Pedersen was one of four changes made to the side thrashed in round one, with David Rodan and Luke Tapscott also dropped.
Lynden Dunn was left out due to a hamstring.
Neeld said that Pedersen's form throughout the NAB Cup and last weekend had been inconsistent and he needed to return to the VFL to work on aspects of his game.
"We've decided to go with a different forward make-up," Neeld said.
James Sellar will be the back-up ruckman against Essendon while the Demons have welcomed back co-captain Jack Trengove and Tom McDonald from injury, and included veteran Aaron Davey for his first game since round 13 last year and a first gamer, 23-year-old Dean Terlich.
As Neeld tries to rebuild the confidence of the group for this week, he said the team had looked at vision from the NAB Cup where the team performed well and that they continued to take confidence from their training efforts.
He said that translating those efforts into game-day was the challenge the group now faced.
"The final step is always the hardest step: to get that into performance," said Neeld.
Neeld sees Melbourne as one game into the second season of a rebuild and said the team was conscious of other clubs that have successfully traversed the rocky terrain the Demons were now stumbling over.
Although Neeld would not comment on the failure of previous early draft picks to succeed at Melbourne, he expressed confidence that the players brought in this season such as Jimmy Toumpas, Jack Viney and Jesse Hogan would have good careers.
"Clearly with the players we have got to the football club there is that element of competitiveness," Neeld said.
"You only have to look at the way Viney plays and when you speak to Toumpas he's naturally competitive and wants to be good.
"We've seen a little bit of Hogan [and] without trying to say here is a 17-year-old boy we'll be trying to build a forward line around… he is the grumpy big forward.
"[They are] men before their time [and] they want to be good."
One player in the gun this week has been Jack Watts.
Neeld said they entertained the thought of pushing him forward after half-time last week but decided to persist with him in defence.
"He's got to get going Jack. We know that. He knows that," Neeld said.
Neeld hopes Davey can display the sort of form that previously made him a favourite of Melbourne fans during years past.
"I'm the same as all the Melbourne supporters. We'd love to see Aaron go out there and run around and show the intensity that we all know he can play with and lay a few tackles and kick a goal and excite his teammates," Neeld said.
As he said it, Terlich looked on with anticipation as he was days away from fulfilling his dream to play AFLfootball.
Terlich is a mature-aged recruit who spent time on the Sydney Swans' rookie list in 2008 before heading to Norwood under Nathan Bassett.
He was best on ground in last year's SANFL Grand Final as a running defender and will add flair and drive to the Demons' backline.
Terlich comes from the NSW Riverina town of Henty, a place he described as "a good little place to grow up. It's busy for three days a year."
He said the nerves were not too bad before his first game.
"It won't sink in until I start getting ready to run out at the MCG," Terlich said.
