Farm Fuels Bulletin | Diesel Firms on Stagnant Production

Posted on 05/10/2019 2:58 PM


Farm Diesel

  • Our regional average farm diesel price per gallon rose a penny on the week to $2.46. That is dead even with the same week last year.
  • According to EIA, national crude oil stocks fell 4.0 million barrels from the prior week in the week ended May 3.
    That figure is still, however 32.8 million barrels above the same week last year.
  • EIA also reports crude oil production was steady with the prior week at 12.2 million barrels per day. That compares to 10.612 million barrels per day in the same week last year.
  • Overall distillate production during the report week was up 0.013 million barrels on the week at 5.026 million barrels, which compares to 5.015 million barrels during the same week last year.

According to a May 8 article on, "Refineries in the U.S. are gearing up for an unusually intensive maintenance season this spring, to prepare their equipment for the upcoming IMO 2020 emission rules that will suspend the production of high-sulfur fuels in favor of low-sulfur ones."

It is unclear what the new emission requirements will mean for farm diesel prices moving forward. We will cover those potential impacts in future posts. More immediately, as the article i referenced above notes, refineries will befarm diesel price chart conducting extra extensive maintenance to make ready for the switch to lower sulfur blends. That may support higher on farm prices through sidedress season.

I would advise you talk with your preferred supplier and consider booking a portion of your harvest diesel needs at current prices. There is technical downside potential for crude oil and petroleum products, but there is an equal measure of upside risk. With so many trade and international hot buttons in play, it is prudent to protect oneself against a market moving event by locking in today's price.

But also bear in mind the potential a deal with China or ratification of USMCA has to pressure crude oil once agreements are finally inked. USMCA will likely be finalized long before we hear the last of the China trade talks, but it is the Chinese talks that will carry the potential for a bigger market move of the two.

It is also important to note the production figure from EIA above... 12.2 million barrels per day is another impressive weekly average production figure and that will help to blunt outside price support.

As you well know, American agriculture has a lot of balls in the air right now, and the outlooks on everything from fuel prices to fertilizer to commodity prices in general are extremely difficult to nail down. A move on any number of issues will inject volatility into the ag space so be nimble, be prepared to take advantage of opportunities on short notice and by all means, take control of the things you can while keeping a healthy perspective on the things you cannot.


  • Our Midwestern propane price gained 2 cents per gallon on the week.
  • Ten of twelve states were unchanged as Nebraska fell a penny per gallon. The gain in our regional average price was due to a 14 cent per gallon rise in Missouri.
  • According to, national propane stocks climbed 1.011 million barrels to 59.951, now 21.280

Week-over Change
Current Week
Farm Diesel
+1 cent
Farm Diesel
+2 cents

Our farm diesel/heating oil futures spread compares the weekly average retail farm diesel price with front-month heating oil futures as of the close on the previous Friday. A move below the "line in the sand" indicates pending upside risk. A move above our "line in the sand" indicates downside potential.

This week, our spread analysis indicates very mild upside risk for retail farm diesel.

diesel spread chart


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