pellets > $400 per ton. seems like a shortage

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dccampli

New Member
Jun 19, 2008
19
Long Island, NY
Situation is sad on Long Island. Was planning on getting pellets from Lowes. Was number 55 of the list they were maintaining. Went in yesterday and was told corporate made them throw the list in the garbage. I guess they like riots. Only two trailers being delivered in September(maybe nothing this past August) plus 2 ton limit @ $305 and $85 for delivery + tax. So an area that can easily use 1000 tons right now will be getting 42 tons in September. Home Depot is worse, only 1 store does pellets and they order 50 tons for the season.

Next option is private dealers. 349 - 389 per ton plus delivery plus tax, so lowest = $412 per ton. Not even sure they have them at these prices, will call during the week.

I found some bidding info on the internet for a local pellet dealer asking for a shipper $2500 for 22 tons to pick up from pellet mill. This helps explain the high costs. Although the prices are high, some have said at least you have control over your heating costs for the winter. But it is the availability that bothers me. I don't see it any better next year when all the new pellet stove owners decide to get pellets early.

Maybe I should just start a business as pellet dealer. My garage can hold a trailer worth of pellets. Just need a portable dock and fork lift.

Oh, and who knows if the the $5k stove will even show up.

-DC
 
dccampli said:
Situation is sad on Long Island. Was planning on getting pellets from Lowes. Was number 55 of the list they were maintaining. Went in yesterday and was told corporate made them throw the list in the garbage. I guess they like riots. Only two trailers being delivered in September(maybe nothing this past August) plus 2 ton limit @ $305 and $85 for delivery + tax. So an area that can easily use 1000 tons right now will be getting 42 tons in September. Home Depot is worse, only 1 store does pellets and they order 50 tons for the season.

Next option is private dealers. 349 - 389 per ton plus delivery plus tax, so lowest = $412 per ton. Not even sure they have them at these prices, will call during the week.

I found some bidding info on the internet for a local pellet dealer asking for a shipper $2500 for 22 tons to pick up from pellet mill. This helps explain the high costs. Although the prices are high, some have said at least you have control over your heating costs for the winter. But it is the availability that bothers me. I don't see it any better next year when all the new pellet stove owners decide to get pellets early.

Maybe I should just start a business as pellet dealer. My garage can hold a trailer worth of pellets. Just need a portable dock and fork lift.

Oh, and who knows if the the $5k stove will even show up.

-DC
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holy cow.....highest I seen around here is 280 and I thought that was outrageous.

GET your pellets in the spring and you'll be all set nxt year.
 
This is exactly the reason I opted for a wood rather than a pellet stove. I felt I had no control over my fuel, but with wood I do. probably 50% is free.
 
Not surprised some areas are seeing shortages, but things are actually looking ok through Seacoast NH and Southern Maine. I've been tracking a few ads on Craigs List where people are trying to get 300 per ton and it doesn't looks like there are buyers at that price. One guy in Somersworth just dropped his price down to 275 pt(he has 3 tons for sale).
I'm sure this doesn't make you feel any better, but there is a chance that things will look up in October/November. Unfortunately this was not a great year to become a new stove owner, but i'm convinced next year is going to be much better all the way around.

Try to buy a Toyota Prius in this environment..same type of situation. Next year though there will be lots more available, as well as a whole new line of 40+ MPG vehicles.
For now though, demand is outweighing supply in all things energy efficient.

Sorry to hear of your trouble and I hope the situation improves in your area.
 
Home Depot in New Haven has them for $299/ton
 
Smaller stores have them in this area for $200 - $235. Lowes and HD have them for $280.
 
At those prices, oil is going to be about the same price - maybe cheaper in the end. Natural Gas is going to be much cheaper!

My opinion only, but I like to see a 40-50% savings over oil to make everything else worth while. That means if oil is $3.60 (now), I'd want $200 pellets to be feeling real good about the work I have to put into it, initial investment, service, etc.

Of course, all things will vary - but last time pellets got to the upper $200's, the demand fell through the floor, and stoves stopped selling. A quote from the owner of Harman Stove in 2006 "I have 20,000 Pellet Stoves and not a SINGLE REASON anyone should buy one".......right from the horses mouth.
 
It will be awhile before its not worth doing pellets for me. I burn a bag a day and last I checked, for the most part theres 30 days in the month...and with the pellets i currently have I paid $5.49 a bag totalling $164.70.....so it will be a long time before I can get 100 gallons for that price which is approx. the gallons i used with oil. :)
 
Based on the "fuel cost calculator" found on the Pellet Fuels Institute website, oil would have to be approx. $3.10 /gal, and pellets would have to be approx. $380/ton for their BTU cost to be EQUAL.

IMO, the days of $3.10 heating oil are long gone, and I think it will take quite a while for pellets to get to $380. In the meantime, I'll burn pellets.
 
Of course, all things will vary - but last time pellets got to the upper $200’s, the demand fell through the floor, and stoves stopped selling.
Click to expand...

I personally don't believe it will happen.... but if Oil keeps going further down (if it does.......) it may happen again.

Long Island is a special case, one cannot compare it to other regions or states.
Densely populated. Transportation/traffic many times a hassle, not easy to navigate. etc. etc.
Doing business there is just more expensive and therefore one can expect to pay a certain premium. If it is justified is another question.
 
I am not a BTU fan......you cant beat the BEST guage and thats "human" BTU's lol......a BTU doesnt dictate my comfort level.....to me my comfort level may be different than someone else. My cost will not be your cost per square footage of the house as we are all of human nature but varied blood warmth :)
 
MainePellethead said:
we are all of human nature but varied blood warmth :)
Click to expand...

Yours isn't 98.6? :coolsmirk:
 
Did you try liwoopellets.com spoke to him at the end of June he said he had plenty at that time he quoted me $325.00

but they would go up and he delivers for a flat fee $40 for 1 ton $60 for 2 tons. Doesn't hurt to call
 
most i have heard around south jersey is $290 a ton i picked mine up tractor supply for $239 in mid aug. but my aunt in PA. said a local hardware store near her was selling legnitics for $220 a ton.they start getting cazy on prices i'll park the pellet stove in the garage and install a wood stove,and they just installed my new pellet stove last Tuesday or maybe just start using the natrural gas heater then i have no labor involved at all wont have to go get pellets unload and stack in the garage then cary to the house to use,i thick the middle man just trying get as much out us as the can but when the little independent hardware store are givining better prices then lowes and homedepot make me think they are no better than the oil companies gas prices of oil are down around $100 a barrel how long can they keep blaming it on that
 
I am of the persuasion that there will be plenty of pellets around this winter. The "shortages" are mostly due to people buying their winter fuel supply all at once. They will be secure in their fuel needs. Meanwhile the plants have cranked up production to meet the unprecedented demand and will soon be flooding the market as demand will be down. Lack of stoves and fuel already sitting at home = low demand.
Next spring will be different I am sure.
Will
 
BrotherBart said:
MainePellethead said:
we are all of human nature but varied blood warmth :)
Click to expand...

Yours isn't 98.6? :coolsmirk:
Click to expand...

lol.... you know what I meant Bart. I guess I should have been clearer....
 
it's too bad. it appears that some suppliers are hordeing pellets in order to price gouge later in the winter. i saw a stove dealer with hundreds of tons of pellets on his lot and he wanted $375.00 per ton and wanted me to pick them up. what a shame. then you see them on ohio or kansas for $200.00!!! I just have top believe that people that do that with pricing will get theirs in the end.
 
bobm33 said:
it's too bad. it appears that some suppliers are hordeing pellets in order to price gouge later in the winter. i saw a stove dealer with hundreds of tons of pellets on his lot and he wanted $375.00 per ton and wanted me to pick them up. what a shame. then you see them on ohio or kansas for $200.00!!! I just have top believe that people that do that with pricing will get theirs in the end.
Click to expand...

They cant sit on them forever :) They will regret it later.....theres going to be a glut on the market in a couple months maybe sooner....ESPECIALLY if oil plummets....I will not hesitate to use oil if it becomes cheaper to use. But i dont see that for some time.
 
MainePellethead said:
bobm33 said:
it's too bad. it appears that some suppliers are hordeing pellets in order to price gouge later in the winter. i saw a stove dealer with hundreds of tons of pellets on his lot and he wanted $375.00 per ton and wanted me to pick them up. what a shame. then you see them on ohio or kansas for $200.00!!! I just have top believe that people that do that with pricing will get theirs in the end.
Click to expand...

They cant sit on them forever :) They will regret it later.....theres going to be a glut on the market in a couple months maybe sooner....ESPECIALLY if oil plummets....I will not hesitate to use oil if it becomes cheaper to use. But i dont see that for some time.
Click to expand...

No housing market = No glut. Plain and simple.

The same raw product pellet manufacturers use is also used by ;Paper manufacturers
OSB board Mfgs
Particle board Mfgs
Mulch Producers
Electric generators
Commercial boiler operators
Compost producers
Mushroom farms
Farming operations for bedding
Horse racing tacks for stable bedding
Steel heat treating plants


Sawdust and chips are no longer a waste product, they have become a commodity JUST LIKE OIL. SOLD to the highest bidder!!!!!!!!
It will take 10+ years of a robust housing market( i don't see this happening in my lifetime) to rebuild the milling infrastructure we have lost in just the last 2-3 years if anyone has any credit worthyness left or the banks are willing to finance an unprofitable business.
 
that's all fine and makes perfect sense, but, what do you think they paid per ton for those hundred or more tons of pellets they got sitting there?? I have no problem with folks buying and selling and making a good profit but price gouging just plain sucks.
 
bobm33 said:
that's all fine and makes perfect sense, but, what do you think they paid per ton for those hundred or more tons of pellets they got sitting there?? I have no problem with folks buying and selling and making a good profit but price gouging just plain sucks.
Click to expand...

NO SUCH THING AS PRICE GOUGING !!!

There is a market price for EVERYTHING ! Oil,beef,steel,lobster,caviar,diamonds,cars,trucks,pasta,etc,etc,etc. If I have it and you want it ,you HAVE to pay my price or go somewhere else.

Supply and demand rules the market place.
If a retailer is selling pellets for $375/ton picked up then that is what it takes for them to make a profit . Retailers are retailers not storage facilities. They DON"T make $$$$ storing pellets.

If you think I'm wrong then next time you want cheap pellets go to ACME PELLET STORAGE for the best deal.
 
LEES WOOD-CO said:
bobm33 said:
that's all fine and makes perfect sense, but, what do you think they paid per ton for those hundred or more tons of pellets they got sitting there?? I have no problem with folks buying and selling and making a good profit but price gouging just plain sucks.
Click to expand...

NO SUCH THING AS PRICE GOUGING !!!

There is a market price for EVERYTHING ! Oil,beef,steel,lobster,caviar,diamonds,cars,trucks,pasta,etc,etc,etc. If I have it and you want it ,you HAVE to pay my price or go somewhere else.

Supply and demand rules the market place.
If a retailer is selling pellets for $375/ton picked up then that is what it takes for them to make a profit . Retailers are retailers not storage facilities. They DON"T make $$$$ storing pellets.

If you think I'm wrong then next time you want cheap pellets go to ACME PELLET STORAGE for the best deal.
Click to expand...

If he is selling for 375 a ton that is not necessarilly what it takes for him to make a profit. At least in my area it isnt. I have seen where 3 separate places all had three separate prices....low end was 249 for the ton and another not to far away had the high endof 310....I know for a fact what mill they received their pellets from....they got the same whole sale price.
And I am a price hawk....if I see pellets for 375 a ton.....they will rot in that businessmans yard because this cat aint buying....I move on to the lowest bidder. :)
This year I have seen big box have penningtons for 249(wal mart) and then almost next door at lowes they had same darn pellet for 280 a ton. And thats 2 companies that buy very large quantities in bulk. So who's playing the consumers here.
After talking to a pellet mill owner here in maine and seeing the amount of work flowing through their mill....not to mention other mills around here....they'll be plenty of pellets. Theres a hoarding game going on right now....Theres 2 that I know of that sells harmon and breckwell in the area and they have HUGE amounts in their yards sitting and their not selling them. I called. But....they can only sit so long.....they have to recoup their cost even if it means dropping prices :) And they will.
 
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