The demand for biofuel pellets has increased considerably in recent years, causing shortage of the traditional raw materials sawdust and wood shavings. In this study, the costs and energy requirements for the production of pellets from agricultural raw materials were analysed. The materials studied were Salix, reed canary grass, hemp, straw, screenings, rape-seed meal, rape cake and distiller’s waste. Four production scales were analysed, having an annual output of 80,000, 8000, 800 and 80 tonnes of pellets per year. It was concluded that the raw materials of greatest interest were Salix and reed canary grass. They had competitive raw material costs and acceptable fuel properties and could be mixed with sawdust in existing large-scale pelleting factories. Straw had low production costs but can cause serious ash-related problems and should, as also is the case for screenings, be avoided in small-scale burners. Hemp had high raw material costs and is of less commercial interest, while distiller’s waste, rape-seed meal and rape cake had higher alternative values when used as protein feed. The scale of production had a crucial influence on production costs. The machinery was used much more efficiently in large-scale plants, resulting in clear cost savings. Small-scale pelleting, both static and mobile, required cheap raw materials, low labour costs and long utilisation times to be profitable. In most cases, briquetting would be more commercially viable. The energy use in manufacturing pellets from air-dried crops was generally no higher than when moist sawdust was used as the raw material.

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