Ethanol News
United Ethanol • Growing To Meet Your Needs
Ethanol News 1250 Chicago St. • Milton, WI 53563 • (608) 868-5900 • www.unitedethanol.com
August 2016
Greetings from the CEO David Cramer President and CEO Contents Greetings from the CEO ................... 1 Ethanol exports up from a year ago...................... 2 Second-quarter financials .......... insert
When the calendar turns to August, it generally catches everybody off guard. Where did the summer go? How soon will harvest begin? Now more than two-quarters of the way through the fiscal year, United Ethanol has been focused on improved plant operations. Our plant is running very well with production records being broken several times this summer. We are running consistently at over 140,000 gallons of ethanol per day. Our corn oil production has also improved to about 33,000 pounds per day, which is also very good. Margins have been better in the second quarter, giving us some nice profits in May and June. But like most markets these days, we have much volatility in margins. The summer driving season and some exports have provided opportunities to the industry for improved profits. If that continues for the balance of the year, United Ethanol should have a solid performance in 2016. We continue to put emphasis on safety and operational training with the goal of no workrelated injuries and improved operational excellence. Our employees are doing a great job in both areas and we are seeing many positive results from those efforts. As of June 30, 2016, United Ethanol produced 24,653,081 gallons of ethanol. We also
produced 65,292 tons of distiller’s grains, 33,062 tons of liquefied carbon dioxide and extracted 5,638,194 pounds of corn oil. All of these unit numbers are well above last year’s six month numbers. With the corn crop looking as good as it does, we are expecting a large harvest with competitive grain prices so the cost of production should be in a range that ethanol will be able to compete with petroleum, even with low oil prices. This makes me very optimistic about the future of the ethanol industry. Enclosed are unaudited financial statements for United Ethanol per section 8.2(b)(ii) of the United Ethanol, LLC Operating Agreement. Our accounting department has included the United Ethanol balance sheets as of June 30, 2016, also showing 2015 numbers; the statement of operations for the quarters ending June 30, 2016, and June 30, 2015, and the statement of cash flows for the quarters ending June 30, 2016, and June 30, 2015. I’ll touch base with you again in November. Enjoy the remainder of the summer! Cooperatively yours, David Cramer, President and Chief Executive Officer
1250 Chicago St. Milton, WI 53563 This newsletter is compliments of United Ethanol, LLC and is distributed to United Ethanol, LLC investors.
Ethanol exports up from a year ago By: Chad Campbell, Chief Operating Officer
The second quarter showed positive earnings for United Ethanol LLC. We are near the top 10% in the country for ethanol yield in a corn-based ethanol plant. Natural gas prices and corn prices shot up for a period of time in the second quarter, but ethanol prices rose as well, keeping us in healthy, positive margins for the quarter. So far in 2016, US exports are down, and imports are up compared to the end of last year, due to the strength of the dollar. Ethanol exports, however, are up 6% from a year ago through May. Dried distiller’s grains, which are primarily exported from our plant, can’t sing the same tune. DDGs exports are down 9% through May, and have negatively impacted our price for the co-product. The plant has operated well through the summer. Near the time of this writing the heat index has been as high as 114 degrees. Our employees have definitely put their sweat into keeping the plant running well, and we are grateful for their efforts. We have spent a lot of time safety training in the summer months, encouraging our team to be safe not only at work, but also at home. Summer can be a dangerous time for people who are working in extreme heat. Looking ahead to the third quarter, we still project positive returns. The second semi-annual shutdown of the year is scheduled for late August. During this outage small process improvements will be made to the distillation system. We expect to run more efficiently after this turnaround.
Ethanol News 1250 Chicago St. • Milton, WI 53563 • (608) 868-5900 • www.unitedethanol.com
August 2016
Greetings from the CEO David Cramer President and CEO Contents Greetings from the CEO ................... 1 Ethanol exports up from a year ago...................... 2 Second-quarter financials .......... insert
When the calendar turns to August, it generally catches everybody off guard. Where did the summer go? How soon will harvest begin? Now more than two-quarters of the way through the fiscal year, United Ethanol has been focused on improved plant operations. Our plant is running very well with production records being broken several times this summer. We are running consistently at over 140,000 gallons of ethanol per day. Our corn oil production has also improved to about 33,000 pounds per day, which is also very good. Margins have been better in the second quarter, giving us some nice profits in May and June. But like most markets these days, we have much volatility in margins. The summer driving season and some exports have provided opportunities to the industry for improved profits. If that continues for the balance of the year, United Ethanol should have a solid performance in 2016. We continue to put emphasis on safety and operational training with the goal of no workrelated injuries and improved operational excellence. Our employees are doing a great job in both areas and we are seeing many positive results from those efforts. As of June 30, 2016, United Ethanol produced 24,653,081 gallons of ethanol. We also
produced 65,292 tons of distiller’s grains, 33,062 tons of liquefied carbon dioxide and extracted 5,638,194 pounds of corn oil. All of these unit numbers are well above last year’s six month numbers. With the corn crop looking as good as it does, we are expecting a large harvest with competitive grain prices so the cost of production should be in a range that ethanol will be able to compete with petroleum, even with low oil prices. This makes me very optimistic about the future of the ethanol industry. Enclosed are unaudited financial statements for United Ethanol per section 8.2(b)(ii) of the United Ethanol, LLC Operating Agreement. Our accounting department has included the United Ethanol balance sheets as of June 30, 2016, also showing 2015 numbers; the statement of operations for the quarters ending June 30, 2016, and June 30, 2015, and the statement of cash flows for the quarters ending June 30, 2016, and June 30, 2015. I’ll touch base with you again in November. Enjoy the remainder of the summer! Cooperatively yours, David Cramer, President and Chief Executive Officer
1250 Chicago St. Milton, WI 53563 This newsletter is compliments of United Ethanol, LLC and is distributed to United Ethanol, LLC investors.
Ethanol exports up from a year ago By: Chad Campbell, Chief Operating Officer
The second quarter showed positive earnings for United Ethanol LLC. We are near the top 10% in the country for ethanol yield in a corn-based ethanol plant. Natural gas prices and corn prices shot up for a period of time in the second quarter, but ethanol prices rose as well, keeping us in healthy, positive margins for the quarter. So far in 2016, US exports are down, and imports are up compared to the end of last year, due to the strength of the dollar. Ethanol exports, however, are up 6% from a year ago through May. Dried distiller’s grains, which are primarily exported from our plant, can’t sing the same tune. DDGs exports are down 9% through May, and have negatively impacted our price for the co-product. The plant has operated well through the summer. Near the time of this writing the heat index has been as high as 114 degrees. Our employees have definitely put their sweat into keeping the plant running well, and we are grateful for their efforts. We have spent a lot of time safety training in the summer months, encouraging our team to be safe not only at work, but also at home. Summer can be a dangerous time for people who are working in extreme heat. Looking ahead to the third quarter, we still project positive returns. The second semi-annual shutdown of the year is scheduled for late August. During this outage small process improvements will be made to the distillation system. We expect to run more efficiently after this turnaround.
