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Food for thought. If there was no ethanol mandate corn production for 2013 would have been lower, less CRP land would have been tilled over leaving better bird habitat, no ethanol in the gas would mean a lot less problems with all kinds of gas engines/fuel lines, and less propane would have been used to dry corn used for ethanol production.
If…… “If’s” & “Buts” were “Candies” & “Nuts”, we’d all have a Merry Christmas!
It is what it is and until it changes, this is what we live with.
I feel really bad for the people out there who are scrambling to both find propane and then to pay for it. Talk about NOT a problem that working people anywhere need.
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A friend told me today that he had locked in for $1.49/gallon last summer, but the supplier has now told him they will not honor that price. The new price is $6/gallon. The supplier claims that they met with their attorney and were told this was legal. I don’t know if their was a written contract and, if so, what escape clause it contains.
Big story about a similar situation (maybe the same one) was on the Ch 5 news last night. People thought they had a “contract”, but what they actually had was not legally binding so companies are just telling people that it’s meaningless and pay the current price or you get nothing.
And even getting the bulk supply was reported to be a huge problem. Very tight market and you can’t just order a rail car delivery and have it there the next day. Lots of lag time.
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Food for thought. If there was no ethanol mandate corn production for 2013 would have been lower, less CRP land would have been tilled over leaving better bird habitat, no ethanol in the gas would mean a lot less problems with all kinds of gas engines/fuel lines, and less propane would have been used to dry corn used for ethanol production.
Careful, calculator abuse is a crime in 48 states. You’re adding 1+1 and getting 156.
First of all, propane is used to dry all kinds of grain, not just corn.
Secondly, it wasn’t as if farmers just suddenly started using propane this year for the first time. The whole system is set up around a spike in demand in the fall. So this year they used a % more than was “normal”. To me that doesn’t fully explain this shortage 3 months after the end of the harvest season.
IMO the big picture is that globally the slack is out of the chain in all kinds of commodities. There used to be large excesses in the supply of things like grain, coal, natural gas, steel, etc. Supply was vastly in excess of current demand.
Fast forward from 20 years ago to today. Just one example, the Chinese have been on a mission over the past decade to ramp up domestic production of pork and chicken. Problem is that all the feed for these animals has to be imported.
So suddenly the Chinese are in the “must buy” position and scooping up hundreds of thousands of tons of grain that they weren’t buying 20 years ago. Add to that the fact that this isn’t a optional purchase, you can’t just stop feeding hogs or shut down a chicken rearing operation that has 500,000 birds. Once those operations are up and running, the Chinese were locked in to buy whatever it takes to keep them running.
That kind of situation has happened in “developing economies” all over the world. Suddenly these regions are draining supply and turning a market like grain or iron ore, which used to have large surpluses, into a tight dog-eat-dog market for the available supply.
IMO, shortages of all kinds of things are going to become a reality in the USA in a way that they never were before.
Grouse
Rumor has it a guy locally paid $1200 for 200 gallons of propane yesterday.
I tell you, if I heated with propane I’d be looking at installing Plan B right NOW. Electric baseboard, pellet stove, wood stove, whatever.
There’s a propane shortage story on the radio right now as I type this. It’s all over the media and the next issue will be panic buying by those who don’t need it, but want to get it “in case”.
There’s going to be an EPIC shortage of every other type of alternative heating appliance in about 2 weeks. If you don’t have Plan B in place now, I’d get on it. Shelves will be bare very soon.
Grouse
Obviously, He didnt have any other option at the time. I just checked my tanks. My 1000 gal tank is setting at a little under 50%. As upsetting as it is to get a bill for 700 at $2, I cannot fathom it as $6.. Starting to look for things to sell in the barn..
I thought it was hilarious that Dayton declared a “State of Emergency” over the shortage and was ready to mock him, but then I saw several other states, including WI had done the same thing.
I do feel bad for people living out state that depend on it and did not budget in propane costs more than doubling.
From my provider:
We will continue with normal business procedures as we would any other year. When we fill your tank on the route program it is because we do not want you to run out of product, it is not that we are just trying to move product. This is a serious issue and I cannot control the price. If prices are still extreme come March, then we will look at doing short fills (minimum drops) to help lessen the strains of the price.
Sounds like I couldnt order a short drop even if I wanted to.. Yikes..
time to start rounding up an electric furnace..
(1928 farmhouse with boiler and radiators.. No AC)
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