How long before propane price affects the supermarket ?

[Yuptag]

Originally Posted by Teddy52

I just read an article in a central MN paper that a big turkey operation in Minnesota goes thru 30,000 gallons of propane in a week.

Since the propane price jumped over $3 a gallon recently, that is a $90,000 a week increase in expense.

Since the profit margin on poultry operations is narrow, look for poultry prices at the supermarket to rise or huge poultry barns sit empty.

that would cause poultry prices to rise, also.

I was thinking that, too. Propane affects a lot of goods.

[Oildog]

Winter got an early start in many places this year. Its colder than normal. Many places no longer use heating oil for cost/environmental/availability reasons. Demand for propane as a heat source has dramatically increased with these polar vortexes and such. Many communities have been buying propane from non-traditional suppliers as their inventories have been depleted faster than previous years and normal suppliers have run out.

Supply/demand strikes again.

[TaxPhd]

Originally Posted by vmaxnc

"The market establishes equilibrium" means nothing more than people charge more for their products whether those products cost more to produce or not

Do you believe that a change in production costs is the only thing that does, or should, change the price of a product?

Show all the graphs you want but this is nothing more than people raising the price because they can. If sellers didn't change the price of their products, regardless of how many they have, they would not go up on their own. Artificial.

Why is gold more valuable than water? (Hint, production cost is only one factor).

Since I seem to be a little slow here, help me to understand what "non-artificial" price increases are.

Your rant against rising prices when faced with increased scarcity can be likened to a rant against the effects of gravity. You may not like it. You may not understand it. You don't agree with it, nor do you accept it. But step off the edge of a cliff and you will immediately know that it exists.

[vmaxnc]

Originally Posted by TaxPhd

I'm not sure what you mean by "artificial concepts" but the concepts of supply and demand are as real as gravity. There is nothing "artificial" about them.

Take a look at this graph:



The shortage causes a change in supply, and the supply curve shifts to the left, from Supply 1 to Supply 2. When that happens, the equilibrium point shifts as well, and the market establishes equilibrium at the new, higher, price.

And as I said before, greed has nothing to do with it.

Originally Posted by TaxPhd

Do you believe that a change in production costs is the only thing that does, or should, change the price of a product? Yes.

Why is gold more valuable than water? (Hint, production cost is only one factor). Because we decided it is. Was there a sign on gold when we first found it that said it should sell for "x"? No. We assigned a value to it.

Since I seem to be a little slow here, help me to understand what "non-artificial" price increases are. Using propane as the example, any business that buys propane is now paying more to produce their product. So they pass those costs along to their customers. That isn't artificial. They have to charge more, or they will not make a profit and will go out of business. Arbitrarily charging more for propane when the cost to produce it has not risen is artificial.

Your rant against rising prices when faced with increased scarcity can be likened to a rant against the effects of gravity. You may not like it. You may not understand it. You don't agree with it, nor do you accept it. But step off the edge of a cliff and you will immediately know that it exists.

Gravity isn't a decision. Raising the price of something arbitrarily when its cost hasn't gone up is.

[Teddy52]

In the 1970's, a president of the United States thought it was a good idea to put a freeze on the price of beef . The price was rising rapidly due to small supplies.

That freeze sure didn't last long and it proved that price freezes on scarce products is a disaster.

[Rakin]

Wonder if that Turkey farm does not have access to natural gas ?

It's much better priced and available.

[North Beach Person]

Originally Posted by Rakin

Wonder if that Turkey farm does not have access to natural gas ?

It's much better priced and available.

The chicken farms on the Eastern Shore of MD don't, they use propane.

[flyonpa]

Many Poultry farms are generally far enough out of "town" and/or off the main roads that they would not have Piped Natural Gas Service,

IF the had it available they would use it.