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In this Week's Pellet Wire:
Executive Director's Notes: A Curtailed Spring
Every edition of Hearth & Home Magazine contains a short section near the front of the issue called “Business Climate.” It’s loaded with informative data and graphs on monthly sales by segment, temperature trends for the entire country and a small handful of anonymous retailer comments. I consume every bit of it, and this month the Business Climate section made it clear that the first two months of the coronavirus pandemic made things very difficult for our colleagues in the hearth, patio and barbecue retail segment.
The first graph in the section illustrates this reality most clearly. Retailers were asked to compare sales in four categories (hearth, patio, barbecue and spas) from April 2020 to April 2019. They report simply whether sales in those categories were up, down had no change when comparing the two months. In every category but one, a large majority of retailers reported sales were down compared to the 2019 numbers. It shouldn’t surprise anyone that the one category that had more “up” responses than “down” was barbecue. This dually aligns with what I’ve heard from our retail partners and common sense—with restaurants closed, consumers began to invest in barbecue to spruce up what they could do at home. The numbers were close, however, with just 53% reporting sales were up or the same compared to 47% reporting that sales were down. The hearth category had a particularly difficult March and April, with 72% of retailers reporting that this April’s hearth sales were down.
How and when pellet manufacturers would feel the boost of a particularly strong year in pellet appliances or the drag of a down year has always been difficult to assess, but everyone manufacturing wood pellets cheers strong years in appliance selling and bemoans lackluster years.
The data segment in Business Climate is peppered with snippets of retailer comments included with the data responses. This month’s comments tell the tale with many retailers reporting mandated closures that found them with darkened showrooms for weeks on end. Retailer sentiment regarding closures were mixed with some offering understanding of the government-imposed business restrictions, while the frustration was plain in others.
I was also struck by the passion and ingenuity of hearth retailers reported in the retailer comments section. Time and time again, retailer comments pointed to operators and owners doing whatever they could to keep cash flowing and sales leads working through the sales funnel, even if things were slowed dramatically. Retailers were answering phones remotely, pursuing service work and performing needed remodels and maintenance on their stores. Curbside service for consumables, including wood pellets, also shows up in the comments.
The data available in the section was through April, but a comment from a retailer in New Jersey got my attention. They noted simply, “May is going to be huge.” I hope they are right, and I hope that the buoyancy of barbecue in this challenging climate continues to provide some relief for our retail partners.
Squaring up the data in this report with our own sales data for April will have to wait a week, as the U.S. EIA’s April data isn’t scheduled for release until next Wednesday. I suspect April sales will align with last year’s, as foot traffic doesn’t impact a retailer’s need to build inventory for the upcoming heating season. That said, cash flow challenges may have kept retailers from building the inventory they normally would have so a retreat from April 2019 numbers (103,000 tons) wouldn’t surprise me.
Each day that passes brings us closer to the start of 2020-‘21 heating season. Early buy promotions have already begun, and pellets will begin to move in earnest in less than 60 days. My fingers are crossed that new outbreaks are kept in check and retailers find themselves open and in full song as heating season begins to take off.
—Tim Portz
Executive Director
Photo of the Week: Win a Pellet Grill
Member and longtime PFI Annual Conference Danson’s has always supported our conference with a pellet grill to motivate people to action regarding their conference registration. This year, despite our inability to gather in person, is no different.
All attendees registering at the “Register Your Support” rate of $445 will be entered for a chance to win. Registration revenue from our conference is vitally important to the success of PFI. We are hopeful that our traditional conference attendees can support us at the “Register Your Support” rate.
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Registration for VirtuallyPFI is Open
 Earlier this month, we announced that the agenda for VirtuallyPFI, our replacement for our coronavirus-impacted in-person conference, has been finalized and registration is open. If you missed that email or haven’t had an opportunity to look at the agenda, I encourage you to have a look. We pulled the discussions from the agenda of our annual conference and I look forward to the conversations about our sector, in what may go down as one of the most unprecedented business years any of us have ever experienced.
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