The Hearth Industry suffered a shock … a nice kind of shock … beginning with the surge in oil prices during the summer of 2005. Energy alternatives were suddenly back in the news, and specialty stores across the nation enjoyed booming sales. Manufacturers were backlogged seemingly forever, and list price was the name of the game.

The Bad News:

Cordwood prices shot through the roof; electricity, natural gas and propane all saw increases, sometimes huge increases.

Pellet fuel was no exception. Prices went up while stocks dwindled, and the media seemed to find glee in pointing out shortages of wood pellet fuel. Where did that news come from? Who did they interview to learn there was a shortage? Why, the mass merchants, of course.

The Worse News:

There was a pellet shortage, particularly in the Northern Midwest and the Northeast states, but in other areas as well. Dependable supplies dried up overnight. The border tax on Canadian softwood products meant less timber production, and thus less available sawdust. The Canadian market for pellets grew as fast as it did in the States, and a home market is always kinder to a manufacturer. In addition, the Canadian dollar strengthened. The cost of motor fuel went up, DOT regulations forced truckers to raise rates, and dealers had to transport pellets over greater distances. The result of all this was a genuine shortage of pellet fuel, and much higher prices.

Except for some dealers who gouged their customers on price, this situation didn't benefit many in the pellet industry. Neither producers nor dealers earned more per unit, although sales volume was up for those lucky enough to obtain fuel at all.

More tough times ahead:

Fuel supplies are increasing, but by small increments. New mills will come on line, and existing mills will expand their capacity. It's expensive to move product from the West coast to the East, yet supplies in the West are plentiful. Still, a slowdown in new home construction is underway, which will once again affect the amount of sawdust generated. Demand for new stoves remains high as well, so our market will face at least one more year of tight supplies.

We can do it:

We need to cooperate to make it work. First, we are the people in-the-know about hearth products, not the mass merchants, and we need to communicate that to the news media. We need to speak with one voice, too, and tell the truth as we know it. We saw long time customers this year who had gone without pellet fuel for months; people who never called because someone on the news told them there were no pellets. It wasn't true. We had fuel in stock all along. Our supply was limited at times, but we never ran out.

But people listen to the news, and they tend to take as truth what they hear on the news, so we lost sales and those customers paid the cost to use their primary heat sources. That situation should never have happened, but when we tried to get the news media to correct their error we were ignored. That shouldn't have happened either.

Let's face it. We're all in business to earn a living, and we compete with each other to varying degrees. That's fine, and the way things should be as long as it's honest competition. We've all spent a lot of time learning our business and the customers we serve. We know the products, and we know how to set realistic expectations. We deliver the best products we can find, too.

The big box stores don't worry about any of that. Any product is good if they can sell it cheaply enough, and when the price is low enough you only have to know enough to state that price. That's fine too. There will always be consumers who only shop price, and only worry about what they bought when it doesn't work very well.

This in no way gives these stores reason to even believe they have the right to speak for the marketplace. If they are out of pellets, that should be the only thing they relate to the media. Wdon't know how to change this, but it has to change.

Ensure Your Fuel Availability By Planning Now

Please complete the Dealer Application and Pellet Order forms so you can order your stoves with confidence that you will have fuel to provide with your stoves.