A continuous process is described whereby waste woody materials such as bark, twigs, sawdust, plantation waste, and peanut shells, containing around fifty percent moisture are initially predried, and subsequently carbonized, to produce a high yield of relatively pollution-free industrial fuels. By utilizing a two-step process an optimum flow rate of gas may be achieved during both the drying and carbonization steps to maximize the formation of solid and gaseous fuels and to minimize the formation of condensable liquids during pyrolysis. The products of the process of this invention may be a solid industrial fuel, charcoal having more than approximately 23 percent volatile combustible matter, and a fuel gas having fuel value of from approximately 150-185 B.t.u. per standard cubic foot or more. The solid fuel is enriched by allowing the condensible combustible matter in the fuel gas to adsorb thereon. In the alternative, charcoal formed may be pulverized and suspended in a major portion of the gas to produce an enriched fuel gas having a fuel value of from about 400 to 625 B.t.u. per standard cubic foot. The fuel gas may be produced in quantities sufficient to allow use of the sensible heat from a portion thereof for the initial drying step, if desired.