The clouds are 3D volumetric, so yes…particles more or less.
Volumetric materials and particles aren’t remotely the same thing.
But as cold as it sounds for me to say that, this is easily the best foliage-related Terragen image I’ve ever seen! Amazing work. Looks far better than Vue or (sigh) Bryce, for example, and it’s an amazing feat you’ve accomplished here. I could never push a scene like that through Maya, for example, and I daresay nobody else could either.
I’d put off Terragen for years due to its lack of foliage / control, but perhaps it’s “ready” now? Other than the impossible animation renders, it’s amazing to behold and thank you very much for sharing! I’m off to check out Terragen’s instancing and see how it works…