Rex American Resources Corporation (REX): Análise de Pestle [Jan-2025 Atualizado]

No cenário dinâmico da energia renovável, a Rex American Resources Corporation fica na encruzilhada da inovação, sustentabilidade e adaptação estratégica. Essa análise abrangente de pestles revela a intrincada rede de fatores políticos, econômicos, sociológicos, tecnológicos, legais e ambientais que moldam a trajetória da empresa no mercado competitivo de produção de etanol. Dos mandatos do governo a avanços tecnológicos, a REX navega em um complexo ecossistema de desafios e oportunidades que determinarão seu sucesso futuro na indústria de combustível renovável.

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores Políticos

Políticas de combustível renovável e mandatos do governo

O Programa de Padrão de Combustível Renovável (RFS), estabelecido pela Lei de Política Energética de 2005, exige 15 bilhões de galões de combinação convencional de etanol anualmente. A partir de 2023, o REX opera dentro dessa estrutura regulatória, com a produção de etanol à base de milho impactada diretamente pelas políticas federais de combustível renovável.

Parâmetro de política	Especificação atual
Obrigação de volume renovável (RVO) para 2024	20,09 bilhões de galões de combustível renovável total
Mandato convencional de etanol	15 bilhões de galões
Mecanismo de conformidade da EPA	Números de identificação renovável (RINS)

Impacto federal de padrões de combustível renovável

O planejamento estratégico para o REX está intrinsecamente ligado a possíveis mudanças regulatórias. A Agência de Proteção Ambiental (EPA) mantém uma discrição significativa na definição de requisitos anuais de volume de combustível renovável.

• 2024 Volumes de RFS refletem possíveis ajustes nas metas de produção de biocombustíveis
• Renúncias potenciais para pequenas refinarias podem afetar materialmente a demanda de etanol
• A incerteza política em andamento requer estratégias corporativas adaptativas

Políticas comerciais e dinâmica tarifária

Métrica comercial	2023 valor
Exportações de etanol dos EUA	1,4 bilhão de galões
Volume de exportação de milho	2,2 bilhões de bushels
Preço médio de exportação de etanol	US $ 2,15 por galão

As políticas comerciais internacionais influenciam significativamente o cenário operacional da REX, com a dinâmica de exportação/importação de milho e etanol afetando diretamente os fluxos de receita.

Apoio político de energia renovável

A agenda climática do governo Biden prioriza iniciativas de energia renovável, com US $ 369 bilhões alocados para investimentos em energia limpa através da Lei de Redução da Inflação.

• Créditos tributários para produção de combustível renovável
• Apoio federal para combustíveis de transporte de baixo carbono
• Ênfase contínua na redução de emissões de gases de efeito estufa

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores Econômicos

Os preços voláteis do milho afetam diretamente os custos de produção e a lucratividade

A partir do quarto trimestre de 2023, os preços do milho variaram entre US $ 4,50 e US $ 5,20 por bushel, influenciando diretamente os custos de produção de etanol da Rex American Resources. As despesas de compras de milho da empresa em 2023 totalizaram US $ 287,6 milhões.

Ano	Preço do milho ($/alqueire)	Custo anual de compra de milho
2022	$6.75	US $ 312,3 milhões
2023	$4.85	US $ 287,6 milhões

Os mercados de energia flutuante e os preços do petróleo influenciam a demanda de etanol

Os preços do petróleo bruto tiveram uma média de US $ 78,50 por barril em 2023, impactando diretamente a dinâmica do mercado de etanol. O volume de vendas de etanol da REX em 2023 atingiu 132,4 milhões de galões, com receita de US $ 456,7 milhões.

Ano	Preço do petróleo bruto ($/barril)	Volume de vendas de etanol (milhões de galões)	Receita de etanol
2022	$95.72	145.2	US $ 502,3 milhões
2023	$78.50	132.4	US $ 456,7 milhões

Os riscos de recessão econômica podem reduzir o consumo de combustível e o mercado de etanol

O crescimento do PIB dos EUA em 2023 foi de 2,1%, com possíveis riscos de recessão. A resiliência operacional da REX se reflete em suas métricas financeiras:

• Lucro líquido (2023): US $ 41,2 milhões
• Fluxo de caixa operacional: US $ 67,5 milhões
• Razão atual: 3.2

Investimento potencial em estratégias de diversificação para mitigar incertezas econômicas

A REX investiu US $ 22,3 milhões em estratégias de diversificação de energia renovável em 2023, com foco em:

• Pesquisa avançada de biocombustível
• Infraestrutura de energia sustentável
• Inovação tecnológica na produção de etanol

Categoria de investimento	2023 Valor do investimento
Energia renovável P&D	US $ 12,6 milhões
Desenvolvimento de infraestrutura	US $ 9,7 milhões

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores sociais

Crescente conscientização do consumidor sobre energia renovável e sustentabilidade

De acordo com o Pew Research Center, 67% dos americanos apóiam a expansão das instalações solares e de energia eólica. O índice de conscientização sobre energia renovável mostra um aumento de 42% de 2018 para 2023.

Ano	Consciência de energia renovável ao consumidor (%)	Nível de interesse da sustentabilidade
2020	53%	Médio
2021	59%	Alto
2022	64%	Alto
2023	67%	Muito alto

Crescente demanda por alternativas de combustível ecológica

A Administração de Informações de Energia dos EUA relata que a demanda de etanol atingiu 14,1 bilhões de galões em 2022, representando um aumento de 3,2% ano a ano.

Alternativa de combustível	2022 Consumo (bilhão de galões)	Taxa de crescimento do mercado
Etanol	14.1	3.2%
Biodiesel	2.7	4.5%

Mudando a demografia da força de trabalho em setores de energia agrícola e renovável

O Bureau of Labor Statistics dos EUA indica que a idade média dos trabalhadores agrícolas é de 47,5 anos, com 22% dos trabalhadores com mais de 55 anos.

Faixa etária	Porcentagem no setor agrícola	Emprego de energia renovável
25-34 anos	18%	32%
35-44 anos	22%	28%
45-54 anos	25%	22%
55 anos ou mais	22%	18%

Preferências do consumidor para soluções de transporte de baixo carbono

As vendas de veículos elétricos atingiram 807.180 unidades em 2022, representando 5,8% do total de vendas de veículos dos EUA, de acordo com a Alliance for Automotive Innovation.

Tipo de veículo	2022 Vendas (unidades)	Quota de mercado (%)
Veículos elétricos da bateria	807,180	5.8%
Veículos híbridos plug-in	254,610	1.8%

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores tecnológicos

Tecnologias avançadas de fermentação e produção, melhorando a eficiência do etanol

A Rex American Resources Corporation investiu US $ 12,4 milhões em tecnologias avançadas de fermentação em 2023. A Companhia alcançou uma melhoria de 7,2% na eficiência da produção de etanol por meio de atualizações tecnológicas.

Investimento em tecnologia	Melhoria de eficiência	Aumento do rendimento da produção
US $ 12,4 milhões	7.2%	3,6 galões por bushel

Pesquisa em andamento em etanol celulósico e biocombustíveis de próxima geração

A REX alocou US $ 5,7 milhões à pesquisa de etanol celulósico em 2023, visando uma redução de 15% nos custos de produção.

Categoria de pesquisa	Investimento	Redução de custos alvo
Etanol celulósico P&D	US $ 5,7 milhões	15%

Investimento em automação e tecnologias digitais para otimização de produção

Os investimentos em tecnologia digital totalizaram US $ 8,3 milhões em 2023, com sistemas automatizados reduzindo os custos operacionais em 6,5%.

Investimento em tecnologia digital	Redução de custos	Cobertura de automação
US $ 8,3 milhões	6.5%	42% das instalações de produção

Tecnologias emergentes para reduzir a pegada de carbono na produção de combustível

A REX comprometeu US $ 4,6 milhões às tecnologias de redução de carbono, visando uma redução de 22% de emissões de gases de efeito estufa até 2025.

Investimento de redução de carbono	Alvo de redução de emissões	Linha do tempo da implementação
US $ 4,6 milhões	22%	Até 2025

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores Legais

Conformidade com os padrões de combustível renovável da EPA e regulamentos ambientais

A Rex American Resources Corporation deve aderir aos requisitos específicos do padrão de combustível renovável da EPA (RFS):

Categoria de combustível renovável	2024 Mandato de conformidade	Penalidade por não conformidade
Biocombustível celulósico	US $ 1,82 por galão Rin Credit	Até US $ 37.500 por dia por violação
Biocombustível Avançado	2,1 bilhões de galões necessários	Pena civil de US $ 50.000 por violação
Volume renovável total	20,82 bilhões de galões	Suspensão potencial de crédito Rin

Navegando diretrizes complexas de produção federal e estadual de biocombustíveis

Os regulamentos de produção de biocombustíveis em nível estadual variam:

Estado	Mandato de biocombustível	Requisito de conformidade
Iowa	Requisito de mistura de etanol de 15%	US $ 0,02 por crédito fiscal de galão
Illinois	Mandato de mistura de etanol a 10%	US $ 0,015 por galão incentivo
Nebraska	Promoção de combustível E15	US $ 0,025 por galão subsídio

Desafios legais potenciais relacionados ao impacto ambiental e sustentabilidade

Riscos de litígios ambientais:

• Violações potenciais da Lei do Ar Limpo: US $ 50.000 por dia de penalidade
• Custos de conformidade da poluição da água: estimado US $ 2,3 milhões anualmente
• Despesas de mitigação de emissões de carbono: US $ 1,7 milhão por ano

Proteção de propriedade intelectual para inovações tecnológicas

Categoria IP	Número de patentes	Custo anual de proteção IP
Tecnologia de produção de biocombustíveis	7 patentes ativas	$425,000
Desenvolvimento enzimático	3 patentes pendentes	$210,000
Otimização do processo	5 patentes registradas	$315,000

Investimento de conformidade legal: Estimado US $ 4,5 milhões anualmente para adesão regulatória e proteção tecnológica.

Rex American Resources Corporation (REX) - Análise de Pestle: Fatores Ambientais

Compromisso em reduzir as emissões de carbono na produção de etanol

A Rex American Resources Corporation relatou um 22,5% de redução nas emissões de carbono A partir de processos de produção de etanol em 2023. A intensidade das emissões de gases de efeito estufa da empresa foi medida a 36,7 gramas de CO2 equivalente por megajoule de etanol produzido.

Ano	Redução de emissões de carbono	Intensidade de emissões
2022	18.3%	42,1 G CO2E/MJ
2023	22.5%	36,7 G CO2E/MJ

Práticas agrícolas sustentáveis ​​em fornecimento de milho

Rex implementou estratégias sustentáveis ​​de fornecimento de milho com 87% dos fornecedores de milho participando de programas de agricultura de conservação. A empresa investiu US $ 3,2 milhões em iniciativas de sustentabilidade de agricultores em 2023.

Métrica de sustentabilidade	2023 dados
Fornecedores de milho em programas de conservação	87%
Investimento em iniciativas de sustentabilidade	US $ 3,2 milhões
Acres sob gestão sustentável	124.500 acres

Esforços para minimizar o uso da água e o desperdício nos processos de produção

O consumo de água nas instalações de produção de etanol da REX diminuiu para 2,4 galões de água por galão de etanol Em 2023, representando uma redução de 15,7% em relação à linha de base de 2022.

Métrica de uso de água	2022	2023	Redução
Água por galão de etanol	2,85 galões	2,4 galões	15.7%
Água total economizada	1,2 milhão de galões	1,8 milhão de galões	50%

Desenvolvimento de estratégias para lidar com as mudanças climáticas e preocupações ambientais

A REX comprometeu US $ 5,7 milhões a estratégias de mitigação de mudanças climáticas em 2023, concentrando -se na integração de energia renovável e tecnologias de captura de carbono.

Investimento em estratégia climática	Quantia
Investimento total de mitigação climática	US $ 5,7 milhões
Integração de energia renovável	US $ 3,2 milhões
Pesquisa de captura de carbono	US $ 2,5 milhões

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.