Propane Availability Forecast September 8, 2017
Are hurricane Harvey or Irma likely to affect propane availability for farmers and rural Nebraska homeowners for winter 2017-18?
Not in the long run as propane availability is good, said Gregg Walker, director of communications for the Propane Education and Research Council. Hurricane Harvey delayed exports from Texas ports for a few days and may have hampered processing at some facilities, but “we make more than enough propane to meet US supply,” Walker said.
He does encourage rural users to work with local suppliers to order propane early to guarantee they’ll have what they need when they need it this winter.
“Nebraska is fairly close to a major distribution center at Conway, Kansas, which puts Nebraska markets in a good position,” Walker said; however, propane competes for space with other energy commodities in the transportation system and sometimes there just aren’t enough rail cars or trucks available to get it where it needs to go on a short deadline. Ordering early helps everyone in the supply chain better identify and plan for domestic need and respond to potential export sales.
“The US produces more propane than any other country in the world and is the world’s largest exporter,” he said. That means that even if the US were to have a mild winter, if Europe had an unusually long and bitterly cold winter, export needs would increase, affecting supplies.
Growers may still remember 2013-14 when there was a high demand for grain drying, followed by a tough winter. As the “Polar Vortex” dipped down, the US sustained record lows over an extended time, increasing propane needs for many rural Americans, sometimes beyond normal expectations.
Rural users can take steps to help ensure they have a ready supply when they need it, just as they would with other farm inputs, Walker said. He recommends users establish a good relationship with their local supplier and make plans with them soon regarding winter propane needs and purchases.
While growers may take a risk that the price of propane moves higher or lower after the price is contracted, setting the price early can help with budgeting and provide peace of mind that the fuel will be available when needed, said Anthony Barrett, farm financial consultant at Nebraska Farm Business Inc. Growers purchasing inputs in the fall also may be able to lock in cash discounts.