Cr (prEN 15297)	mg/kg (d.b.)	≤10	≤10	≤10
Copper, Cu (prEN 15297)	mg/kg (d.b.)	≤10	≤10	≤10
Lead, Pb (prEN 15297)	mg/kg (d.b.)	≤10	≤10	≤10
Mercury, Hg (prEN 15297)	mg/kg (d.b.)	≤0.1	≤0.1	≤0.1
Nickel, Ni (prEN 15297)	mg/kg (d.b.)	≤10	≤10	≤10
Zinc, Zn (prEN 15297)	mg/kg (d.b.)	≤100	≤100	≤100
Ash melting behaviour, DT (prEN 15370)	°C	should be stated	should be stated	should be stated

) [50]. Industrial pellets are characterized by a larger diameter, higher ash, nitrogen, sulfur, and chlorine content, and lower calorific value, and therefore cannot be used in low-power devices due to the risk of damage [51].

The world’s leading wood pellet certification system, ENplus, guarantees high product quality. In 2022, the amount of certified pellets was 13.3 million tons, with total certified production exceeding 14 million tons. The ENplus system plays an important role in maintaining the trust of both professional customers and consumers, even in times of crisis. 2022 was a difficult year for the pellet market in Europe due to the energy crisis, price increases, and the ban on imports from Russia and Belarus, which caused disruptions in the supply chain [52,53,54,55].

Despite these difficulties, the certification system continued production, with Germany remaining the largest producer of ENplus-certified pellets in 2023 (over 3.5 million tons) and Austria maintaining second place (1.5 million tons). Poland, France, Spain, and Belgium follow in the ranking [56,57,58].

To a large extent, pellets as a source of energy worldwide (Figure 7), including in Poland, have become one of the most cost-effective solutions [10]. This is especially true given the growing demand in the residential sector, where pellets are used in households for heating purposes in solid fuel boilers (with manual and automatic fuel feeding), tile stoves, and air heaters (potbelly stoves, fireplaces).

Growing demand, particularly in Europe, has led to increased interest in production in Poland. The Polish pellet production market began to develop in 2003, and consumption in 2004 (Figure 8) [16,59]. Production growth was so progressive that in 2023 it reached a level of 2200 tons, compared to European production of 24,300 tons.

Consumption grew more slowly, reaching 850,000 tons in 2023, with European consumption at 30,000 tons. It is worth noting that in 2023, Poland, being the third largest pellet producer in Europe, had unused production capacity of 500,000 tons.

3. Materials and Methods

The literature review revealed a research gap indicating a limited number of studies on the assessment of various components of the pellet supply chain, from raw materials, through processing, transport, and storage, to delivery to the end user. The research problem was formulated as follows: to what extent are changes occurring in pellet supply chains PSC? The research area covered Europe and Poland, as one of the EU countries that is trying to use pellets for energy production.

The following research hypotheses were formulated:

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H1: The introduction of pellet raw material quality control contributed to changes in the pellet supply chain.

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H2: Longer storage and drying times for pellet raw materials contributed to changes in the pellet supply chain.

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H3: The implementation of pellet production automation contributed to changes in the pellet supply chain.

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H4: Changes in packaging systems and distribution channels affect the transformation of the supply chain.

-

H5: Proper warehouse management increases security throughout the supply chain.

Theoretical and empirical research methods were used in the study. From a theoretical point of view, literature studies, descriptive analysis, and comparative analysis were used to achieve the objective and solve the research problems for the purpose of data processing. Theoretical methods allowed for analytical examination, organization of the PSC, and description of the research material. In the research part, empirical methods in the form of scientific observation were used to gather information about the facts, phenomena, and components of safe logistics management in the PSC. The use of pellets for energy purposes enables compliance with strict environmental standards, particularly in terms of CO₂, SO₂, NOx, dust, dioxin, chlorine, and heavy metal emissions. In accordance with environmental protection regulations, a mixture of coal and pellets is treated as an environmentally friendly fuel. The use of pellet mixtures reduces CO2 emissions into the atmosphere. The emission balance is zero because during combustion, the amount of CO₂ released into the atmosphere is equal to the amount previously absorbed by plants from the environment. Due to the low nitrogen content in pellets, NOx emissions into the atmosphere are reduced compared to coal combustion. Factors to be taken into account in the logistics system are related to, among other things:

-

Type of pellets;

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Physical, chemical, and mechanical properties of pellets;

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Availability of raw materials;

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Number of suppliers of a given type of pellets;

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Technical transport capabilities;

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Warehouse capabilities;

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Pre-treatment capabilities prior to the conversion process;

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Economic and legal conditions, and environmental protection requirements;

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Location of energy production sites.

The PSC consists of the procurement process, i.e., the delivery of raw resources and materials for energy production and maintenance; the pellet production process; and the pellet distribution process. From a logistics perspective, it is essential that raw resources be supplied continuously. For this reason, management refers to all processes and entities in the chain, which should be interconnected.

4. Pellet Supply Chain (PSC)

The European quality certainty norm is divided into several parts. The aim of the prEN 15234 quality assurance norm is to facilitate effective trade in biofuels by ensuring that:

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End consumers can access fuel that meets their needs in terms of supply and quality;

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Producers/suppliers produce fuel with specific and consistent properties, accompanied by an appropriate description in accordance with customer requirements.

The quality assurance system is integrated with the SCM system to help suppliers document pellet quality and build trust between suppliers and end users. The SCM quality management system covers quality assurance, quality control, quality planning, and quality improvement throughout the SC. The EN standard covers SC quality assurance and information flowing from raw resource suppliers to end users to be used in product quality control, to ensure traceability and certainty exist by demonstrating that all processes throughout the solid biofuel SC, up to the point of supply to the consumer, are under control (Figure 9).

Quality assurance aims to ensure that consistent pellet quality is achieved at all times, aligned with customer requirements, starting with the raw materials. The most commonly used raw materials are softwood and hardwood.

4.1. Supply Logistics

Raw material supply is an integral part of pellet manufacturer logistics. In the case of in-house production, deliveries are made via pipelines, minimizing transport costs. When raw materials must be purchased, road transport (trucks with tilting platforms), rail, or sea transport is used. In relation to supply logistics, the following hypothesis was formulated:

H1. 

The introduction of pellet raw material quality control has contributed to changes in the PSC.

4.1.1. Softwood and Hardwood

Wood chips are a by-product of the sawmill or forestry industry and require grinding before palletization. Wood shavings and sawdust are usually ready for palletization, although a hammer mill is often used to standardize the particles. Drying is necessary for industrial wood chips and forest sawdust, while industrial wood shavings may require minimal drying. The lignin content in softwood increases the mechanical durability of pellets, while hardwood, with its lower lignin content and higher density, requires more energy during palletization. Industrial wood chips from sawmills are contaminated with minerals, which is due to the design of the warehouse facility (paved or unpaved). Therefore, the basic recommendation is to use a shed-type storage facility with a paved floor and/or another semi-open storage facility with protection against moisture. Contamination of wood chips may occur during harvesting or transport.

4.1.2. Bark

Bark, obtained mainly from sawmills and the paper industry, is characterized by a high ash and lignin content. It requires grinding and drying (moisture content 45–65% w.m.) before palletization. Bark pellets (class A2) are only suitable for industrial installations due to their high ash production (4–10 times more than wood). Briquetting is preferred due to the mechanical difficulties involved in grinding bark. Figure 10 shows the stages of the procurement process in the pellet supply chain.

Contamination of the raw material may occur at any stage of the procurement process, which is why quality control should be carried out in accordance with Figure 10.

4.1.3. Energy Crops

Annual energy crops and straw constitute herbaceous biomass, in which stems and grains are used for energy production. They are characterized by higher ash and concentrations (

Table 4. Concentrations of C, H, O, and volatile matter in various raw resources for pellet production.

Fuel Type	C wt.% (d.b)	H wt.% (d.b)	O wt.% (d.b)	Volatiles wt.% (d.b)
Wood chips	47.1–51.6	6.1–6.3	38.0–45.2	76.0–86.0
Bark	48.8–52.5	4.6–6.1	38.7–42.4	69.6–77.2
Straw	43.2–48.1	5.0–6.0	36.0–48.2	70.0–81.0
Miscathus	46.7–50.7	4.4–6.2	41.7–43.5	77.6–84.0

) of N, S, and Cl than wood, low ash melting temperature, and increased dust emissions, which limits their use in small installations [60].

The moisture content of the harvest drops from >50% DM to 10–20% DM after a few days of field drying, allowing palletization without additional drying. Mixing woody raw materials with herbaceous ones (e.g., willow with wheat straw) allows the production of good-quality pellets, mainly suitable for large installations (

Table 5. Parameters of pellet raw materials by type.

Type of Raw Material	Origin	Moisture Content at Harvest/Delivery	Lignin Content	Ash Content	Grinding Requirements	Drying Requirements	Comments on Pelletization	Typical Application
Industrial wood chips	Sawmill industry	30–45% w.m.	Medium–high (softwood)	Low	Required (for particle standardization)	Necessary	Mechanically durable, low abrasion	Small and medium scale, industrial energy
Wood chips	Forest	40–55% w.m.	Medium	Low	Required	Necessary	Similar to industrial energy consumption, higher energy consumption	Medium and large scale, industrial energy
Wood chips/sawdust	Wood industry	5–20% w.m.	Medium–high	Low	Usually ready for granulation	Depending on humidity	Homogeneous particles, high efficiency	Small and medium scale
Bark	Sawmills, paper industry	45–65% w.m.	High	High	Required (cutting mills)	Necessary	More difficult to process, high ash production	Only large-scale industrial use (class A2), briquettes
Energy crops	Energy-efficient crops (poplar, willow, alder)	50% m.c. (mature 10–20% w.m.)	Low–medium	Medium–high	Required	Field drying is usually sufficient.	Good in mixtures with wood, limited in small installations	Large scale, energy industry
Straw and whole herbaceous plants	By-products of grain harvesting	10–20% w.m. after drying	Low	High	Required	Field drying is sufficient	Not recommended for use alone in small installations, good in mixtures	Large scale, energy industry

w.m.—weight moisture (% by weight). m.c.—moisture content when fresh (% by weight).

).

Based on the analysis, hypothesis H1 was verified. The introduction of raw resource quality control upon pellet acceptance contributed to changes in the SC.

4.2. Raw Resource Warehouse Management

In relation to the warehouse of raw resource, the following hypothesis was formulated:

H2. 

Longer warehouse and drying times for pellet raw materials contributed to changes in the PSC.

Longer storage of sawdust and wood chips affects the bulk density, durability, and fine particle content of pellets, as well as energy consumption during pelletization. Studies have shown that sawdust stored for 4–6 weeks produces pellets with higher durability and density, even though energy consumption increases due to increased friction in the compression channel. Chemical processes such as the degradation of fatty acids and resins contribute to the improvement of the mechanical properties of pellets, although the correlation between chemical concentrations and product quality has not been fully established, requiring further research.

The moisture content of the raw material must be taken into account during storage: wood chips (5–14% moisture content) are drier than sawdust (up to 55% moisture content). Raw materials should be stored in closed facilities (silos, halls), as open storage increases the risk of moisture and biological processes that can lead to material degradation or spontaneous combustion.

Pellets should be transported in closed systems (pneumatic, screw) with separation of fine particles, which can be returned to production, minimizing losses and dusting.

Table 6. Relationships between factors in storage and transport.

Stage	Parameter	Range/Comments	Impact on Pellet Quality	Logistical Comments
Storage of raw materials	Storage time	4–6 weeks	↑ bulk density, ↑ durability, ↓ amount of fine particles	Longer storage increases energy consumption during pelletization
	Raw material moisture content	Wood chips: 5–14% m.c., sawdust: up to 55% m.c.	Optimal humidity minimizes degradation and spontaneous combustion	Store raw materials in silos or closed halls.
Pellet storage	Warehouse type	Silos, halls, enclosed spaces	Reduces moisture absorption and mechanical degradation	Avoid storing in open spaces
	Separation of fine particles	Filters, screening	Minimizes dust and energy loss	Dust can be returned to production
Transportation	Transport system	Pneumatic, screw, closed	Reduced mechanical degradation, less dusting	Fine particles returned to production
	Exposure to moisture	Minimizing contact with water	Preservation of the mechanical and energy properties of pellets	Important in international transport and loading

shows the relationships between storage, moisture content, and quality.

The impact of raw resource warehouse time on the bulk density, durability, and fineness of pellets, as well as on energy usage during pelletization. Pelletization tests with spruce and pine showed that longer warehouse has a positive effect on the bulk density, durability, and amount of fine particles in pellets, while energy consumption increases when raw resource are stored for longer periods. It is accepted that fatty acids and resins degrade through oxidation processes during warehouse, which then growths friction forces in the compression channel, leading to higher bulk density, durability, and energy consumption, and fewer fine particles. Pellets made from raw resource that are stored were more durable and had a higher bulk density. Variability in resin and fatty acid concentrations was found, but no direct correlation between these concentrations and pellet quality could be established. Therefore, other differences between fresh and stored raw resources are assumed, which require further research. Manufacturers’ experiences present this effect. It was found that sawdust stored for four to six weeks resulted in pellet quality that would otherwise only be achievable with the use of biological additives.

When storing, it should be noted that wood chips (with a moisture content of only 5–14% by weight) are drier than sawdust (with a moisture content of up to 55% by weight) upon arrival. If sawdust is to be used as a raw resource, it must be dried and then processed in the same way as wood chips in warehouse. The moisture content of appropriately dry material stored outdoors will increase under specified weather conditions. Therefore, wood chips, as well as dried sawdust, must be kept in closed facilities, i.e., silos or halls. Moist sawdust is stored in silos, halls, covered areas, or simply in the open. However, warehouse storage in the open air is not advised due to the risk of re-moisturization. It should be noted that during storage, many biological, chemical, and physical processes can occur that can have a negative effect on the material. Spores, fungi, and bacteria can multiply unexpectedly, the dry mass can degrade, and the entire mass can heat up. In the worst case, this can lead to spontaneous combustion. These processes happen quite quickly, so the warehouse period for moist sawdust should be as brief as possible. Each time pellets are transported, they are subjected to mechanical stress, which leads to abrasion and, consequently, the formation of dust. Therefore, pellets should be transported in closed systems (pneumatic, screw) with separation of fine particles. In this way, fine particles can be returned to the manufacturing process.

Based on the analysis, hypothesis H2 was verified: storing the raw material (from 4 to 6 weeks) and the transport system improves its quality in the PSC.

4.3. Production

Wood chips are becoming increasingly important because sawdust is not accessible in sufficient quantities to enable further expansion of pellet manufacturing capacity. The following hypothesis was formulated in relation to pellet production.

H3. 

The implementation of pellet production automation has contributed to changes in the PSC.

Therefore, a distinction should be made between sector wood chips with and without bark, as well as forest wood chips, which typically have bark. Figure 11 shows the stages of the pellet manufacturing process.

Stage 1: Size reduction

Reducing the size of the raw material to approx. 4 mm is a key stage in preparing biomass [61] for palletization. Proper granulation increases the homogeneity of the raw material, improves compression efficiency, and minimizes the risk of unburned charcoal in further energy use. Automation of this stage ensures fraction stability and reduces the proportion of non-standard particles, which improves pellet quality and reduces losses in the supply chain.

Stage 2: Drying

The raw material must reach the optimal moisture content for granulation technology (usually below the fiber saturation range of 18–26% w.m.). Automatic dryer control systems allow for precise adjustment of parameters to variable raw materials (wood chips with bark/without bark, sawdust, wood dust). Automated drying stabilizes the quality of the feedstock, reducing moisture fluctuations that later affect pellet stability during storage and transport.

Stage 3: Conditioning

Conditioning involves introducing steam or water, which increases the plasticity of lignin and improves mechanical strength. Optimal conditioning increases granulator efficiency and pellet dimensional stability (Figure 12). Automatic steam dosing and humidity control systems minimize operator errors and maintain consistent quality despite variable raw material parameters.

Stage 4: Pelletization

The compaction process in a ring or flat die transforms the raw material into uniform cylindrical granules. Automatic control systems for rotational speed, roller load, temperature, and raw material mixing allow for greater dimensional stability and minimize the risk of structural heterogeneity. Effective automation increases process efficiency and reduces the risk of failure, which stabilizes supply in the supply chain.

Stage 5: Cooling

After leaving the die, the pellets reach 80–130 °C and their mechanical strength is low. Countercurrent cooling lowers the temperature and reduces moisture by approx. 2%, improving the pellets’ resistance to breakage. Automatic cooling systems stabilize air and flow parameters, resulting in less brittleness during packaging and loading.

Stage 6: Screening

Screening removes dusty fractions that could impair transport quality, generate explosion risks, and reduce the commercial value of the product. Automatic dust extraction and fine particle recirculation systems reduce raw material losses and improve operational safety. Properly controlled screening prior to packaging increases supply chain durability by reducing dust in transport units (

Table 7. Identification of the stages of the pellet production process.

Production Stage	Main Task	Critical Parameters	Impact on Pellet Quality	Automation/Advantages for the Supply Chain
Size reduction	Grinding raw material to the appropriate fraction	Particle size 2–6 mm, uniformity	Improves compaction, reduces unburned carbon	Stable load, fewer losses, consistent quality for further transport
Drying	Reducing humidity to the optimal level	Humidity 18–26% w.m.	Prevents degradation, reduces crumbling	Precise humidity control improves supply chain stability
Conditioning	Moistening and plasticization of lignin	Conditioning time 10–20 min, additional 2% humidity	Increases mechanical durability and uniformity	Minimizes granulator failures, stable product quality
Torefaction/steam treatment	Improvement of energy and mechanical properties	Temp. 200–300 °C, pressure, absence of oxygen	Increases resistance to moisture, dusting <0.6%	Product more resistant to transport, long-distance deliveries possible
Pelletizing	Forming granules in a matrix	Pellet diameter, pressure, roller speed	Dimensional stability, homogeneity	Higher efficiency, less waste, consistent quality throughout the SC
Cooling	Lowering temperature and humidity	Granule temperature 80–130 °C, moisture reduction by ~2%	Reduces brittleness, improves durability	Reduces damage during packaging and transport
Screening	Removal of fine particles and dust	Fractions < 1 mm, dust removal	Reduction of dust and explosion risk, uniform product	Safe transport, fewer losses in storage and delivery

).

Based on the analysis, hypothesis H3 was verified. That the automation of pellet production increases the safety of pellet production and contributes to changes in the SC.

4.4. Distribution

Efficient logistics are the basis for global pellet distribution. In this context, the following hypothesis is formulated:

H4. 

Changes in packaging systems and distribution channels influence the transformation of the supply chain.

Pellets are distributed both in packaged form and in bulk. The retail segment mainly uses 10–25 kg bags and 1.0–1.5 m³ big bags, which provide protection against moisture, reduce dusting, and enable pallet transport. Although these solutions increase the unit cost, they are essential for distribution to small heating installations (Figure 13).

In countries with developed heating markets (Germany, Austria), bulk transport dominates. Filling pneumatic tankers and unloading at customer warehouses requires air filtration and flow control systems, which reduce dust emissions and the risk of overpressure. Vehicles equipped with integrated weighing systems enable precise control of deliveries. Internationally, pellets are transported in bags, containers, rail cars, and in bulk by sea. Twenty- and forty-foot containers enable economical bulk transport, especially from North America and South Africa. Rail transport, common in North America, is used to transport 85–100 ton loads from production facilities to transshipment ports.

The international (SC) involves four stages: (1) delivery of pellets to the port and temporary storage, (2) sea transport in ships with a deadweight tonnage of 1500–50,000 DWT, in which pellets are transported in dry, ventilated cargo holds, (3) unloading using port cranes or suction systems, and (4) further distribution by land, often ending in Europe with packaging in consumer bags for small customers (Figure 14).

Changes in the market—including the growth of ocean and container transport—have led to a significant restructuring of global supply channels, especially between North America and Europe, and Asia and Europe. Mechanical stresses arising during transport and transshipment promote the formation of fine particles and dust, increasing the risk of fire, explosion, and health hazards. The results confirm hypothesis H4—the evolution of packaging and distribution systems significantly changes the structure and security of the international pellet supply chain (IPSC).

4.5. Small-Scale Pellet Warehouse at End-User Facilities

Pellets, as a biofuel susceptible to mechanical and chemical degradation and moisture absorption, require a properly designed storage space. In the context of distribution, the following hypothesis was put forward:

H5. 

Proper storage management increases security throughout the supply chain.

In small-scale installations, pellets are usually stored in closed warehouses located in the basement, as close as possible to heating devices. Stoves and compact heating systems have small integrated tanks that provide several hours or days of automatic operation, while warehouses for central heating systems are designed with a monthly autonomy in mind. For ease of use, the storage volume should be 1.0–1.5 times the annual fuel demand, which is achieved by using basement rooms, underground tanks, or composite tanks installed inside or outside the building.

When designing storage rooms, building regulations, adequate separation from the boiler, and geometry that minimizes dead space should be taken into account. Long, narrow rooms promote the gravitational sliding of pellets towards the feeder. Space utilization efficiency depends on the configuration of the installation and can reach 85%.

For a standard 15 kW heating system, the annual demand is approximately 5500 kg of pellets. With a bulk density of 625 kg/m³, this corresponds to 8.8–13.1 m³ of usable volume and 10.3–15.4 m³ of total storage volume. With a room height of 2.2 m, this results in a base area of 4.7–7.0 m².

Design guidelines vary between standards. The ÖKL 66 guideline assumes 1.0 m³ of usable volume per kW of heating power, which at 15 kW gives 15 m³ (approx. 17.6 m³ total volume, 8 m² base area). The ÖNORM M 7137 standard provides for lower values–0.6–0.7 m³ per kW, which translates into 9.0–10.5 m³ of pellets and 10.6–12.4 m³ of total storage capacity (4.8–5.6 m² of base area) [62].

These results indicate that the standards differ in terms of precision and conservatism, with ÖKL 66 providing more unambiguous design parameters than the broader ÖNORM standard.

4.6. Warehouses at Companies and Intermediaries

Pellet storage in silos is a key element of the logistics infrastructure in solid biofuel supply chains, especially when energy demand is high. Agricultural silos with capacities ranging from 50 to 10,000 m³ are mainly used in situations requiring increased buffering capacity. Loading is usually carried out by belt conveyors, and the drop height is limited by the use of stream deflectors or deflecting mechanisms. In complex systems, above-ground remote-controlled conveyor systems are used, equipped with deflectors that direct the raw material to selected tanks; an alternative is telescopic conveyors with controlled discharge.

In response to the growing scale of the pellet market, underground storage systems based on pneumatic unloading have been developed. The most important solutions include spherical structures emptied from below and cylindrical tanks emptied from above. The cylindrical shape allows for maximum use of the available volume, and the top intake eliminates the need for a conical bottom, reducing the risk of voids in the material. Top access facilitates maintenance, and the underground location reduces infrastructure requirements, eliminates dust emissions into the building, and reduces loss of usable space. The disadvantage is the high investment cost.

Vertical silos with flat bottoms use circulation screws to transport fuel to a central unloading point. Despite lower construction costs compared to conical silos, this solution is less efficient in terms of emptying and has high operating costs due to the need for frequent maintenance of the screws.

Type A industrial storage facilities, designed to store 15,000–100,000 m³ of pellets, are an economical option for handling very large volumes. Loading is carried out by means of telescopic conveyors suspended from the ceiling, and the material is stored on a flat floor. When the warehouse is located on the premises of a power plant, the pellets are transported by front loaders to boiler feeding systems; in ports, they are transported to hoppers and then by road or rail. However, this method is a significant source of pellet degradation and dust formation.

The empirical analysis confirmed hypothesis H5, according to which properly designed and operated pellet storage management is one of the key safety factors in the supply chain of this fuel.

5. Conclusions

Analysis of the data presented indicates that the pellet supply chain is undergoing profound structural changes resulting from both the characteristics of the raw materials and growing quality, logistical, and environmental requirements. The main conclusions include the following:

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First, the range of raw materials used is expanding, which requires greater flexibility in production processes. Variations in moisture content and material fractions necessitate investment in drying, grinding, and bark separation equipment, which modifies the organization of raw material supplies and affects inventory planning.

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Second, there is a shift in responsibility for storage in the supply chain from producers to intermediaries and wholesalers. Producers, who often have limited storage space, rely on a dispersed buffer infrastructure, which creates a need for better coordination of flows and more advanced market monitoring. At the same time, new storage technologies are being introduced, including synthetic fiber tanks and underground pellet tanks, which reduce costs and improve storage parameters.

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Third, the stability of supplies is increasingly based on transport infrastructure of national and international importance. Ports, railways, and distribution networks are key elements in compensating for seasonal fluctuations in demand and local supply constraints. This requires the expansion of transport and storage capacity outside the place of production and greater use of the potential of international trade.

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Fourth, the market is undergoing clear qualitative segmentation. Higher normative requirements for A1 pellets and the differentiation of product parameters for individual and industrial customers are influencing the standardization of logistics, storage, and production processes. Quality standards are becoming a key factor in determining the organization of the SC.

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Fifth, there is a need to integrate environmental objectives into the supply chain. The changes concern procurement criteria, supplier qualifications, and logistics indicators, which should reflect decarbonization objectives. The SCM transformation also includes investments in low-carbon transport technologies and the modernization of the energy infrastructure of chain participants. These trends indicate a shift from viewing logistics as a tool for efficiency to treating it as an instrument supporting energy transition.

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Sixth, the importance of systematic monitoring of supply, inventories, and market fluctuations is growing. Market observations and seasonality analyses are prerequisites for maintaining security of supply, especially in the absence of a coordinated storage strategy at the sector level. In this context, individual users play an important role, as they increase the resilience of the supply chain by storing fuel for 1–1.5 seasons, especially during the heating season.

In systemic terms, the limitation remains that analyses based on national data do not reflect regional, sectoral, or short-term dynamics. The lack of complete, comparable data makes it difficult to build economic models that optimize PSC and prevents correlation with key socio-economic indicators. The role of pellets in the energy transition and the resilience of their supply chain also remain insufficiently recognized.

For this reason, future research should focus on alternative supply chain configurations, causal policy assessments, microdata on orders and emissions, and distributional impact analyses. This will allow for a more accurate assessment of the quality, timeliness, and stability of supplies within the PSC, as well as determine their potential in the decarbonization process.