Paper Pallets Market (2021-2026)

Paper Pellets Market Overview

Paper Pellets Market size is estimated to reach $721.4 million by 2027, growing at a CAGR of 5.1% during the forecast period 2022-2027. Paper pellets can be delineated as small-sized rigid balls made by compressing wasted papers which include cardboards, filled copies, discarded newspaper, and tattered documents. The process of making paper pellets begins with grinding large papers with the help of a hammer mill; the step is followed by drying, where papers are dried to a moderate limit so that there remains nearly 12 to 15 percent moisture in them. Pellets are then prepared using a pellet machine. According to a report, nearly 40 to 43 percent of harvest wood is used by the paper industry; therefore, paper pellets have emerged as one of the prominent sources of saving trees by recycling paper. Not just trees but paper pellets are quite environmental-friendly too since littered discarded papers pollute the environment by discharging toxic substances into the environment and take up a large room owing to their lower density. Owing to the high presence of fibers, papers are being used as a pellet fuel in boilers and stoves. Proliferating demand for lightweight materials, growing environmental concerns, campaigns to save trees, growing usage as a biofuel, soaring demand for renewable sources of energy, and easy availability owing to bettering retail infrastructure are factors set to drive the growth of the Paper Pellets Market for the period 2022-2027.

Report Coverage

The report: “Paper Pellets Market Forecast (2022-2027)”, by Industry ARC, covers an in-depth analysis of the following segments of the Paper Pellets Market.

By Pellet Type: Block, Flush, Perimeter base, and Stringent.

By Runner: 2-way and 4-way runner.

By Material: Cardboard, Corrugated, and Kraft Paper Pellet.

By Application: Biofuel, organic pesticides, Personal care, Food and beverages, Shipping & Logistics, and Others.

By Distribution Channel: Offline and Online.

By Geography: North America (U.S., Canada, and Mexico), Europe (Germany, UK, France, Italy, Spain, Russia, and Rest of Europe), Asia-Pacific (China, India, Japan, South Korea, Australia & New Zealand, and Rest of Asia-Pacific), South America (Brazil, Argentina, Chile, Colombia, and Rest of South America) and Rest of World (the Middle East and Africa).

Key Takeaways

• Geographically, the Europe Paper Pellets Market accounted for the highest revenue share in 2021. The growth is owing to the widescale use of environment-friendly packaging, firm commitment by governments to phase out coal in order to reduce carbon emissions, high awareness among consumers regarding the existence of such products, and well-established retail infrastructure.
• Lightweight nature which is perfectly aligned with reduced fuel cost, environment-friendly, rising demand as a renewable source of energy in Asian countries, ameliorating retail infrastructure, booming shipment industry owing to e-commerce services are said to be preeminent drivers driving the growth of the Paper Pellets Market. Hampered production owing to the covid-19 and water vulnerability is said to reduce the market growth.
• Detailed analysis of the Strength, Weaknesses, and Opportunities of the prominent players operating in the market will be provided in the Paper Pellets Market report.

Paper Pellets Market Segment Analysis-By Application

The Paper Pellets Market based on the application can be further segmented into Biofuel, organic pesticides, Personal care, Food and beverages, Shipping & Logistics, and Others. The shipment and logistic segment held the largest share in 2021. The growth is owing to overwhelming growth in the retail industry after the beginning of e-commerce services. Thanks to online shopping, as consumers we can shop online any hour of the day. As a result, shipment companies always find themselves in rush-hour traffic. Courier express and parcel services deliver thousands of parcels on daily basis. Moreover, using paper pellets instead of wooden or metallic pellets helps companies save their fuel cost; moreover, it is quite an environment-friendly choice. Supply chain Companies like DHL laid out their plans to deliver services without generating harmful greenhouse gases by no later than 2050 which is likely to fuel the market. Furthermore, logistics along with biofuel and organic pesticides are estimated to be the fastest-growing segment with a CAGR of 6.3% over the forecast period 2022-2027. This growth is owing to the replacement of chemical fertilizers with more natural and organic options to save the organic content of the soil and the rapid adoption of paper pellets for cooking purposes.

Paper Pellets Market Segment Analysis-By Distribution Channel

The Paper Pellets Market based on distribution channels can be further segmented into offline and online. The offline segment held the largest share in 2021. The growth is owing to a wide-ranging presence in both developed and underdeveloped areas. As offline channels extend conveniences like instant purchases, hassle-free returns, bulk buying, and quality checks, people prefer buying from them. On the contrary, online or e-commerce services are bound to certain requirements such as full-fledged infrastructure for their smooth functioning; otherwise, it is not viable for them to offer doorstep deliveries. In addition to that, the growing existence of modern outlets like supermarkets has gravitated the attention of billions worldwide since their well-established nature, lucrative sale deals, and one-stop solutions. Nevertheless, online is projected to be the fastest-growing segment with a CAGR of 6.7% over the forecast period 2022-2027. The growth is owing to augmenting trend of work-from-home jobs. Owing to WFH jobs people don’t get much of a chance to go outside, they are turning toward e-commerce services. In addition to that, booming technological advancements like Google maps and e-banking services, the time-saving nature of e-commerce purchases, and expanding smartphone users are the factors behind the market expansion.

Paper Pellets Market Segment Analysis-By Geography

The Paper Pellets Market based on Geography can be further segmented into North America, Europe, Asia-Pacific, South America, and the Rest of the World. Europe held the largest share with 33% of the overall market in 2021. The growth in this segment is owing to the factors such as high attentiveness regarding environmental health as the majority of the population is literate, soaring demand for environmental-friendly packaging, extensive use of online shopping, and round-the-corner presence of modern retail outlets like supermarkets. However, Asia-Pacific is expected to be the fastest-growing segment over the forecast period 2022-2027. This growth is owing to the thriving retail industry. China and India are two of the most populous nations on planet earth. Nearly, 3 billion people call these countries home as of 2022. Additionally, bettering retail infrastructure with deep penetration of internet in rural areas and growing prevalence of supermarkets has been another reason for the market hold. Also, unlike developed western nations, many countries like Nepal, India, Pakistan, and others still use stoves for cooking food; therefore, paper pellets open up possibilities of a cheaper and environment-friendly fuel option for them. Nevertheless, rising disposable incomes and enlarging size of the middle-class are likely to fuel the market in the said region.

Paper Pellets Market Drivers

• Massive deforestation and rising environmental calamities enhance the industry expansion.

According to a report, every year more than 15 billion trees are being axed down globally and over the past 12,000 years, nearly 45 to 46 percent of trees around the world have been chopped down. The world tree cover stat reached 25.8Mha in 2020 which once used to be 3.92GHa in 2010. The paper industry has an overwhelming contribution to growing deforestation worldwide as approximately 42 percent of harvested wood globally is taken into account to make paper. Deforestation is directly responsible for some of the major environmental calamities like the heightened amount of greenhouse gases in the atmosphere, desertification, shrinking agricultural land, soil erosion, and flooding. Therefore, in order to curb the pace of such tragedies governments are promoting more and more recyclability of papers which is likely to drive the paper pellet market.

• Augmenting e-commerce services and the broadening use of paper pellets as biofuel are expected to boost product demand.

Paper pellets have the capacity to replace the fuel in stoves and furnaces in homes, schools, and marketplaces. Moreover, it can lower the cost of energy. On another hand, the growing shipment industry is another prominent driver driving the aforementioned market. Amazon is deemed to ship nearly 1,600,000 packages on daily basis. The figure is likely to proliferate as the company is expanding its presence by entering new markets across the globe. A report claimed Amazon logistics, in the U.S., had delivered more than 4 billion parcels in 2020, the figure has witnessed a steep rise of nearly 2.1 billion as compared to 2019. Similarly, other major shipment companies in the U.S. like USPS and FedEx delivers billions of parcel every year. The growing number of smartphone users in developing nations like India and China is likely to fuel the market astoundingly.

Paper Pellets Market Challenges

• Strangled production activities owing to covid and water vulnerability of paper pellets are anticipated to hamper the market growth.

Owing to harsh pandemic restriction enforced by governments across the globe has created a big gap between demand and supply chain by hampering production activities. Reduced employees and obstructed raw material supplies chain are two major factors responsible for this. According to a report, in 2021, total hours worked globally reduced by 4.3 percent as compared to pre-pandemic levels. The percentage is equal to a total of 125 million full-time jobs. On another hand, paper pellets as compared to wooden or metallic, are easily penetrable by moisture and water which is anticipated to challenge the steady growth of the market.

Paper Pellets Market Industry Outlook:

Product launches, mergers and acquisitions, joint ventures, and geographical expansions are key strategies adopted by players in the aforementioned Market. Paper Pellets market top 10 companies include-

1. Smurfit Kappa Group
2. Eltete Malaysia Sdn Bhd
3. Green Level Packaging
4. Honey Shield Emballeurs
5. DNA Packaging Systems
6. YOJ Pack-Kraft
7. DS Smith Plc
8. Conitex Sonoco
9. Oji Holdings Corporation
10. Tat Seng Packaging Group

Recent Developments/Product Launches:

• In October 2021, Dublin, Ireland-based renowned corrugated packaging firm “Smurfit kappa” announced the successful acquisition of Northern Italy-based containerboard mill “Verzuolo.” A payment of 360 million euros was made by Smurfit in order to bring the acquisition to a close. The transaction is likely to uphold the company’s packaging portfolio.
• In July 2021, London, United Kingdom-based multinational packaging company “DS Smith Plc” announced the sale of its Netherland-based paper mill “De Hoop” to another De Lier, Netherland-based packaging firm “DE Jong Packaging.” The total value of the transaction stands at around 50 million euros.
• In August 2019, a Hungary-based unit of UK-based renowned packaging firm DSM Smith Plc announced that the company has commenced the production of paper fiber pellet at its base which is based in Fuzesabony, Hungary. The production has started following an investment of 3 billion Hungarian forints.

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