Northeast Pellets decreases production to avoid closure

Press release, Northeast Pellets

Dec. 28 2015

Northeast Pellets Decreases Production To Avoid Closure

ASHLAND, ME – Northeast Pellets, LLC of Ashland, Maine has announced it will be decreasing pellet production effective immediately due to unseasonably warm weather and a shift in business climate. 

“It is with a sad heart this Holiday Season, that I announce an indefinite curtailment of our operations effective immediately,” said Matthew Bell, President of Northeast Pellets, LLC.  “I was optimistic that we could endure the impact of low oil pricing, warmer than expected weather and an extremely competitive Canadian exchange rate.”

Bell said that retail bag sales have been down due to the unseasonably warm weather; however, the real blow to his business came when one of the mill’s largest local customers announced it would begin sourcing their bulk pellets from a Canadian supplier to fuel boilers for a large northern University account, which equates to about 15% of the mill’s annual production volume.  This outsourcing left the mill owner with little to no option, but to reduce his operations to avoid a complete closure.

“Since the beginning of our pellet operations, we have invested great time and effort as well as financial resources to promote the conversion of the region’s energy source to wood pellet fuel,” said Bell.  “We partnered with many interests in the area to create this transition and aid local businesses, but now find our operations at risk in this difficult market.”

Over the past 12-16 months, Bell said they have invested nearly half a million dollars into increasing the mill’s capacity and efficiency, as well as their bulk storage and loading facilities, all to better accommodate the increased demand they saw last winter.  With the decrease in sales and the out-sourcing to Canada, the mill’s production will be cut in half.

Until recently, the Ashland mill operated 24-hours a day, five days a week, performing maintenance on Saturdays and Sundays.  Effectively immediately, operations have been cut to three days a week, resulting in a reduction of hours and positions for the 13 full-time employees. 

“I wish to thank our employees and our countless customers for their continued support,” said Bell.  “We ask our employees for their patience as we try to sort through this market situation.” 

Thank you,

Matthew S. Bell

President & CEO

Northeast Pellets, LLC