Wood pellets are a type of biomass fuel produced from wood by-products such as sawdust, wood chips, bark, and branches during the forestry processing industry. Through grinding, drying, and high-pressure compression without the need for chemical binders, the raw materials are transformed into compact, cylindrical pellets with low moisture content (usually below 10%) and high energy density. Thanks to these characteristics, wood pellets have become an ideal alternative fuel source to coal and traditional fossil fuels in many industrial and civil applications.

In developed markets such as Japan, South Korea, and Europe, wood pellets are widely used for electricity generation in biomass power plants, providing heat for residential heating systems, and as fuel for industrial boilers. Compared to coal, wood pellets produce significantly lower CO2 emissions when burned and are considered a carbon-neutral energy source, as the amount of CO2 released is equivalent to the amount absorbed by trees during their growth.

Vietnam, with its abundant plantation timber resources and a thriving wood processing industry, is currently one of the world's leading exporters of wood pellets, particularly to the Japanese and Korean markets. The development of the wood pellet industry not only brings high economic value to businesses and forest growers but also contributes to the efficient utilization of agricultural and forestry by-products, minimizing resource waste and promoting sustainable development goals, moving towards a green economy and reducing global greenhouse gas emissions.