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Table 3 Common characteristics of pellet mill wood procurement for three types of supply chains

From: Assessing the wood sourcing practices of the U.S. industrial wood pellet industry supplying European energy demand

Characteristic Type 1—large mills sourcing a large proportion of feedstocks from pulpwood size roundwood Type 2—medium to large mills linked to a sawmill providing a large proportion of total feedstock as secondary residuals Type 3—smaller mills sourcing 100% of feedstock as secondary residuals
Feedstock procurement
 Contracts with large industrial forest ownerships for primary sourcing A small portion (10–20%) of the supply Contracts with large industrial forest ownerships for a significant (50–100%) portion of the supply of primary fiber No contracts with large industrial forest ownerships
 Reliance on wood dealers Significant reliance on wood dealers to provide primary and secondary fiber Insignificant reliance on wood dealers Significant reliance on wood dealers
 Sourcing of secondary residues Sourcing secondary fiber from multiple sawmills and re-manufacturing facilities Direct sourcing of secondary residues from a sawmill either owned by the same company or by a partner in joint venture Supply chain is nearly entirely built around secondary fiber, sourcing from several sawmills and other wood product facilities, from a large area
Risk assessment (RA) feature
 Use of external consultants and publicly available data for risk assessment (RA) RA usually completed by external consultants using publicly available data RA usually completed by external consultants using publicly available data RA usually completed by external consultants using publicly available data.
 Level of integration Commonly feature RAs directly integrated into procedures of primary fiber procurement and indirectly integrated into secondary fiber procurement Commonly feature RAs directly integrated into primary fiber procurement –
 Standards used for RA RA is done to standards of PEFC CS, FSC CW, and SBP RA is done to standards of PEFC CS, FSC CW, and SBP RA is done to standards of PEFC CS, FSC CW, and SBP
 Coverage RAs cover area from where primary fiber is sourced and attempt to cover sourcing area for other suppliers (i.e., sawmills providing secondary fiber) RAs cover area from where primary fiber is sourced and attempt to cover sourcing area for other suppliers (i.e., sawmills providing secondary fiber) RAs attempt to cover sourcing area for all suppliers (i.e., sawmills providing secondary fiber)
Risk mitigation
 General picture Considerable variation among mills, use of several measures Comprehensive use of risk mitigation through certification Limited risk mitigation
 Avoidance of risk identified in RAs Yes, for primary fiber Yes, for primary fiber RAs encompass geographic area of secondary residual suppliers or RAs not conducted
 Sourcing from FM-certified forests Yes, for primary fiber. Sourcing mainly from certified industrial forests vs. uncertified non-industrial forests Yes, for primary fiber. Sourcing mainly from certified industrial forests vs. uncertified non-industrial forests Very limited sourcing of primary fiber
 Inspecting a portion of harvest by pellet mill staff Yes, for primary fiber Yes, for primary fiber –
 Inspecting via questionnaires and/or site visits a portion (10–100%) of residual supplier records and sourcing practices Yes Yes –
 Use of quota systems limiting the amount of non-FM-certified fiber Yes, for primary fiber. Use of quota system to encourage fiber from certified forests – –
 Use of independently managed group certification programs Yes. Including offering to certify the landowners supplying roundwood to sawmills providing pellet mill residuals Yes. Including offering to certify the landowners supplying roundwood to sawmills providing pellet mills residuals –
 Use of supply volume-based agreements that include feedstock sourcing specifications Yes, for primary fiber. Some instances where contracts with sawmills are cited as evidence of risk mitigation Yes, for primary fiber. Some instances where contracts with sawmills are cited as evidence of risk mitigation –
 CoC, including PEFC CS and FSC CW Yes, for primary fiber Yes, for primary fiber One company with a number of pellet mills of supply chain type 3 reportedly requires that suppliers of secondary fiber use PEFC CS and FSC CW certifications
 RA with suppliers Yes, for primary fiber. RAs with suppliers (e.g., wood dealers and wood residual suppliers) Yes, for primary fiber. RAs with suppliers (e.g., wood dealers and wood residual suppliers) Yes, some companies extend their RAs to the supply-base of all residual suppliers
 Use of trained loggers Yes, for primary fiber Yes, for primary fiber –
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