Farm Fuels in Focus: LP Softens Slightly, Farm Diesel Takes Off

February 24, 2014 09:05 AM
 

 

  • Farm Diesel firms 8 cents to an average of $3.54 per gallon.
  • Distillate stocks are 10.9 million barrels below year-ago at 112.7 Mmbbl and falling quickly -- March heating oil opened at $3.08 this morning -- one penny higher than last week's report.
  • LP softens 4 cents in regional averages to $3.75/gallon.
  • National propane stocks are 24.36 Mmbbl behind year-ago at 26.71 Mmbbl -- March Natural gas opened this morning at $6.30 this morning -- 91 3/4 cents above last week's Farm Fuels Report.

 Picture1

LP -- Propane softened 4 cents in regional averages this week to $3.75 led by strong declines in Kansas. Most states are unchanged and with the exception of Kansas, those that did change moved higher -- that's Iowa up by 2 cents and Minnesota feeling the burn, 20 cents higher on the week. The price swings continue and are driven by the local supply situation.

The fact that most prices are unchanged reflects uncertainty in the market and sellers' unwillingness to quote a price for fear that price will last only as long as their supply holds out. Check your local prices if you are running low. The bottleneck on deliveries has loosened to a certain extent, but the upside risk is far from over.

The regionwide low currently lies at $2.39 in Illinois and the Midwest high is at $5.10 in Wisconsin where the price just won't give an inch.

Below, we table propane and farm diesel prices as reported to your Inputs Monitor for the week ended February 21, 2014.

Propane 2/24/14
Previous Week
Current Week
Change
Iowa
$4.74
$4.76
+$0.02
Illinois
$2.39
$2.39
Unchanged
Indiana
$3.57
$3.57
Unchanged
Wisconsin
$5.10
$5.10
Unchanged
Minnesota
$4.42
$4.62
+$0.20
South Dakota
$4.30
$4.30
Unchanged
North Dakota
$3.02
$3.02
Unchanged
Nebraska
$4.22
$4.22
Unchanged
Missouri
$3.53
$3.53
Unchanged
Kansas
$3.16
$2.41
-$0.75
Ohio
$3.89
$3.89
Unchanged
Michigan
$3.21
$3.21
Unchanged
Midwest Average
$3.79
3.75
-4 cents

 Picture2

Farm Diesel --

Farm diesel firmed 8 cents this week to a regionwide average of $3.54 with 4 of the 12 states in our index unchanged. The biggest move was a 40 cent increase in Ohio to $3.79 and a 34 cent increase in Illinois to $3.78.

The cards are stacking against farm diesel and as distillate stocks continue to decline amid $100.00+ WTI crude, refilling those supplies could be at higher restocking prices. That would make it hard for prices to fall, but part of me is surprised we haven't seen more upward price movement here or in heating oil futures.

Just about the time we feel demand might get a break, another snowstorm blows through here or there and re-excites demand for home heat. As the dreaded Polar Vortex settles southward once again, the nation's midsection braces for another round of toe-tingling cold this week. Strong efforts will have to be made to rebuild stocks for next year -- which may be just as bad as this winter -- or prices will bake higher and as WTI light sweet crude finds customers on the global market, domestic fuel prices may look to capture the difference with higher retail pricing.

The regionwide low currently lies at $3.26 in Missouri and the Midwest high is at $3.79 in Ohio.

Farm Diesel 2/24/14
Three Weeks Ago
Previous Week
Current Week
Change
Iowa
$3.37
$3.35
$3.40
+$0.05
Illinois
$3.44
$3.44
$3.78
+$0.34
Indiana
$3.55
$3.72
$3.72
Unchanged
Wisconsin
$3.62
$3.66
$3.71
+$0.05
Minnesota
$3.36
$3.39
$3.43
+$0.04
South Dakota
$3.44
$3.49
$3.49
Unchanged
North Dakota
$3.92
$3.53
$3.53
Unchanged
Nebraska
$3.56
$3.62
$3.61
-$0.01
Missouri
$3.32
$3.26
$3.26
Unchanged
Kansas
$3.27
$3.27
$3.31
+$0.04
Ohio
$3.39
$3.39
$3.79
+$0.40
Michigan
$3.45
$3.48
$3.52
+$0.04
Midwest Average
$3.47
$3.46
$3.54
+8 cents

 


 

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