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Agland's Mr. Max Propane Contract

Agland's "Mr. Max" contracting program was developed as a means of price protection for propane users.

Simply stated, the "Mr. Max" contract locks in a "ceiling" price for your propane needs, while giving you full "downside" protection in a declining market. Agland will invoice either the "Mr. Max" price or the daily delivered price, whichever is less, for the gallons delivered. All contracts will require a $0.10 per gallon administrative fee for the total gallons contracted.

Participation in the program is open to anyone using propane. To participate you will need to 1.) estimate the gallons you will need October 1st to March 31st, 2.) pay a $0.10 per gallon administration fee on the estimated gallons which may be billed to your 30-day convenience credit account, if established, 3.) sign and return a Mr. Max contract to the Petroleum Division.

Frequently Asked Questions
Q: Do I have to pay for all contracted gallons before delivery?
A: No! You pay only the $0.10 per gallon administration fee at the time the contract is accepted. Customers with a 30-day convenience account will be invoiced at the time of delivery or if you don't have an established credit account you will be billed for cash upon delivery.

Q: What happens if I take delivery of more gallons than was contracted for during the quarter?
A: Daily Agland posted price will be charged for all gallons that exceed your contracted quantity.

Q: What happens if I don't use all of the contracted gallons before March 31st?
A: Remaining gallons simply go away and the administration fee on those gallons will be forfeited.

Q: What is the "Mr. Max" contract price measured against?
A: The contract price is measured against the daily delivered posted price. The customer will be billed for whichever is less.

Q: Why is an administration fee required?
A: A vital component of the "Mr. Max" contract is the use of "Put" options. Agland must purchase options along with the physical product (gasoline, diesel fuel, or propane) in order to offer downside protection to the customer. Extreme market volitility has driven the cost of these options up nearly 300% from last year. This dramatic increase is the reason for passing on some of the cost in the form of a $0.10 per gallon administration fee.

The Mr. Max contracting program is WIN-WIN for the end user. Other programs that greatly enhance the Mr. Max contracting program are the Budget Billing and Scheduled Delivery programs.

For more information about our Mr. Max or Budget Billing programs, contact the Petroleum Division directly.