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Git R Done boys.......

Post in 'The Boiler Room - Wood Boilers and Furnaces' started by heaterman, Mar 29, 2011.

  1. heaterman

    heaterman Minister of Fire

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    Just a general comment for all of you who are thinking about pulling the trigger on any wood boiler this summer.

    DO IT NOW! DO NOT WAIT!!

    Prices for steel are going through the roof as we speak. I know Garn is already dealing with a steel surcharge and I am aware of a couple other lines that are talking 10%+ price increases in the very near future also. I just priced out a 2.5MMbtu steam boiler for a commercial job we'll be doing this summer and the manufacturer will not even provide a firm price until a deposit of 25% is in their hand. They will give me a price range to work with for 14 days and after that all the numbers are void. They told me to anticipate at least 8-10% and that is a chunk of change on a $50K item.
    Steel pipe is starting to act like copper, which might as well be made out of unobtainium from what I can see. (just paid $.78 per foot for a 250' roll of 12-2 MC cable at the supply house)
    One of my suppliers just sent out a new price sheet for malleable iron fittings that shows a jump of about 16% across the board. When I called about it they told me it looks like there will be another increase within 60 days for nearly the same amount. After that they do not know where it will be.
    From what I can see right now, prices for anything made from steel or iron will be up 20% by July.

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  2. afblue

    afblue Feeling the Heat

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    This is the message I saw in my email this morning. So my sir what you are saying is 100% correct. Good thing I put my $$ down on mine when I did!!!

    Hello All,

    I wanted to take the time and let everyone know that prices for our boiler line are going up in 2011. This significant price increase is due to the rising cost of steel, which is the highest component cost in our products.

    This announcement was sent to ensure anyone considering a purchase this year, can call their local dealer and place an order before the end of this month.
    FYI – Our typical customer saved on average $3000 in the 2010/11 heating season in fuel costs. Using half the wood with clean burning technology, they heated their homes at 75 degrees all winter long.


    Feel free to contact me with any questions!

    Thank You,
    Joseph Jensen
    Northeast Territory Manager
    Pro-Fab Group of Companies


    joseph.jensen@profabgroup.com

    www.profabgroup.com
  3. heaterman

    heaterman Minister of Fire

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    Well Yahhh! I'm not just trying to blow smoke up everyone's backside. ...........(pun intended)

    Seriously, these are some of the biggest price increases I have seen since the 20% inflation years of the early 80's. It's not going to be fun and I am reeeeeally wondering how our government is calculating their inflation numbers right now. Real inflation is far above the measly 2% or whatever drivel they are claiming.
  4. EricV

    EricV Feeling the Heat

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    unobtainium, that's a good reference. (you have to be a sci-fi nut to get that one)

    I think we are going to see this happen with all goods that are mined, farmed, manufactured or transported with diesel, which is EVERYTHING in our world. Everything is affected by fuel prices.

    Unless you grow chickens in your backyard and grow veggies hang on, the world is changing.
  5. Frozen Canuck

    Frozen Canuck Minister of Fire

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    Have to agree, if you have a project of any sort get it done, or at least purchase all the materials NOW!!!

    I was at the suppliers yesterday pricing a few jobs & in general materials I had purchased for last years fall/winter jobs were up 20%. Had time to talk with the owner & his suppliers are telling him to lay in as much stock as he can NOW, as they cannot give him a firm price more than 10 days out & the price is always higher than the last.

    He asked if I would build him more storage when the frost is gone & he made the point of saying the DAY the frost is out. He then asked how much unused storage I had at the farm & would I rent it to him until I could build him more on his site. No problem there, we have known each other for over 20 years & he is an important part of our business.

    Understand; the guy is making preparations for serious inflation in the very near future, as he feels that what he buys now is going to be worth a lot more in very short order. Think this year not next.

    This confirms what I noticed driving around the area this winter, fiberglass insulation plant 1.5 hours from me has a huge inventory, I have never seen the inventory that large & they had a contractor on site building open sided storage sheds, which they would fill as soon as the columns to support the roof were in place, the contractor used a large crane to place the roof iron as the ground was now covered in insulation. Talk about being pushed by the customer!!!! This was repeated shed after shed, these sheds were the size of aviation hangers. Site size; about a section of land, rail siding of course & everything going full blast in the dead of winter. Same story for the plywood & OSB plants here, massive inventory & been going flat out all winter.

    Most of these are large companies; Weyerhauser, Dow Chemical, John Mannsville etc. So I doubt this is a fools gamble by any of them. They are all making preparations for serious inflation in the very near future, by building massive inventory NOW that they will of course sell into an inflated market later.

    My local supplier gave me a list of material that he expects to double in price this year. Almost everything one can think of when building a structure from the cement in the foundation to the shingles on the roof. In short the more fossil energy it takes to make it, the faster it will double in price & from there who knows? Inflation is a tougher one for an individual to deal with as wages usually dont keep pace.

    One add on to the above: If you have a mortgage of any size; ie. borrowed money, pay that off first. If interest rates get above 20% as they did here in the 80's you will want to be out of debt totally.

    Personally I am not considering any long term borrowing at this time on any level. Working hard on getting the business full of assets that are debt free. Same goes for the home front.

    Sit down, buckle up & hang on tight. Big time inflation train headed our way IMHO. If you make preparations for it BEFORE it gets here you have a much better chance of not getting ground up in the gears.

    Either way it will be one heck of a ride!!!! Trains that have the potential to be run aways always are!!!!
  6. turbotech

    turbotech Feeling the Heat

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    The new President handed out money to the financial crooks, paid for 30% of people's new stoves, a big chunk of people's cars, paid for town's that didn't save enough to up keep their roads.
    When you give out free money it can't go on forever. We all knew big inflation was coming. Don't believe the lies the government will tell about it being small. Add the product that Japan needs and you will see it is going to be one of the largest jumps ever.

    Yes, I agree on ordering now and storing product if you have the space.
  7. Fsappo

    Fsappo New Member

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    Yup, the prices are rolling in now. Just had to call some old quotes up and give them expiration dates on the prices.
  8. bigburner

    bigburner Feeling the Heat

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    Here's the difference between now and the 80"s - Money had some investment value - 12% to 20% CD's Now it's worth nothing. Hyper inflation will hit and with any luck that will drive out the new Jimmy Carter and elect a new Roland Regan. We don't stock anything, just pieces & parts left over from projects. If I did have some equipment that I bought cheap I would end up selling it at a discount to give me an edge. The problem is no one is spending a dime they don't have too!
  9. DaveBP

    DaveBP Minister of Fire

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    Would that be the same 'Roland Reagan' that more than doubled the national debt during his administration? And had more White House appointees convicted of felony corruption than any administration before or since?

    You're counting on politicians (of either party) to save us?

    Is roller coaster inflation anything new or surprising?
  10. Pat53

    Pat53 Minister of Fire

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    I'm still sticking to my thesis that commodity prices for things like steel, copper, aluminum and even oil will be much lower 2 years from now. The deflationary "juggernaut" that will engulf the western world will crush demand for most commodities and other assets. China is a major bubble that is going to implode as well, and demand from there will also collapse.... you heard it here first ... be prepared !!
  11. heaterman

    heaterman Minister of Fire

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    At least the crooks were prosecuted and convicted in that administration.........
  12. heaterman

    heaterman Minister of Fire

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    So you're thinking worldwide depression? There is indeed a case to be made for that scenario but I think hyperinflation will precipitate that event. Makes a guy scratch his head a little. In an inflationary environment, a person is not going to get hurt badly (all other things being equal) if he has debt that is fixed in terms of interest rates. In fact debt is probably the best place to be if you can continue to service it because you are paying it off with "cheaper" dollars. In a time of major deflation however, where assets of all types become less valuable there is no safe haven and any debt will kill you. At least that's the way I understand things.............

    Personally, I don't think the government (IE: Ben Bernanke) will allow deflation to occur. Or at the very least he will fight it tooth and nail. He knows that there is no way the government/USA could ever dig itself out of the debt we are in should things deflate. Default by the USA and darn near everyone in it would be the only option.
  13. Pat53

    Pat53 Minister of Fire

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    Yes, in an inflationary environment debt is manageable. In a deflationary environment debt is a killer. I think the deflation comes first. The amount of worldwide debt is absolutely mind-boggling, and much of it has to be refinanced soon. You're allready seeing what is going on in Europe. Austerity and cuts in Government services/jobs. Same thing is happening here now at all levels of Government, teachers getting whacked EVERYWHERE. You can't really have inflation without WAGE inflation, and that only happens when there is a lack of labor, we currently have a huge surplus of labor. Real wages have been falling for decades.

    The commodity inflation you are seeing now is all because of the reflation efforts of Bernanke and Co and a weakening US $. That will reverse at some point. My guess is when Congress is forced to enact some serious cuts in Government spending (soon) the markets will roll over, and may even plunge, all asset classes are likely to get hammered, especially commodities. Government spending is the only thing keeping the game going. When it ends, don't be the last one looking for a chair !!

    Pat
  14. benjamin

    benjamin Minister of Fire

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    Poor Frozen Canuck, you forget that we southerners have fixed rate loans guaranteed by our government, and we all know that the government just prints more money when it needs to so we'll never feel the pain of inflation like other countries that have to actually do something about their fiscal problems.
  15. flyingcow

    flyingcow Minister of Fire

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    This could turn into an Ash Can mess in a hurry. :)


    Thanks for the heads up heaterman. All of the equipment in trucking has been climbing in price, partly due to high steel prices. This is only going to get worse.
  16. Frozen Canuck

    Frozen Canuck Minister of Fire

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    We have the fixed rate option here as well (agreement between bank & lender) no govt involved. However if you look on page 57 (small print) you will find clauses for forced re-negotiation, should "unforseen" circumstances arise. In other words they will move the loan to a variable rate. Agree you need to stop printing money south of 49, or you may become the next "peso" currency (a bad thing for sure).
  17. woodsmaster

    woodsmaster Minister of Fire

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    It's usually cheaper to buy a boiler in the spring regardless of what the market does. I paid about $700.00 more by buying mine in the fall.
  18. heaterman

    heaterman Minister of Fire

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    This spring may soon be the exception to that rule if I'm reading things correctly. Hate to think of what fall will look like if things stay as they are.
  19. Frozen Canuck

    Frozen Canuck Minister of Fire

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    All products are going to cost more as virtually everything is made/moved using oil.

    Dwindling supplies of oil just as China & India (that's 2 billion new customer's/user's of oil) begin to demand/need more is only going to drive the price of oil up.

    In the past there has been a measure of predictability with these cycles, now that everything has at it's base the need for oil, we can probably throw the old rule books out the window & try to figure out the new reality.

    Seems to me the only currency/commodity that will have predictable value range is oil, everything else will just follow along for the ride.

    One thing I know, many customer's will not be able to afford the service calls when it costs $400 or more just to fill up the service truck!!!! BTW my cost for same service truck fill up now is $159, so we dont have that far to go.
  20. heaterman

    heaterman Minister of Fire

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    I not only "feel your pain", I experience it also. Pulled up to the pump with the van and the pickup last week, filled both and left the place minus $208.00 That was two days worth of travel. OUCH!!!
  21. Frozen Canuck

    Frozen Canuck Minister of Fire

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    Indeed Heaterman:

    It adds up to a lot of extra money on a longer 60-90 day job.

    Customer winds up shaking their head as they get NO extra value for $100/day fuel expense. 90 day job is $9000 just to move people around & thats just the cost of fuel.
  22. sdrobertson

    sdrobertson Minister of Fire

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    Are the scrape prices going to follow the same upswing?
  23. Frozen Canuck

    Frozen Canuck Minister of Fire

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    Without a doubt, scrap business will take off as oil climbs. All that old farm equip will be worth more as scrap than it was the day it was made.
  24. heaterman

    heaterman Minister of Fire

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    Yah! My uncle just paid $5300 for a complete overhaul/refurb on an old WD-45 Allis Chalmers that his dad/my grandpa paid $600 for brand new in the 1940's or thereabouts.
  25. PassionForFire&Water

    PassionForFire&Water Minister of Fire

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    The end of the global economy .... yeaaahaaaaaaaaaa.
    Back to the past, make and buy stuff in your backyard.
    Or .... do I miss something?

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