IndexBox has just published a new report: ‘EU – Peat – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The European peat market is entering a downward trend against the targeted regulation strategy to cut peat output and consumption. The EU is committed to protecting the peat deposits, as they naturally absorb greenhouse gases. Alternatives to peat are increasingly being used in agriculture and other areas, such as energy and wastewater treatment.

Key Trends and Insights

Europe remains committed to reducing peat consumption in a bid to protect natural peat deposits. These deposits are believed to absorb carbon dioxide from the air, contributing to the reduction of greenhouse gases. Projects are now underway in Ireland and Sweden to restore the peatlands.

According to USGS data, in 2020, peat production fell in Finland to 8.4M tonnes (-15.3% y-o-y), in Germany to 2.3M tonnes (-4.8% y-o-y), in Latvia to 1.5M tonnes (-13.6%), in Poland to 0.7M tonnes (-19.5% y-o-y), and in Sweden to 1.8M tonnes (-16.7% y-o-y).

Output increased only in Ireland, to 2.8M tonnes (+15.6%) and in Estonia, to 0.9M tonnes (+1.1%). Ireland also intends to curtail peat production, following the country’s shift towards alternative sources of energy, ceasing peat extraction by 2028. Finland has also set similar targets for transferring to alternative energy, but approx. 40% of the country’s energy consumption is still generated by peat and other fossil fuels. Finland intends to reduce greenhouse gas emissions to zero by 2035, implying a shift away from peat in the energy sector.

Such a negative trend in terms of peat production is now evident worldwide. According to preliminary estimates, global peat output in 2020 amounted to 29M tonnes, against 33M tonnes in 2019. This trend is to continue in the medium term against rising environmental concerns.

In the period to 2030, the European peat market is forecast to decline to 20M tonnes (IndexBox estimates). Compost made from wood, coconut fibre, deciduous plants, coniferous species and moss is set to replace the use of peat in the agriculture sector. Geotextiles, sand and polyurethane foam filters can act as filtering materials and as an alternative to peat in wastewater treatment.

Peat Consumption by Country

Finland remains the largest peat consumer in the EU, accounting for approx. 50% of the total volume. Moreover, peat consumption in Finland exceeds the figures recorded by the second-largest consumer, Germany, fivefold. The third position in this ranking is occupied by Sweden, with a 10% share.

In value terms, the largest peat markets in the European Union are Finland ($217M), Ireland ($194M) and Germany ($190M), with a combined 45% share of the total market. These countries are followed by Sweden, France, the Netherlands and Poland, which together account for a further 26%.

The highest levels of peat per capita consumption are registered in Finland (1,700 kg per person), followed by Ireland (354 kg per person), Sweden (194 kg per person) and the Netherlands (66 kg per person), while the average per capita consumption of peat in the EU is estimated at 47 kg per person.

Peat Imports and Exports

After two years of growth, overseas purchases of peat decreased by -10.3% to 6.1M tonnes in 2019. Overall, imports, however, saw a relatively flat trend pattern. The pace of growth was the most pronounced in 2013 when imports increased by 9.2% year-to-year. Over the period under review, imports hit record highs at 6.8M tonnes in 2018 and then declined in the following year. In value terms, peat imports dropped to $649M in 2019.

In 2019, the Netherlands (1.8M tonnes), distantly followed by Germany (1,002K tonnes), France (641K tonnes), Belgium (541K tonnes) and Italy (383K tonnes) represented the major importers of peat, together making up 71% of total imports. Poland (270K tonnes), Spain (202K tonnes), Lithuania (185K tonnes), the Czech Republic (170K tonnes), Austria (122K tonnes) and Hungary (99K tonnes) held a little share of total imports.

In value terms, the largest peat importing markets in the European Union were the Netherlands ($125M), France ($100M) and Germany ($93M), with a combined 49% share of the total imports. Italy, Belgium, Spain, Poland, Lithuania, the Czech Republic, Austria and Hungary lagged somewhat behind, together accounting for a further 36%.

Source: IndexBox AI Platform