Its not going to hurt him to eat that much of the pellets but are you offering him a good seed mix? Try giving him more vegetables and don't offer fruit but several times a week and not everyday, fruit is sugar laden so it must be given in moderation, he will also benefit from the addition of some rices, pasta, grains and legumes in his diet.
I am glad to hear you have chosen to not cage him to get him to step up, negative reinforcement does not work with greys, only positive and you have to earn their trust and that takes time, lots of time in some cases so patience is your best ally.