PELLETING DIFFICULTIES

Maybe I am not convincing enough in my statement that PELLETING is very difficult . 

My records and visits to many pelleting plant , be it Wood or EFB  Pellet , till todate the failure is nearly approaching 20 plant , big and small included . Definitely the number is much higher than this figure .

Potential Investor must understand the reason behind it to figure out why so many failure in this industries .

I append the major factor for the failure :

1 ) Wrong Machineries

•   Pelleting process need very high pressure to bind the dust back into pellet , many machineries are not able to cope with the HIGH PRESSURE and thus will be damage before it even start to really produce pellet .Talking about pressure , do you know how it work ?
• Pelleting need dry dust , dryer are needed to do the job , that is why American Dryer price are in the range of USD1 Million and above , the reason is you need consistent Moisture Dust to be able to produce consistently good grade pellet , otherwise there will be no pellet at all . I doubt many understand the science of drying !!
• Small Pellet Mill smaller than 500 kg / hour are a definite no no unless you are willing to put your money to burn , go calculate the returns !!!
• Go look at my video on Wood Pellet Manufacturing again , look at the rate of output and then compare the price of machineries . Then go visit the supplier and look at their output to be convince .

The above are only 20% of the main factor , if you do not know about the above , please do not invest , do your homework again , don't waste the precious cash for FAILURE .

2 ) Service and Training 

• I did mentioned earlier about this . The machineries from China is cheap because they do not provide proper Service and Training , this cost will easily increase their pricing by at least 20% . Low price act as an inducement for potential investor , so many will jump in but end up without anyone to turn to when failure stare at them 
• Supplier of machineries are just supplier , I am convince many are great Marketeer , they have never run a pelleting plant before . So when the going gets tough the supplier do not get going , they just ignore you .... , sounds familiar I guess . 
• Supplier are from China , they are not locals , they cannot stay long to guide and train local staff , so you can guess what will happen if problems start to crop up , who you gonna call !!

3 ) Experience and Skill

• Ask yourself , how much you know about Biomass and Manufacturing , I would say , if you are going to invest based on the so many inquiries you get from the market , please keep your cash in the Bank , at least it earn interest . If you do not have over few years on Material experience and few years in manufacturing it is a definite no no to invest 
• Do you have an enquiring and analytical mind ? Every action will have a reaction , when something happen there must be REASONS why it happen , it cannot happen just out of nothing . There is a Chinese saying , Die also don't know because of what !! I am saying this because this will happen many many times and you will need your skill and experience to overcome it 

Mark my word , go check around before you really decide to invest in this industry . There are too many failure which is not good for this industry overall .

WOOD PELLET FOR SALE

We now offer wood pellet for sale in the local market .

Price delivered Klang Valley at RM300 / MT in Bulk Bag .

Below are the test certificate and photo of wood pellet .

Call me at 012 9887 118 Lee Seng Ann .

Pellet Manufacturing

Choosing the Right Pellet Line

I received many enquiries from potential investor on setting up wood pellet or EFB pellet Plant .

Most of the questions asked are as follows :

1 ) Price of Pellet Production Line

2 ) Capacity per Hour per Pellet Mill

3 ) I want to visit your factory in production

We are more than glad to received any visitors and offer quotation for our pellet line .

In my opinion , what potential investors should have asked are :

1 ) Effciency of the Pellet Production Line

2 ) Maintenance of the machineries especially the pellet mill

3 ) Return on Investment ( ROI )

Efficiency

We claim that our pellet mill and the whole line can produce > 1 TPH for a pellet mill with 420 internal diameter die , CONSISTENTLY over prolong period of production time . I believe not many can claim this !!!

You can buy Pellet Mill from so many supplier from China are reasonable price , most can produce 1 TPH consistently but not over prolong period of time .

Pellet Mill from China are still in infant stage as the same pellet mill are for feed production . Therefore it is not as robust as machines from USA or Europe which price are at least double .

Efficiency are very important in Pellet Production as the capacity are very small i.e. 1 TPH per machine , you need to be efficient to make profit . If your machine can only run 8 hours per day but others can operate 15 hours per day , others will make double your profit .

In short pellet manufacturing is a race against time .

Maintenance

Many stories from friends regarding their pellet mill performance .

Die cracking , roller bearing need constant change , pellet refused to come out , need additives for smooth production and etc .

1 piece of Die cost RM5,000 , should last 500 ton production , if the die crack by 250 ton , then your cost will go up to RM20 per ton instead of RM10 per ton . Not mentioning down time and failure to deliver to customer will cost you more .

Return on Investment

I am not sure how many of the potential investor have data on the profitability of wood pellet manufacturing . But I believe most do not have complete and accurate data and depends on the fact that they want to go into this business as there is so many enquiries for this product .

This business are definitely lucrative as of now if you have this advantages :

1 ) ample supply of raw material

2 ) good wood pellet production line

A friend of mine once said if you get the correct combination of raw material , machines and customer , you are simply printing money every second .

Conservatively , Our Wood Pellet Line should have payback within 2 year and ROI of over 6% per month .

Whole Line Wood Pellet Plant

2 Ton Per Hour Pellet Plant

We are a bit delayed in the installation of our 2 Ton Per Hour ( 2 TPH ) Whole Line Wood Pellet Plant . New date for commissioning have been push back to End of April 2011 .

Lots of minor problems with China Whole Line Design and Installation .

I admit we overlook a few areas and also the professionalism of China Machinery Supplier are in doubt especially in Project Management and also the linkage between each section in the Whole Line Plant .

But in the process we also learn a lot for our future expansion plan and possibly our new 2nd line maybe in 6 month to 1 year time .

We now believe that our pellet mill are one of the best from China and hopefully when it is in production it should give us above 1.2 TPH for the Model 420 unit with minimal maintenance .

Here are some of the photos during installation of machineries at my plant .

Current Pellet Mill / Pellet Mill Plant from China have the following problems :

a ) Pelet Mill Die cracking after short time of usage

b ) Roller Bearing need constant change

c ) Constant Jamming in the Pellet Mill Die Chamber

d ) Low Density of Wood Pellet Produced

e ) Sawdust need additives during production to ensure smooth output of pellet from Pellet Mill

We also found out that many China supplier are not genuine factory owner which means they buy and sell the machineries , thus technical wise they are not up to standard unless they are supplying the best machines from the best fabricator . Normally this is not the case as the buyer will haggle about pricing , therefore the supplier will tend to get the cheaper machines which will create problems in the end . How would you know which is the best machines from China , there is more than 100 supplier of pellet mill machineries from China , everyone say they supply the best . Unless you want to CAMP there to search for the best machines . For the record , I did 3 tour of duty to China to search for the best machineries .

Pre-requisite of establishing a Wood / EFB Pellet Manufacturing Business :

1 ) Stable source of sawdust or EFB

2 ) Total Investment - RM1 Million including machineries , electricity supply , local steel fabrication , forklifts & etc for a 2 TPH Whole Line Plant

3 ) Some technical knowledge on machineries

4 ) For now , market should not be a problem , it is a matter of pricing

Lately ( the last 3 months ) , my blog have generated tremendous search for wood pellet maybe due to the current high price of fossil fuel which at the time of writing , Nymex Oil Futures is at over USD100 per barrel . Inflation in China is also causing a problem as Wood Pellet Plant pricing have also increase from initial RM750,000 earlier to over RM850,000 now , at last count . Sawdust price have also been increasing locally . If price continue to rise , it might not be viable anymore to invest in Wood Pellet Business unless Wood Pellet price play catch up in the near term .