From the Director’s Desk: Cold as Ice, Your Average January, Eyeing the 119th Congress
Cold as Ice
Bill Bell (Maine Pellet Fuels Association) likes to start his columns with a popular song title or lyric. I’m borrowing from his playbook to begin this edition of the Pellet Wire, and appropriately, I’m writing it during the coldest 24-hour stretch of weather Minnesota (and much of the upper Midwest) is likely to see this heating season. The 1977 radio classic by Foreigner focuses on a love gone bad, never once mentioning Heating Degree Days. Still, it’s almost noon (Tuesday) as I write this, and the temperature outside is currently -6°F. Schools in the Minneapolis/St. Paul metro area and across much of Minnesota have closed. These are the days that have been in short supply for the last three or four heating seasons—the kind of cold that has thermostats calling for more heat and, consequently, more fuel.
The PFI Heating Degree Day Index (see Photo of the Week) showed an improvement across much of the country compared to last year, and next week’s HDD will show an even bigger improvement.
Your Average January
With an eye on a return to the kind of cold pellet fuel manufacturers hope for in January, let’s take a look at what we’ve come to expect from the month.
January
5-year average (January 2024):
East
Sales – 86,889 (77,101)
Production – 95,544 (92,428)
Inventory – 74,482 (125,709)
West
Sales – 41,984 (36,923)
Production – 36,726 (34,383)
Inventory – 23,106 (41,409)
South
Sales – 31,420 (26,845)
Production – 19,416 (15,512)
Inventory – 25,356 (25,669)
All U.S.
Sales – 160,078 (140,869)
Production – 151,706 (142,343)
Inventory – 122,945 (192,787)
January is one of those months where the averages can obscure the realities. January’s sales average is certainly one of those instances. While the 5-year average is 160,000 tons, the month tends to fall dramatically on one side or the other. Since 2021, sales in January have fallen on the wrong side of the average. Beginning in 2021, U.S. total sales have been 118,217; 120,584; 138,610; and 140,869. Contrast that with the three years prior to 2021, when producers sold over 200,000 tons every January. January has served as a litmus test of sorts since the EIA began collecting wood pellet data. A strong January typically foretold a strong pellet year. In fact, there isn’t an instance of a wood pellet sales year eclipsing 2 million tons that didn’t see January sales exceed 200,000 tons.
This January “feels” more like the Januarys of 2018, 2019, and 2020. Most pellet-burning regions have had at least one cold snap. The PFI Heating Degree Day Index reveals a colder January so far, but only modestly so. Concord, New Hampshire, had accumulated 8% more HDDs by the beginning of this week than last year, and the early part of this week will certainly push those numbers even higher on Monday’s HDD index. But how much? I suspect the HDD index will show two or three locations with double-digit percentage increases over last year. Will that be enough to drive 200,000 tons worth of sales? Not impossible, but improbable. I’d bet on a sales figure higher than the average but short of the 200,000-ton mark. 170,000 tons feels about right.
Eyeing the 119th Congress
This week started with the inauguration of President Trump, making official the start of the second Trump presidency. Prior to his inauguration, the 119th Congress was gaveled in, and members were assigned to their committee assignments. The Pellet Fuels Institute’s legislative and regulatory affairs committee is already at work understanding the impact of the newly elected members of Congress, their varying committee assignments, and the effect on the organization’s policy and regulatory ambitions.
Below is a list of Senators and Representatives new to Congress who hail from PFI member states or districts.
Senators:
Jim Banks (Republican), Indiana
Bernie Moreno (Republican), Ohio
Dave McCormick (Republican), Pennsylvania
Jim Justice (Republican), West Virginia
Ruben Gallego (Democrat), Arizona
Adam Schiff (Democrat), California
Elissa Slotkin (Democrat), Michigan
Representatives:
David Taylor (Republican) – Ohio (2)
Janelle Bynum (Democrat) – Oregon (5)
Maxine Dexter (Democrat) – Oregon (3)
Maggie Goodlander (Democrat) – New Hampshire (2)
Riley M. Moore (Republican) – West Virginia (2)
John J. McGuire III (Republican) – Virginia (5)
Regardless of committee assignments, the PFI will place a high priority on meeting with these new faces in Congress, introducing them to the value wood pellet manufacturing brings to their state or district.
—Tim Portz
Executive Director
