By: Rubina Obaid

“Wood pellet producers have a great interest in the Asian biomass market while keeping a tab on the rising PKS market which is going to impact the wood pellet demand in the coming years”

Residues of palm oil industries are one of the most important sources of renewable energy fuel specifically in Southeast Asia. There is a massive growth of biomass due to the fast development of these industries. Throughout the value chain of palm oil, there is an overall surplus of by-products, however, the utilization of these by-products is pretty low. Palm Kernal Shells or PKS are the shells that are left after the nut is removed by the palm oil mills. It is a fibrous material and can easily be handled in bulk quantity quite easily. The moisture content of palm kernel shells is very low as compared to other biomass residues and it is accounted for high heating value, making it a perfect candidate for biomass fuel.

Therefore, wood pellet producers have a great interest in the Asian biomass market and they keep a tab on the rising PKS market which is going to impact the wood pellet demand in the coming year specifically in Japan. The research reflects that 60% of planned Japanese biomass power projects use PKS for 20 MW. However, Japanese biomass plants want to replace wood pellets with PKS, as their major source of energy for power generation. As currently, 50-85% of their biomass supply is dependent upon wood pellets. Increased PKS supply will reduce the demand for wood pellets and an overall reduction of usage in the region.

Until now PKS has greatly surpassed wood pellets demand but there is an uncertainty in future availability when the demand aggravates even more. Over the last year, the Asian biomass market has faced a sharp surge in demand for PKS and turned as on the most sought option for renewable energy. Whereas the fragmentation of the PKS market and small domestic players made it difficult to have more credible partners for imports. Asian biomass is one of the huge sellers of palm kernel shells, coconut shells, rice husk, and PKS pellets.

Asian biomass is based in Indonesia having its headquarter in UK and connections in many different countries. With an objective to overcome the supply discrepancies in the market and a reliable and bankable seller of PKS and related products in different countries.  In doing so meticulous trading practices are being followed with great transparency to the market. Presently, seven million tonnes of Kernal Shells are coming out of Indonesian mills every year and sold worldwide to use as a cost-effective source of biomass.

Unlike other biomass resources, PKS has the lowest downtime for burning and releases a large amount of carbon at once, while taking minimum time in the regrowth of new fruit bunches. Thus, starts sequestering carbon back from the atmosphere and they are harvested three times a year. It is going to bring a massive change in Asian countries to reach climate neutrality, and help to address the global warming hazards. Specifically, in the countries where they have switched from coal to biomass for the sake of positive environmental change. Apart from electricity generation, PKS is also used to produce other forms of bioenergy through the thermochemical process. In this process, organic materials are chemically decomposed at a high level of temperature. PKS is playing a pivotal role in helping countries to be on the track with climate neutrality goals. However, it needs to be a more efficient and transparent supply chain to improve the quality of its pellets while making it safer alternative for the environment.

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