Fuelwood Market Size, Share & Trends Analysis Report By Source Type (Natural Forests, Plantation Forests, Agroforestry), By End Use (Residential Heating & Cooking, Industrial Heating), By Region, And Segment Forecasts, 2025 - 2030

Fuelwood Market Summary

Despite global efforts to transition to modern energy sources, fuelwood remains a reliable and affordable option for millions of households, particularly in nations like India, Nigeria, and Ethiopia, where traditional cooking practices and economic constraints sustain its widespread use. Several factors are driving the growing demand for fuelwood. Economic constraints and limited infrastructure in rural areas make fuelwood an accessible choice compared to electricity or LPG. Moreover, cultural practices and traditional cooking methods still rely heavily on wood-based fuels. In addition, the rising prices of alternative energy sources and the push for energy self-sufficiency in some regions have further supported the use of locally sourced biomass. In some cases, even urban communities are turning to wood pellets and briquettes for heating due to high electricity tariffs or supply instability.

Recent innovations in the fuelwood industry aim to address environmental and efficiency concerns. Technologies such as improved cookstoves reduce emissions and increase combustion efficiency, significantly lowering fuel consumption. The development of compressed biomass briquettes and pellets as standardized fuel products has helped streamline distribution and storage. In addition, digital tools and mobile apps now enable better tracking of supply chains, while reforestation and sustainable harvesting programs are being integrated into policy frameworks to promote renewable sourcing. These upgrades are helping the fuelwood sector transition toward a more sustainable and regulated future.

Market Concentration & Characteristics

The fuelwood industry is largely fragmented, with a high concentration of small-scale and informal suppliers, especially in developing countries. Most of the production and distribution occur at the local or regional level, with limited presence of large, organized players. This results in varying pricing, inconsistent supply chains, and limited regulatory oversight. However, in some developed regions and urban centers, the market is becoming more structured with the emergence of biomass pellet producers and improved cookstove manufacturers. Government initiatives and NGOs are also playing a role in shaping the market through sustainable forestry programs and rural energy access projects.

In terms of product substitutes, fuelwood faces growing competition from liquefied petroleum gas (LPG), electricity, biogas, and solar-powered cooking solutions. These alternatives are often cleaner and more efficient, but are not always accessible or affordable in remote or low-income regions. Compressed biomass products like briquettes and pellets are also emerging as popular substitutes, offering similar utility with reduced environmental impact. While modern energy options are gaining ground, fuelwood remains dominant in many areas due to cultural preferences, cost considerations, and infrastructure limitations. As awareness and access to cleaner alternatives increase, the fuelwood industry may gradually shift, but for now, it continues to be a critical energy source for millions.

Source Type Insights

The natural forests segment led the market with the largest revenue share of 51.5% in 2024, due to their widespread availability, accessibility, and minimal management requirements. In many developing regions, rural communities rely on nearby natural forests for wood collection, often through informal or subsistence-level harvesting. These forests offer a low-cost, readily available source of biomass fuel without the need for investment in cultivation or infrastructure. In addition, weak enforcement of forest management regulations in several countries has led to unchecked extraction from natural reserves, reinforcing their dominance in the fuelwood supply chain.

The plantation forests segment is anticipated to grow at the fastest CAGR of 4.1% during the forecast period, driven by increasing concerns over deforestation, biodiversity loss, and environmental degradation caused by over-reliance on natural forests. Governments and environmental agencies are promoting sustainable fuelwood production through managed plantations that offer predictable yields, reduced ecological impact, and better regulatory compliance. Plantation forests can be specifically cultivated with fast-growing species like eucalyptus or acacia, allowing for more efficient harvesting cycles. This controlled approach supports both environmental goals and growing fuelwood demand, making plantations a key focus area for sustainable biomass sourcing.

End Use Insights

The residential heating and cooking segment led the market with the largest revenue share of 54.7% in 2024, due to the heavy reliance on biomass by rural and low-income households in developing regions. In many parts of Asia, Africa, and Latin America, fuelwood remains the most accessible and affordable energy source for daily domestic needs. The cultural preference for wood-based cooking methods, coupled with limited access to clean energy alternatives like LPG or electricity, has further entrenched fuelwood use in residential settings. Government subsidies on improved cookstoves and community-level distribution systems have also reinforced their widespread adoption in the household segment.

The industrial heating segment is anticipated to grow at the fastest CAGR during the forecast period. As industries, especially in agro-processing, textiles, and small-scale manufacturing, seek cost-effective and renewable energy sources, fuelwood and biomass are increasingly being adopted for thermal energy needs. Rising fossil fuel prices and stricter emission norms are also pushing industries to explore biomass-based heating as a sustainable alternative. With improved fuelwood processing methods (such as pellets and briquettes) offering consistent quality and higher combustion efficiency, the shift toward industrial applications is accelerating, driving rapid growth in this segment.

Regional Insights

The fuelwood market in North America is relatively niche but stable, primarily driven by residential heating in colder regions. The use of wood-burning stoves and fireplaces remains popular in rural areas and among environmentally conscious consumers seeking renewable heating alternatives. The market is more structured compared to developing regions, with regulated supply chains, sustainable forestry practices, and increased adoption of wood pellets and briquettes.

U.S. Fuelwood Market Trends

The fuelwood market in the U.S. is supported by demand for residential space heating, especially in the Northeast and Northwest regions. A growing segment of environmentally aware consumers and off-grid households continues to use wood as a renewable heating source. Furthermore, the U.S. leads in biomass pellet production, with a portion of it being exported for industrial use in Europe, positioning the country as a key player in the global biomass supply chain.

Europe Fuelwood Market Trends

Europe dominated the fuelwood market with the largest revenue share of 59.68% in 2024, as it is a major consumer of fuelwood and biomass products, largely due to strong government support for renewable energy and climate goals. Many European countries offer subsidies for biomass heating systems, driving the demand for fuelwood, pellets, and briquettes in both residential and industrial sectors. The region's focus on reducing carbon emissions has led to increased adoption of modern biomass technologies and stricter regulations around sustainable forestry and emissions control.

The fuelwood market in Germany plays a leading role in the European market, driven by its strong commitment to renewable energy and energy transition goals (Energiewende). Fuelwood is widely used for both residential heating and in district heating systems. The country also emphasizes sustainable forestry practices, ensuring a regulated supply of biomass. Continuous innovation in biomass boilers and efficient heating systems further fuels demand in both rural and urban sectors.

Asia Pacific Fuelwood Market Trends

The fuelwood market in Asia Pacific is driven largely by its large rural population, significant dependence on traditional biomass, and widespread use of wood for residential cooking and heating. Countries like India, Indonesia, and Bangladesh have millions of households that rely on fuelwood as a primary energy source due to limited access to modern fuels. Government-led clean cooking programs and the introduction of improved biomass technologies are gradually transforming the market. Still, traditional fuelwood usage remains deeply entrenched, especially in remote and low-income areas.

The China fuelwood market holds a substantial share within Asia Pacific region in 2024, due to its vast rural landscape and historical reliance on biomass for domestic energy needs. While urbanization and modernization have reduced the use of fuelwood in cities, many rural and mountainous regions still depend on it for heating during the winter. In recent years, China has promoted biomass energy through renewable energy policies, leading to the growth of commercial wood pellet use for industrial heating and power generation.

Central & South America Fuelwood Market Trends

The fuelwood market in Central and South America remains an essential energy source for cooking and heating, particularly in rural and indigenous communities. Countries like Brazil, Peru, and Guatemala still rely heavily on wood due to limited infrastructure for electricity and clean fuels. While modern energy adoption is growing, the informal fuelwood industry remains strong, driven by affordability and cultural preferences.

Middle East & Africa Fuelwood Market Trends

The fuelwood market in the Middle East & Africa has a significant growth, particularly in Sub-Saharan Africa, where it remains a primary energy source for millions of households. In countries like Nigeria, Ethiopia, and Sudan, fuelwood is essential for daily cooking needs. The lack of energy infrastructure and high poverty levels contribute to continued reliance on traditional biomass. Efforts by NGOs and governments to introduce cleaner cooking solutions are underway, but face challenges in scaling across vast rural populations.

Key Fuelwood Company Insights

Some of the key players operating in the market include Enviva Inc. and Drax Group plc.

• Enviva Inc. is one of the largest producers of industrial wood pellets, a refined form of fuelwood used primarily for renewable energy production. The company sources sustainably harvested wood from natural and plantation forests, converting it into pellets that serve as a cleaner alternative to coal in power plants globally. Enviva plays a crucial role in the fuelwood industry by promoting biomass as a key component of the global transition to renewable energy, especially in Europe and Asia.

• Drax Group plc is a UK-based energy company heavily invested in biomass energy, including fuelwood in pellet form. Drax operates one of the world’s largest biomass power stations, using sustainably sourced wood pellets to generate renewable electricity. The company is pivotal in transforming traditional fuelwood into high-efficiency, low-carbon energy solutions, aligning with Europe’s climate goals and helping reduce dependence on fossil fuels.

Pinnacle Renewable Energy, Lignetics, Inc., are some of the emerging market participants in the fuelwood industry.

• Pinnacle Renewable Energy is a leading North American producer of wood pellets, supplying both residential and industrial markets. Their pellets are derived from sustainably managed forests and provide a renewable substitute for traditional fuelwood. Pinnacle supports the fuelwood industry shift toward cleaner, more efficient biomass fuels by offering consistent-quality pellets used in heating systems and power generation across multiple continents.

• Lignetics, Inc. is a prominent U.S. manufacturer and supplier of wood pellets, firelogs, and firewood products mainly targeting residential heating and recreational markets. The company emphasizes producing high-quality fuelwood products that burn efficiently and cleanly, appealing to consumers seeking affordable and renewable heating alternatives. Lignetics contributes to the fuelwood industry by enhancing product availability and encouraging the use of biomass fuels in homes.

Recent Developments

• In 2023, Enviva Inc. announced that it is constructing its 11th wood pellet production facility in Epes, Alabama. Once operational, this plant is projected to add 1.1 million metric tons per year to Enviva's production capacity, making it the world's largest wood pellet production plant.

Fuelwood Market Report Scope

Global Fuelwood Market Report Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global fuelwood market report based on source, end use, and region.

• Source Type Outlook (Revenue, USD Million, 2018 - 2030)

  • Natural Forests

  • Plantation Forests

  • Agroforestry

  • Others

• End Use Outlook (Revenue, USD Million, 2018 - 2030)

  • Residential Heating & Cooking

  • Industrial Heating

  • Power Generation

  • Others

• Regional Outlook (Revenue, USD Million, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • UK

    • France

    • Italy

    • Spain

  • Asia Pacific

    • China

    • Japan

    • India

    • South Korea

  • Central & South America

  • Middle East & Africa