Which insect larvae are known to produce frass that is fine powder and pellets?

The correct choice, which addresses the nature of frass produced by certain insect larvae, is associated with drywood termites. Drywood termites create fine, powder-like frass that resembles sawdust, which is often indicative of their feeding habits and nesting behavior within dry, sound wood. Unlike some other wood-destroying organisms, the frass of drywood termites is typically very fine and can appear in small piles near their entry holes, as these termites do not need to return moisture to the soil like subterranean termites do, leading to a drier waste product.

In contrast, drywood termites produce frass that is small and granular compared to the frass from other insects. While carpenter ants and subterranean termites both cause significant wood damage, they produce different types of frass. Carpenter ant frass can consist of larger wood shavings and debris because they tend to hollow out wood rather than digest it. Subterranean termites produce mud tubes and have a more moist frass since they require contact with the soil for moisture.

Powderpost beetles are also known for their damaging larvae, which create frass that is more coarse and resembles small pellets or granules. This distinction is essentially what sets the drywood termite apart in this context,