Our pulp mill bought three types of wood, logs, purchased chips and bark. We had a big drum debarker and a 2500 horsepower chipper down stream of it. The logs were piled in rows and unloaded by our crews so we didnt have to worry about rocks and junk. There was a metal detector upstream of the chipper that diverted suspect wood away from the chipper. Most of our wood was from industrial forests so junk grown into the trees was rare. The chipper could chip just about anything. We had to notify the utility several hours before it was turned on and on days when power was expensive in New England we would only run it at night and on weekends when the power was cheapest. The chipper was designed to optimize chip size. Everything went to out chip screening system I described previously.
Purchased chips were generally supplied by specific suppliers that chipped what most on this forum would use as fire wood. The loggers would sell the high grade logs and pallet logs for much higher value and set the trunks (sometimes called the bole) and large branches aside and would chip them with s specialized chipper that produced somewhat uniform chips and fines. The chips would be blown into tractor trailer box and in theory the fines would not make it in the truck. The trucks were then driven to the mill and dumped using a truck dumper. For many years we had an attendant at the truck dumper who would sample the load. We had a Gradex chip sorter that would be loaded with a random sample and it would automatically sort the chips by size. Over, undersized and properly sized chips were weighed. If there was too much over and undersized chips in a sample the load might get rejected but normally the supplier was put on notice. The foresters knew all the loggers and knew the good ones and the sketchy ones. The closest buyer of these grade chips was about an hour away so if supplier got on our do not buy list they had to drive an hour away and the cost of diesel ate up their profits. The mill paid when delivered and had done so for over 100 years except for about a one year period where it was owned by some Iranian criminals (one of the biggest frauds in the US that no one seems to have heard of
https://www.forbes.com/forbes/2002/1125/070.html#4332c81730bf )
The final product we produced and bought was "bark" which was a mix of fresh and reclaimed bark and low grade chips. It was burned as fuel to generate steam and electricity to run the mill. We didnt need to buy oil to run the plant as long as the bark boiler was running. The "bark" we bought which were claimed to be whole tree chips but usually were mostly the crown wood, twigs and leaves that were too small and dirty to make purchased chips. The chippers used to make them were designed to make a lot of chips for a minimum amount of diesel. The loggers that owned the chippers ran them cheap and tended not to change the knives so they got dull and tended to shred the wood instead of chip it. The resulting chips were mostly strips of wood and branches. On occasion in winter we would get a truck full of mostly ice and snow with some chips mixed in. They were miserable to deal with as they tended to get caught up and clog the transfer and fuel system. The reclaimed bark was odd stuff, the area started out with a sawmill complex in the 1860s and eventually switched to pulp. Up until the 1980s all the bark was dumped in whatever hole needed filling. After the first arab oil embargo the mill built a bark boiler and started digging up all the bark from all the places it had dumped. After about 20 years they dug out all the easy stuff and started buying it from other old bark piles. It was mostly bark but tree trunks and boulders came along for the ride. The bark boiler was a bottom grate design. It had to be raked out while in operation once or more often times a shift by hand. It was backbreaking work by employees who had to wear reflective insulated suits to handle the rakes.
These days there is a market for clean uniform chips for the smaller school and institutional systems. Some suppliers specialize in them. Froling sells Precision Dried Chips made in Peterborough NH, they are partially dried, clean and sized chips and sold as replacement for pellets in commercial and industrial boilers. No doubt they have a reject stream that gets sold to someone else. The term with respect to pork production was that the industry sold "everything but the squeal" a properly functioning wood market should do the same thing but of late the low grade markets do not make economic sense for the logger so they leave it in the woods and see if they can get credits for carbon storage. The big downside is forests need to be "pruned" every 20 to 30 years to ultimately grow high grade logs and without the low grade markets it costs too much out of pocket to prune the woods so the quality of logs produced as long as 80 years from now will be lower.
When I tuned up big power producing biomass boilers I always asked the plant to set aside some "good" chips for about 12 hours of run time. Good uniform chips flow well and spread out over the grate well leading to clean combustion. Chips full of sticks clumps and do not spread over the grate very well. We used to preach to the owners to put in screening systems in their fuel yards but they cost money to install and run. I know of few abandoned systems that did a good job but couldnt get anyone to bite to have them buy them and move them. One of the plants ran for over 25 years without buying any wood, they just reclaimed wood from the bark dump of formerly very large sawmill.They had real ice screening system and top pile reclaimers to keep the rocks boulders and big metal out of the process.