German Pellets is coming to America. The largest wood pellet manufacturer in Europe is building its first pellet plant in the U.S. in Tyler County, East Texas. The company intends to manufacture 500,000 metric tons of wood pellets per year, with the first pellets produced in the third quarter of 2012. German Pellets plans to continue to expand its production capacities in the U.S.
According to German Pellets, the U.S. is an attractive location due to its timber resources, and especially the southeastern U.S. with its mild climate and fertile soils, and significantly higher forest-growth rates in cubic feet per acre than Europe.
“This high volume of raw materials makes the region attractive for us and supplements our existing sources of supply,” says Peter Leibold, CEO of German Pellets. In addition, the paper and pulp industry in the region has significantly reduced its production levels and even closed entire facilities, meaning that sufficient quantities of wood are available on a long-term basis and at reasonable prices, according to German Pellets, which also reports that supply contracts for the required quantities have already been signed with local forest owners.
Following ramp-up at the new Texas plant, German Pellets anticipates increased production capacity of up to 2 million metric tons per year in the medium term. The pellets from the U.S. plant will be transported by ship to Europe via a nearby port.
The pellet plant for German Pellets Texas, LLC, is being built on a 198 acre site of a former wood-chip mill. “One advantage of building on this site is the possibility of using the existing supply structures and infrastructures, especially with respect to raw material supply,” says Leibold. German Pellets can also take advantage of the large number of skilled workers from the local wood industry. Roughly 250 jobs will be created.