making and selling wood pellets

[concretecutter]

anyone have any experience making and selling wood pellets?

[Ken]

I was involved in a commercial pellet operation for a short while.  Still paying for that one.  Very energy intensive and expensive to make a quality product.  Just the thought of making pellets makes me cringe.

[concretecutter]

what are your thoughts on a pto powered pellet mill using unlimted free sawdust from the local sawmill
capable of producing 500lbs of pellets per hour

[Ken]

I can't comment as I've never seen an operation like that.  Would the sawdust be dry?  Wet pellets cause lots of issues.  It would be a surprise to me if a unit like that worked as advertised but I could be wrong. 

[r.man]

I know of two machines locally, one I have worked on and been around that is made for a woodworking shop to produce pellets from their waste wood and the other is a large commercial machine with support equipment. The small electric machine has never made pellets consistently and after many hours of trying many different recipes and variations the owners have given up on it. The large commercial machine was put in used and has suffered from many catastrophic breakdowns. I have not seen this machine but I know a young fellow who works there and he has had a lot of time off for maintenance reasons. From what I have seen the operation is doable but finicky and needs the right personality type to be making the decisions.

[OntarioAl]

concretecutter
Do the math.
Wholesale price at your facility minus all expenses incurred to get the product to a marketable state.
Unless you are set up on the end of the sawdust chain (highly unlikely) the sawdust is not free you have costs associated with handling and perhaps drying.
Heed r.man's advise about pellet making it is not that simple and if you dig deep enough (at least up here) you will find some sort of government susidy is involved.
Al

[concretecutter]

I have done the math everything seems profitable aslong as the machine lives up to the production standards it claims which i find it hard to believe to thats why i am asking for everyones input. even the salesmen said not to go with the diesel single clyinder model because of vibration of the motor causes things to loosen up, which throws a red flag if your going to sell something atleast put out a quality and dependable machine and also having a consistant product. i have never made pellets or have ever burned them but if a person could find a dependable pto mill that can make a consistent batch that is quality, i believe there is money to be made.

on the sawdust end of it, the mill is two miles from my house and they are paying to get rid of all the sawdust they produce by the semii load.

[Jim_Rogers]

I did a little research on this subject once. I found a small electric pellet maker for about $2500 and I wanted to see on in action close to me. There we're any around here.
I emailed the company and asked them if their machine would produce pellets from my sawdust right off the mill. He said to send him a 5 gallon pail full and he'd try it. I never did.
With more research they suggested that I might need to buy and put in a binding agent to get the wood to stick together in the pellet. That was a turn off.
Then it seems to get the best pellet you need "dry" sawdust. In order to dry the sawdust you need to install an operate a sawdust drying plant. That would cost $10,000 for the smallest one available.
My next thought was to go to all the local woodworking shops that throw out their sawdust into their dumpster.
And offer to take it all off their hands for free, by providing them with 55 gallon barrels that they would load up with their dry sawdust. And when full, I could drive over and pick them up and drop off other empty barrels.
But this all involves time. Time to go get the sawdust. Time to feed it into the pellet maker hopper. Time to bag up the pellets as they exit the machine. Looking at all the time I'd have to invest into making the pellets it seemed like it was easier to just buy pellets from big supply houses.

I'd ask to see their machine in operation, near you, if possible. I'd ask for them to test some of "your sawdust" and see if it will produce a good pellet. And then burn them and see how they burn. If it isn't dry you're not going to get good heat out of them.
Good luck with your research.

Jim Rogers

[Cedarman]

Since making pellets seems to be the big boys that get subsidies, what about biochar or furnaces that use sawdust?  I know there are some units that make biochar on a small scale.  There are several companies making sawdust burners.
Why spend the money making pellets?  Is it because they burn better than sawdust or because they ship better than sawdust?  Or some other reasons?

[concretecutter]

im just going to try and talk to some of the companies that sell there machines and see if they will demo me one or atleast rent one before i go and just buy one. It will be the ultimate test to see if this product with produce what they claim before investing 4 or 5grand.

[Magicman]

I toured a commercial pellet mill.  The pellets were not made with sawdust but with papermill quality chips containing a maximum of only 4-6% bark.  They went through a hammermill and then were dried to a specific moisture content before being feed through the dies.

They said that sawdust would not work.  If using sawdust is so simple, then why was this commercial manufacturer not using it?  We asked and I only remember that they said that it would not work.  They had about 6 lines and only one was running.   Without a government grant and subsidy the pelletmill could not operate.

The ultimate test is not whether the machine will make pellets.  The ultimate test is whether you have a reliable market for your product. 

[concretecutter]

thanks everyone for your comments. Its just so hard not to believe everything you read online  :D just add sawdust and your making pellets.

selling your product i wouldnt think would be to hard its just like selling firewood just word of mouth and a good reputation and of course a sore back when the season is over with.

[red oaks lumber]

the biggest negative to all pellet makers, how to keep fines and ash to a minuim. i burn pellets and nothing more frustrating than having  alot of ash. i looked into making small amounts for my self as i have enough raw material, sawdust, shavings but, i'm real leary about spending the money to only be dissapointed at best.

[Rockn H]

I used to haul pellets out of a mill in Pine Bluff AR... Fiber Resources.  They made hard wood pellets for heating and hardwood pellets for BBQ'ing by adding flavors.  They also made pine pellets for horse stalls.  The pine pellets were made from fine saw dust that would break down when the pellets got wet.  Horse ranches loved'em.  You could fork the clumps out and leave the good pellets.  I'm not sure just how they were made other than lots of pressure though.

[SwampDonkey]

From locally made pellets, they are finding that hardwood pellets have far less ash than softwood pellets. The closest mill makes the softwood pellet. The stove store in town started carrying those when the mill started making them, but had to use pellets from a hardwood mill instead because of the ash issue with the stoves he installs. And these stoves are $5000 and up in price, not cheap ones.

[Magicman]

selling your product i wouldnt think would be to hard its just like selling firewood just word of mouth and a good reputation 

Normal firewood customers are not necessarily pellet customers.  The pellet stoves/heaters that I have seen are set up to properly vent and burn the small pellets.  Firewood units may not be, which means that your market could be very select.

[redprospector]

I seriously looked into putting in a pellet plant at one time. Thankfully, the county that I live in decided that they would put in a plant of their own. Rather than try to compete with my own tax dollars, I decided to do other things with the land I had bought. Then the county decided they wouldn't build one either.  :D
I don't believe that those little Chinese made pellet presses will make a quality pellet using just saw dust. The minimum you will need to produce any quantity of pellets is a hammer mill large enough to produce enough product to keep the rest of your system in operation, you'll also need a dryer to take the stuff from the hammer mill down to the proper moisture content. You'll need a means to convey the material to the mill, if the material gets too dry you'll need a steam tube to add moisture back into it before it goes into the press. As the pellets come out of the mill they are pretty hot, so you will need a cooling tower or at the least a conveyor that will let air blow up through it to cool the pellets to a "firm" state. If you're going to sell them, you'll either have to get a bagger, or sell them in bulk.
You shouldn't need a bonding agent with a good press. The moisture content, and the lignin's in the wood should do that job. Unless you are making pellets out of grass, leaves or news paper, then you'll need a bonding agent.

Making a quality pellet isn't as simple as these people selling the Chinese machines would have you think. But they have it figured out how to make money.

[OntarioAl]

concretecutter
I apologize for coming across a little on the strong side.
In Ontario without government grants and subsidies energy produced from forest biomass is marginal even for industries that have bio waste (bark sawdust etc.) that they have to dispose of.
In your case the business opportunity of getting a cheap source of raw  material was very appealing. I would hazard a guess that the management at the sawmill in question looked at the cost benefit of processing the sawdust or hauling away and made the business decision that it was cheaper to pay to haul it away then the associated costs of processing and marketing the product (probably at a net loss without a subsidy).
I think if one does some serious market research I would not be surprised to  find that there is a strong correlation between the wholesale price of wood pellets and the subsidized price that the Europeans are paying (to offload their "carbon footprint)
I have to stop myself now before I go off on a rant.
Al

[kevin19343]

My understanding is that the inexpensive pellet mills don't produce anywhere near the amount of pellets that they claim.
Plus the material you use must have precisely the correct moisture content, meaning you must use an expensive drying system.
In addition to all this you'll also need a bagging system that protects the pellets against moisture.

Some guys use their pellet machines to make animal feed, like the pellets you feed your pet hamster or rabbit.

[Ron Wenrich]

I remember someone bringing in one of those small machines to see how well it did making pellets off our mill waste.  It was a small machine, and it was looked at mainly for some personal use, and not necessarily to be a full blown commercial venture.  After a tryout, it was put back on the truck, and never seen again. 

Everything always looks good on paper.