Company: REX
Filing Date: 2025-09-02
Form Type: 10-Q
Source: 0000930413-25-002856
Chunk: 121

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-09-02
Form: 10-Q
Item: Part I, Item 2
Chunk 121
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Ethanol and By-Products

At July 31, 2025, we had investments in three ethanol
limited liability companies, in two of which we have a majority ownership interest. The following table is a summary of ethanol entity
ownership interests at July 31, 2025:

    Entity
    Location
    REX’s
    Current Ownership Interest
  
    One
    Earth Energy, LLC
    Gibson City,
    IL
    76.1%
  
    NuGen
    Energy, LLC
    Marion, SD
    99.7%
  
    Big River Resources, LLC:

    Big River Resources W Burlington,
    LLC
    W. Burlington, IA
    10.3%
  
    Big River Resources Galva, LLC
    Galva, IL
    10.3%
  
    Big River United Energy, LLC
    Dyersville, IA
    5.7%
  
    Big
    River Resources Boyceville, LLC
    Boyceville, WI

    10.3%

Our ethanol operations are highly dependent on commodity
prices, especially prices for corn, ethanol, distillers grains, distillers corn oil and natural gas, and availability of corn. As a result
of price volatility for these commodities, our operating results can fluctuate substantially. The price and availability of corn is subject
to significant fluctuations depending upon several factors that affect commodity prices in general, including crop conditions, the amount
of corn stored on farms, weather, federal policy, foreign trade, tariffs, and international disruptions caused by wars or conflicts. Because
the market prices of ethanol and distillers grains are not always directly related to corn prices (for example, demand for crude and other
energy and related prices, the export market demand for ethanol and distillers grains, soybean meal prices, and the results of federal
policy decisions and trade negotiations can impact ethanol and distillers grains prices), at times ethanol and distillers grains prices
may not follow movements in corn prices and, in an environment of higher corn prices or lower ethanol or distillers grains prices, reduce
the overall margin structure at the plants. As a result, at times, we may operate our plants at negative or minimally positive operating
margins.

We expect our ethanol plants to produce approximately
2.9 gallons of denatured ethanol for each bushel of