Hate to say this but shipping is going up...... Bottom line it will raise the price of pellets.

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kinsmanstoves

Minister of Fire
I was contacted by the shipping company I use to move my pellets. They are awesome, on time delivery, friendly drivers, and great customer service. I have used a lot of companies including some big ones and I have owned a semi myself, I am not Mr. Trucking but I know how the business works.

I was told there will be an increase in the fuel sur charge. This is the first time in 18 months this has happened. So just when you thought the price of pellets was falling, this happens.

Remember fuel is needed to start the chain saw that will drop the first tree to start the pellet making process so fuel is related. If I was a betting man I would not wait for those Summer Buy Programs if you see pellets cheap, grab them.

Eric
 
Many supply chains are pretty local and others move vast quantities by rail.
That said, shipping for everything has been going up for a decade or more. The funny thing is, they always seem to add the surcharges, but never subtract them when fuel is cheap (the exception is utilities, which are regulated and therefore have to).....

If your shipping company buys a truck which gets 15% more MPH, you better believe they are not going to cut your rates!

Ideally, a LOT of the pellet supply chain will get more and more local because moving around vast weight on highways is inefficient by nature.
 
Even using a backhauler to grab my pellets from a couple hundred miles away, and coal from just a little further, I'm feeling the sting of fuel surcharges. My cost on coal just went up as well. Lucky to be where I am close by to both sources.
 
Diesel is $3.65 a gallon and climbing. Here comes the double dip.
 
There has not been a commercial truck engine built in 10+ years in the US that gets better MPH!
There is no such thing as a "backhaul" anymore.
Pellet prices are going to be volatile for a while. Buy a multifuel!
 
As a trucker many loads we haul never pay a fuel surcharge. I have to haul heavier outbound loads because my backhauls get cheaper because there are more trucks than loads...simple supply and demand.

When fuel prices have declined so have any fuel surcharges I receive....
 
unknowingLEE said:
There has not been a commercial truck engine built in 10+ years in the US that gets better MPH!
There is no such thing as a "backhaul" anymore.
Pellet prices are going to be volatile for a while. Buy a multifuel!

I use Gypsum Express to grab pellets and coal. I'd call 400 bucks a load freight a backhaul price.
 
Prices of everything go up with the rising costs of a barrel of oil, have to expect that. If oil prices continue to climb, people will start cutting back on travel/gasoline usage (I intentionally seek out E85 for my FlexFuel pickup truck because it's $2.80 per gallon in my area, gas stations selling E85 has increased dramatically over the past year) and the demand for oil will fall. Big oil will once again lower their prices as demand decreases, like they did a couple of years ago when gasoline was over $4/gallon. It's all a game to them, inflate profits, skim off the top, when the oil execs have filled their greedy pockets fat enough to the point of bursting, the cost of a barrel of oil will come down again.
 
ChrisWNY said:
(I intentionally seek out E85 for my FlexFuel pickup truck because it's $2.80 per gallon in my area, gas stations selling E85 has increased dramatically over the past year) and the demand for oil will fall..

Thats why CORN is sky rocketting. Untill they make bio-mass fuel from somthign other than food, im out of it.
 
Funny thing in another thread I mentioned buying now and someone said wait for the spring buy... I am not saying its not possible, but I don't see many spring prices being much if any cheaper than what we are paying now. with everything going on in the middle east and oil going up I find it very hard for those big boys not to make some extra money as they alwAys do...
then when they predict $5 a gallon for heating oil next winter ... prices will stabilize and drop some after summer
 
Spring buy deals are somewhat unique. As the mills sit threw the spring/early summer sitting on stock. Most pellet burners don't think of the fuel until the late summer/fall when heating season is about to begin. The mills offer deals to the dealers and the dealers then pass along some savings to the people willing to stock up early. So both the mills and dealers are bringing in some sales while the market is on the stale side. They may also pass along some left over deals to the early buyers.

Its a win-win for both sides. :)

I said it before and I will say it again. All bets are off once the spring deals are over.
 
iron stove said:
ChrisWNY said:
(I intentionally seek out E85 for my FlexFuel pickup truck because it's $2.80 per gallon in my area, gas stations selling E85 has increased dramatically over the past year) and the demand for oil will fall..

Thats why CORN is sky rocketting. Untill they make bio-mass fuel from somthign other than food, im out of it.

There are literally millions upon millions of bushels of corn stored outside after last year's record or near record harvest. There simply isn't enough room for it to be stored inside. There is no reason, other than market manipulation, for corn prices to be high.

The high priced corn is simply too expensive for the ethanol producers many of which buy 'old' corn or lower quality for up to 80 cents per bushel less than current market prices. Currently ethanol consumes about 11% of the corn crop in the US... but, again, most of that returns to the market as feed.

Ethanol production doesn't mean the end of the corn as a viable product... the refining process simply removes the sugars from the corn to make alcohol. The remaining product 9about 85% by volume) is either sold as a wet or dry 'distillers grain' which is used for animal feed.... much the same way raw corn is fed to cattle. Farmers love it for their cattle and hogs... it's cheap and readily available in any area that has an ethanol refinery close by.

Most of the bad press about ethanol is from the earliest days of production. It now moves by rail as well as by truck... no longer does it take more energy to make it than it delivers as a fuel...
 
Franks said:
unknowingLEE said:
There has not been a commercial truck engine built in 10+ years in the US that gets better MPH!
There is no such thing as a "backhaul" anymore.
Pellet prices are going to be volatile for a while. Buy a multifuel!

I use Gypsum Express to grab pellets and coal. I'd call 400 bucks a load freight a backhaul price.

They don't use a broker.
Doubt it went more than 300 miles.
 
You don't have to be a rocket scientist to price pellets.
When pricing the trucking cost for truckload sales I generally figure anywheres between $2.50 to $3.00 per mile from the plant's zip code to the customer's zip code. The per ton price depends on the load size, who is providing the forklift, and what kind of pellet the customer wants.
Vans generally haul 22 tons and flat beds can carry 22 to 40 tons depending on which state they are traveling in.
This time of year trucking is much easier to line up than in the warmer months.
 
doone060 said:
You don't have to be a rocket scientist to price pellets.
When pricing the trucking cost for truckload sales I generally figure anywheres between $2.50 to $3.00 per mile from the plant's zip code to the customer's zip code. The per ton price depends on the load size, who is providing the forklift, and what kind of pellet the customer wants.
Vans generally haul 22 tons and flat beds can carry 22 to 40 tons depending on which state they are traveling in.
This time of year trucking is much easier to line up than in the warmer months.

At those rates I guess I'm going to have to start hauling for you!!!!
 
unknowingLEE said:
Franks said:
unknowingLEE said:
There has not been a commercial truck engine built in 10+ years in the US that gets better MPH!
There is no such thing as a "backhaul" anymore.
Pellet prices are going to be volatile for a while. Buy a multifuel!

I use Gypsum Express to grab pellets and coal. I'd call 400 bucks a load freight a backhaul price.

They don't use a broker.
Doubt it went more than 300 miles.

LEE is right. I just checked. $505 to haul 22 tons of coal 225 miles $396 to haul 22 tons of pellets 155 miles
 
iron stove said:
ChrisWNY said:
(I intentionally seek out E85 for my FlexFuel pickup truck because it's $2.80 per gallon in my area, gas stations selling E85 has increased dramatically over the past year) and the demand for oil will fall..

Thats why CORN is sky rocketting. Untill they make bio-mass fuel from somthign other than food, im out of it.

There are a few growers that grow fuel strickly for corn stoves. We have one in Lakeville, CT. But with corn prices up. I am sure there higher than pellets this year.

Corn stoves should burn other forms of fuel like chery pits and such. Grass pellets are another biofuel to keep an eye on. I know I will once my stash gets low. Even if I don't burn 100%, I could mix to extend the other fuels. Options are good to have!
 
j-takeman said:
iron stove said:
ChrisWNY said:
(I intentionally seek out E85 for my FlexFuel pickup truck because it's $2.80 per gallon in my area, gas stations selling E85 has increased dramatically over the past year) and the demand for oil will fall..

Thats why CORN is sky rocketting. Untill they make bio-mass fuel from somthign other than food, im out of it.

There are a few growers that grow fuel strickly for corn stoves. We have one in Lakeville, CT. But with corn prices up. I am sure there higher than pellets this year.

Corn stoves should burn other forms of fuel like chery pits and such. Grass pellets are another biofuel to keep an eye on. I know I will once my stash gets low. Even if I don't burn 100%, I could mix to extend the other fuels. Options are good to have!

Last I heard Western Reserve had bagged burn corn for over $8 for 50 lbs. I deal with a couple farms on sifted and bagged corn but at the current price I sold a whole 2 tons this year.

I will just say this again, stock up early $4 a gallon gasoline and $4.50 diesel real soon.

Eric
 
If you think the price is going up, it's much easier to purchase a security tied to oil or gas or diesel than the actual stock!

We discussed that before, but hedging is always done by the big dogs...maybe the little dogs should join the party!

A couple years back when diesel and jet fuel went over $4, Southwest Airline destroyed all their competition because they had bought vast hedges of jet fuel (not the actual fuel, just securities) guaranteeing them a low price. As I remember, they had enough for almost a full year!

I've shifted into a bit more energy (securities) in the last few months, and am already seeing a decent upswing. That offsets the higher cost at the pump, etc.

Granted, this is tough for a pellet dealer or customer, but much easier for a large trucking company.
 
Just ordered 2.6 tons of CleanFire Pacific from www.woodpellets.com for $250.28 a ton; delivered!! They waived the current $11.00 delivery fee, so not too bad. I don't need the pellets this year. But what the hell, for that price delivered if the price of oil and diesel goes up by next year, and I'm betting it will, I should have almost 5 tons going into winter 2011/2012. If the prices drop, oh well, can't see'em dropping much less than 250 a ton; delivered.
 
iceman said:
Funny thing in another thread I mentioned buying now and someone said wait for the spring buy... I am not saying its not possible, but I don't see many spring prices being much if any cheaper than what we are paying now. with everything going on in the middle east and oil going up I find it very hard for those big boys not to make some extra money as they alwAys do...
then when they predict $5 a gallon for heating oil next winter ... prices will stabilize and drop some after summer

Ice- I think it was me who said to wait a month or so to buy your next years' needs.......still sticking to that, although I have some inside info......I donth think you'll get rich in the savings, but, still feel it will be cheaper, regardless od the current diesel prices........oh, and dont worry, if I'm right, I'll reference this thread, and if Im wrong, well, I'll forget I said it....lol
 
I have 4 tons of Greenway's in the garage at $187 a ton from Lowes before the prices went up. That gives me heat all next winter and a year to shop.
 
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