The 2020 harvest was a breath fresh air for most farmers in the region after the disastrous fall of 2019 marked by an early snowstorm and excessive moisture.
As a result of the unusual 2019 conditions, some of the crop did not get harvested until spring. Farmers able to harvest took out an extremely wet crop that had to be dried several points. This caused a bottleneck in the propane supply distribution system and meant record drying costs for farmers. Colton, S.D., farmer Jeff Thompson even dried his soybeans in 2019, but Mother Nature was much kinder this fall.
Thompson said there were several notable differences between the 2020 and 2019 growing seasons. To start with, the crop got planted early and matured early, as it got pushed along with the heat and dryness in August. The crop dried down quickly, resulting in farmers having to dry very little of their crop. Typically, it can cost about 3.5 cents per percentage point of moisture to dry corn. Taking away that cost is a huge savings for farmers like Thompson.
“I'm sure I saved, you know, probably a couple, two to three thousand over last year," he said. "The gas prices themselves, of the propane, was quite low, but we just didn't go through the gallons.”
Plus, the near-perfect weather conditions this fall meant it did not require a lot of heat to dry the crop down.
CHS Director of Propane Sales and Marketing Dennis St. Aubin said farmers saved a substantial amount of money drying corn.
“We were hearing in the late part of September into October moistures coming off the field at anywhere from 22% to 14%,” he said. “My experience is talking to marketers and farmers, and we’re seeing, you know, less than the five-year average by upwards of 30% to 40%.”
Compared to last year he said it may be more than 40% due to the heavy demand they saw for propane due to the wet crop.
Many farmers were able to take the crop directly from the field and put it into the bin with just some air, which should also preserve the quality of that crop and help keep it in condition through the winter, which also adds to the value of the grain.
While the demand for propane is down, surprisingly the price point per gallon of propane is comparable to 2019.
“Year over year, we’re really seeing similar costs as far as what our hub price of propane going from the marketer to the farmer,” he said.
He attributes some of that to farmers being more proactive and contracting propane early and getting the price locked in. Not only was there a sense of urgency due to the supply problems from last year fresh on farmers' minds, but there was also concern about the ability to get propane due to the COVID-19 pandemic. Last year there were bottlenecks and propane shortages and the region’s governors even had to sign proclamations to extend the hours of service for the delivery of propane.
The outlook for this winter’s grain drying season will be dictated by the weather. Predictions of a strengthening La Niña could mean colder temperatures in the Midwest.
“We certainly are anticipating a colder weather pattern coming in December and January,” St. Aubin said.
He said that will mean increased demand for propane not just for drying but also for swine and poultry facilities. Farmers can use a forecasting tool through the Propane Education and Research Council’s website, https://propane.com, to help them see what the crop drying demand may be even into the next cropping year.