The Tariff Issue

Tariffs often appear as a simple line-item tax on imported goods, and they’re one of the oldest tools of international trade policy, dating back to the classical antiquity period of the ancient Greeks and Romans.

Tariff notices can also be humorous, like this brass placard from a Ben Line Steamship (Glasgow), circa early 1900’s:

                               TOILET TARIFF

1^ST CLASS TOILET-----.10c

2^nd CLASS TOILET-----.05c

3^RD CLASS TOILET-----OVER THE SIDE

10% U.S. Tariff on Canadian Energy, including Propane

Sadly, there’s nothing funny about a 10% tariff on propane imported from Canada.

Most retailers just want to know what’s going on and if they’ll be impacted, so we’ll try to address both concerns.

What’s going on:

1. The Department of Homeland Security and U.S. Customs and Border Protection issued their latest tariff notice effective Tuesday, March 4^th.
2. On Thursday, March 6^th the executive order was paused until April 2^nd.
3. In the Annex section, under article description, natural gas liquids are subject to the 10% tariff on Canadian energy resources.
4. The tariff is placed on “the entered value of the imported product.”

Will you be impacted?

To give you peace of mind from the impact of potential tariffs on Canadian propane, Ray Energy has secured domestic supply options for the upcoming contract season!

These extraordinary efforts include our commitment to securing the propane you buy from us exclusively (or predominately) from U.S. supply sources.

After all, while Canada supplies about 15% of the propane that’s consumed within the U.S. (mostly in border states), the U.S. exports over 60% of our domestic propane production. But it doesn’t have to be that way!

In fact, it’s likely that there will be some major redeployment of North American energy resources over the coming months.

The Skinny

The world is topsy-turvy right now, and there’s a lot of uncertainty.  

We had a colder than normal winter, but what will next winter bring? Propane prices may seem high but they’re only a few cents per gallon higher than last year at this time. Tariffs on Canadian energy are looming as well, and even if there is another pause, or things get resolved for now, who’s to say they won’t come back, possibly at a higher rate?

The midstream propane industry is also changing. There are new faces, new acquisitions and more questions than answers.

It’s times like this when you need a proven, reliable supplier like Ray Energy. We have the answers you’re looking for, including domestic propane supply options for the new contract season. And we’ll always have your back!

Get Stephen's insights on propane delivered to your inbox every month. Sign up for our monthly newsletter here. 

For more frequent updates and industry news, join us on LinkedIn.

 NOTE: The views and opinions expressed herein are solely those of the author, unless attributed to a third-party source, and do not necessarily reflect the views of Ray Energy Corp, its affiliates, or its employees. The information set forth herein has been obtained or derived from sources believed by the author to be reliable. However, the author does not make any representation or warranty, express or implied, as to the information’s accuracy or completeness, nor does the author recommend that the attached information serve as the basis of any buying decision and it has been provided to you solely for informational purposes. 

« Back to The Heffron Blog