Unusable wood are chunks of scrap wood that can no longer be used for crafting.
The only use of unusable wood is as a fuel inside a campfire, charcoal barbecue or antique oven, and lasts for 1 hour and 24 minutes if done so.
Unusable wood is a scrap item found only when disassembling wooden objects. There is a chance, depending on the player's carpentry level, that the dismantled object will be destroyed, leaving unusable wood instead of planks.
From newitems.txt (Project Zomboid directory/media/scripts/)
Weight = 1,
Type = Normal,
DisplayName = Unusable Wood,
Icon = UnsableWood,