Wushin justifies price hike

Liquefied petroleum gas wholesaler Wushin Corp. justified the increase of prices by citing the high demand for propane gas worldwide during the winter season, as another Saipan LPG distributor disclosed plans to implement a similar price adjustment soon.

Besides Wushin, Saipan Industrial Gas, Inc. disclosed it would increase LPG prices in December. The company, however, did not disclose its new rates once the price hike takes effect, deferring the inquiry to its general manager, Dionisio Lopez, who was reportedly off-island.

Effective May 1, 2005, Saipan Industrial Gas implemented an increase in LPG prices, pegging the price of 90-lb. cylinder LPG’s at $79 each at delivery rate, higher by $4 than the previous rate. Pickup rate increased from $72 to $75.

For 40-lb. LPG’s, the prices increased by $6 per tank. Delivery rate became $45, while pickup rate increased to $42. The new prices of LPG in 20-lb. cylinders increased by $2 each and became $25 and $22 for delivery and pickup rates, respectively.

As far as Wushin is concerned, the price adjustments it has implemented and would be implementing soon are justified, saying that its Guam supplier, South Pacific Petroleum Corp., also raised prices.

Wushin general manager Enoch Sungsoo Lim said the worldwide price of LPGs increase during the winter season due to high demand for the product.

Lim said the nature of supply and demand applies to the CNMI even though the islands enjoy tropical weather, saying that the demand rises not only in the United States, but also in Asian countries such as Japan, Korea, China and Hong Kong.

Citing a statement from the National Propane Gas Association, Lim also said that Hurricane Katrina affected the worldwide supply of LPGs, with the typhoon damaging some of the Gulf Coast’s major ports for energy imports.

Lim noted that the Gulf Coast serves as home for many oil and gas fields, oil refineries, and gas processing plants that supply petroleum products, including LPGs, to the United States. He said the limited supply of propane worldwide also jacked up LPG prices.

On Nov. 3, Wushin raised the residential price of LPG in 90-lb. cylinders by $3 for a new price of $79 each. The prices of LPG in 50-lb. and 20-lb. cylinders rose by $2 and $1, respectively; those LPGs sell at $46 and $21.

By Dec. 2, LPG in 90-lb. cylinders will sell at $84 each. LPG in 50-lb. and 20-lb. cylinders will increase by $3 and $1 for higher residential rates of $49 and $22, respectively.

Wushin also implemented a 15-cent gallon price increase for commercial gallon rates, which now range from $3.40 to $3.90. Wushin also disclosed that it would hike gallon prices again by 25 cents beginning on Friday, when commercial gallon rates would range from $3.65 to $4.15.

At the same time, Wushin’s residential rates will also increase by Friday. By Dec. 2, LPG in 90-lb. cylinders will sell at $84 each. LPG in 50-lb. and 20-lb. cylinders will increase by $3 and $1 for higher residential rates of $49 and $22, respectively.