A furnace (10) for burning cellulosic fuel has walls (64) which taper upwardly and outwardly, such that a given level or height (66) the cross-sectional flow area is 11/2 to 2 times the cross-sectional flow area near the bottom of the furnace. Thus the gas velocity continuously decreases, as the cross-sectional area increases. Any partially burned char particles initially entrained in the gases near the furnace bottom reach a height in the furnace where the gas velocity equals the particle terminal velocity, so that the particles remains suspended at this height until combustion as reduced their size enough so they can be carried on out of the furnace by the reduced gas velocity.