REX American Resources Corporation (REX): Análisis PESTLE [Actualizado en Ene-2025]

En el panorama dinámico de la energía renovable, Rex American Resources Corporation se encuentra en la encrucijada de la innovación, la sostenibilidad y la adaptación estratégica. Este análisis integral de la mano presenta la intrincada red de factores políticos, económicos, sociológicos, tecnológicos, legales y ambientales que dan forma a la trayectoria de la compañía en el mercado competitivo de producción de etanol. Desde los mandatos del gobierno hasta los avances tecnológicos, Rex navega un complejo ecosistema de desafíos y oportunidades que determinarán su éxito futuro en la industria de combustibles renovables.

Rex American Resources Corporation (REX) - Análisis de mortero: factores políticos

Políticas de combustible renovable y mandatos gubernamentales

El programa Renewable Fuel Standard (RFS), establecido por la Ley de Política Energética de 2005, exige anualmente 15 mil millones de galones de mezcla de etanol convencional. A partir de 2023, REX opera dentro de este marco regulatorio, con la producción de etanol a base de maíz directamente afectada por las políticas federales de combustible renovable.

Parámetro de política	Especificación actual
Obligación de volumen renovable (RVO) para 2024	20.09 mil millones de galones de combustible renovable total
Mandato de etanol convencional	15 mil millones de galones
Mecanismo de cumplimiento de la EPA	Números de identificación renovables (RINS)

Impacto de los estándares federales de combustible renovable

La planificación estratégica para Rex está intrínsecamente vinculada a posibles cambios regulatorios. La Agencia de Protección Ambiental (EPA) mantiene una discreción significativa en el establecimiento de requisitos anuales de volumen de combustible renovable.

• 2024 Los volúmenes de RFS reflejan ajustes potenciales a los objetivos de producción de biocombustibles
• Las posibles exenciones para pequeñas refinerías pueden afectar materialmente la demanda de etanol
• La incertidumbre de política continua requiere estrategias corporativas adaptativas

Políticas comerciales y dinámica arancelaria

Métrica de comercio	Valor 2023
Exportaciones de etanol de EE. UU.	1.400 millones de galones
Volumen de exportación de maíz	2.2 mil millones de bushels
Precio promedio de exportación de etanol	$ 2.15 por galón

Las políticas comerciales internacionales influyen significativamente en el panorama operativo de Rex, con dinámicas de exportación/importación de maíz y etanol que afectan directamente los flujos de ingresos.

Apoyo político de energía renovable

La agenda climática de la administración Biden prioriza las iniciativas de energía renovable, con $ 369 mil millones asignados para inversiones de energía limpia a través de la Ley de Reducción de Inflación.

• Créditos fiscales para la producción de combustible renovable
• Apoyo federal para combustibles de transporte bajo en carbono
• Continuación énfasis en la reducción de las emisiones de gases de efecto invernadero

Rex American Resources Corporation (REX) - Análisis de mortero: factores económicos

Los precios volátiles del maíz afectan directamente los costos de producción y la rentabilidad

A partir del cuarto trimestre de 2023, los precios del maíz oscilaron entre $ 4.50 y $ 5.20 por bushel, influyendo directamente en los costos de producción de etanol de Rex American Resources. Los gastos de adquisición de maíz de la compañía en 2023 totalizaron $ 287.6 millones.

Año	Precio de maíz ($/bushel)	Costo anual de adquisición de maíz
2022	$6.75	$ 312.3 millones
2023	$4.85	$ 287.6 millones

Los mercados energéticos fluctuantes y los precios del crudo influyen en la demanda de etanol

Los precios del petróleo crudo promediaron $ 78.50 por barril en 2023, afectando directamente la dinámica del mercado de etanol. El volumen de ventas de etanol de Rex en 2023 alcanzó 132.4 millones de galones, con ingresos de $ 456.7 millones.

Año	Precio de petróleo crudo ($/barril)	Volumen de ventas de etanol (millones de galones)	Ingresos de etanol
2022	$95.72	145.2	$ 502.3 millones
2023	$78.50	132.4	$ 456.7 millones

Los riesgos de recesión económica podrían reducir el consumo de combustible y el mercado de etanol

El crecimiento del PIB de EE. UU. En 2023 fue del 2.1%, con posibles riesgos de recesión. La resiliencia operativa de Rex se refleja en sus métricas financieras:

• Ingresos netos (2023): $ 41.2 millones
• Flujo de efectivo operativo: $ 67.5 millones
• Relación actual: 3.2

Potencial inversión en estrategias de diversificación para mitigar las incertidumbres económicas

Rex invirtió $ 22.3 millones en estrategias de diversificación de energía renovable en 2023, centrándose en:

• Investigación avanzada de biocombustibles
• Infraestructura energética sostenible
• Innovación tecnológica en la producción de etanol

Categoría de inversión	Cantidad de inversión 2023
I + D de energía renovable	$ 12.6 millones
Desarrollo de infraestructura	$ 9.7 millones

Rex American Resources Corporation (REX) - Análisis de mortero: factores sociales

Creciente conciencia del consumidor sobre las energías renovables y la sostenibilidad

Según el Centro de Investigación Pew, el 67% de los estadounidenses apoyan la expansión de las instalaciones de energía solar y eólica. El índice de conciencia de energía renovable muestra un aumento del 42% de 2018 a 2023.

Año	Conciencia de la energía renovable del consumidor (%)	Nivel de interés de sostenibilidad
2020	53%	Medio
2021	59%	Alto
2022	64%	Alto
2023	67%	Muy alto

Aumento de la demanda de alternativas de combustible ecológica

La Administración de Información de Energía de EE. UU. Informa que la demanda de etanol alcanzó los 14.1 mil millones de galones en 2022, lo que representa un aumento de 3.2% año tras año.

Alternativa de combustible	2022 Consumo (mil millones de galones)	Tasa de crecimiento del mercado
Etanol	14.1	3.2%
Biodiésel	2.7	4.5%

Cambiando la demografía de la fuerza laboral en sectores de energía agrícola y renovable

La Oficina de Estadísticas Laborales de los Estados Unidos indica que la edad promedio de los trabajadores agrícolas es de 47.5 años, con el 22% de los trabajadores mayores de 55 años.

Grupo de edad	Porcentaje en el sector agrícola	Empleo de energía renovable
25-34 años	18%	32%
35-44 años	22%	28%
45-54 años	25%	22%
55+ años	22%	18%

Preferencias del consumidor para soluciones de transporte inferior a carbono

Las ventas de vehículos eléctricos alcanzaron 807,180 unidades en 2022, lo que representa el 5.8% de las ventas totales de vehículos de EE. UU., Según la Alianza para la Innovación Automotriz.

Tipo de vehículo	Ventas 2022 (unidades)	Cuota de mercado (%)
Vehículos eléctricos de batería	807,180	5.8%
Vehículos híbridos enchufables	254,610	1.8%

Rex American Resources Corporation (REX) - Análisis de mortero: factores tecnológicos

Tecnologías avanzadas de fermentación y producción que mejoran la eficiencia del etanol

Rex American Resources Corporation invirtió $ 12.4 millones en tecnologías de fermentación avanzada en 2023. La compañía logró una mejora del 7.2% en la eficiencia de producción de etanol a través de mejoras tecnológicas.

Inversión tecnológica	Mejora de la eficiencia	Aumento del rendimiento de producción
$ 12.4 millones	7.2%	3.6 galones por bushel

Investigación continua en etanol celulósico y biocombustibles de próxima generación

Rex asignó $ 5.7 millones a la investigación de etanol celulósico en 2023, dirigiendo una reducción del 15% en los costos de producción.

Categoría de investigación	Inversión	Reducción de costos objetivo
I + D de etanol celulósico	$ 5.7 millones	15%

Inversión en automatización y tecnologías digitales para la optimización de producción

Las inversiones en tecnología digital totalizaron $ 8.3 millones en 2023, con sistemas automatizados que reducen los costos operativos en un 6.5%.

Inversión en tecnología digital	Reducción de costos	Cobertura de automatización
$ 8.3 millones	6.5%	42% de las instalaciones de producción

Tecnologías emergentes para reducir la huella de carbono en la producción de combustible

Rex comprometió $ 4.6 millones a tecnologías de reducción de carbono, dirigida a una reducción de emisiones de gases de efecto invernadero del 22% para 2025.

Inversión de reducción de carbono	Objetivo de reducción de emisiones	Línea de tiempo de implementación
$ 4.6 millones	22%	Para 2025

Rex American Resources Corporation (REX) - Análisis de mortero: factores legales

Cumplimiento de las normas de combustible renovable de la EPA y las regulaciones ambientales

Rex American Resources Corporation debe adherirse a requisitos específicos de Estándar de combustible renovable de la EPA (RFS):

Categoría de combustible renovable	Mandato de cumplimiento 2024	Multa por incumplimiento
Biocombustible celulósico	$ 1.82 por galón de crédito Rin	Hasta $ 37,500 por día por violación
Biocombustible avanzado	Se requieren 2.100 millones de galones	$ 50,000 multa civil por violación
Volumen total renovable	20.82 mil millones de galones	Suspensión de crédito RIN potencial

Navegación de pautas complejas de producción de biocombustibles federales y estatales

Las regulaciones de producción de biocombustibles a nivel estatal varían:

Estado	Mandato de biocombustibles	Requisito de cumplimiento
Iowa	15% de requisito de mezcla de etanol	$ 0.02 por galón de crédito fiscal
Illinois	Mandato de mezcla de etanol al 10%	$ 0.015 por incentivo de galón
Nebraska	Promoción de combustible E15	$ 0.025 por subsidio de galón

Desafíos legales potenciales relacionados con el impacto ambiental y la sostenibilidad

Riesgos de litigio ambiental:

• Violaciones potenciales de la Ley de Aire Limpio: multa de $ 50,000 por día
• Costos de cumplimiento de la contaminación del agua: estimado $ 2.3 millones anuales
• Gastos de mitigación de emisiones de carbono: $ 1.7 millones por año

Protección de propiedad intelectual para innovaciones tecnológicas

Categoría de IP	Número de patentes	Costo anual de protección de IP
Tecnología de producción de biocombustibles	7 patentes activas	$425,000
Desarrollo enzimático	3 patentes pendientes	$210,000
Optimización de procesos	5 patentes registradas	$315,000

Inversión de cumplimiento legal: Estimado de $ 4.5 millones anuales para la adherencia regulatoria y la protección tecnológica.

Rex American Resources Corporation (REX) - Análisis de mortero: factores ambientales

Compromiso de reducir las emisiones de carbono en la producción de etanol

Rex American Resources Corporation informó un 22.5% de reducción en las emisiones de carbono de los procesos de producción de etanol en 2023. La intensidad de emisiones de gases de efecto invernadero de la compañía se midió a 36.7 gramos de equivalente de CO2 por megajule de etanol producido.

Año	Reducción de emisiones de carbono	Intensidad de emisiones
2022	18.3%	42.1 g CO2E/MJ
2023	22.5%	36.7 g CO2E/MJ

Prácticas agrícolas sostenibles en abastecimiento de maíz

Rex implementó estrategias de abastecimiento de maíz sostenible con 87% de los proveedores de maíz participando en programas de agricultura de conservación. La compañía invirtió $ 3.2 millones en iniciativas de sostenibilidad de agricultores en 2023.

Métrica de sostenibilidad	2023 datos
Proveedores de maíz en programas de conservación	87%
Inversión en iniciativas de sostenibilidad	$ 3.2 millones
Acres bajo gestión sostenible	124,500 acres

Esfuerzos para minimizar el uso del agua y los desechos en los procesos de producción

El consumo de agua en las instalaciones de producción de etanol de Rex disminuyó a 2.4 galones de agua por galón de etanol en 2023, que representa una reducción del 15.7% desde la línea de base de 2022.

Métrica de uso de agua	2022	2023	Reducción
Agua por galón de etanol	2.85 galones	2.4 galones	15.7%
Agua total guardada	1.2 millones de galones	1.8 millones de galones	50%

Desarrollo de estrategias para abordar el cambio climático y las preocupaciones ambientales

Rex comprometió $ 5.7 millones a estrategias de mitigación del cambio climático en 2023, centrándose en la integración de energía renovable y las tecnologías de captura de carbono.

Inversión de estrategia climática	Cantidad
Inversión total de mitigación climática	$ 5.7 millones
Integración de energía renovable	$ 3.2 millones
Investigación de captura de carbono	$ 2.5 millones

REX American Resources Corporation (REX) - PESTLE Analysis: Social factors

Growing consumer demand for renewable energy and lower-carbon fuels drives market interest.

You're seeing a clear shift in consumer preference, driven by climate awareness and corporate Environmental, Social, and Governance (ESG) mandates. This isn't just a niche trend anymore; it's a structural change. For REX American Resources Corporation, this translates into sustained demand for their core product, ethanol, which is a lower-carbon fuel compared to straight gasoline. The push is defintely toward decarbonization across the transportation sector, which keeps the Renewable Fuel Standard (RFS) firmly in place and supports the industry.

The latest industry data shows that US consumers are increasingly choosing blends like E15 (15% ethanol), where available. This is supported by the fact that ethanol reduces greenhouse gas emissions by an average of 40% to 50% compared to gasoline. This social pressure acts as a tailwind, making ethanol a critical component for meeting state and federal clean air goals.

Here's a quick look at the social drivers impacting the renewable fuels market:

• Climate Action: Public support for policies reducing carbon footprint.
• Energy Security: Desire for domestically-produced, less volatile fuel sources.
• Rural Economy: Recognition of ethanol's role in supporting US agriculture.

Ethanol production supports the American agricultural sector by creating demand for corn.

Honestly, the social impact of REX's operations on the agricultural heartland is massive. Ethanol production is the single largest industrial consumer of US corn. The demand created by the ethanol industry provides a vital floor for corn prices, directly supporting thousands of American farm families and rural economies. It's a direct link between energy policy and social stability in farming communities.

For the 2025 fiscal year, the US ethanol industry is projected to consume approximately 5.3 billion bushels of corn. That's a huge number, and it represents roughly 35% of the total US corn crop. Here's the quick math: if the average corn price is, say, $4.50 per bushel, that's over $23.8 billion in direct market value flowing from the energy sector back to US farmers. REX, with its significant production capacity, is a key piece of that economic engine.

What this estimate hides is the ripple effect: increased demand for farm equipment, local services, and transportation jobs in the rural areas where REX operates. It keeps money circulating locally.

Distillers grains and corn oil byproducts provide protein-rich livestock feed, linking REX to the food supply chain.

To be fair, ethanol plants aren't just making fuel; they are also sophisticated food ingredient producers. When corn is processed into ethanol, the remaining co-products-Distillers Grains with Solubles (DGS) and corn oil-are high-value, protein-rich animal feeds. This links REX directly into the domestic and global food supply chain, adding another layer of social relevance beyond just energy.

The production of these co-products helps keep the cost of livestock feed lower than it would be otherwise, which ultimately helps manage consumer meat prices. The US ethanol industry is expected to produce over 30 million metric tons of DGS in the 2025 period. Corn oil production is also a significant revenue stream, with the industry generating an estimated 3.2 billion pounds of corn oil for feed and biodiesel markets.

This dual-product system is a key part of the social license to operate for companies like REX. It's not a waste product; it's a value-added food and feed ingredient. This table shows the scale of the co-product value, based on the latest available market data:

Co-Product	Estimated 2025 US Production Volume	Primary Social/Economic Use
Distillers Grains with Solubles (DGS)	30.5 million metric tons	Protein-rich feed for cattle, swine, and poultry
Corn Oil	3.2 billion pounds	Livestock feed supplement and feedstock for renewable diesel
Carbon Dioxide (CO2)	~15 million metric tons	Food/beverage carbonation, dry ice, and industrial uses

Anyway, REX's operations are deeply embedded in the social fabric, connecting energy independence, climate action, and agricultural economics. It's a complex, but defintely essential, relationship.

REX American Resources Corporation (REX) - PESTLE Analysis: Technological factors

Advancing a Carbon Capture and Sequestration (CCS) project at One Earth Energy

REX American Resources Corporation is making a significant technological bet on Carbon Capture and Sequestration (CCS) at its One Earth Energy facility in Gibson City, Illinois. This project is a critical move to future-proof the ethanol business by reducing the carbon intensity score of its fuel, which directly impacts its competitive position and eligibility for federal and state clean fuel credits.

The core of this technological push is the capture, dehydration, and compression of carbon dioxide ($\text{CO}_2$) produced during the ethanol fermentation process, preparing it for permanent subsurface sequestration (storage). The company has already secured land easements from all necessary landowners for the rights-of-way for the planned 6-mile carbon transport pipeline, which will connect the facility to the injection wells. This proactive step mitigates a major logistical and legal risk often associated with pipeline projects.

$220-$230 million is budgeted for the CCS and capacity expansion projects

The combined capital investment for the technological advancements at One Earth Energy is substantial. The budget for the CCS project and the ethanol capacity expansion has been revised to between $220 million and $230 million for the entire One Earth projects, reflecting adjustments for inflation and changes to the expansion plan as of the Q4 2024 earnings call. This is a significant commitment, and through the end of fiscal first quarter 2024 (April 30, 2024), the company had already incurred capital expenditures totaling $78.1 million related to these combined projects.

The financial viability of this investment is bolstered by federal policy. The economics of the proposed CCS project are strengthened by the preservation of key incentives, specifically the 45Q tax credit for carbon capture and the 45Z Clean Fuel Production Credit, which reward low-carbon fuel production. Here's the quick math: securing these credits for a facility of this scale provides a long-term, defintely predictable revenue stream that justifies the high up-front capital cost.

Project Component	Status (as of 2025)	Key Metrics/Timeline
Total Project Budget (CCS & Expansion)	Revised Capital Commitment	$220M-$230M
Carbon Capture & Compression Facility	Substantially Complete	Construction on capture/compression portions completed in late 2024/early 2025.
Class VI Injection Well Permit (U.S. EPA)	Awaiting Final Decision	Expected final decision in March 2026.
Carbon Transport Pipeline	Rights-of-Way Secured	100% of landowners for the planned 6-mile pipeline secured.

Capacity expansion aims to boost One Earth Energy's output to 175 MMgy, with a potential for 200 MMgy

The technological upgrade is dual-focused, combining environmental mitigation with production efficiency. The capacity expansion aims to initially boost One Earth Energy's output to 175 million gallons per year (MMgy). This initial expansion is expected to be fully operational in 2026, a timeline that was extended past the previous mid-2025 target due to a review of certain elements by management.

The ultimate goal is a further boost to 200 MMgy once additional permitting activities are complete. This phased approach allows the company to realize efficiency gains while navigating the regulatory process for the full capacity. The combined effect of higher output and lower carbon intensity will significantly increase the plant's profitability and market access.

Construction of the carbon capture and compression facility is substantially complete

The physical construction of the carbon capture and compression facility is substantially complete, a major technological milestone achieved in late 2024/early 2025. This means the core equipment is in place to capture and compress the $\text{CO}_2$ to a state suitable for sequestration. However, the operational start is contingent on external factors, primarily regulatory approval and utility connection.

• Construction is physically done, but testing is not yet complete.
• Start of pipeline and well construction awaits further permits.
• The U.S. EPA Class VI injection well permit is the key bottleneck, with a final decision now expected in March 2026.
• Subsurface easements for the first injection well are secured, providing capacity for 15 years of carbon sequestration for the One Earth plant.

The technology is ready, but the regulatory environment and utility interconnection still govern the timeline. This is a classic case of operational readiness preceding regulatory clearance.

REX American Resources Corporation (REX) - PESTLE Analysis: Legal factors

Awaiting U.S. EPA Class VI injection well permit approval for CCS, anticipated in early 2026

The regulatory timeline for Carbon Capture and Storage (CCS) projects is a critical legal bottleneck for REX American Resources Corporation's (REX) growth strategy. You are waiting on the U.S. Environmental Protection Agency (EPA) to finalize the Class VI injection well permit for the three wells associated with the One Earth Sequestration, LLC project.

REX submitted the application in October 2022. According to the EPA's Class VI Permit Tracker Dashboard, as of mid-2025, the anticipated timeline is for the EPA to prepare a draft permit by November 2025, with a final permit decision expected by April 2026. This process is meticulous, as the EPA aims to protect Underground Sources of Drinking Water (USDWs), so any delay in providing requested information could easily push the final decision past that April 2026 target.

The entire CCS project hinges on this single federal permit. It's a long wait for a go/no-go decision.

Illinois state moratorium on new CO2 pipelines creates a significant logistical hurdle

The Illinois General Assembly's passage of the Safety and Aid for the Environment in Carbon Capture and Sequestration (SAFE CCS) Act (Senate Bill 1289), signed into law in July 2024, creates a significant, near-term logistical problem for REX's CO2 transport plans. This law imposes a temporary, two-year moratorium on the construction of new carbon dioxide pipelines.

This moratorium is currently set to last until July 2026, or until the U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) finalizes new federal safety rules, whichever comes first. Since REX's One Earth Sequestration project requires a pipeline to move captured CO2 from the ethanol plant to the injection site, this state-level ban directly blocks the construction phase, even if the EPA Class VI permit is secured by April 2026. This means a minimum three-month gap between a potential permit approval and the earliest possible pipeline construction start, which defintely impacts the project's return-on-investment timeline.

Ongoing legal challenges to EPA small refinery waivers (SREs) create volatility in RIN (Renewable Identification Number) values

The legal and regulatory uncertainty surrounding the Renewable Fuel Standard (RFS) and the Small Refinery Exemption (SRE) program continues to be a primary driver of volatility in Renewable Identification Number (RIN) values, which are a major revenue stream for ethanol producers like REX. The value of a D6 RIN directly impacts your bottom line.

In August 2025, the EPA announced decisions on a backlog of 175 SRE petitions for compliance years 2016-2024. This action, which granted 63 full exemptions and 77 partial (50%) exemptions, immediately injected volatility into the market.

Here's the quick market reaction:

Metric	Pre-Decision (Aug 22, 2025)	Post-Decision Peak (Aug 22, 2025)	Post-Decision Settlement (Aug 22, 2025)
D6 RIN Price (per RIN)	As low as $1.00	As high as $1.17	$1.15
Intra-Day Price Swing	N/A	N/A	Up 8.2% from prior settlement

The key issue going forward is the EPA's plan to propose reallocation of the exempted volumes for 2023 and later compliance years, which accounts for 1.39 billion usable RINs. This reallocation is intended to maintain the integrity of the RFS blending volumes, but the proposal itself will trigger a new round of legal challenges and market speculation, keeping RIN prices on a rollercoaster.

Pending Illinois legislation (SB 1723) restricts CCS near sole source aquifers

What started as pending legislation is now a signed law, which is a much firmer legal constraint you must navigate. Illinois Senate Bill 1723 (SB 1723) was approved by the Governor on August 1, 2025, becoming Public Act 104-0119, and takes effect on January 1, 2026.

The law prohibits any carbon sequestration activity within a facility that overlies, underlies, or passes through a sole-source aquifer. This is a direct measure to protect the Mohomet Aquifer, the primary drinking water source for a large part of Central Illinois.

The law's impact is twofold:

• Site Restriction: It mandates a geological review to ensure REX's proposed injection site is not in violation, potentially forcing a costly relocation of the sequestration well if it's found to compromise the aquifer.
• Study Commission: It creates a study commission to further investigate the safety of CCS projects near the Mohomet Aquifer, meaning the regulatory environment will continue to evolve even after the law is effective.

This is a permanent geographical limitation on where REX can operate CCS in Illinois. You need to verify your current well site's position relative to the Mohomet Aquifer immediately.

REX American Resources Corporation (REX) - PESTLE Analysis: Environmental factors

The CCS project aims to move the One Earth Energy plant toward near-carbon neutral operation.

You're watching REX American Resources Corporation invest heavily to future-proof its ethanol production, and that's a smart move. The primary environmental opportunity is the Carbon Capture and Sequestration (CCS) project at the One Earth Energy facility in Gibson City, Illinois. This project is critical because it aims to reduce the plant's Carbon Intensity (CI) score, which directly impacts profitability and market access.

The company has committed a substantial capital outlay. As of the end of the fiscal second quarter in July 2025, total capital expenditures for the expansion and CCS project reached $126.7 million. The combined project budget is estimated to be between $220 million and $230 million. The physical construction of the carbon capture and compression portion is largely complete. Still, the final hurdle is regulatory: the U.S. Environmental Protection Agency (EPA) Class VI injection well permit is not expected until January 2026. This delay pushes the project's operational start into 2026, meaning the full financial benefit won't be realized in the 2025 fiscal year. That's a defintely a timing risk to watch.

Ethanol's carbon intensity score is increasingly important for market access, like California's Low Carbon Fuel Standard (LCFS).

The Carbon Intensity (CI) score is the lifeblood of the low-carbon fuel market, essentially quantifying the total greenhouse gas emissions from a fuel's production, from the farm field to the car's tailpipe. Selling into high-value markets like California's Low Carbon Fuel Standard (LCFS) depends entirely on achieving a low CI score.

The average CI score for U.S. corn ethanol is around 53.6 gCO2e/MJ (grams of carbon dioxide equivalent per megajoule) according to the GREET model, with a range that can go as low as 37.6 gCO2e/MJ for the most efficient plants. The LCFS benchmark for 2025 mandates a 22.75% CI reduction from 2018 levels. Capturing and sequestering the CO2 from fermentation is the most powerful tool to drop that score, potentially making REX American Resources Corporation's ethanol a premium product.

Here's the quick math on the regulatory pressure:

• A verified CI score that is higher than the reported score for the 2025 compliance period triggers a 4-to-1 deficit obligation.
• This means a small CI error creates four times the required deficit, significantly increasing the cost of compliance and eroding profit margins.
• The LCFS credit price, though volatile, represents a major revenue stream for low-CI producers, making the CCS project a massive potential value driver.

Operations are susceptible to extreme weather conditions impacting corn crop yields and prices.

The core business of REX American Resources Corporation is tied to the price of corn, its primary feedstock. Despite a national USDA forecast for a record-setting 2025 corn yield of 181.5 bushels per acre, localized extreme weather creates massive volatility and risk. The 2025 growing season in the Corn Belt, including Illinois where One Earth Energy is located, was marked by extremes.

This volatility directly impacts your input costs. While a large national crop generally pressures prices downward-with the USDA projecting the 2025-26 season-average farm price to be around $4.20 per bushel-localized weather events can cause sharp, unpredictable spikes. Analysts are anticipating price volatility of up to 15% in the near term, heavily influenced by weather. The company's financial performance is therefore directly exposed to these climatic swings.

2025 Corn Market Metric	Value/Projection	Implication for REX
National Yield Forecast	181.5 bushels per acre (Record High)	Downward pressure on corn prices (feedstock cost relief).
Q4 2025 Price Projection	Around 433.83 US cents/bushel	Bearish outlook, but subject to high volatility.
Price Volatility Risk	Up to 15%	Significant risk to gross profit margins; requires robust hedging.
Illinois Weather Impact	Drought in late July, 72% of subsoil moisture very short/short (Nov 2025)	Local supply disruption and potential basis price spikes at the One Earth Energy plant.

EPA announced plans in March 2025 to review and potentially roll back environmental regulations under the Clean Air Act.

In March 2025, the EPA, under Administrator Lee Zeldin, announced a significant plan to review and potentially roll back numerous environmental regulations, including multiple National Emission Standards for Hazardous Air Pollutants (NESHAPs), as part of the 'Powering the Great American Comeback' Initiative.

For REX American Resources Corporation, this regulatory shift presents a near-term opportunity but a long-term risk. The immediate benefit is a potential easing of compliance costs and a possible 2-year compliance exemption for affected facilities while the rulemaking process is underway. This could reduce operating expenses in the short term. However, the long-term trend is still toward decarbonization, driven by market demand and state-level programs like the LCFS, which would be unaffected by a federal rollback.

The federal policy shift creates regulatory uncertainty. If the EPA's deregulation efforts slow the national push toward low-carbon fuels, it could dampen the premium value of the company's future low-CI ethanol, potentially reducing the return on their $220 million to $230 million CCS investment. You need to focus on state-level policy and market-driven incentives, not just federal rules, to gauge your long-term return.