Propane Update -- It Is As We Had Feared

January 28, 2014 03:34 AM

We collect our pricing data here at the Inputs Monitor each week and report our findings to you the following Monday. Last week we heard from Pro Farmer Members, Inputs Monitor Subscribers and propane industry experts that prices had spiked to near five dollars in some areas. When I tallied last week's numbers however, the price we noted was only a dime higher on the week at $2.15. IMG 0176

I knew this couldn't be. After making a full day's worth of telephone calls, it is as we had feared. Most locations did not report a spot price because prices are so uncertain and volatile right now that as soon as they would have reported a price, that price was bound to change. This is the result of spiking demand, transport difficulties and dangerously low temperatures.

We have spoken to our retailers and they were good enough to share their current price with us, but keep in mind that these prices are highly variable, and as soon as I post them, they are bound to already be outdated. That is the struggle that propane dealers have been dealing with.

Having said that, we offer the following updated LP pricing with much appreciation to the suppliers who shared their prices with us...

State Average LP Price 1/28/2014
South Dakota
North Dakota
Regional Average


The Midwest is currently suffering under another cold snap and the below zero temperatures are expected to drive LP prices higher. Many of the retailers we spoke to are limiting the amount of propane they will deliver and most are very hesitant to quote a price. Bear in mind, your preferred retailer is as much a victim as the end-user. My blog from Friday, "LP -- Who's Asleep At The Switch?" outlines the causes of the current supply crunch and reveals why prices are so high, even as hydraulic fracturing promises energy independence here in the United States.

Keep an eye on your propane supply but the best advice I have heard is to take out your LP frustrations by chopping wood for your fireplace or wood-burning stove. The propane supply crunch is not expected to get better until the winter passes, and the prices posted above may have already run higher in your area.


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Spell Check

1/28/2014 02:44 PM

  The problem is not fuel supply. The problem is management theory. Nobody wants to hold inventory, which was appropriate in the high interest times of the 80's, but today is extremely short sighted. Just in time production was the newest thing in town in the eighties. Management educator careers were built on it, it has become gospel. In todays low interest environment it is rather out dated. with todays radical volatility in prices, those who invest in inventory of basic commodities are paid handsomely.


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