If the waste-wood is deemed valuable enough to justify collecting, processing, and distribution, they may sell it as:
Mulch for landscaping
Medium Density Fiberboard (MDF): Used for mostly furniture and cabinets
Often times the wood is not justifiably valuable and is incinerated.
The citations will answer your question in much more depth if you like!
The big question is whether the “waste wood” is valuable enough to justify
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