The price of propane is expected to trend higher in the upper midwest, as farmers search for fuel to dry out wet crops. Mike Newland, staff as director for agriculture business development for the Propane Education and Research Council(PERC) says the situation bears watching.
Is it a supply or demand issue?
“We do have a big supply of propane in the country.” There are a few regions, such as the corn belt that is strapped a little bit on grain drying. “We are sensitive to the fact that we do have supply but we are rallying the troops from a logistics standpoint and our industry is doing everything they can to get the hurdles cleared.”
There has been a surge in demand from not only crop farmers, but also livestock producers and rural homeowners. As for who takes priority “We have our opinion of what should get priority but those decisions are made at a local level.”
There are several moving parts, but Newland says folks are pulling together to manage the situation. “We have a lot of folks, that have resources available. There are service labors in place, just about every state across the midwest that allows extra hours of driving time for those transport operators.” Several tools are underway to address the increase in propane demand although, it may take some time for them to take effect.
According to data from the EIA, prices for wholesale propane edged up 4.3% in October, to roughly 61 cents per gallon.