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An eye on sales and supply

API and Craig Whitley of Purvin & Gertz share notable facts and figures

The American Petroleum Institute says propane sales for combined residential, commercial, engine, farm and industrial uses in 2008 fell 3.4 percent from 2007 sales volumes.

API reports that nationwide retail sales of propane – excluding chemical use – in 2008 was 9.9 billion gallons.

Six of the states ranked in the top 10 in total retail sales saw a drop in gallons from the preceding year, including top-ranked California. Texas had its third straight yearly drop, while Illinois climbed into fourth place with a third straight year of growth.

Here is how they finished:

1. California (633.1 million gallons, down 2.8% from 2007)
2. North Carolina (550.5 million, down 1.2%)
3. Michigan (521.5 million, down 21.9%)
4. Illinois (494.5 million, up 16.9%)
5. Iowa (463.8 million, up 13.8%)
6. Texas (435.0 million, down 6.2%)
7. Minnesota (404.6 million, down 5.6%)
8. Wisconsin (398.9 million, down 6.6%)
9. Missouri (396.3 million, up 4.7%)
10. New York (349.3 million, up 4.9%)

States with the fewest number of retail gallons sold in 2008 were Alaska (13.9 million), Rhode Island (17.0 million), Hawaii (28.1 million), Delaware (49.8 million) and Nevada (50.6 million). All five had sales declines from 2007.

The report also ranks the states with the largest volume of propane sales in the residential, commercial and agricultural sectors. They are:

Residential Sector (Propane sold for use in private households primarily for use in space heating, water heating and cooking. Also includes sales for RVs):

1. Michigan (411.8 million)
2. Illinois (293.8 million)
3. Wisconsin (288.4 million)
4. California (283.7 million)
5. North Carolina (252.4 million)

Commercial Sector (Propane sold for use in commercial establishments such as motels, churches, restaurants, retail stores and laundries primarily for use in space heating, water heating and cooking for commercial purposes):

1. California (108.5 million)
2. North Carolina (106.8 million)
3. Florida (98.7 million)
4. Texas (94.3 million)
5. Missouri (71.4 million)

Agricultural Sector (Propane used in the production, harvesting and processing of agricultural products. Uses include heating buildings, controlling pests, powering agricultural equipment, and drying or conditioning crops. Farm residential use is included in residential category.)

1. Iowa (178.3 million)
2. Minnesota (116.2 million)
3. Illinois (81.6 million)
4. North Carolina (73.1 million)
5. California (59.4 million)

Current propane supply overview
Craig Whitley, propane supply and price guru at Purvin & Gertz, offered these summary conclusions to attendees at his April 10 supply presentation at the Southeastern Convention and International Propane Expo in Atlanta:

• We’ve experienced some particularly difficult logistical issues over the past two winters.
• Different fundamentals were at work both winters.
• Had March not brought warmer weather this year, our delivery system was in for a real test – with possible outages.
• The future brings promise of more supply, both domestically and internationally.
• 2010 import levels may look a lot like low 2009 levels.
• The real impact of growing international supplies will not likely be felt until 2011.
• U.S. shale plays will be very beneficial to our industry and markets, and can be considered a “game-changer.”
• Keep your eye on international price levels and arbitrage conditions.
• If import levels do track lower than historical averages, take care of getting your supplies lined up early.

Breast cancer racers
Debra Grooms, executive director of the Iowa Propane Gas Association, and Jenni McKeen, executive director of the Georgia Propane Gas Association, are fielding a team to walk the Komen 5K in Washington, D.C., prior to Propane Days (June 8-9). Industry folks interested in joining them in the Sunday, June 5 event on The Mall should contact Jenni (770-645-8677/info@georgiapropane.org) or Deb (515-564-1260/dgrooms@iapropane.org). If you can’t participate but still want to help the cause, please consider making a donation online at http://globalrace.info-komen.org.