Farm Fuels in Focus: LP & Diesel Lower Again

March 24, 2014 05:52 AM
 

 Picture2

  • LP falls 11 3/4 cents to $2.32 1/2 on the week.
  • April '14 natural gas opened today at $4.31.
  • Farm Diesel falls 1 cent to an average of $3.56 1/4 per gallon.
  • April '14 WTI crude oil opened the day at $99.49.
  • At the open the WTI/Brent crude oil spread narrowed that dime on the week to $7.76 with April '14 Brent opening unchanged today at $107.25.

 

Propane --

LP continues to slide lower -- a welcome sight after the parabolic chart action we saw in weeks previous. Warmer weather and supply relief are to thank for the lower prices. Kansas led the way down dropping 81 cents on the week. Five of our twelve states are unchanged and the others all moved lower.prstuss

Each year we see the low in July and will take advantage of the seasonal price break to bolster supplies for what could be a similar winter of 2014-'15. But forward booked supplies will likely betray strong demand and may support pricing above that of last summer. Be prepared to jump in when the time is right -- but that is a few months off yet. We will keep you posted.

Propane inventories reported by EIA last week increased .182 million barrels to 26.241 million barrels, but remain 15.518 million barrels below the same time last year.

The regionwide high is at $3.31 in Michigan -- our last holdout with a $3 handle. The low is currently in Kansas at $1.60.

LP 3/24/14
Three Weeks Ago
Previous Week
Current Week
Change
Iowa
$2.21
$2.18
$2.16
-$0.02
Illinois
$3.10
$2.70
$2.65
-$0.05
Indiana
$3.29
$2.90
$2.51
-$0.39
Wisconsin
$2.15
$2.15
$2.10
-$0.05
Minnesota
$2.65
$2.41
$2.35
-$0.06
South Dakota
$2.99
$2.09
$2.09
Unchanged
North Dakota
$3.02
$2.09
$2.07
-$0.02
Nebraska
$1.90
$1.83
$1.83
Unchanged
Missouri
$2.49
$2.55
$2.55
Unchanged
Kansas
$2.41
$2.41
$1.60
-$0.81
Ohio
$2.69
$2.69
$2.69
Unchanged
Michigan
$3.31
$3.31
$3.31
Unchanged
Midwest Average
$2.68
$2.44 1/4
$2.32 1/2
-$0.11 3/4

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Farm Diesel --

Farm diesel softened 1 cent this week to a regionwide average of $3.56 1/4 with 4 of the 12 states in our index unchanged. The biggest move was a 22 cent decrease in Kansas to $3.57 with Indiana adding 17 cents to $3.83. Other moves trended +/- a few cents with the trend pointed lower.

The vertical ascent that elevated propane pricing was lost on farm diesel, and, thankfully, so far home heating oil looks to have made it out of the woods with affordable pricing intact. That will limit farm diesel pricing, and the chart indicates farm diesel is basically on course with last year. The suggestion is that prices will continue to fall through early spring and we will look to fill remaining needs then.

The regionwide low currently lies at $3.38 in Kansas and the Midwest high is at $3.83 in Indiana.

Farm Diesel 3/24/14
Three Weeks Ago
Previous Week
Current Week
Change
Iowa
$3.46
$3.46
$3.45
-$0.01
Illinois
$3.82
$3.81
$3.79
-$0.02
Indiana
$3.72
$3.66
$3.83
+$0.17
Wisconsin
$3.74
$3.73
$3.70
-$0.03
Minnesota
$3.45
$3.44
$3.43
-$0.01
South Dakota
$3.52
$3.56
$3.56
Unchanged
North Dakota
$3.53
$3.63
$3.62
-$0.01
Nebraska
$3.43
$3.39
$3.39
Unchanged
Missouri
$3.56
$3.41
$3.41
Unchanged
Kansas
$3.34
$3.36
$3.38
+$0.02
Ohio
$3.79
$3.79
$3.57
-$0.22
Michigan
$3.75
$3.63
$3.63
Unchanged
Midwest Average
$3.59 1/4
$3.57 1/4
$3.56 1/4
-1 cent

 

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