Pellet supply and pricing

[mtalea]

Hello all;
Been awhile since I was here last. Hope all is well with all of ya. I live in Connecticut and was wondering if anyone has gotten pricing for pellets lately and how the supply is, I dont want to wait till last minute like last winter



Matt

 

[chevyhd]

I got mine in the beginning of april for $185 per ton picked up in southcentral PA. They have gone up since then. I have plenty of oak split and stacked as well, just waiting for next winter now.

 

[MountainStoveGuy]

Out west, i have 180 ton surplus. The cost didnt go down, but it didnt go up either. There going for 5 bucks a bag/240 a ton. I dont see any relief anytime soon with freight costs the way they are. Btw, that price is down from a mid season buy i had to do for lingetics, they were 7/bag 309/ton. I hope there never that bad again.

 

[HarryBack]

Closer to your area, Mtalea....in central MA, we are currently selling New England, Cubex, Allegheny (premium hardwood pellets) for $239/ton, and Energex, Quality (premium softwood pellets) for $239/ton as well. yea, shipping's a huge issue....costs me about $50-60/ton to get Allegheny up here from PA. No real "early season" savings this year, as the pellets seem to be distributed differently this year than in years past. Used to be, that a retailer could buy alot of pellets early, if he so chose, and get somewhat of a discount, which we'd pass on to customers on the form of an early season sale. It would seem now that the pellet manufacturers, while allocating as much pellets to each dealer as they did last year, have chosen in their infinite wisdom to now spread that allocation out over 12 months, and not vary the cost, depending on the season, as theyve done in years past. What this means to you is that, while there will be as many pellets in New England in the supply channel as last year, alot of it wont even become available until winter hits! I think this will cause a scarcity of pellets in late summer or early fall. My advice would be for you to buy your seasons supply NOW, if you can. I think its fairly reasonable to assume the price wont go down soon, unless you expect to see a drop in oil prices between now and winter (anyone?)

 

[mtalea]

Thanks all!

 

[PutnamJct]

You would think the stove manufacturers would put a little fire under the butts of the pellet manufacturers to try to keep the prices reasonable. If the pellet price is not competitive with oil/gas the stoves aren't going to sell. No sense in humping 5-6 tons of pellets around when I can sit inside and watch the oil truck pull up.

 

[MountainStoveGuy]

The pellet manufactures dont realy care, they have way more old stoves to supply then worry about new ones being sold. They can give a rats butt if i sell stoves. They will sell pellets reguardless.

 

[HarryBack]

exactly. MSG! And theres lots of sites where you can compare energy contents of all sorts of fuels, to determine whats cheaper...and it aint oil!

 

[PutnamJct]

CHeapest in order is probably wood, coal, pellets, and depending where you are electric, gas, oil, or propane. My only thought was that if pellet prices stay artificially high, the savings between using them and the next ones on the list isn't as good; which leads to "why bother?"
Why, if the cost of transportation is supposedly driving the cost per ton of pellets higher is the cost of other large bulk items not following suit? Go to any home center or nursery and people are buying 40 lb bags of topsoil for $1.89 or less. Same price as it was 5 years ago. Comes in on a trailer, has to be offloaded with a forklift just the same.......

 

[begreen]

CHeapest in order is probably wood, coal, pellets, and depending where you are electric, gas, oil, or propane. My only thought was that if pellet prices stay artificially high, the savings between using them and the next ones on the list isn't as good; which leads to "why bother?"
Why, if the cost of transportation is supposedly driving the cost per ton of pellets higher is the cost of other large bulk items not following suit? Go to any home center or nursery and people are buying 40 lb bags of topsoil for $1.89 or less. Same price as it was 5 years ago. Comes in on a trailer, has to be offloaded with a forklift just the same.......

Supply and demand. Top soil is "dirt" cheap and pellets are red "hot" in the east right now. Locally, pellets have held there price around 150-180/ ton for several years and continue to. It's been more stable than cordwood.

 

[MountainStoveGuy]

CHeapest in order is probably wood, coal, pellets, and depending where you are electric, gas, oil, or propane. My only thought was that if pellet prices stay artificially high, the savings between using them and the next ones on the list isn't as good; which leads to "why bother?"
Why, if the cost of transportation is supposedly driving the cost per ton of pellets higher is the cost of other large bulk items not following suit? Go to any home center or nursery and people are buying 40 lb bags of topsoil for $1.89 or less. Same price as it was 5 years ago. Comes in on a trailer, has to be offloaded with a forklift just the same.......

As begreen stated, supply and demand play part of the pellet cost, and the only logical answer i can come up with for your comparsion to soil, is that the soil is coming from a local source, pellets come along way to get to me. Currenty missouri is where im getting my pellets, and the garden department where i work buy soil from a local distrubitor. Just a guess.

 

[warminwisco]

I am getting Marth Hardwood for 137.00 a ton in 40 lb bags, and canadian fir for 136.oo a ton bulk. I enroll in a club 40 bucks and get discounts on parts and sevice if needed. DDiscount is 30 percent off list, dealer is in dale WI and has 4 or 5 brands that go from 137.00 to 200 or so for Bear Mountain. At 230 a ton do you really save much money over NG? I know in my area, WI, I would not. I also mix corn in with the stove at 65 a ton

 

[HarryBack]

Well, sadly NG isnt available in our area....the only way one can get gas is to have it delivered to an onsite tank, and Im told its expensive...but, fortunately, I DO have an update on pellet prices.....here in New England, we only have one pellet mill.....and as of June 5, 2006, they are increasing their prices by $24/ton! Its not even winter yet! Im looking at warminwisc's pellet numbers and those prices were well below cost BEFORE the increase......Im hoping someone in the pellet manufacturing world sees the light and realizes they are pricing pellets right out of the ballgame in New England! This info is from an extremely reliable sourse, by the way.....

 

[Mike Wilson]

I looked at pellets for a smaller "add on" stove in one zone of the house, thought it would be cost efficient and get some of that wood heat feel in my office here. Then I did a price comparison... forget it. I'll burn dinosaurs, its cheaper, and I don't need to blow 2 grand for the stove. Pity nobody makes a smaller coal stoker, a DVC-500 mini, perhaps. We can call it the DVC-200. Dane... Dane... DANE (by all accounts, Dane is wholly deaf)

-- Mike

PS - has anyone done any real price comparisons for pellets on Long Island? Post your results.

 

[Shane]

It's the same story here. The least expensive pellet in town 3.65 per bag 182.50 per ton. When you break it down (not including transportation costs to haul the pellets) It costs me .50 per hour to run my 45,000 btu pellet stove. To run a 45,000 btu gas stove (NG) would cost .52 per hour. Compared to propane which is somewhere around .90 per hour it's still a good deal. But like I said the 3.65 are the cheapest, the average is 4.85 which makes pellets not even close to cost effective for around 50% of the population in my area. I'm not even sure the big box is selling them right now. Judging from what they did last year we'll probably see them over 4.00 per bag when they start carrying them again. They see the media hype about fossil fuel prices and the majority of consumers listen to that and rarely do actual comparison of fuel costs. There have been a few pellet manufacturers come on the board and explain/defend their pricing. All of their claims seem reasonable to me (got me off my price gouging soap box) but I know at the same time they're all bringing in good profits right now and good for them. It seems that pellet fuel will remain a niche heating source, it is too dependent on fossil fuel for production and transportation. Of course there is still the pissed off consumer factor. I have sold pellet stoves to people recently, even after pointing out the slim savings. The simple fact is that they feel the NG supplier here is shifty and they just don't want to give their money to them any longer. Wood just isn't feasible for alot of working folks, the automation and ease of pellets is a perfect answer for many.

 

[elkimmeg]

I looked at pellets for a smaller "add on" stove in one zone of the house, thought it would be cost efficient and get some of that wood heat feel in my office here. Then I did a price comparison... forget it. I'll burn dinosaurs, its cheaper, and I don't need to blow 2 grand for the stove. Pity nobody makes a smaller coal stoker, a DVC-500 mini, perhaps. We can call it the DVC-200. Dane... Dane... DANE (by all accounts, Dane is wholly deaf)

-- Mike

PS - has anyone done any real price comparisons for pellets on Long Island? Post your results.

CFM makes a coal stove Villgant, I have seen on sale for under $1,400

 

[Mike Wilson]

CFM makes a coal stove Villgant, I have seen on sale for under $1,400

Yep, I know that. Thanks. I was looking at stokers, nothing hand fired... too dirty, and more work.

-- Mike

 

[webbie]

exactly. MSG! And theres lots of sites where you can compare energy contents of all sorts of fuels, to determine whats cheaper...and it aint oil!

Well, at the Hearth.com comparison at:

This Link

If I put 250 a ton in (figuring delivered) for Pellets, and 2.50 a gallon for oil (my guess is that it will average less than this next year, but use it anyway), we will see that Pellet ARE more expensive per BTU than oil. Coal is vastly cheaper and natural gas, although it differs in many parts of the US, is similar or cheaper.

Don't tell me you're using those nu'cler pellets again!

This chart does not take annual maintainence, pellet shortages, electric use of any appliance, original cost and such things into account, which can add greatly to the annual cost and hassle factor.

In any case, few could argue that the difference makes it worth while to buy $3000 stoves, haul pellets and clean up dust.

This, in my opinion, is why the industry would benefit greatly from additional suppy on the pellet end resulting in lower pricing.

 

[PutnamJct]

$2,261.95 per year for normal home for Oil $2.60 GALLON OIL
$1,833.50 per year for normal home for Pellets $249 TON

$64,000 question: Will Oil still be available at $2.60 a gallon (or less) and will pellets still be available at $249 a ton or better?

 

[PutnamJct]

From 1 of the Connecticut dealers web sites:
http://www.trading-post-ct.com/_fuel/newoodpellets.html

 

[HarryBack]

From 1 of the Connecticut dealers web sites:
http://www.trading-post-ct.com/_fuel/newoodpellets.html

Yea, but that page was done as of April when everyone figured NE pellets would keep the same price all summer long.....now it seems that isnt the case....I bet the prices will be changing soon...maybe a good time to snatch them before they go up?

 

[webbie]

$2,261.95 per year for normal home for Oil $2.60 GALLON OIL
$1,833.50 per year for normal home for Pellets $249 TON

$64,000 question: Will Oil still be available at $2.60 a gallon (or less) and will pellets still be available at $249 a ton or better?

a 5-15% difference in the cost of one fuel over another is not likely to swing the convenience factor. In other words, very few would choose to haul 7 tons of pellets, buy and install a stove and do the other assorted chores for a $200 savings.....and actually no savings at all once other factors are figured in.

Luckily, people buy and use Pellet stoves for other reasons - the gadget factor, to burn renewable fuel, to have a space heater and backup in the house and for the look of a flickering flame. But, mark my words, if Pellets continue to rise in price and oil/gas stabilize, the demand for stoves and pellets will also do so. We saw the Pellet Craze come and go once or twice already, leaving bad feelings and boat anchors all over the country. Hopefully some things have changed, but the manufacturers and the pellet makers should talk and make certain they don't kill the goose with the golden eggs.

American have been proven over and over again to have a short memory....and with Natural Gas at very low prices (NOW) on the wholesale level, this could spell renewed strength in gas appliances...

Wholesale Natural Gas right now is less than $6.00 per Million BTU. That is equal to oil at less than $1.00 per gallon, and WAY less than Pellets at any available wholesale pricing...even by the trainload. Sure, it will go up in the future, but since it is the most used fuel for home heating, it is substantial competition for Pellet fuel.

 

[cbrodsky]

$2,261.95 per year for normal home for Oil $2.60 GALLON OIL
$1,833.50 per year for normal home for Pellets $249 TON

$64,000 question: Will Oil still be available at $2.60 a gallon (or less) and will pellets still be available at $249 a ton or better?

a 5-15% difference in the cost of one fuel over another is not likely to swing the convenience factor. In other words, very few would choose to haul 7 tons of pellets, buy and install a stove and do the other assorted chores for a $200 savings.....and actually no savings at all once other factors are figured in.

Luckily, people buy and use Pellet stoves for other reasons - the gadget factor, to burn renewable fuel, to have a space heater and backup in the house and for the look of a flickering flame. But, mark my words, if Pellets continue to rise in price and oil/gas stabilize, the demand for stoves and pellets will also do so. We saw the Pellet Craze come and go once or twice already, leaving bad feelings and boat anchors all over the country. Hopefully some things have changed, but the manufacturers and the pellet makers should talk and make certain they don't kill the goose with the golden eggs.

American have been proven over and over again to have a short memory....and with Natural Gas at very low prices (NOW) on the wholesale level, this could spell renewed strength in gas appliances...

Wholesale Natural Gas right now is less than $6.00 per Million BTU. That is equal to oil at less than $1.00 per gallon, and WAY less than Pellets at any available wholesale pricing...even by the trainload. Sure, it will go up in the future, but since it is the most used fuel for home heating, it is substantial competition for Pellet fuel.

This is why I think if people really want to get into wood heat but aren't that movitated to handle cordwood, a woodstove+compressed logs makes a lot more sense right now until the pellet price becomes competitive again. We had a long debate on that here in another thread... pretty much the same theme here. You're not really saving much money over traditional fossil fuel options when you use compressed wood products. With a woodstove, you also have to deal with the chimney requirements, but you can also supplement with cheap cordwood/free scrounging. In a severe energy crisis, pellets and all compressed wood products will move up in price right behind all the other traditional energy prices - supply and demand will quickly eliminate any cost savings in commercial alternative fuel sources. Then the wood you own on your land is the only way to beat the market.

The one other financial motivation I can see for pellets would be for a vacation cabin where you don't want the expense of an oil furnace system and don't need the automatic reliability of running weeks at a time without intervention. (for example, you drain the pipes...) Certainly much cheaper solution than central heat for those that don't want to use traditional woodstoves.

-Colin

 

[Mike Wilson]

Three thoughts on this:

1- Burning wood in a stove is just plain fun, no matter how you slice it. Watching pellets burn in a stove is like, well, watching pellets burn.

2- I have been reading about the latest Ethanol craze (which will go away, IMO), and they've been saying that its much cheaper to make ethanol out of "excess" wood shavings, etc, rather than corn. So, there's another competing consumer for pellet material.

3- As mentioned above, a 5-15% price difference is not going to move people to a labor intensive, less convenient method of heating, such as pellets. Now, try comparing Oil at 2.50/gal, to Coal at 200/ton or Wood at 200/cord, and you come up with 55% and 50% savings, respectively. Hell, bump the prices of Coal and Wood up to 250/ton/cord, and you still come up with 44% and 38% savings. To get pellets anywhere near that savings you need to buy them at 140/ton or so.

-- Mike

 

[HarryBack]

true, Mike, but a couple other things to consider......

1. If ethanol uses wood in production, your cordwood will also have competition.
2. I know, I know, all you wood folks love the exercise you get cutting, splitting, hauling, and stacking your wood....BUT, I submit, you are a VERY small minority of folks who enjoy it....heck, you can find folks who like head cheese as well, maybe even have a forum extolling its virtues, but again, I submit, the GREAT majority of folks are unwilling to eat it.
3. By nature of the fact that wood grows fairly slowly, only a small minority of folks will ever be able to effectively heat with it....the more folks who use it, the less that will be available, and the more it will cost.
4. Some pellet mills are now buying whole logs and making pellets, so, its a matter of whether cordwood folks pay more for logs or whether pellet folks pay more for logs......I wonder who'd pay more?
5. Wood is more difficult to burn, and in most cases requires more attention than pellets...(flame on, but you know Im right)
6. Certainly while not idiot-proof by any means, pellets are more idiot-proof than wood.
7. Many pellet stoves can also burn a corn/pellet mix, diversifying the fuel one can burn.
8. A years' worth of pellets takes up less space than a years' worth of cordwood
9. Pellets dont bother my asthma like the mold, mildew, ants, and rodents in the woodpile
10. A typical pellet stove are more efficient than a typical wood stove.....(again....flame on....but I think you'll be hard pressed to prove Im wrong here...and In doing so, I want hard data, not some vagaries written to some left-wing website about how ole' Jim Dandy the hillbilly can make his stove run at 200% efficiency using the Bubinga trees he grows on his property....etc.....ie: manufacturers advertized efficiencies....)
11. Anyone see many elderly folks at their home stacking their years' worth of cordwood into nifty Holz Hausen piles? Again, Im sure theres SOME, but for every one you show me, I'll show you 10,000 who dont)

12. Flame away