Winter 2013-14 Propane Updates

Energy Information Administration ^ | February 6, 2014 | Energy Information Administration

[berdie]

$5.00 a gallon...ouch!

To think I was whiney about the $3.25 I was quoted when I called for a refill last week.

Of course, I am also whiney about the cold we have...which is NOTHING compared to a lot of people.

[thackney]

The one week draw down, in my opinion, was people filling their propane tanks while the price was cheaper to stock up for the winter.

If that was the cause, the seasonal drawdown should reflect the average. That is not the case. Significantly more was withdrawn than in past years. Measuring 13 weeks starting with the beginning of Sept:

Fall 2005 15001
Fall 2006 14600
Fall 2007 14849
Fall 2008 13298
Fall 2009 15430
Fall 2010 13190
Fall 2011 13151
Fall 2012 16196
Fall 2013 17622

http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=wprup_nus_2&f=4

[Just another Joe]

Was it because of out of country sales?

[thackney]

No, those numbers are only domestic consumption.

Exports are counted separately.

[Repeal The 17th]

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http://buford.patch.com/groups/police-and-fire/p/intense-fire-strikes-buford-dam-store
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“...A fire at the Dam Store, located at 1250 Buford Dam Road...”

[thackney]

I thought this would contribute to the conversation.

Propane shortage impacting corn harvest
http://cornandsoybeandigest.com/blog/propane-shortage-impacting-corn-harvest
Oct. 29, 2013

As we head into November, growers become more concerned with getting corn harvest completed before winter conditions set in. Most of the corn currently being harvested in many areas is still at 18-26% moisture, as a result of later-than-normal planting last spring. The corn moisture content has not dropped significantly since early October, due to the extended cool, damp weather pattern across the region. Corn should be dried to about 15-16% moisture before going into an on-farm grain bin for safe storage until next spring or summer.

[Just another Joe]

Ahh, OK.
The first part is drivel. Farmers routinely harvest at 18% to 21% moisture and use nothing but fans to dry the grain down to about 16% before the cold weather sets in.
When the spring warms up they finish drying to 14% to 15% before selling the grain. (This is in the case of field corn. Other types of grain have different considerations.)
Admittedly, commercial facilities use dryers to dry to about 15% before long term storage.

Also notice that the article says propane shortage affecting grain harvest, not grain harvest affecting propane shortage.
So the propane shortage affects grain drying, not grain drying is one of the causes of propane shortage.

"The shortages of propane gas for corn drying comes at the same time that LP demand is increasing for 2013 home heating needs, which is also earlier this year due to the extended cool weather pattern in October."

The farmers that have harvested at a higher moisture have chilled the grain down to between 5 and 10 degrees farenheit in order to store it over the winter.
Believe me, it's been cold enough.

I don't know what the cause of the shortage is, but I find it hard to believe that grain drying of a wetter harvest is causing it.
I deal with the grain, fans, dryers, and storage of the grain on a daily basis.

[thackney]

I don't know what the cause of the shortage is

As posted above, there are multiple contributing factors that all came together in the same season. In addition to a later planting resulting in a later harvest and a corresponding later propane demand, there was earlier winter temps, pipeline and rail deliveries shutdown/delayed.

There is no one single cause.

[thackney]

Another ag source with more details:

Minnesota’s 2013 corn crop leads to drying challenges
http://www.minnesotafarmguide.com/news/crop/minnesota-s-corn-crop-leads-to-drying-challenges/article_a99859bc-5b76-11e3-90d5-001a4bcf887a.html
December 02, 2013

There were several reasons why the propane shortage developed.

One, farmers were surprised by corn yields. Based on Nov. 1 conditions, corn yields were forecast at 164 bushels per acre – just 1 bushel lower than in 2012. The harvested acres were estimated at 8.1 million acres.

In addition, Minnesota farmers last dried large quantities of corn in 2009.

“Between 2009 and 2013, we had a substantial growth in the size and number of grain dryers – both on farms as well as at grain elevators,” said Zelenka. “The demand was a lot greater this year than in 2009.”

The U.S. corn harvest bunched up in 2013, and as a result, the corn all needed drying at the same time.

Minnesota farmers had about 253 million bushels (19 percent) of corn harvested by Oct. 20.

They harvested another 386 million bushels (29 percent) by Oct. 27 and an additional 333 million bushels (25 percent) by Nov. 3. During the week ending Nov. 10, they harvested 186 million bushels (14 percent) and 93 million bushels (7 percent) more as of Nov. 17.

“The drying period seemed to happen all at the same time statewide, and upper Midwest-wide,” he said. “The demand was very concentrated, and it drew down all of the propane available and put a strain on all of the available supplies.”

More at link

[Just another Joe]

Now that is entirely possible.
Normally I see harvest go from south to north and may take several months.

Thinking back, the harvest this year did seem to be bunched quite a bit.

I don't think necessarily that much more grain was dried but it's entirely possible that it happened in a much shorter time period nationwide.

[thackney]

And combined with pipeline and rail delays/stoppages, the stocks were not able to restore to normal levels before a significant winter weather arrived.

Several dominoes in the chain to lead to this point.