Abstract: An automatic pellet feeding apparatus and method for delivering plastic pellets to a plastic molding machine for encapsulating semiconductor chips stores a plurality of plastic pellets for ultimate delivery to the plastic molding machine. A stair like structure is provided for vertically moving the plastic pellets from a plastic pellet storage location to a conveyor which moves the plastic pellets to the plastic molding machine. The stair like structure has an arrangement of members which alternates between a movable member and a stationary member. The movable members are all moved up and down together, and when the movable members are down, plastic pellets may be loaded thereon from either the storage location or from an adjacent stationary member. Alternatively, when the movable members are up, plastic pellets may be off-loaded therefrom to either an adjacent stationary member or to the conveyor.