Maine pellet mill will overcome northeast exporting barriers

By Lisa Gibson | October 18, 2011

Once completed and operational, a 300,000-ton wood pellet mill near Portland, Maine, will export its product to European customers under contract. Since the Northeast U.S. only possesses two suitable ports for exporting, the mill represents a sizable accomplishment and milestone for the region.

Maine houses those two ports, and the Portland mill, sponsored by Maine forest products company F.E. Wood & Sons, will send its product 28 miles by rail to reach one, according to David Perlman, managing director for the project’s investment banking firm, Fieldstone Private Capital Group Inc. The project will include the development of a storage facility at the port itself, Perlman said.

The announcement of the plant’s development drummed up plenty of excitement at Biomass Power & Thermal’s Northeast Biomass Conference & Trade Show in Pittsburgh, Pa., Oct. 11-13, as Perlman’s presentation followed a somewhat bleak outlook of the exporting potential in the Northeast. Clearly, the exporting market is port dependent and Pete Stewart, president and CEO of Forest2Market, explained to attendees that proper port infrastructure is lacking in the Northeast, except for the two ports in Maine. To facilitate exports, a port must have 36-foot draft and bulk handling capabilities. “Building one out is an expensive and difficult process,” Stewart said.

Unfortunately, because of that one huge barrier, pellet export potential in the Northeast U.S. will almost certainly be limited to northern Maine, Perlman, Stewart and fellow speaker Seth Ginther, executive director of the U.S. Industrial Pellet Association, all agreed. Asked whether barges on inland rivers transporting to southern ports was an option, all three again agreed that it is not a certain one and is open to mishaps and huge challenges.

While pellet demand in Europe is growing exponentially, it seems the Northeast U.S. won’t be able to contribute a large portion of that supply, despite its relative proximity to Europe. Perlman’s announcement of F.E. Wood & Sons’ major project was a refreshing and exciting aspect of a discussion panel that painted a realist, albeit less than positive, picture of the exporting opportunities in the Northeast.