Propane prices (Warning- RANT)

[jc55]

Re: Propane prices (Warning- RANT)

Disagree. The supply WAS/IS limited. Again, not apologizing-just facts.

Nobody is sitting around figuring out ways to gouge you. The supplier pays what he/she pays and adds markup. Simple as that.

The supplier is not going to lose money. It happens everyday at your local gasoline station. Why do you think those prices vary? Supply and demand. Nothing new.

The propane supply has been fairly consistant until recent weather issues caused supply problems. Propane is moved by truck, for the most part. NOBODY wants a rail car full of it within 100 miles of their house. That's another issue.

Agreed, there may be "supply" sitting around but that supply may be "committed" to a certain customer at an agreed price. Of course they are going to HOLD that.

If you want to buy 5000 gallons in July, you can work out the same deals.

All of this is called "Free Market".

If you want the government to weigh in, you will get what they decide to give you at the price they decide.

Your choice.

This is VERY short lived. Prices will come back down as supply replenishes.

I agree. Assuming that propane is following the current state of the natural gas supply, the prices make sense. I live in Carroll County. We're in the middle of the new shale plays. Right now with the "wet gas" that is coming out of the ground, the wells are freezing off and transmission companies are having a hard time/not being able to make contract obligations which are already in place, let alone increased demand to power plants, commercial and residential customers, and refineries. I know this because I work at a natural gas compressor station. I see the pressures, volume, and capacity running through Ohio daily. I can't just post specifics online, but there is an extremely high demand/squeeze. Propane is a product of refining, yes. So, it doesn't come out of the ground as propane but is a by product of natural gas and petroleum.

 

[WIMUSKY]

Re: Propane prices (Warning- RANT)

They showed natural gas wells burning off the gas in the Dakotas because it can't be processed fast enough... We have so much natural gas under our feet that we could never use it all. At least not in the next few(dozen) generations..... They have us by the nads and there's nothing we can do. I bet the propane companies will have record profits. Just like the gasoline companies does when they have a "shortage".....

 

[korygrandy]

Re: Propane prices (Warning- RANT)

I knew somewhere my fellow long lost boating friends would be b$#$! and moaning about winter somewhere... I just didn't realize it would be in the form of propane prices...

Just wanted to check in from maui... I miss the boat but not the snow

I also don't miss the maintenance that comes along with being a homeowner...like keeping the propane topped off!

 

[roscoe]

Re: Propane prices (Warning- RANT)

If anyone doesn't believe that propane consumption is up due to the cold weather across most of north america, they have their head in the sand.

Additionally, huge amounts of propane was used this fall, to dry wet corn crops, some reports estimate that 2-3 times the normal amount of propane was used.

Add in the refinery problems, and the pipeline problem, and the export issue, and you end up with a supply issue.

 

[jasoutside]

Re: Propane prices (Warning- RANT)

BTW, who uses wood as a back up or as the main and propane as back up?

Yup, that's me. I burn wood for heat and LP for back up. My bride usually turns on the LP furnace when I'm gone for the day or something. Every year I feel like it's me vs. the propane guy. I win every year.

This year, unfortunately, I think he'll take a big bite otta me. I got too busy and didn't split and season enough wood for the whole winter, only about half. My LP tank is starting to run low too. Looks like I'll need to either buy wood or buy LP, either way I'll pay. Rats.

I looked into buying my own LP tank and then trying to negotiate the best deal with the half dozen LP companies around here. Since they didn't own the tank it seemed like they all wanted to add on a "Safety Check" charge of $30 - $50 which obviously eats into my savings. So, I ended up "leasing" for $12/year. Of course, now I can only buy LP from one LP guy, so........

 

[bigdee]

Re: Propane prices (Warning- RANT)

Disagree. The supply WAS/IS limited. Again, not apologizing-just facts.

Nobody is sitting around figuring out ways to gouge you. The supplier pays what he/she pays and adds markup. Simple as that.

The supplier is not going to lose money. It happens everyday at your local gasoline station. Why do you think those prices vary? Supply and demand. Nothing new.

The propane supply has been fairly consistant until recent weather issues caused supply problems. Propane is moved by truck, for the most part. NOBODY wants a rail car full of it within 100 miles of their house. That's another issue.

Agreed, there may be "supply" sitting around but that supply may be "committed" to a certain customer at an agreed price. Of course they are going to HOLD that.

If you want to buy 5000 gallons in July, you can work out the same deals.

All of this is called "Free Market".

If you want the government to weigh in, you will get what they decide to give you at the price they decide.

Your choice.

This is VERY short lived. Prices will come back down as supply replenishes.

This guy paid attention in economics class. I totally agree.

 

[bigdee]

Re: Propane prices (Warning- RANT)

A free market causes price fluctuations from high to low. Do away with free market by adding regulation and the fluctuation will stop....along with the lower price! Nobody ever complains when the market price swings low.

 

[bigdee]

Re: Propane prices (Warning- RANT)

The price will come down, when the temps rise and they no longer have the country by the short and curlies.

Who are "they" I have family in the propane business and they totally disagree with what your saying. YOU also have control of the situation by buying when demand is down. Remember in competition, "they" is plural, regulation is singular.

 

[bruceb58]

Re: Propane prices (Warning- RANT)

So what is it? Your last post says there is a smaller supply.

And yet, my local delivery guy tells me his companies tanks are full and they have no where to store any more. Something just isn't fitting in the picture...

I love it when someone says supply is fine because the local guy has full tanks. :facepalm:

Propane is a byproduct of refining production. You just can't produce more propane without then refining everything else. If all the other products don't need to be made, they don't make as much propane.

My suggestion...stop worrying so much about everything. You are going to have a seizure. :laugh:

 

[jasoutside]

Re: Propane prices (Warning- RANT)

A question, do you think you save $$$ burning wood? I've a couple neighbors that do and in talking to one he tells me that with the cost of a good chain saw, splitter, other tools and all the maintenance, then the use of the 4X4 to get in and out of the woods, fuel etc. he really doesn't think he saves all that much, especially if he figures he is worth 50 cents an hour for labor.

Yup, I save a pile of cash every winter. I'd guess somewhere in the $3K maybe $4K per year range (+/- depending on the winter). Yah I certainly have all the gear to make it happen (tractor, saw, trailer, splitter) but I'd have all that stuff anyway (with the exception of the splitter). I live on 11 acres so I'm having to work on the property as it is. All my wood is free whether it's here on my property or easy picks from other peoples take downs.

My maintenance costs for the equipment are almost insignificant by comparison. Time is the big kicker for me, I am really stinking busy so it's very important that I carve out the time to cut/split/stack/season. If I don't, I end up like this winter, short on wood and grumpy about buying LP.

Good news there, I have two boys who are growing up fast. Very soon they will be strong enough to help me crank through the work in a flash!:thumb:

 

[pikefisherman]

Re: Propane prices (Warning- RANT)

We burn pellets, still need to buy something, but for me I just don't like hearing that propane truck backing up to the tank. Also the gas furnace is screwed up again. I wonder if I would get slammed if I called the repair guy.

 

[roscoe]

Re: Propane prices (Warning- RANT)

Again, there is no "shortage". I know of no one saying they can't get what they want, if they are willing to pay and when its your only source of heat you WILL pay. "IF" there were a shortage (lack of supply) I would agree with you but that just is not the case. The price will come down, when the temps rise and they no longer have the country by the short and curlies.

Then try checking in other parts of the country where it has gotten colder, and the supply chain is broken.

I know of 3 families near me who have drained the pipes and moved out of their houses, moving in with friends and relatives, because they can not get any propane.

One family is near Rhinelander, WI, they moved in with my cousin.
My uncle's fianc? has done the same with her home in upper MI, and moved in with her daughter.
And another cousin in Eagle River WI, has moved in with a neighbor.
All three are willing to pay. Actually, two of them are under contract, keep full, and my cousin prepaid last summer.
Still can't get any gas.
Half the people I work with, know of at least one person who can't get gas.

Maine is getting killed.
They are actually trucking propane to Maine, from Indiana and Illinois.

I am prepaid for 1000 gallons, but have been limited to 100 gallons per fill.
Half of my house is shut down, the other half is set at 61*, but it is only 52* where I am sitting as I type this.

NONE of the LP companies are taking ANY new customers, regardless of what you might be willing to pay.

 

[Fishing Dude too]

Re: Propane prices (Warning- RANT)

Am under 150 gallon limit, yes there are shortages but not just propane, natural gas is also short due to electrical generation, and electric due to coal plants being shut down. Pile on a high demand brought on by a cold spell you have shortages.

 

[Tim Frank]

Re: Propane prices (Warning- RANT)

Not to apologize but facts.

Propane is a by-product of refining, NOT the natural resource (oil/gas, etc.)

The issues with propane are transportation. Midwest bad weather caused a lot of transportation issues. Low Supply=Higher Prices.......

Until we relax (EPA) the building of new refineries, the fluctuation in prices will continue.

^^^^Amen!

"Add in the refinery problems, and the pipeline problem, and the export issue, and you end up with a supply issue. "

And yet, my local delivery guy tells me his companies tanks are full and they have no where to store any more. Something just isn't fitting in the picture...

Yeah....your "statistics".
Supply can only offset demand if it is in the same place.
The full tanks at the distributor in your area and empty ones in other areas only speak to distribution issues, not price gouging or other conspiracy theories.
Couple that with the long lag time to adjust refinery output mix....it is all based on demand forecasts.

The sky is not falling in, although I understand that you don't like the price levels.
Nobody does, including the gas companies.

 

[MTboatguy]

Re: Propane prices (Warning- RANT)

I also burn pellets with electric as a back up, of course I am blessed to live in an area that has more reasonable electric rates as well as being on a budget program with the local electrical co-op, so I don't have to pay large bills in the winter, my electric bill only varies about $10.00 per month year around. I don't even know what propane is selling for on the open market around here, I know I can still exchange my 20 lb tank at Costco for about $10-$11.

 

[WIMUSKY]

Re: Propane prices (Warning- RANT)

Rumor has it that our propane company is charging over $5/gal. I "think" around $5.89. There's got to be some gouging. We contracted at $1.39 last fall. That's a 400% increase. No rumors yet about a lack of, or no, supply........

 

[pikefisherman]

Re: Propane prices (Warning- RANT)

FYI I guess you can use a 20 lb tank if you need to. This will last a week I heard from a friend.

 

[jkust]

Re: Propane prices (Warning- RANT)

We are just delving into the whole propane as a heat source with our vacation lake home purchase last August. We filled the tank in August as it was empty when we closed on the place then we had to fill it in December when we were up there after xmas. We are keeping it heated at 48 degrees throughout the winter. It has been routinely colder than -20F air temp for weeks and weeks on end and so are really burning through it. We are locked in at $1.40 per gallon for the first year but we had to work to get them to fill it a month ago as they were dealing with the shortage then as well. To top it off they can only fill the tanks to 80% as a general rule whenever they fill it (they did an 85% fill in August given the warm temps). We really screwed up not getting any wood for the fireplace and now can't get our hands on any now that our small supply is used up.

 

[jasoutside]

Re: Propane prices (Warning- RANT)

I know a couple of you guys mentioned it earlier, but, what's the deal with Compressed Natural Gas (CNG)? Why can't we get that rolling? Seems like it's a total non starter? What's the problem there anyway? Seems like I've seen video of third world countries who are using it quite readily. Any of you fellas want to educate me with CNG?

Maybe I'm dum, but it seems like a no brainer to me, eh?:noidea:

 

[Thalasso]

Re: Propane prices (Warning- RANT)

Not to apologize but facts.

Propane is a by-product of refining, NOT the natural resource (oil/gas, etc.)

The issues with propane are transportation. Midwest bad weather caused a lot of transportation issues. Low Supply=Higher Prices.......

Until we relax (EPA) the building of new refineries, the fluctuation in prices will continue.

:thumb: