Green Plains Inc. (NASDAQ:GPRE) Q2 2020 Earnings Conference Call - Final Transcript
Aug 04, 2020 • 11:00 am ET
will become more normalized, the rest of the initiatives that provided better performance versus the market margins should continue as part of our ongoing results. While certainly ethanol margins will remain volatile, these initiatives are just the beginning of what is possible as we continue the total transformation of Green Plains over the next several years.
We produced approximately 149.9 million gallons of ethanol, which put us at a 53.5% utilization rate for the quarter. We exercised our operational discretion to slower shutdown plants as a result of the negative margin environment, but we did not furlough any employees during these slowdowns.
We will continue to follow the data moving forward. While we have seen margins improve off their lows in April and the spot market remains slightly positive, margins are very inverted, which is clearly sending a signal to the market. The weekly EIA data has been negative towards margins as production is now over 950,000 barrels per day, which is too much in our opinion. While EIA stocks got down to levels we have not seen in many years, they began to rise last week. Clearly, this industry lacks discipline.
The consolidated crush margin for the second quarter was $0.09 per gallon, which was strongly influenced, to the positive due to high grade alcohol sales. Fuel ethanol margins were generally weak during the quarter, but we believe that through a combination of slowdowns and margin management, we achieved better than the daily average market.
We have now completed Project 24 upgrade at our Fairmont plant, where we are starting this plant back up and expect to see similar results to what we have realized on our previously reported Wood River facility as well as our Superior and Fergus Falls plants. Up next for Project 24 is our Mount Vernon location, which should be done by the late fourth quarter.
Project 24 has been delayed at our Madison facility due to the state of Illinois permitting and also at our York, Nebraska location as we will now take that plant offline because of their positive contribution to the overall financial performance of the company. But we believe with what we have accomplished so far, we will be at or below $0.24 per gallon by the end of the of Q4 and expect to complete our Project 24 initiative by Q1 2021 subject to state permitting.
We are excited to have announced that we have secured credit approval for $75 million financing to continue funding of our protein initiative. This gives validation to our strategy and allows us to quickly proceed with Wood River as our second protein location as well as to begin engineering a third location as well.
We expect Wood River to come online during the second quarter of 2021. When completed, we will have over 200 million gallons of capacity capable of generating $0.15 to $0.20 per gallon of incremental margin from this high value protein feed. This is incremental margin to what Green Plains historical