Ethanol Producers Facing Negative Profit Margins as Recent Drought Sends Corn Prices Soaring
August 17 2012 - 7:20AM
Marketwired
Skyrocketing corn prices and lower gasoline demand in the U.S. has
seen profits of ethanol producers drop drastically. Producers have
begun to idle plants and/or slow production as a result. "Even the
most profitable plants out there are barely breaking even in the
current environment," said Matthew Farwell, a New York-based
analyst for Imperial Capital LLC. Five Star Equities examines the
outlook for companies in the Ethanol Industry and provides equity
research on Pacific Ethanol Inc. (NASDAQ: PEIX) and Gevo, Inc.
(NASDAQ: GEVO).
Access to the full company reports can be found at:
www.FiveStarEquities.com/PEIX
www.FiveStarEquities.com/GEVO
Ethanol producers have battled record high corn prices, and
tight domestic supply. The drought in the Farm Belt has drove
corn-futures to an all-time high in July. Prices have relaxed a bit
since then but have still surged over 40 percent since early June.
It is estimated that approximately 40 percent of the nation's corn
output is consumed by the ethanol sector. Major producer Archer
Daniels Midland recently stated that their ethanol margins had
crumbled to a loss of over 20 cents per gallon.
Five Star Equities releases regular market updates on the
Ethanol Industry so investors can stay ahead of the crowd and make
the best investment decisions to maximize their returns. Take a few
minutes to register with us free at www.FiveStarEquities.com and
get exclusive access to our numerous stock reports and industry
newsletters.
Pacific Ethanol's mission is to be the leading marketer and
producer of low-carbon renewable fuels in the Western United
States. Pacific Ethanol owns a 34% interest in and operates four
ethanol plants in the Western United States with a combined
operating capacity of 200 million gallons. The company recently
reported net sales in the second quarter of 2012 were $205.4
million, compared to $214.6 million in the second quarter of
2011.
Gevo is a leading renewable chemical and advanced biofuels
company. They are developing bio-based alternatives to
petroleum-based products using a combination of synthetic biology
and chemistry. The company retrofits existing ethanol plants to
make isobutanol, a second-generation biofuel.
Five Star Equities provides Market Research focused on equities
that offer growth opportunities, value, and strong potential
return. We strive to provide the most up-to-date market activities.
We constantly create research reports and newsletters for our
members. Five Star Equities has not been compensated by any of the
above-mentioned companies. We act as an independent research portal
and are aware that all investment entails inherent risks. Please
view the full disclaimer at:
www.FiveStarEquities.com/disclaimer
Add to Digg Bookmark with del.icio.us Add to Newsvine
Contact: Five Star Equities Email Contact
Gevo (NASDAQ:GEVO)
Historical Stock Chart
From Jun 2024 to Jul 2024
Gevo (NASDAQ:GEVO)
Historical Stock Chart
From Jul 2023 to Jul 2024