Livestock agriculture is a big user, particularly the turkey and pork producers.
A propane squeeze caused by January’s bitter cold has put the hurt on Minnesota’s livestock industry, as farmers scramble to find costly fuel to keep their animals warm.
Some turkey growers are being told by suppliers that the propane spigot might get turned off if the cold keeps up over the next week.
Relatively mild weather Friday and Saturday should help matters some, but the deep freeze is supposed to be back early next week.
“With the onset of severely cold weather over the past weeks, propane supplies in the Midwest are extremely tight,” according to a report Thursday from the U.S. Energy Information Administration. Agriculture uses about 30 percent of Minnesota’s propane.
Shortage worries are particularly acute in the turkey industry, and Minnesota is the nation’s leading turkey-producing state, with about 250 growers.
Fuel suppliers have told some farmers that they have “five days left of propane,” said Steve Olson, executive director of the Minnesota Turkey Growers Association. “The big concern is availability.”
Young turkeys require 90-degree heat, while full-sized birds need temperatures of 45 to 50 degrees. So far, supplies haven’t gotten so low that growers have dialed down the thermostat. But’s that’s a possibility. “It’s going to be the last resort,” Olson said.
If the heat goes down, turkeys get more stressed, which in turn makes them more susceptible to disease, he said.
Concerns over propane supplies have surfaced in the hog industry, too, and Minnesota is one of the nation’s top pig producing states.
“I’ve heard from folks who’ve been told by suppliers that they don’t know where their next load of propane is coming from,” said David Preisler, executive director of the Minnesota Pork Producers Association.
Faced with shortages, some hog farmers have tried to find alternate propane suppliers only to be told the dealers aren’t taking on new business.
The propane shortage is also having an effect in the dairy industry, though less for animal heating. The larger the animal, the more body heat it generates, and cows generate enough that their heating needs are less.
But propane is often the prime fuel used to heat water, and piping hot water is vital to keeping dairy farm equipment clean.
Farmers pay big premiums
Farmers — along with propane users of all stripes — are paying huge premiums for the fuel these days. Wholesale spot prices in Minnesota have gone from about $3.75 per gallon a few days ago to just south of $5 a gallon. Last fall, the propane price was $1.55 per gallon, and most of the run-up since then has occurred this month.
There are several reasons. Last fall’s bumper U.S. corn crop came in wet, and corn drying is done primarily by propane-powered heaters, taxing fuel supplies. Then, logistical problems prevented the Midwest from fully replenishing its propane inventories before winter, according to the U.S. Energy Information Administration.
The Cochin pipeline, which delivers propane to the Upper Midwest from Canada, was out of service for maintenance from late November to Dec. 20. The pipeline, operated by Kinder Morgan, carries 40 percent of Minnesota’s propane.
That shutdown foreshadows long-term supply problems for the state. Kinder Morgan plans to halt propane shipments on the pipeline this spring, reversing its direction to carry light petroleum condensate from the United States to Canada. Propane wholesalers are scrambling to retool their supply chains, increasing storage capacity and getting access to more railroad tank cars.