German German Pellets has become bankrupt

The reasons for the bankruptcy of the largest producer of pellets from wood depends on the price of oil fell. Another reason was failing investments that the company made in 2010 in solid fuel boilers heating KAGO brand.

The company produces more than 2 million tons of wood pellets per year in Germany. German Pellets has 15 enterprises, and about 800 employees. In addition, the company has plants in North America, which produce about one million tons of pellets annually.

In 2014, German Pellets founded his company in Russia and was going to build a plant producing wood pellets in the Nizhny Novgorod region (500 thousand tons per year). But, the construction wasn’t started.

Announcing its own financial problems, the company German Pellets claims that shortly pellet market will only increase. It is known that Belgium, the United Kingdom and Denmark have taken a serious course replace traditional hydrocarbon fuels to alternative biofuels and this course they will stick, because these states have made commitments to reduce greenhouse gas emissions.

To date, on the market of pellets consumption slowed down its development due to lower oil prices and a relatively warm winter. The company predicted that Germany will be installed 40 thousand solid fuel boilers and installed in all 16 thousand boilers. Besides all this, almost the entire 2015 oil was cheaper than wood pellets. In order to somehow have a positive impact on the situation, the German authorities began to increase grants for those who moves from traditional to alternative fuels.