Profitability of production of sawdust pellets

Suppose you run a carpentry shop, you have dry wood waste that can be used to produce pellets, that is, the raw material for the production of pellets is free.

The average price of energy, according to the G11 tariff, is PLN 0.5118 net per 1kW. This price consists of:

• Variable/network distribution fee
• Fixed distribution/transmission fee
• Transitional charge
• Subscription fee
• Round-the-clock cogeneration fee
• Round-the-clock res fee
• Power charge
• Quality fee

Source - https://globenergia.pl/ile-kosztuje-1-kwh-energii-elektrycznej-z-czego-sklada-sie-rachunek/ 

The calculation will be carried out on the example of work on the LDG-3000 KOMBI line, which includes:

1. Screw feeder PS-200:

2. Humidification System:

3. PRIME - 300:

4. Calibrator-cooler for KC-100 granules / pellets:

5. Closed exhaust system SO-2:

6. Control Panel:

Total power consumption of the line-25 kW per hour.

On the LDG - 3000 KOMBI line with a pellet mill with rolls of a new type, about 400 kg of pellet per hour can be produced. A quick calculation shows that in 8 hours it is possible to produce 3,200 kg of pellet, or 64,000 kg of pellet per month. 

 We assume that the average salary of an employee at the pellet production line is PLN 2,600 net.  This means that for an hour of work the employee receives a net salary of PLN 16.

 The price of the matrix for pellet pellet prime-300 for Pine sawdust-1250 PLN net for 1 piece.  The service life of the Matrix-up to 70 tons. It can be calculated that the cost of Matrix depreciation for the production of 1 kg of pellet is PLN 0.0179 net (PLN 1250 / 70000 kg = 0.0179).  

 In the same way, we calculate the cost of depreciation of roller and bearing shells. The cost of a set of bearings for the pellet mill PRIME-300-480 PLN net and the service life is up to 40 tons. Bearing depreciation for the production of 1kg pellet is PLN 0.012 net.

 Set of coats for Rollers-928 PLN net. Depreciation of coats for the production of 1kg pellet is 0.0077 PLN.

Based on the data above, you can estimate the cost of pellet production:

  25kW (line) * 0.5118 (net cost of 1 kw) * 8 (hours of machine operation) + 128 PLN (employee's salary for 8 hours of work) + 3200*(0,0179+0,0077+0,012) = 352,65 – the daily production cost of 3200 kg of pellet, that is, the production of 1 ton of pellet costs 110.2 PLN net.

Profitability of pellet production from wet sawdust

In a similar way, you can draw up a cost estimate for sawmills, who have wet sawdust. Of course, it is impossible to make pellets from wet sawdust. For this, an additional machine comes into play, that is, an aerodynamic sawdust dryer SA-400 whose power consumption is 5 kW. In addition, you need to add to the calculation of the salary of the second employee in the amount of 2600 PLN net who will work at the dryer.

30kW (line + dryer) * 0.5118 (net cost of 1 kw) * 8 (hours of machine operation) + 256 PLN (salary of two employees for 8 hours of work) + 3200*(0,0179+0,0077+0,012) = 499,12 PLN net-the daily production cost of 3200 kg of pellet, that is, the production of 1 ton of pellet costs PLN 155.98 net.

Profitability of pellet production when buying dry sawdust

Not everyone has access to free sawdust. For this, our mission is not only to draw up a cost estimate on the basis of free raw material for the production of pellets, but also when buying sawdust for the production of fuel pellets. Average price of 1mp per olx.pl it is PLN 30 net.

Źródło – https://www.olx.pl/

Also you can find deals with lower valuable on sawdust or even for free.  

Źródło – https://www.olx.pl/

For the production of 1000 kg of pellets you need to consume an average of 6mp sawdust. 19.2 mp sawdust-this is necessary for the daily production of 3200 kg of pellets. So our calculation is as follows:

 25kW (line) * 0.5118 (net cost of 1 kw) * 8 (hours of machine operation) + 128 PLN (employee's salary for 8 hours of work) + 3200*(0,0179+0,0077+0,012) + 576 PLN net (19.2 mp sawdust) = PLN 928.65 net-the daily production cost of 3200 kg of pellet, that is, the production of 1 ton of pellet costs PLN 290.20 net.

Summary

In our assumption, a large cost is the salary of the employee, which in turn leads to higher production costs. Of course, depending on the region, locality, you can find an employee less demanding for a monetary salary, but even with such an employee's salary, pellet production is quite a profitable activity, because the average market price of 1 ton of high-end pellet is at the level of PLN 700 net. Also, the calculations do not take into account possible downtime, taxes, transportation costs and the cost of renting a room. Of course, we can not take into account all the factors related to the production of pellets, but the above lists allow us to fully estimate the costs associated with production.

So it is worth investing today in pellet production lines until there is high competition in this industry!

The demand for pellets increases every day.  This is not only related to the co-financing program for the replacement of heating boilers under the "Clean Air" project, but also related to the global concern about climate change. Of course, today not only sawdust is used for pellet production, but also straw, hay, cane, miscant, etc. You can find more videos and information on our YouTube page: https://www.youtube.com/c/TechnoMaszBud/videos