Pellet market prospects for opening a business

Industrial production

Pellets is a newfangled word that few people know in Russia. And no wonder - pellets (or solid, not fossil fuels), this is still a European boom. But this is only ... for now ..

As soon as a civilized economy begins in Russia, it will be profitable to sell pellets in the domestic market here. Well, today, pellet producers are organizing business in Russia, and they are trading mainly with foreigners, who sell this product with a bang.

For only 200-500 thousand dollars, a pellet (solid biofuel) production workshop is being built, but this business pays off in one year.

Oil and coal VS pellets?

Europe is forcibly switching from oil and gas to pellets. Why? Well, firstly, when pellets are burned, the CO2 emission into the atmosphere is 50 times less, and the ash formation is 15-20 times less!

Secondly, the European Union does not want to depend on the vagaries of countries that supply their natural raw materials - oil and gas, because it so happened that countries in the depths of which fuel lies have a very strange political regime and ideas about civilization.

The replacement of fossil fuel raw materials (oil and gas) is the fuel raw materials of plant origin.

What are the fuel materials of plant origin or pellets made of?

Bioethanol, biogas and biodiesel are made from grains and oilseeds. But the alternative to coal is “granulated waste from the woodworking industry” (in other words: sawdust and wood chips) and “agriculture” (sunflower and rape husks, grain straw)

Pellet business: supply and demand

The leaders in the EU, both in production and in the consumption of pellets, are Sweden and Denmark.

The high annual growth of the pellet market is explained by stringent requirements, even by ultimatums of the European Union.

Our pellets consume so far little. So far, “free” oil and gas are flowing, and the environment exists only on paper from officials. But this tragic situation can change at any moment - just change the political course.

Specifically, the underdeveloped consumer demand for pellets in Russia is based on a number of the following reasons:

low prices for oil and gas, the high cost of pellet boilers, compared with gas, low domestic price of pellets, amounting to 75-80 euros (For comparison, we give prices in Poland. the price of pellets in Poland is 160 euros).

Nevertheless, even if you don’t find a buyer in Russia for pellets, you still need to start a business - you will find a buyer abroad.

Pellets and arrogant villagers

The situation with suppliers of raw materials for pellets resembles the ordeals of Chichikov, described by Gogol in “Dead Souls”. It would seem, who needs dead souls? There is no benefit on the farm, but pay tax for them. But as soon as the cunning landowners heard that for some reason Chichikov needed dead souls for some reason, they immediately broke the price for them or refused to sell them at all, complicating Chichikov’s life.

The same is true for peasants who drive husks and woodworkers who sell sawdust. In fact, both husk and sawdust are garbage, but as soon as the gentlemen listed above hear that you are a businessman who makes newfangled fuel for trade with foreigners, they start to tear up the price of their sawdust or refuse to cooperate at all.

Here business players immediately warn of this incident, as a manifestation of greed, envy and stupidity, which must be borne in mind. In no case do not say - why are you buying sawdust and husk, try not to brag about your production, otherwise you will be sold sawdust at the price of black caviar and still turn your nose away from you.

Pellet raw materials

The cheapest raw material for pellets by players is unanimously recognized as the husk of sunflower seeds. The best, however, has been and remains - rapeseed husk.

We choose equipment for the production of pellets

The most expensive are the German pellet lines Kahl and Munch.

A “fully packaged” workshop operating with a capacity of 2 tons per hour (and less is not worth it to venture with business) costs 1 million euros.

There are also Lithuanian lines that the Radvilizh Machine-Building Plant makes.

The same capacity can be bought for 450-500 thousand dollars already.

Pellet sales: Look for countries that the EU “dictates”

For the most profitable trade with foreign countries, a novice entrepreneur should go to the markets of those countries that only recently joined the Euroconventions and received a puzzling order - to switch to bio fuel.

For example, the story of Poland. With the entry into force in Poland of the “EU Directives on the Use of Renewable Energy Sources” the following story happened - the Poles rushed to buy pellets - at any and at any price.

The Poles did not even pay attention to the fact - the high or low quality of the pellets they bought! The European consumer prefers to buy pellets with an ash content of only up to 0.5%, but is now forced to buy pellets with an ash content of 3%.

Market players say: you don’t have to run after the consumer - he will come running to you.

You don’t even have to look for a consumer, he will find you. The European buyer is ready to sign a long-term contract, even if you do not yet have the production itself! And with a signed contract it’s easier to get a loan for the purchase of equipment.

Well, the prospect is so encouraging that you should seriously think about starting such a business.

Pellet Production Process

and in conclusion, a little about the production process itself. It consists of a number of successive stages:

1. Reception of raw materials: assumes the presence of a receiving hopper and a conveyor for feeding raw materials to the crusher.

2. The grinding of raw materials occurs in a chipper from which it is fed

3. for drying in a tumble dryer

4. The next stage is granulation, which occurs due to the forcing of raw materials through the radial holes of the granulator matrix

5. To keep the granules in shape, they are cooled in a cooling column

6. Finished granules are conveyed by the conveyor for packaging.

Nazarenko Elena

(c) www.clogicsecure.com - a portal to small business business plans and guides

You can see what the process of pellet production looks like, for example, in this video shot by Premium-Auto, one of the pellet manufacturers:


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