REX American Resources Corporation (NYSE:REX) Q4 2019 Earnings Conference Call - Final Transcript

Mar 26, 2020 • 11:00 am ET

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REX American Resources Corporation (NYSE:REX) Q4 2019 Earnings Conference Call - Final Transcript

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Q & A
Analyst
Pavel Molchanov

of the lock-down just across the industry?

Executive
Stuart A. Rose

Zafar?

Executive
Zafar A. Rizvi

I think that basically there is some of the reason we are considering at One Earth Energy, because as you know Illinois has locked down, but on the same time the margins are affecting due to COVID-19 and it's not also economically to produce ethanol at $0.99 or $0.85 when the corn is $3.51. So I think there is no margin also, but we are also trying to follow the guideline, what exactly every state or every even cities are issuing those. So in both the locations, we have clear cut instruction and guideline where there should be a distance they've had and how close they were working and what policies are implemented because safety of our employees is the most important than anything else and we are taking all of those steps. Yes, certainly, this is affecting, but the major impact of not only COVID-19 is all of the ethanol pricing and the gasoline pricing and that leading to the shrinking margin. So, that's really happening.

Executive
Stuart A. Rose

Pavel, as you know, a lot of companies have announced shutdowns and many others I'm sure considering shutdowns. At this point, whether it was the state causing the shut down or the margins, it's the same effect. We can't make money at this cycle.

Analyst
Pavel Molchanov

Yeah. Last question for me about this one on a separate topic. So, it's been about three months since the Phase 1 trade deal with China. Obviously, a lot has happened since then in China and everywhere else. To your understanding, is China buying any U.S. ethanol at this point?

Executive
Zafar A. Rizvi

No, we have not seen really any even rumors in the market that China is buying any of ethanol or DDG. But we heard previously one time that China's buying DDG, but later on, find out that was not Chinese who were buying the DDG. But there certainly the rumors out and going on to that China is buying the corn. And that's the reason yesterday I think the corn price was a little bit gone higher because there was -- the China is trying to buy 1 million metric ton. And -- but as the corn price goes up and ethanol price is decreasing, consistent with crude, it really does not help unless we can also sell ethanol price also showed up [Phonetic] the same way. But it's really -- no, we have not seen any ethanol purchase from China at this stage.

Analyst
Pavel Molchanov

Thank you guys. Stay safe.

Executive
Stuart A. Rose

Thank you.

Executive
Zafar A. Rizvi

Thanks, Pavel.

Operator
Operator

[Operator Instructions]

Executive
Stuart A. Rose

There's no more questions. I thank everyone for listening today and hopefully things will get better in the future. We appreciate your sticking with us, whoever is sticking with us. Thank you very much. Bye.

Executive
Zafar A. Rizvi

Thank you, everyone. Bye-bye.

Operator
Operator

[Operator Closing Remarks]