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Prepare Now for Upcoming Propane Needs
Iowa Ag Connection - 09/17/2019

Iowa Secretary of Agriculture Mike Naig encouraged ag businesses, farmers, rural residents and other Iowans that use propane to consider taking steps to ensure adequate propane supplies this fall and winter.

"As of the first week of September, propane inventories were significantly higher than what they were at this time last year and just shy of the five-year average high," Naig said. "Due to the late planting season across the state, Iowans need to be aware of the length of time and amount of propane that will be needed this fall."

According to the USDA National Agricultural Statistics Service's Iowa Crop Progress and Conditions report on September 8, 60 percent of the corn crop has reached the dent stage or beyond with four percent mature, 11 days behind the five-year average. These figures were 87 and 28 percent, respectively, a year ago. The later crop maturity in large portions of the state will likely mean a steady demand for propane use for grain drying throughout the fall months.

Actions that farmers and other propane users can take now in order to prepare for this fall and winter include:

- Confirm propane supplies for grain drying, livestock facilities, homes and machine sheds are full going into the fall season.

- Take advantage of early buy/booking programs

- Consider expanding on-site capacity at facilities and homes

- Communicate early and regularly with propane suppliers

Propane production has continued to increase across the country over the summer months and exports were down in August. Those two factors have helped to boost late summer supplies. It is estimated that just over a million more barrels of propane is currently being stored in the Midwest and about 21 million barrels more in the Gulf Coast region compared to this time last year.

The increase in supply means prices have decreased since last year. The latest average for propane in Iowa is $1.11 per gallon, down 15-cents from fall 2018. Nevertheless, it is important for users to be prepared as fall and early winter weather patterns approach. With the chance of export pressures to increase this fall, ensuring adequate supplies on hand now can help avoid any possible unforeseen spikes in demand later this year.

As of Sept. 6, the U.S. Energy Information Administration (EIA) reports propane stocks in the Midwest "PADD 2" region at 26.9 million barrels. That is up from 25.8 million barrels a year ago. EIA reports that U.S. propane stocks as of that same date at 97.8 million barrels compared to 74.6 million barrels a year ago. Higher supply levels are attributed primarily to increased production levels and lower August export pressures.

The Iowa Department of Agriculture and Land Stewardship continues to work with a number of Iowa agriculture organizations and the Iowa Propane Gas Association (IPGA). The IPGA and the state propane suppliers work towards communicating the supply and demand for this vital agricultural energy resource.


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