Propane, drying corn, and cold winter

RB Energy describes the problems with commercial and residential propane markets:

We’ve been talking a lot over the past year about the need for increasing exports to balance the U.S propane market as growth in production from gas processing plants outruns domestic demand.  U.S. propane production from gas processing has increased by over 100 Mb/d since January 2013, and there’s lots more to come.  For the first time U.S. propane exports exceeded 400 Mb/d in October 2013 thanks to growing U.S supply and infrastructure developments including dock expansions by Enterprise and Targa.  But just after exports ramped up, the propane market was hit by a couple of wild cards – a late and very heavy crop drying season and a series of record cold temperature events. In today’s blog, we continue our series covering the record setting 2014 NGL markets.

but this year Midwest propane suppliers were hit particularly hard by a late and heavy crop drying season followed directly by much colder temperatures. For an in-depth look at these demand anomalies and the impact on domestic markets see A Perfect Storm – Polar Vortex Turns Propane and other NGL Markets Upside Down.  For more on propane demand and crop drying see Farmer Dries Corn and I Do Care; Propane Corn Drying, Shortages and the Cochin Reversal – Part 2 .  While seasonality in propane demand is normal, this winter has been anything but normal.  The 2013 crop drying season and the 2013-14 Polar Vortex weather pattern are both extremes.