June Energy Update

Jun 03, 2019

In the blink of an eye, it’s June already. My mom always said that time goes by faster as you get older and I have to agree. She turned 90 in May (shhh….don’t tell her I told you) so the days must REALLY be going by quickly for her.
June is kind of a big deal for the energy division. We’ve got quite a bit of our propane gallons purchased from our vendors and in June we’ll be offering contracts to our customers. Last year was another winner for the customers who contracted their propane. I can almost set my watch by when propane prices begin to creep up when the crop drying/cold weather hits. 
If you’re thinking of calling to see if I think you should sign a contract, I’ll tell you the same thing I tell people every year, contract your propane. It’s a great risk management tool to lock in your low propane price. If you can’t come up with the entire prepay amount, book the rest of it. Propane is a really good bargain right now. Compare the propane price on your contract with gasoline prices and you’ll see how reasonable propane is as an energy source. Although I’m not done buying contracts yet, I think I can safely tell you to expect a lower propane contract price than you saw last year. 
Hopefully the monsoon season is over as you read this because it’s grilling time! Modern cylinder fill valves come with an Overfill Protection Device, or OPD. These devices have a float that shuts off the flow of propane when it reaches a particular volume. The warmer the propane the less you can get into the tank. At our locations that fill cylinders, we fill them by weight or when the OPD shuts off the flow of propane. We typically are able to get 17 to 20 lbs. of propane in a 20 lb. cylinder before the OPD shuts down the flow.
Did you know that many propane exchanges only put 15 lbs. of propane in a 20 lb. cylinder? Check the cage for a disclaimer. What seems like a good deal may not be so good after all. If the exchange tank seems a little light, it probably is. 
To all you dairy farmers out there, Happy June Dairy Month! And as always, thank you all for your business.

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