LP Gas, April 2017

WINTER RECAP Weve yet to cover any plants this year marking the first winter in memory that this task was unnecessary Blazina says Of his propane industry colleagues he says A lot of them are moaning and groaning The bulk of Blazinas business in Florida is residential Most sales revolve around stoves hot water heaters dryers pool heaters and a more recent trend of supplying autogas for the school bus segment Fueling forklifts is another source of revenue The nice thing about forklifts is that its a yearlong load he says We used to move millions of gallons out to the nurseries and then they ran natural gas lines out there and that market went away Drastic measures Weather drama rumbled through North Dakota when 111 passengers on an eastbound Amtrak Empire Builder were stranded for 14 hours after the train became stuck in a 25 ft high 200 ft long snowbank outside Rugby North Dakota Named for a village in England Rugby bills itself as the Geographic Center of North America Luckily the train retained electrical Crop drying was very moderate at best We had some crop drying but it was sporadic and short lived GREG NOLL Propane Marketers Association of Kansas power and the dining car stayed open as rescue crews from the Burlington Northern Santa Fe Railroad fought to dislodge the immovable cars Reinforcement locomotives chugged in to push and tug fore and aft augmented by trackside skid steer loaders plunging into the giant drift Unfortunately the climate borne excitement was a bit of a fluke according to energy manager Keith Dibble at the Rugby based Envision Cooperative Its kind of been hit and miss Weve had some cold snaps and then its been warm he says Envisions sales volumes were up 30 percent over last year the fall harvest burned a bountiful amount of propane but last year they were down 25 percent over the previous year Dibble says Crop drying wasnt lucrative everywhere however Crop drying was very moderate at best We had some crop drying but it was sporadic and short lived says Greg Noll of the Propane Marketers Association of Kansas The weather in Kansas is as warm as it can possibly be Winter temperatures in the 70s have created an undesirable business environment Noll adds Were 25 percent to 30 percent below our previous two years Because of our loss of volume we see that the average price has taken an increase Marketers have been making a few bucks by increasing their margins he says Weather is the most important factor for success in the propane industry and its the thing that we have the least control over he adds It could be a big factor with some smaller independent companies deciding to get out of the business Marketers are being forced to take drastic measures to overcome winter challenges Noll says with expense management and controls taking hold in Kansas You have to be prepared have a plan and work that plan he adds Noll suggests that marketers maximize profits minimize expenses charge a fair price and keep tanks filled even when the heating season is over Summer pre buys are being promoted by 80 percent to 90 percent of Kansas retailers Thats certainly a tool in almost every marketers toolbox says Noll adding that the strategy shields customers from experiencing overly expensive heating bills when extreme cold eventually comes calling We continue to see a steady flow of propane appliances and we see a continuation of new appliances that run on propane he says A government appliance rebate program implemented in 2004 is moving sales and boosting loads Were always focused on autogas opportunities Noll says Kansas is Continued from page 19 US propane inventories 2012 17 Million barrels 120 100 80 60 40 20 inventory level five year average five year range 0 2012 2013 2014 2015 2016 2017 Source U S Energy Information Administration Weekly Petroleum Supply Report Note Inventories include propane propylene for fuel use only U S propane inventory hovered over the norm entering the last two winters 20 LPGas April 2017 www LPGasmagazine com