Pellet mill is the key equipment in wood pellet manufacturing process. Wood pellets are made from wood wastes from manufacturing lumber and other forest products and forest activities. Wood pellets manufacturing is a way to utilize low grade wood that may otherwise go to waste.

Most pellets are manufactured in large commercial pellet press but small scale pellet press are now becoming available to small business and home owners.

The pellet press is the heart of the wood pellet manufacturing process. More and more people are interested in wood pellet manufacturing process, there are various pieces of equipment, however they all centre around the main piece of equipment, the pellet press. A pellet press is also known by several other names such as a pellet press or pellet machine. The pellet press has seen various design changes over is history, which has been over century. Originally designed for animal feed pellet manufacture, a flat die pellet press design what the original. The principle of the flat die pellet press is a vertical process orientation. Material enters the top of the press and falls on to the surface of the die template. Here, a series of rollers set a specific height from the die compress the material through the die, and into pellet form. A pellet press which is properly set-up should have a gap between the two. Setting an appropriate gap is part of the wood pellet manufacturing process. Increasing the gap can increase pellet quality, however it also increased energy demands and therefore the cost of pellet manufacture. Therefore a balance has to be meet between the life of the consumables, pellet quality, pellet manufacture, and the energy consumption of the press.

As described, the pellet press is at the heart of the pellet plant. However before the material reaches the pellet press, several other pieces of equipment are required. Chippers, shredders and hammer press are used to process the material into dust. Then a rotary dryer is normally used to reduce the required moisture.

Depending on the chosen raw material the grade of wood pellet manufactured will change, specifically in the amount of ash produced. Premium grade wood pellets produce the lowest ash content, and are produced mainly from pine and spruce sawdust. Other types of wood generally manufacture a lower standard grade pellet and other biomass materials produce wood pellets with a higher ash content still and possible clinkers.