Propane Suppliers Work with Farmers as Harvest Increases Demand

Agriculture and energy officials are working together to deal with the high demand for liquid propane this harvest season.

Iowa Propane Gas Association Executive Director Deb Grooms says customers who use propane to heat their homes were told to top off their tanks this summer. She says farmers got the same advice from Ag Secretary Bill Northey.

“To take advantage of the early buying process. Our marketers are also telling their customers to get their tanks full so they’re prepared when winter hits,” Grooms says.

Propane is used to dry grain when it comes out of the fields with too much moisture. There was a shortage of liquid propane to dry crops and heat homes in 2009, and former Governor Terry Branstad declared an energy disaster in 2013 when farmers throughout the Midwest used a record amount of the fuel to dry their corn. That demand from farmers depleted supplies for home owners who were forced to pay record high prices. Carlson says suppliers were busy last week as good weather allowed farmers to get into the fields.

“They’ve been working very hard to get the ag customers taken care of this week and pretty soon the home heating season will begin, so communication is a big thing,” Grooms says.

The president of the Petroleum Marketers and Convenience Stores of Iowa, Dawn Carlson, says they’ve talked with farmers about the importance of taking steps to have enough propane for the harvest season.

“They have been urging their customers to put storage on the farm. Our propane distributors in Iowa have been purchasing more storage tanks on their own property so we actually have a lot more storage capacity in the state than we did right years ago,” Carlson says.

Another factor in the liquid petroleum availability is that worldwide demand is at an all-time high. Carlson says long term contracts with countries like China make the fuel very attractive and exports reflect that.

“Since November of 2009 they’ve increased from 100-thousand barrels a day to the most recent data I have is from August of this year — they’ up to to 720-thousand barrels a day,” Carlson says. “So just in the last eight years, we’ve increased eight-fold.”

Propane prices went up slightly last week as demand increased. The report from the state ag department says the price was up four cents for a statewide average of one dollar, 39 cents for a gallon.

 

(story courtesy of Radio Iowa)

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