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Drive Sawdust Pellet Demand By Selling Particulate Combustion Equipment?
- May 28, 2018 -

In April this year, to be held in Atlanta, the international conference on biomass and fair I attended my first roundtable biomass industry association, to discuss our subdivision industry comparative advantage and the news of the day.Representatives from the biomass energy association, the biogas commission, the biomass thermal commission and the renewable energy alliance also attended.

The meeting provided me with another opportunity to discuss Operation 100k, the strategic initiative of the Pellet Fuels Institute for annual sales of heating equipment.As I prepared my notes that morning, I wondered if it was possible to work out what the market would have been like if Operation 100k had been launched 10 years ago and had been successful.

Soon, I opened a spreadsheet and filled in the cell with sales data published in June 2017 in Hearth&Home magazine.Then, I set up a formula to calculate the annual excess and deficiency.By the way, over the past 10 years, sales of particulate combustion equipment have been disappointing (141,208 in 2008).Even with overuse in 2008, the industry lost nearly 100,000 units a year in equipment sales between 2008 and 2017, to nearly 350,000 units.From then on, I began to quantify the annual impact of these missed sales.

In order to better understand the influence of the members of the pellet fuel producers, I estimated the loss of demand. I assumed that the pellet consumption of these devices was 2-3 tons/unit per year, with a range of about 700,000 to 1.05 million tons.Average wholesale price of $185 a tonne, this means revenue between $195 million - $1.29, not to mention our downstream retail partners will produce profit of $4000 to $60 million (according to the average retail price per ton, less than the average wholesale price of per ton).Overall, annual revenue losses are $170 million to $250 million.

Our industry cannot afford another decade of depressed burner sales.In the face of the last decade's Numbers, our plan to move towards selling 100, 000 particulate burners a year seems daunting, but supporting demand by focusing on burners sales is a priority.Our members' business needs to be as close to their productive capacity as possible to maximize their profit potential.Operation 100k recognizes this and places market expansion at the centre of the chip fuel association's investment.

The most obvious challenge we have to face as we try to change demand is the lack of contact with consumers in making home and regional heating decisions.pellet producers will only be involved if they decide to use pellet burners.If consumers choose to use non-particulate fuel sources of equipment, the demand for sawdust pellets will not be affected.As an industry, we must find a way to get customers to understand the value of pellet heat early in the decision-making process.This is the challenge that PFI has solved.

The good news is that our members have a close relationship with the special boiler retailers on the market.If we have any industry may affect demand plan, so we'll have to reconsider these relationships, and retailers should how to sell more pellets combustion appliances make a strong case.

We have to admit that we don't know all the answers, but we're saying, "how do we grow the market for our products?"The more we think about it, the more certain we are that it is the right question.