This is probably a dumb question, but here it is anyways! A local stove shop in my area is placing American Fiber Hardwood pellets i used them all winter on sale in May for 189 a ton. He claims the prices are only going to go up. Do you think I should buy next year winters supply at this price, or do think it is just a sales pitch and pellets may go lower in the summer?
Pellet Prices
- Thread starter Rocket
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HarryBack
New Member
Xena
Minister of Fire
Shane
Minister of Fire
I'd buy them. That sounds like a good price. Compare the cost to your other heating source and make sure burning the pellets is cost effective.
Corie
Minister of Fire
That sounds great to me, I don't think I could touch that price out here right now although i haven't checked.
webbie
Seasoned Moderator
HarryBack
New Member
Choppedliver
Member
Wow, thats a good price. as long as you have a good dry, shaded , off the ground place to store them I would buy pellets now. Lignetics( one of the largest pellet makers out there) just sent out there price increase for next season. They have a $25.00-30.00 per ton increase for next year. That would put Lignetics retail price around $6.50 to 7.50 per bag in Colorado.
restorer
New Member
Choppedliver said:
Seems like Lignetics might be pricing themselves out of the market. If we were able to buy them in Utah at $240.00 per ton last year, why so much more on the Front Range? At $6.50 that's $325 per ton. I think Heartland, Eureka and Bear Mountain will be better buys. We have no pre-season prices yet, but I got a quote from IFA for a regional premium softwood at $5.29 per bag and they will do $4.79 for three tons. Ironically I have a customer close to the production plant. I stopped by three weeks ago to check things out, I was not impressed by the operation or the stock on hand ( lots of pieces and fines), but the foreman said if I picked up in April or may I could get them for as cheap as $160.00 per ton. I'm looking for a dry storage lot, either a warehouse or sheds and thinking about going into competition with the big boys. I have access to a forklift, pallet jacks a a partial capital backer. We'd do it as a side business, but I am now exploring suppliers. May have to stick with the small independents, but with fair warning to buyers and some extra education it might work. Also looking at a source in Eastern Idaho for bagged corn, and distillers pellets. If your going green, why not all the way.
I still think, the prices are not in, yet. I would think early pellet buying should take place, after they hysteria of this seasons prices are gone (don't just buy because it's at the price of last year and you know it's going up), and when sellers are really looking at a stagnant inventory.
Not sure why there would be a 20-30 percent increase in wholesale price, but that seems to be excessive. I assume the price is FOB factory as they can not predict the cost of shipping with the price of fuel through the roof. If Lignetics are excessively more expensive than other quality brands careful buyers will be able to stare at the full warehouses. I am sure they will not be stocked at the big boxes, so this may be the best source in a few months.
HarryBack
New Member
well, Unclerich, most suppliers HAVE gotten prices to dealers...in fact, Ive got all of mine, and carry 7 different types of pellets. One company who shall go nameless has sold out of their entire production until September...know what? They sold it all in less than a day!
Usually by now, the manufacturers have already lowered pricing, trying to move product to make more space, to make NEW product. As for stagnant inventory, Im selling it as fast as I can get it. Sold 14 tons to a person this afternoon....New England Premium Hardwoods, for $214/ton (we still get alot of resistance here in New England against the softwoods, even though they are a fine pellet).....heck, my New England Canadians (softwoods), are $199/ton....moving, but nowhere nearly as fast as the hardwoods. Go figure.
I think you certainly can compete with the "big boys". Theres a small learning curve. First big step is delivery or not. That can be expensive. Out east here, nowhere near as many folks own a truck or pickup, and they do require it. We dont do it for free, mind you, because the truck and mountable forklifts are EXPEN$IVE! Then, also, try to sell early...beat the big boxes to the punch. Walmart, Lowes, HD dont stock pellets at this time of year....big advantage for those of us who do. Good luck with the endeavor! PM me if you have any other questions.
Usually by now, the manufacturers have already lowered pricing, trying to move product to make more space, to make NEW product. As for stagnant inventory, Im selling it as fast as I can get it. Sold 14 tons to a person this afternoon....New England Premium Hardwoods, for $214/ton (we still get alot of resistance here in New England against the softwoods, even though they are a fine pellet).....heck, my New England Canadians (softwoods), are $199/ton....moving, but nowhere nearly as fast as the hardwoods. Go figure.
I think you certainly can compete with the "big boys". Theres a small learning curve. First big step is delivery or not. That can be expensive. Out east here, nowhere near as many folks own a truck or pickup, and they do require it. We dont do it for free, mind you, because the truck and mountable forklifts are EXPEN$IVE! Then, also, try to sell early...beat the big boxes to the punch. Walmart, Lowes, HD dont stock pellets at this time of year....big advantage for those of us who do. Good luck with the endeavor! PM me if you have any other questions.
restorer
New Member
HarryBack said:
Harry:
Seems the East Coast is a lot more competitive than the West. We have no pellets available right now, even though the low last night was 26*. Retailers are saying, "Check back in August, we'll have prices by then." I guess they don't take pellet burners seriously. I have called all the regular suppliers in the area and they don't seem to be very interested in quotes or speculating on delivery. Rather frustrating to say the least. That's the cause for the move from retail buyer to wholesale buyer. I will never be able to complete with the big box stores, but I think there are those like me that would like to have something locked in for the next Winter.
I have had an interesting suggestion made by a prospective customer. They thought a buy it and store it program might work. That is you buy the pellets, we rent you a storage space for your pellets. That would work if there was enough SF or sheds on an acreage. That way, you are paid for the pellets, etc. and the customer can store as long as they want on site with a monthly rent. Haven't worked that idea through, but sounds interesting. That idea came from a farmer who stores product at the grain mill.
IF I didn't make it clear, the idea is a feed store supplier, cash-and-carry. No delivery, but you buy and we will hold/rent storage for you to pick up. I will not do delivery, but I will keep a list of independent hauler a customer can contract with to haul their purchases.
HarryBack
New Member
storage would be a nightmare with us. We have almost 2100 separate customers....would be a huge amount of space...then the bookkeeping! ("Bill picked up 7 bags out of his 250 today....wheres that slip, anyways?", etc)......
a contract hauler might work, but let me tell you, the worst thing about delivery isnt buying the truck, tho thats bad, but coordinating with the end user. You put, say, 3-4 loads on a truck, and any manner of things can cause you to be late...here we have mud, or you might get a talkative customer, or roadwork, etc, all can screw upa delivery. The customer waits around, get mad when u r 20 mins late, etc. Cell service here is unreliable at best too......wow...I wont, but I can go on and on about the perils of delivery, but it can pay for the truck, if done right, and helping the customer at the same time.
a contract hauler might work, but let me tell you, the worst thing about delivery isnt buying the truck, tho thats bad, but coordinating with the end user. You put, say, 3-4 loads on a truck, and any manner of things can cause you to be late...here we have mud, or you might get a talkative customer, or roadwork, etc, all can screw upa delivery. The customer waits around, get mad when u r 20 mins late, etc. Cell service here is unreliable at best too......wow...I wont, but I can go on and on about the perils of delivery, but it can pay for the truck, if done right, and helping the customer at the same time.
restorer
New Member
HarryBack said:
Seems here we have a problem with businesses not wanting older buildings and yards. There are reasonable properties available to the right parties. All will need creative adaptation. I have been in the retail furniture business for years, and have dealt with small haulers for most of them. If a customer needs a ton delivered there are all kinds of haulers who will to do the work. The kicker is to not do the contracting myself, but give the customers a list of possibles and let them make the deal. I could start out with 200 potential movers on Monday, but by Friday with good customer feed back my list may be down to three or four. I can think of 5 yard care guys who would take the side jobs and do a good job. Satisfaction guaranteed, by them not me.
I don't plan a 1,000 customer business, so I suppose my Quick Books can keep track of quantity. I just think that there is something reasonable between the boutique sellers at 200% plus premium and the big box stores. Any suggestions will gladly be included in the business model.
The area that I live in Northwestern Pennsylvania(Titusville) This where they are going to on sale for $189
Xena
Minister of Fire
HarryBack said:
I wouldn't be trying to commit to a specific time anyway.
As you said, nearly impossible considering the variables.
When pelletsales.com delivered ours, they gave a day
but no time. Then they called me again and asked if
they could drop them off a day early. Prior to delivery
I was asked where I wanted the pallets placed.
They won't drive the forklift over grass or into a garage
for fear of damaging a customers property, so it's pretty
cut and dried that they would place the skids somewhere
on my driveway.
HarryBack
New Member
yea, Zeta, but you seem more down to earth than many people we deal with. We also call ahead, get a spot for delivery, etc ahead of time, but you'd be surprised what is said versus what is understood. Folks want it by the garage door.....you get there, theres a nice note with a map sketched on it as to where inside the garage they'd like the pellets stacked.......or they want the pellets put by the shed, across the immaculately cut lawn, with only a few pools of standing water in it, over the stone wall.....and god knows where the septic is....lol...put it by the shed behind the house...ok.....but theres 2 sheds......
we try to explain these things, but evenso, it seems like folks dont understand.
we try to explain these things, but evenso, it seems like folks dont understand.
Choppedliver
Member
In one week we had two customers that ended are delivery program for ever, one had us deliver 2 tons up to there house they had wanted them "on the front porch" witch was up 30 to 35 steps up from the drive way, the next guy that week wanted 3 tons "Just in side the barn door" the only barn door at ground level was unreachable with a truck, we could either toss the bags up from the bed of the trailer to the second floor doors or carry the pellets around the barn 40-50 feet the other door at ground level and set them inside the door. That was the last time we ever delivered pellets and my back has never felt better.
HarryBack
New Member
heh, Liver! I can relate. We try to communicate that we wont carry the pellets AT ALL. Tailgate delivery only. We try to get the pellets where folks want them, or at least as close to where they are going as we physically can with a forklift, but boy, are some folks mad when you wont stack them for themselves, or you cant get it where they want it! Its nice when someones home, because you can usually explain it to them, or try to. WHen they arent home, you are guaranteed to get a PO'd call at the end of the day, or on the weekend, demanding to know why they werent stacked where they wanted them. If the person is home, we explain why we cant, and usually it suffices. Some folks are adamant tho that the driver stack them, (of course, so the homeowner doesnt have to). We offer then to refund their money, right then and there, since they arent satisfied. We can put the pellets back on the truck from whence they came, refund their money, and go on our merry way. Do you know, we've never had to refund their money?
(all you folks reading this might not understand the delivery biz, but its pretty interesting sometimes, lemme tell ya!)
(all you folks reading this might not understand the delivery biz, but its pretty interesting sometimes, lemme tell ya!)
buildingmaint
Feeling the Heat
Where at ? I live in Oil City .I have bought my pelletts from Agway the last two years. I have had no problems with any of the two kinds they have sold me so far. What kind of pelletts are they?Rocket said:
webbie
Seasoned Moderator
Choppedliver said:
Well, luckily the oil and gas companies are still willing to deliver their fuel just about anywhere!
It's a free market, and $300. pellets that need to be picked up will be the death of the industry.
Not commenting on the ups and downs of the delivery or pellets sales biz, but the bottom line is that the end user will end up weighing the advantages, prices and other factors and then making a choice as to which fuel to burn.
Have to agree with Webmaster Craig. I bought an EnviroFire pellet stove in 2000 and bought pellets every spring/early summer. Bear Mtn or Golden Fire started out at $144 ton. First sale this year is at $202 ton. I understand price increases etc but I'm not sure what would price me out of the market. I like the idea of a renewable resource and all - so I hope the cost of pellets can remain competitive...and readily available.
We just sold that home and now I'm on to bigger and better things(a old pickup, Husky saws, a woodshed, and soon, A STOVE!)
We just sold that home and now I'm on to bigger and better things(a old pickup, Husky saws, a woodshed, and soon, A STOVE!)
One of my local hearth shops is still selling Dry Creek for $275 a ton - picked up! When I asked about when the price may decrease - they did so last year around May - they responded that due to the cost of fuel going up the least they anticipate pellets will be selling will be $250 in May. I guess I know where I won't be buying pellets!
Jabberwocky
New Member
With all deference to the country-living chainsaw lovers, $300 pellets still blow oil and natural gas out of the water (at least in the Northeast) as proven on a previous thread where someone from the plains cited rediculously low natural gas prices unheard of in these parts. Ultimately, its about the fuel that's closest to you. Acreage owners with their own trees enjoy obvious benefits. The acreage also allows them to mask the billowing smoke and soot. Denizens of built-up old mill towns and suburbanites need to look to alternatives.
webbie
Seasoned Moderator
Jabber, you are definitely wrong to state that "$300 pellets blow oil and gas out of the water" - in terms of price.
The basics:
$300 a ton pellets= $6.00 a bag of 40 pounds, or a total of 40x8500BTU= 340,000 BTU for $6.00
Oil at $2.50 a gallon - the same $6.00 would buy approx. 2.3 gallons or 2.3 X 140,000 BTU = 330,000 BTU
Nat. Gas at $1.80 per therm - the $6.00 would buy 3.3 therms or 330,000 BTU
Note that oil prices right now (according to maineoil.com, etc.) can be as low as $2.20 or lower - $2.50 is the upper range.
The gas price given is also high - the page at:
http://www.eia.doe.gov/neic/brochure/oil_gas/natgas06/natgas.html
............states the average price per therm nationwide to be less than $1.10 - yes, it varies greatly but the fact is that Natural Gas blows $300 pellets out the tailpipe in many areas of the country.
Efficiency of ALL modern systems are somewhat similar, although it could be argued that a fixed fuel appliance such as a freestanding gas stove/heater (Rinnai, etc.) as well as a freestanding oil heater (monitor, etc.) is MORE efficient in everyday use. For debates sake, we can say they are all equal.
So, a more accurate statement would be that the total cost of heating with $300 pellets is as high or higher than the cost of fuel oil or natural gas in many parts of the country, and at best EQUAL in others.
This does not consider dust, loading the stove, removing ashes, cleaning out the stove, etc. - Oil and Gas definitely has advantages on those fronts.
While it is my job to promote solid fuels, I feel that accurate information is the best way to do so.
The basics:
$300 a ton pellets= $6.00 a bag of 40 pounds, or a total of 40x8500BTU= 340,000 BTU for $6.00
Oil at $2.50 a gallon - the same $6.00 would buy approx. 2.3 gallons or 2.3 X 140,000 BTU = 330,000 BTU
Nat. Gas at $1.80 per therm - the $6.00 would buy 3.3 therms or 330,000 BTU
Note that oil prices right now (according to maineoil.com, etc.) can be as low as $2.20 or lower - $2.50 is the upper range.
The gas price given is also high - the page at:
http://www.eia.doe.gov/neic/brochure/oil_gas/natgas06/natgas.html
............states the average price per therm nationwide to be less than $1.10 - yes, it varies greatly but the fact is that Natural Gas blows $300 pellets out the tailpipe in many areas of the country.
Efficiency of ALL modern systems are somewhat similar, although it could be argued that a fixed fuel appliance such as a freestanding gas stove/heater (Rinnai, etc.) as well as a freestanding oil heater (monitor, etc.) is MORE efficient in everyday use. For debates sake, we can say they are all equal.
So, a more accurate statement would be that the total cost of heating with $300 pellets is as high or higher than the cost of fuel oil or natural gas in many parts of the country, and at best EQUAL in others.
This does not consider dust, loading the stove, removing ashes, cleaning out the stove, etc. - Oil and Gas definitely has advantages on those fronts.
While it is my job to promote solid fuels, I feel that accurate information is the best way to do so.
HarryBack
New Member
but the question is, Who is selling $300 pellets? That price is wrong by a third these days...pellets are closer, if not below, $200/ton, here in New England.
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