Weekly Farm Fuels Bulletin | Farm Fuels Surge to the Upside

Posted on 01/09/2018 11:30 AM

 

WTI crude oil is currently overbought suggesting pending technical selling. But demand for home heat will have to ease if heating oil futures are to pull near-term farm diesel prices lower. We believe ruby red will lend us an farm diesel chartopportunity to book below last week's $2.31 before spring fieldwork is underway. Stay patient on diesel, and stay filled on propane.

Farm Diesel

  • Farm diesel gained 6 cents per gallon this week on higher WTI, higher heating oil futures and demand for heating oil in response to bitterly cold temperatures across most of the nation last week.
  • Missouri and Kansas posted sharp increases this week, which will likely set-back next week.
  • This week's farm diesel/heating oil futures spread indicates pending price softness for farm diesel, but if demand for #2 diesel (heating oil) remains robust, diesel will remain elevated.

 

Propanepropane price chart

  • Propane added 4 cents this week on frigid temperatures across LP country.
  • Missouri and Minnesota contributed the largest price gains on the week.
  • Iowa and Nebraska actually posted declines during the reporting week, suggesting the upside may have been overdone.
  • As retailers refill supplies, prices will likely moderate and may even come under light near-term pressure.

Fuel
12/25/17
1/2/18
Week-over Change
Current Week
Fuel
Farm Diesel
$2.31
$2.31
+6 cents
$2.37
Farm Diesel
LP
$1.48
$1.47
+4 cents
$1.51
LP

spread


 

 

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