Wood pellet prices rise again this autumn, but demand starts easing
As the heating season approaches, wood pellet prices in Latvia remain well above last year's levels, though industry representatives report demand is starting to stabilize with possible price drops later in autumn.
For homeowners in Latvia who heat with wood pellets, early autumn brings the same recurring question: how much money will heating cost this winter. A discussion spreading on social media highlights that not everyone can afford to pay several hundred euros at once for a full season's supply of pellets, with many buying in smaller batches tied to their paydays. Some commenters suggest setting money aside for fuel as early as spring, while others point out that people living paycheck to paycheck often don't have that option. The discussion also touched on practical alternatives, including returning to firewood, installing heat pumps, or combining heating systems, as well as reminders that low-income households can apply for municipal housing benefits that factor in heating costs.
A year of price swings
Last December, household pellet prices stood at around €240 per tonne excluding VAT. During the cold winter that followed, shortages pushed prices at some retailers as high as €380–450 per tonne. Prices kept climbing over summer, rising roughly 30% by July, driven largely by strong demand from Poland, where traders were stockpiling for the next heating season. According to Didzis Palejs, head of the Latvian Biomass Association LATbio, producer prices in Latvia currently sit around €290–320 per tonne excluding VAT — still notably higher than at the start of last season.
What drives the price swings
The main cost factors are the availability and price of raw materials such as wood chips and shavings, electricity costs given the energy-intensive production process, and labor and transport expenses. Export demand also plays a major role, especially from Poland, where government support is encouraging a shift away from coal-fired heating toward pellet boilers.
Demand starting to ease
Palejs says pellet demand is now declining in September on both the domestic and export markets, and availability at producers is improving, although queues persist at some companies. The export price to Poland has also dropped, from around €350 to about €300 per tonne. He expects prices to keep falling, though gradually, with a more noticeable decrease expected around mid-October at producers closest to Riga.
