I have arrived at a conclusion as to why the smoking wood should be buried in the charcoal.
I think that the sweetest smoke is produced by a fire that’s burning freely and not being smothered by a lack of oxygen. That’s a pellet pit or a stick burner. But a stick burner has a giant fire-tending learning curve. The less-than-experts have to throttle back on their stick burners’ air flow to choke down the fire when their stick burner fires get too hot. Doing so creates at least a bit of smoldering and smoke that’s a bit tainted by undesirable components. Controlling the temperature by choking down the air flow to the fire, thereby producing tainted smoke, is the weak spot for my smoking efforts on my Pit Barrel Smoker, kamado, Masterbuilt Gravity Series, and any pit that chokes the fire.
But—if I bury the smoking wood with charcoal then the smoke must travel through the burning charcoal before it reaches the food. The burning charcoal burns off the undesirable smoke components leaving sweet smoke to properly flavor the meat.
This is much the same way my Karubecue C-60 operates. It's a stick burner that allows the smoke wood to burn freely into the atmosphere. It maintains pit temperature and flavoring smoke by drawing in the heat and pure smoke only when the pit is below its set point. Sometimes it draws it in through the burning coals and sometimes in draws it in untreated. It's my choice.
BTW, the C-60 is by far my favorite smoker. For most of us backyard smokers, it produces the purest smoked goods, but it’s not at all automatic or set and forget. It requires attention every 20 minutes or so.
Just my 2
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