By Blake Hurst

It’s been a long cold winter, and it’s only January. Along with frozen livestock waterers and burst pipes, Missouri farmers are facing an emergency with propane supplies. Prices have doubled in the last few months and, according to my supplier for our greenhouse in northwest Missouri, went up 70 cents a gallon in one day. We’ve had localized reports of propane selling for nearly $5 a gallon. Suppliers are only receiving about half of their normal allocations of propane. Farmers with poultry barns, hog barns and greenhouses are facing an emergency situation.

Although farmers can lock in propane prices with local suppliers, we’re learning that doesn’t always work. At least one supplier has refused to honor those contracts when prices have moved against them, and farmers are facing the bleak prospect of actually losing baby chicks because they don’t have access to heating fuel. More well established, reputable suppliers are dealing with the shortage honorably, and as a result, they’ll gain loyalty from their farmer customers.

Propane is a byproduct of both oil and natural gas production. It seems strange to have a shortage, because U.S. production of both oil and natural gas is expanding rapidly due to the new technology of fracking. The shortage has been caused by a perfect storm. We’ve seen rapidly increasing exports of propane, a wet and late corn crop that increased the demand for propane for grain drying, and extremely cold and windy weather, along with some winter snow storms that have increased the difficulty of moving propane around the country.

Someone somewhere made a terrible miscalculation last year, as they collectively decided what inventories they would hold moving into the winter. The attraction of a growing export market pulled away supplies that are desperately needed here in Missouri and the Midwest. Farmers and homeowners are paying for those mistakes, and their memories are likely to be very long.

Adding to the misery, hog producers are concerned because allocating propane means increasing trips to every farm. Each trip adds to the chances that disease could be transmitted from one farm to another. Not only that, but at least one large poultry producer is cutting the number of chicks they place in their grower’s barns. That will decrease the supply of chicken and increase its price. Even if you don’t depend upon propane for heat, you’ll see the results of this winter’s miscalculation in your grocery bills in the future.

In Texas, regulations have been relaxed to ease transportation difficulties. People in the propane business are working around the clock to serve their customers, and propane users are desperately seeking ways to conserve. Missouri Farm Bureau is doing everything we can to improve the situation. As one long-time observer and participant in the industry commented, “This has never happened before.” Let’s hope that it never happens again.