A fluidized bed reactor with 3 kg h(-1) throughput operating at an atmospheric pressure with an inert atmosphere at 773 K has been used to produce bio-oils from the wood feedstocks such as Pterocarpus indicus, Cunninghamia lanceolata, and Fraxinus mandshurica, as well as from rice straw. The best oil-producing characteristics were for P. indicus and the worst were with rice straw. These data were used to design a larger scale unit of 20 kg h(-1) throughput, and to estimate the production costs at an industrial scale. The quality of the bio-oil produced remains poor, and a combination of high value products and energy applications are needed for profitability. (C) 2003 Elsevier Ltd. All rights reserved.