Morgan Stanley is out with a note today stating that VeraSun Energy (VSE) beat consensus and their Q2 estimates by a wide margin yet they still rate the stock equal weight due to the "tough ethanol market." That being said Morgan Stanley believes VSE has the best risk reward profile among the pure play ethanol producers.
Morgan Stanley also reported, "Given our outlook for increased industry capacity and a challenging cost profile we recommend investors … Read the rest
According to StreetInsider.com, Biofuel Energy (BIOF) has announced that it had realized approximately 26.1 million in losses resulting from closing out various corn, ethanol and nat gas hedges and has an additional 20 million in unrealized paper losses at current prices.
The Company put the corn and natural gas hedges in place to minimize the impact of rising prices. However, the plummet in the corn market exposed them to large unrealized losses under its … Read the rest
Pacific Ethanol (PEIX) reported a big loss this morning of .23/share, much larger than the .12/share loss analysts had been expecting as soaring corn prices eroded profits. Revenues came in on the light side as well at 198 million, vs the estimate of 206 million
Shares are down more than 15% this morning and the stock is once again trading below the 50 day moving average.… Read the rest
ADM reported a drop in fiscal fourth-quarter profit even as the company’s sales were boosted by higher commodity prices.
ADM reported net income in the quarter ended June 30 of $372 million, or 58 cents a share, down from $955 million, or $1.47 a share, a year earlier. The profit picture was complicated by gains from asset sales last year, which added $616 million after taxes to year-earlier results. Excluding the effect of those gains, … Read the rest
Pacific Ethanol (PEIX) is about to go online with its 5th ethanol plant in the next two weeks in Stockton California. The plant is on a 30 acre site within the Port of Stockton and has transportation infrastructure that includes barges, rail and highway access. They are expected to begin taking in corn in the next week and begin the grinding process during the week of the 18th of August. … Read the rest
Andersons (ANDE) has raised its full year 2008 guidance to the range of 5.00 – 5.40 up from previous estimates of 4.40 – 4.80 just announced in June. This is a big bump in such a short time.. very impressive. The Street consensus is 4.61 EPS. The increase in primarily attributed to the Plant Nutrient Groups performance. Expect the stock to pop up above important resistance of the 200 day moving average tomorrow. … Read the rest
The Financial Times reported today that the board of the Inter-American Development Bank is set to approve a 15 year loan of $250M to three new ethanol plants. Despite the growing environmental concerns about biofuels this will be the biggest development ever by a multilateral intuition. The new ethanol project will cost over $1bn and will be built by Santa Elisa Vale Do Rosario, a Brazilian company, and US private equity groups.
"Steady rises in … Read the rest
The Canadian government has agreed to give Suncor Energy’s (SU) St. Clair Ethanol Plant a $25 million investment to double its current production according to sustainablebusiness.com. The plant should be completed by the end of 2009 and has received equity investment from farmers totaling $12.5 million.
This will be the fourth biofuel plant funded under Canada’s ecoABC initiative. "The Government of Canada is investing a total of $2.2 billion over nine years toward … Read the rest
Yesterday, Biofuel Energy (BIOF) announced that it had begun shipping ethanol (2 million gallons) and distillers grain from its plains in Nebraska and Minnesota. While the plant is not yet running at full capacity it expects to begin doing so shortly.… Read the rest
UBS upgraded two ethanol plays this morning – Aventine Renewable Energies (AVR) & VeraSun Energy (VSE) to buy ratings saying the recent drop in corn prices along with healthy ethanol prices have created a positive margin scenario and that legislative support for corn based ethanol will be a positive for ethanol names in the short term
AVR is currently up about 10% and has cleared the 50 day moving average in recent days but remains … Read the rest