Market Slowdown

[Ken]

As I understand it once trees are reduced to a dust and dried to a MC% of around 10% the BTU value does not vary a lot between species.  Pines apparently have some of the higher heat values due to the larger amount of resin found in them. 

A group of investors in central NB are looking at setting up a small pellet plant along the Nashwaak river valley over the next few months.   The intention is to use low grade wood that industry does not want and turn it into pellets.  Although initially a large portion of the product will likely head to the strong New England market the local opportunities will only grow as the supply of pellets increases.  There are people who would like to buy a pellet stove but they have heard that pellets are hard to come by. 

There is some concern that too many suppliers will begin to drive the cost of pellets down.   I have just returned from a trip to Europe and the pellet industry there is huge.  The demand for pellets has grown steadily over the past decade and projections are that it will increase for the foreseeable future.  That will also create viable markets for pelletized material.  Bulk home delivery in western Austria is nearly 280 Euro/MT.  That is over $400 MT Cdn. 

Our dependance on high priced foreign oil needs to change.  We have a huge natural renewable resource that could be used extensively for heating and power generation.  It will take some will on the part of governments to really make the biomass industry grow although I believe it is a viable alternative. 

Ken

[Nora]

A pinon is a shrubby kind of tree.

It seems that a number of areas around the US have types of trees that take over: Eastern Red Cedar, Tamarisk, ... Great biofuel opportunity!

Besides wood pellets for homes, I'm seeing more news about industry and public buildings being heated with wood chips. In the valley south of us there are two schools being heated with wood: Darby and Victor. I read their report for the last year's heating costs. Here's their summary:

SUMMARY
Cost of wood chips (760 tons) $ 18,170.00
Cost of operating boiler and participating in fuels study 4,700.00
(approximately $9.00 per ton of fuel used)
Supplemental fuel oil 1,935.00
DPS 2005-2006 Cost $ 24,805.00

Comparison of projected cost had the school heated with fuel oil:
Historic usage cost of fuel oil $115,000.00
(50,000 gal @ $2.30/gal, avg. cost winter 2005-2006)
Estimated 2005-2006 cost savings $ 90,195.00

The full report can be found on:
http://smallwoodnews.com/Docs/PDF/FuelsSchools/Darby2005-6.pdf

I think we'll see both more supply and more demand!

Happy New Year everyone!

[Ed_K]

 I'm looking into making sawdust from lowgrade pine,has anyone seen a machine that I can feed in small logs and have sawdust like you use for bedding drop out the bottom? I've googled grinders but they all start with chips or small chunks to start.What I'd really like would be a machine thats low RPMs that I can drive with a farm tractor.

[Furby]

I think you want a shaver.

Yup, google "shaving mill".

[Ed_K]

 I looked at the salsbe shaver 50 Gs,the horse people like the shavings but they have suppliers in my area. I just want to grind junk curvie logs and not price myself out of it.

[Ron Wenrich]

Try a tub grinder.  I'm not sure on what size of screen you would use, but we use them to double grind mulch.  Or you could turn that low grade pine into mulch instead of dust, and get a little better price.

For a higher production end, you could use a wood hog.  That would produce a good amount of mulch/dust.  But, you wouldn't run that with a farm tractor.

For ease of handling, reducing to chips is a lot easier than trying to reduce whole logs.  I saw one guy who used to take a debarker and grind a log down until he couldn't get anymore mulch.  He then put the rest of the log into a wood hog.  It paid more than sawing.

We have one mill that went from sawing into the mulch market.  They also make bedding.  Their main resource is to buy wood chips.  They then put them through a wood hog.  The mulched material is used for landscaping, animal bedding, and playground cover.  They also sell it to parks for use on trails.  They no longer have a sawmill.  http://www.zeager.com/ 

With good marketing, you can have a really good business.

[rebocardo]

> my congressmen and representitives to find out what can be done to push biomass energy

America was blessed with three great natural resources, water, trees, and coal.

Water and trees are renewable within a lifetime.

Maybe starting on a state level, if you required every new house built by a contractor, to be built with a factory chimney made to national UL specs, in 10-20 years you could drive down oil and natural gas consumption from overseas suppliers and save money doing it. We already require 1.5 gallon toilets. Requiring below ground heat pumps would not be a bad idea either. Kind of stupid not to use the natural cooling and heating of the earth to cut fuel bills.

[Cedarman]

We could accomplish a change in energy source in 10 year with a stroke of the pen. But not without a lot of screaming and kicking by the vested interests.

Pass a law that increases taxes on gasoline, diesel and natural gas by 20 cents per gallon each year for 10 years.  This gives people time and incentive to use renewable sources of energy.  I am now ducking for cover.

[farmerdoug]

Cedarman,

They have high taxes on fuel in Europe and it provides incentive to use alternative energy sources.  You maybe on to a good idea and the government is receptive to raising taxes anyways. :

Farmerdoug

[beenthere]

...........Pass a law that increases taxes on gasoline, diesel and natural gas by 20 cents per gallon each year for 10 years.  This gives people time and incentive to use renewable sources of energy.  I am now ducking for cover.

You should duck.    Like that mentality worked so well for getting smokers to quit? 
Your tax idea would put the squeeze on the little guy, the so-called majority of middle income, but those who could afford it would go about their business -- making more money to pay the higher taxes and passing on the increase to the middle income earners.  Can't see how it would work.  Stay the heck out of it, and let the 'shortage' of oil dictate the alternative fuels. The shortage won't happen 'overnight' but will happen over a fairly long period of time (time that can be used to introduce alternative fuels as maybe is happening now).

Your idea would get more cars off the road, more people on the welfare rolls, fewer cars sold, more car producers out of business, which would lay off more workers, which would mean more on the welfare rolls, and on and on... spiraling down - - - at least as I picture it.  But in the meantime, to correct that problem, the gov't would introduce a higher minimum wage so there would be no poor people who couldn't afford the higher taxes, adding to the spiral.......scary, in my opinion.
Government cannot manipulate the economics, other than helping businesses (simpler rules and encouragement) build and grow that will hire more people that will buy more goods and services to get, and maintain, a strong economy.

[Ed_K]

 The only way I would go for more taxes on fuel is if it was for medical,dental and workers comp insurance  ;D . It works in other countries why not here?

[farmerdoug]

I think the laws that regulate the alternative energy sources be loosened.  Laws should also be passed that encourage it.  I do not think that they should offer incentives though as it costs us more in the long run.  They make it real hard to start new plants and then offer money from the taxpayers to encourage them to start onw.  That is just stupid. :

Beenthere is right on letting the market correct itself and push alternate fuels on its own.  But the only problem is that the government has a way of messing it up for the little guy and helping the big business.

I think that if someone generates electricity the utilities should be required to buy it at market rate.  I would be willing to invest in solar, wind, or cogeneration if I could sell to excess to the utilities to offset the power used when I am not producing any.

Farmerdoug

[Mooseherder]

I think the laws that regulate the alternative energy sources be loosened.  Laws should also be passed that encourage it.  I do not think that they should offer incentives though as it costs us more in the long run.  They make it real hard to start new plants and then offer money from the taxpayers to encourage them to start onw.  That is just stupid. :

Beenthere is right on letting the market correct itself and push alternate fuels on its own.  But the only problem is that the government has a way of messing it up for the little guy and helping the big business.

I think that if someone generates electricity the utilities should be required to buy it at market rate.  I would be willing to invest in solar, wind, or cogeneration if I could sell to excess to the utilities to offset the power used when I am not producing any.

Farmerdoug

I like your thinking.
To me alternative energy is a matter of our Country's security.
I think the moderate temperatures so far this Heating season have kept Opec Oil at bay. If'n it would be below freezing for long periods, prices might be over 70 a barrel, currently around 60.
The fact that major oil companies are the ones involved with Solar, Hydro, Wind, Natural Gas, Fuel cells and Biomass interests isn't good for us energy users. Maybe they are the only players that don't have considerable investment problems. :D
Anyway, IMO, all alternative energy resources need to be coupled with more Gulf and Artic Drilling with less dependence on countries that just assume see us dead.
Add the threat of China's Oil based economy in the making to our supplier issues. (Hate us)
We got some trouble coming if'n we keep our head in the sand.

[Fla._Deadheader]

Y'all really don't get it.

  Right now, TEXAS has considered BANNING all Biofuel for vehicle use. There was so much complaining, the agenda was "Shelved" pending further study.  : :

  It was pushed back to 2007, Late in the year.  Big Oil is getting richer "Blending" a little ( 1/10 gallon Bio into 1 galoon of their Diesel, to the tune of $1.00 per gallon, subsidy. YOU try to get that. Now that Bio fuel is getting major influx, The price of Methanol to convert FFA's has risen 50% or more, from $1.75 /gallon, to over $4.00.  Guess where Methanol comes from, Natural Gas.  : :

  Even though ULDS is now on the market, emitting MORE emissions, the use of Vegetable oil is a nearly necessary item to add "lubricity" to the new "Drier" Diesel. : :

  It goes straight down hill from here.

  One Forum I am associated with, just took a poll about how much MEMBERS have made so far this year, back yard style. Over 20,000 gallons of homemade Bio. Just think of what's being produced by Big Oil. ???

  BTW, this crap talk of "it costs more to produce than you get" is just that, CRAP.  >:(

[TexasTimbers]

The oil companies, all of them down the line including the drillers, the refineries, and the biggest players in the oil game - governments (the taxes they charge are practically pure profits inasmuch as they are not part of production) the  charge more and make exhorbitant profits because they can.

Someone tell me . . . . what are "we" the user going to do about it? Nothing. And they know it. they will keep it just low enough to prevent a revolution but even that won't happen. It used to be he who had the gold had the power but as we have known for 150 years now he who has the oil has both the gold and the power. 

Oh well. The wise investor will put his money with the big fatcats for the long haul because $2 a gallon fule is gone for good. $4+ is coming to a pump near you sooner than you think.

[farmerdoug]

FD,

Are you talking about the biodiesel forum run by Shaun of the BioBeetle fame?

If so what is your handle there?  I peruse that site all of the time.  I am really thinking on getting into biodiesel too.

Farmerdoug

[PineNut]

Cedarman, I see what you are saying abut taxes on fuel. We could stand an increase tax on petroleum fuels but only if it were to be used to help the US to become energy independent. But there are two major problems with this.

1.  How to keep the politicians out of it.
2.  How to keep the greedy hands from putting it in their own pockets.

If these two problems could be solved, I could go for it but I see no way it could be done.  So lets not tax it any more.

[OneWithWood]

FD and FD,
I also peruse that forum quite a bit.  My handle there is bdubet.  You may also find me on the dieselstop where I use OWW.  I am actively making bio diesel from waste donut oil.  I will be posting some pics of my setup in the alternative fuel thread whenever I remember to take the camera out to the workshop with me.  I am brewing fuel to use in my equipment during the warmer months and as supplement heat for the greenhouses during winter.
One nice thing about methanol, it is not consumed in the process and by building a separate still much of it is recoverable.  If you use potassium hydroxide as the catalyst the product left over after recovering the methanol is a potassium fertilizer.

[Fla._Deadheader]

   ;) I saw yer handle on there. Didn't put it to a face, though.  8) 8) 8)

[farmerdoug]

My handle is ---
drumroll---

farmerdoug

I wonder who else from here cruises the site also.  Maybe Quartlow as I know he is into biodiesel also.

Farmerdoug

[Ron Wenrich]

Government cannot manipulate the economics, other than helping businesses (simpler rules and encouragement) build and grow that will hire more people that will buy more goods and services to get, and maintain, a strong economy.

Since when doesn't government manipulate economics?  They're called subsidies and they tip the balance of making one commodity more favorable in the marketplace over another.  Subsidies comes in several different forms.  Tax breaks, contracts, exclusions, limited tort are just a few that come to mind. 

I remember talking to my congressman back during the OPEC problems in the '70s.  We had a farmer that was producing ethanol for less than 50¢ a gallon and had a high quality hog feed as a side product.  The government shut down his illegal still.  What was government pushing?  Coal to diesel - even way back then.

I asked the congressman about why they didn't recognize ethanol as a good alternative to petroleum products.  He said the technology was unproven.  What it boils down to is that the government cannot control thousands of small producers.  They can control several large producers.  The government cannot function without tax money, and alternative energy, especially solar and wind, do not generate tax money or taxes can be easily avoided as in biodiesel and ethanol. 

So, the government gives big companies an economic edge and that controls the marketplace.

[SwampDonkey]

We have a Milk Marketing Board. It's good and bad. It reduced the number of dairy farmers that were not profitable, mostly hobbyists (you can not make a living off the cream and milk of 8 cows). It also discouraged the hobbyist as he had to invest a lot of money to get into serious farming. I don't think that part is right at all, it discourages new entrants into farming. At the beginning the Board gave you the quota at no cost. You had to stay within the quota or be fined. Some small operators sold their quota a few years into it and made more on the quota than the cows were worth.  :D  But, too many participants drives the price down and kills our fragile maritime market. We used to have a small dairy truck come from the coop to pick up the farmer's cream in cans, miss that part. They used to make butter right here locally in Florenceville COOP. But, to tell the truth things are a lot more sanitary now. They test that milk after each load and if your lot contaminated that load, you get a bill for the load. Before, 'ole Bessy's tale could have swished around in the milk pale a few times.  And you always wonder how clean the guys pales or separator was. I know some that were not too clean. : Maine milk is subsidized and the surplus is bought by the government. That is why it is half the price of ours. It's no cheaper to produce milk there, than it is here.

[Cedarman]

Ron you are right, very right in by book.
Letting economics sort this out might be fine, but  one reason to use renewable fuels is to lower the amount of greenhouse gases from fossil fuels.

The government supervises patents which by law prevent you from making a cheap product.  Take roundup ready soybeans, farmers can't use there own crop for seed without forking over big bucks. Yet they  the south American farmers get by without paying the fee.  Government controls us from birth to grave. We just think we are free.

[TexasTimbers]

Beenthere,
Governments are at the top of the food chain. I could stop there but but a little more elaboration would say that in our Republic our founders had the novel idea that through a never-before attempted, delicate tapestry of checks and balances "the people" would have the final word, but that also the central government would be very limited. It's main purpose was to protect our shipping lanes and from invasion and the like.
I do agree however, that in our complicated world, it must extend to certain other limited areas and that role has been redefined constantly since our inception.
I could pointlessly go on and on but my point is that to think that government do not control economics, even in our "free economy" society is not seeing the forest for the trees. It is IMPOSSIBLE to conduct business legally in this American system of "free enterpirse" without paying a plethora of taxes some 3, 4, 5 times on the same equipment and tools and inventory etc.
The government is THE ultimate controller of big, small, and medium sized business ventures in this country. They do it through taxation and regulation. They use the several states as collection agencies and they do it directly.
I'm suprised you didn't know this.

[Ed_K]

 The gov and eco's are working overtime for big business interest's, they've got the health departments believing wood smoke is bad. Their starting to curb or out right ban outdoor furnaces,next it will be indoor stoves and furnaces.There is some bad in smoke but I've been under the impression that smoke was mostly carbon which tree need to grow. Thus we're right back to oil. Thoughts? Am I wrong?