A review of Maine’s pulpwood and biomass markets Fastmarkets RISI Woodfiber & Biomass Markets Senior Editor William Perritt 540‐810‐8725 [email protected] Pulpwood and biomass market drivers 2018‐2Q/2019 Deep freeze spurs biomass and pellet demand. Cogen burn rates higher, bio pricing supported. Winter ended with untimely thaw, snow, PMs reached out to neighboring woodbaskets. Verso announces softwood line restart at Jay, est. 1 mm tons. NH biomass bill veto pummels bio market, most producers shut. T&D Wood Energy announces 35k ton/yr pellet mill, Sanford. NH biomass bill veto overridden, power plants restart. Summer pulpwood market easy with good weather. Quotas on. Softwood line restarts at Jay. ND Paper buys Old Town mill, will use softwood (1 million tons/yr approx.), restart 2Q/19. Corinth wood pellet mill burns down, 280,000 tons/yr biomass gone. Pulpwood and biomass market drivers 2018‐2Q/2019 ReEnergy closes Fort Fairfield and Ashland power plants. Eliminates 800,000 tons/yr biomass. Remaining are Stratton and Livermore Falls (about 900,000 tons/yr biomass). Restarts at Jay and Old Town renew infrastructure capacity concerns. Again with NH: Political stalemate thanks to ratepayer group stymies PPAs, power producers falter again. Meanwhile, ReEnergy closures put biomass market in “tailspin.” Bark piles up, chippers reportedly go on the market. Spring pulpwood markets dicey, weather‐related. Quiet slowdowns taken, and spot markets show $70/ton hardwood (del.). Last check in July: Biomass demand down and cogens switching to nat gas for price Long, wet spring upped delivered pulpwood prices on distance, trucker shortage of concern. “Posturing” reported around restart at Old Town. Maine wood prices 2018‐2Q/2019 US$/green ton del. Ave. Fastmarkets RISI Woodfiber & Biomass Markets 55
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“Fear and Loathing” among traditional pulpwood and biomass consumers amid high fossil fuel costs ($5/gal diesel fuel). Red Shield at Old Town closes, 800,000 tons hardwood. Katahdin Paper goes out, full mill shut. Verso takes out capacity at Bucksport. 2009, pulp and paper meltdown across NA, 30 million tons pulpwood impact. Wausau takes down machine at Jay. Domtar Woodland idles indefinitely (est. 1.5 million tons wood), reopens with black liquor credit. Old Town restarts under Patriarch Partner (Old Town Fuel & Fiber) with $30 mm DOE grant. BCAP, and the Northeast was the region to watch… Domtar sells Woodland to International Grand Investment to make pulp for Chinese concern, capacity increases nearly 20%. Pulpwood and biomass market drivers 2008‐2012
Verso breaks ground on bio expansion at Bucksport. Katahdin Paper announces closure at East Millinocket. Natural gas prices start dropping, and will hinder biomass for this point forward. Maine wood prices 2008‐12 US$/green ton del. ave. Fastmarkets RISI Woodfiber & Biomass Markets 70
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20 1Q/08 2Q/08 3Q/08 4Q/08 1Q/09 2Q/09 3Q/09 4Q/09 1Q/10 2Q/10 3Q/10 4Q/10 1Q/11 2Q/11 3Q/11 4Q/11 1Q/12 2Q/12 3Q‐12 4Q‐12 Hardwood roundwood Spruce/fir roundwood Hog fuel Pulpwood and biomass market drivers 2013‐2017
2013 opens with biomass pricing reacting to new Verso boiler, then in the fall, Burgess starts buying for 750,000 ton/yr wood power in NH. Thermogen announces torrefied pellet mill in Millinocket; never happens. Lincoln Pulp & Tissue closes following explosion (450,000 tons/yr hardwood). Great Northern Paper at East Millinocket idles. Market responds to new bio demand and an upswing in natural gas prices. ReEnergy reopens Ashland 39 MW power plant (former Boralex). Verso Bucksport closes (est. 450,000 tons/yr roundwood and chips). Old Town F&F closes, reopens shortly thereafter under Expera. Log and chip export plan announced, Maine Woods Biomass Export. Never happens. Expera closes Old Town after short run. Pulpwood and biomass market drivers 2013‐2017
Verso shuts softwood line at Jay. Covanta closes biopower plants in Jonesboro, Enfield. Impact 500,000 tons/yr biomass. Madison Pulp & Paper announces closure. MA begins rolling in efficiency rules which effectively preclude stand‐alone biomass sources. Three wood power plants restart first of 2017, benefitting from $13.4 million biomass “bailout.” Stored Solar announces conversion of E. Millinocket to wood CHP/biorefinery. Doesn’t come to pass. “42 Railroad Avenue” to restart 24 MW biopower in Staceyville. Seems dead. Maine wood prices 2013‐17 US$/green ton del. ave. Fastmarkets RISI Woodfiber & Biomass Markets 60
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20 1Q/13 2Q/13 3Q/13 4Q/13 1Q/14 2Q/14 3Q/14 4Q/14 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 2Q/16 3Q/16 4Q/16 1Q/17 2Q/17 3Q/17 4Q/17 Hardwood roundwood Spruce/fir roundwood Hog fuel Maine wood prices 2008‐2Q/2019 US$/green ton del. Ave. Fastmarkets RISI Woodfiber & Biomass Markets 70
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20 3Q‐12 4Q‐12 1Q/08 2Q/08 3Q/08 4Q/08 1Q/09 2Q/09 3Q/09 4Q/09 1Q/10 2Q/10 3Q/10 4Q/10 1Q/11 2Q/11 3Q/11 4Q/11 1Q/12 2Q/12 1Q/13 2Q/13 3Q/13 4Q/13 1Q/14 2Q/14 3Q/14 4Q/14 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 2Q/16 3Q/16 4Q/16 1Q/17 2Q/17 3Q/17 4Q/17 1Q/18 2Q/18 3Q/18 4Q/18 1Q/19 2Q/19 Hardwood roundwood Spruce/fir roundwood Hog fuel Thank you! William Perritt Senior Editor Fastmarkets RISI Woodfiber & Biomass Markets 540‐810‐8725 [email protected]