Wood pellets come from many different sources around the country. In the US and Canada, there are almost 100 pellet manufacturers making pellet fuel for North America, and also exporting to other countries. In the West, most wood pellets are made from the sawdust created by lumber mills. A single lumber mill may be the only source of raw material needed for a pellet mill, and much of the lumber is softwood. The trees are de-barked before being cut into lumber, so there is very little dirt or bark in the sawdust, creating a very light colored, clean, low ash pellet with consistent burning characteristics. As the demand for lumber changes with the economy, that supply of sawdust can go up or down. There are also other industries competing for that sawdust which can greatly affect the price.
In the Mountain region, many mills are using Lodge Pole Pine trees killed by the Pine beetle. There are thousands of acres of these standing dead trees that need to be taken down in order to lessen the chances for devastating forest fires. These pellets tend to have flecks of blue in them showing the area where the beetle killed the tree. This source alone will provide consistent low ash pellets for decades to come.
In the South and Midwest, many mills are are also wood flooring and furniture companies, using their waste stream for wood pellets. These may be one species, a softwood blend, or a hardwood blend.
In the East some mills get their raw materials from hardwood lumber companies while other mills work with timber companies to help clean up the forests using wood unsuitable for lumber.
These are just small examples of where wood pellets come from among many different sources. There are also pellets being made from agricultural waste products and prairie grasses. Some of these pellets have slightly higher ash content, but provide for a much larger source of raw materials. There are more pellet manufacturers starting up every year, with many of them starting to product fuel from some of these non-traditional sources as our industry continues to find answers for replacing fossil fuel as an energy source.