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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549


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FORM 10-Q


|           |                                                                                          
|---------- | -----------------------------------------------------------------------------------------
|(Mark One)
|           |                                                                                          
|x          | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
 ACT OF 1934 
|           |                                                                                          
|           | For the quarterly period ended April 30, 2011                                            
|           |                                                                                          
|OR        
|           |                                                                                          
|o          | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
 EXCHANGE ACT OF 1934
|           |                                                                                          
|           | For the transition period from _________ to _________                                    

|                                                        |                                  | 
|------------------------------------------------------- | -------------------------------- | 
|                                                        | Commission File Number 001-09097 | 
|                                                        |                                  | 
|REX AMERICAN RESOURCES CORPORATION                     
|(Exact name of registrant as specified in
 its charter)
|                                                        |                                  | 
|                                                        |                                  | 

| |                                 |  |                        | 
| | ------------------------------- |  | ---------------------- | 
| | Delaware                        |  | 31-1095548             | 
| | (State or other jurisdiction of |  | (I.R.S. Employer       | 
| | incorporation or organization)  |  | Identification Number) | 

| |                                          |  |            | 
| | ---------------------------------------- |  | ---------- | 
| | 2875 Needmore Road, Dayton, Ohio         |  | 45414      | 
| | (Address of principal executive offices) |  | (Zip Code) | 

|                                                                     |  | 
|-------------------------------------------------------------------- |  | 
|(937) 276-3931
 (Registrants telephone number, including area code)
|                                                                     |  | 

Indicate by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes x No o

Indicate by
check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the
preceding 12 months (or for such shorter period that the registrant was
required to submit and post such files). Yes
o
No o

Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer or a smaller reporting company. See definition
of large accelerated filer, accelerated filer and smaller reporting
company in Rule 12b-2 of the Exchange Act.

|                                                                       |                             
|---------------------------------------------------------------------- | ----------------------------
|Large
 accelerated filer o                                             | Accelerated
 filer x        
|Non-accelerated
 filer o (Do not check if a smaller reporting company) | Smaller
 reporting company o

Indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act).
Yes o
No x

At the close
of business on June 1, 2011 the registrant had 9,534,468 shares of Common
Stock, par value $.01 per share, outstanding.

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REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES

INDEX

|         |                                                                                        |  |     
|-------- | -------------------------------------------------------------------------------------- |  | ----
|         |                                                                                        |  | Page
|        
|PART I.  | FINANCIAL INFORMATION                                                                  |  |     
|         |                                                                                        |  |     
|Item 1.  | Financial Statements                                                                   |  |     
|         |                                                                                        |  |     
|         | Consolidated
 Condensed Balance Sheets                                                 |  | 3   
|         | Consolidated Condensed Statements of Operations                                        |  | 4   
|         | Consolidated Condensed Statements of Equity                                            |  | 5   
|         | Consolidated Condensed Statements of Cash Flows                                        |  | 6   
|         | Notes to Consolidated Condensed Financial Statements                                   |  | 7   
|         |                                                                                        |  |     
|Item 2.  | Managements Discussion and Analysis of Financial Condition and
 Results of Operations |  | 24  
|         |                                                                                        |  |     
|Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                             |  | 35  
|         |                                                                                        |  |     
|Item 4.  | Controls and Procedures                                                                |  | 36  
|         |                                                                                        |  |     
|PART II. | OTHER INFORMATION                                                                      |  |     
|         |                                                                                        |  |     
|Item 1A. | Risk Factors                                                                           |  | 36  
|         |                                                                                        |  |     
|Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                            |  | 37  
|         |                                                                                        |  |     
|Item 6.  | Exhibits                                                                               |  | 37  

2

---



PART I. FINANCIAL
INFORMATION

Item 1. Financial
Statements

REX AMERICAN RESOURCES
CORPORATION AND SUBSIDIARIESConsolidated Condensed Balance SheetsUnaudited

|                                                       |  |                 |          |                   |   |          |  
|------------------------------------------------------ |  | --------------- | -------- | ----------------- | - | -------- | -
|                                                       |  |                 |          |                   |   |          |  
|                                                       |  | April 30,
 2011 |          | January 31,
 2011 |  
|                                                       |  |                 |          |                   |  
|                                                       |  | (In Thousands)  |         
|Assets                                                 |  |                 |         
|Current
 assets:                                       |  |                 |          |                   |   |          |  
|Cash and cash equivalents                              |  | $               | 96,951   |                   | $ | 91,019   |  
|Accounts receivable, net                               |  |                 | 10,417   |                   |   | 9,619    |  
|Inventory                                              |  |                 | 12,680   |                   |   | 7,819    |  
|Refundable income taxes                                |  |                 |         |                   |   | 8,503    |  
|Prepaid expenses and other                             |  |                 | 2,447    |                   |   | 3,055    |  
|Deferred taxes, net                                    |  |                 | 4,986    |                   |   | 5,834    |  
|                                                       |  |                 |          |                   |   |          |  
|Total current assets                                   |  |                 | 127,481  |                   |   | 125,849  |  
|Property and
 equipment, net                           |  |                 | 167,524  |                   |   | 169,811  |  
|Other assets                                           |  |                 | 5,477    |                   |   | 5,907    |  
|Deferred
 taxes, net                                   |  |                 | 5,206    |                   |   | 5,206    |  
|Equity
 method investments                             |  |                 | 70,781   |                   |   | 67,349   |  
|Restricted
 investments and deposits                   |  |                 | 1,600    |                   |   | 1,600    |  
|                                                       |  |                 |          |                   |   |          |  
|Total assets                                           |  | $               | 378,069  |                   | $ | 375,722  |  
|                                                       |  |                 |          |                   |   |          |  
|Liabilities
 and equity:                               |  |                 |          |                   |   |          |  
|Current liabilities:                                   |  |                 |          |                   |   |          |  
|Current portion of long-term debt,
 alternative energy |  | $               | 10,158   |                   | $ | 9,672    |  
|Current portion of long-term debt, other               |  |                 | 342      |                   |   | 342      |  
|Accounts payable, trade                                |  |                 | 3,681    |                   |   | 2,557    |  
|Deferred income                                        |  |                 | 3,300    |                   |   | 3,982    |  
|Accrued real estate taxes                              |  |                 | 2,576    |                   |   | 2,393    |  
|Derivative financial instruments                       |  |                 | 1,639    |                   |   | 1,835    |  
|Other current liabilities                              |  |                 | 3,732    |                   |   | 3,786    |  
|                                                       |  |                 |          |                   |   |          |  
|Total current liabilities                              |  |                 | 25,428   |                   |   | 24,567   |  
|                                                       |  |                 |          |                   |   |          |  
|Long-term
 liabilities:                                |  |                 |          |                   |   |          |  
|Long-term debt, alternative energy                     |  |                 | 66,387   |                   |   | 69,049   |  
|Long-term debt, other                                  |  |                 | 1,260    |                   |   | 1,924    |  
|Deferred income                                        |  |                 | 1,825    |                   |   | 2,416    |  
|Derivative financial instruments                       |  |                 | 3,152    |                   |   | 3,688    |  
|Other                                                  |  |                 | 4,145    |                   |   | 4,114    |  
|                                                       |  |                 |          |                   |   |          |  
|Total long-term liabilities                            |  |                 | 76,769   |                   |   | 81,191   |  
|                                                       |  |                 |          |                   |   |          |  
|Equity:                                                |  |                 |          |                   |   |          |  
|REX shareholders equity:                              |  |                 |          |                   |   |          |  
|Common stock                                           |  |                 | 299      |                   |   | 299      |  
|Paid-in capital                                        |  |                 | 142,326  |                   |   | 142,293  |  
|Retained earnings                                      |  |                 | 300,705  |                   |   | 296,053  |  
|Treasury stock                                         |  |                 | (193,394 | )                 |   | (193,713 | )
|                                                       |  |                 |          |                   |   |          |  
|Total REX shareholders equity                         |  |                 | 249,936  |                   |   | 244,932  |  
|Noncontrolling interests                               |  |                 | 25,936   |                   |   | 25,032   |  
|                                                       |  |                 |          |                   |   |          |  
|Total equity                                           |  |                 | 275,872  |                   |   | 269,964  |  
|                                                       |  |                 |          |                   |   |          |  
|Total liabilities and equity                           |  | $               | 378,069  |                   | $ | 375,722  |  
|                                                       |  |                 |          |                   |   |          |  

The accompanying notes are an integral part
of these unaudited consolidated condensed financial statements.

3

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REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIESConsolidated Condensed Statements Of OperationsUnaudited

|                                                                                                           |  |                                           |        |      |   |        |  
|---------------------------------------------------------------------------------------------------------- |  | ----------------------------------------- | ------ | ---- | - | ------ | -
|                                                                                                           |  | Three Months Ended
 April 30,             |       
|                                                                                                           |  | 2011                                      |        | 2010 |  
|                                                                                                           |  |                                           |        |      |  
|                                                                                                           |  | (In Thousands, Except Per
 Share Amounts) |       
|                                                                                                           |  |                                           |        |      |   |        |  
|Net sales and revenue                                                                                      |  | $                                         | 81,214 |      | $ | 71,272 |  
|Cost of sales                                                                                              |  |                                           | 76,534 |      |   | 63,075 |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Gross profit                                                                                               |  |                                           | 4,680  |      |   | 8,197  |  
|Selling, general and administrative
 expenses                                                              |  |                                           | (2,349 | )    |   | (2,091 | )
|Interest income                                                                                            |  |                                           | 171    |      |   | 115    |  
|Interest expense                                                                                           |  |                                           | (671   | )    |   | (1,367 | )
|Equity in income of unconsolidated ethanol
 affiliates                                                     |  |                                           | 5,782  |      |   | 2,847  |  
|Gains (losses) on derivative financial
 instruments, net                                                   |  |                                           | 68     |      |   | (167   | )
|                                                                                                           |  |                                           |        |      |   |        |  
|Income from continuing operations before
 income taxes and noncontrolling interests                        |  |                                           | 7,681  |      |   | 7,534  |  
|Provision for income taxes                                                                                 |  |                                           | (2,665 | )    |   | (2,467 | )
|                                                                                                           |  |                                           |        |      |   |        |  
|Income from continuing operations including
 noncontrolling interests                                      |  |                                           | 5,016  |      |   | 5,067  |  
|Income from discontinued operations, net of
 tax                                                           |  |                                           | 415    |      |   | 538    |  
|Gain on disposal of discontinued
 operations, net of tax                                                   |  |                                           | 125    |      |   |       |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Net income including noncontrolling
 interests                                                             |  |                                           | 5,556  |      |   | 5,605  |  
|Net income attributable to noncontrolling
 interests                                                       |  |                                           | (904   | )    |   | (1,417 | )
|                                                                                                           |  |                                           |        |      |   |        |  
|Net income attributable to REX common
 shareholders                                                        |  | $                                         | 4,652  |      | $ | 4,188  |  
|                                                                                                           |  |                                           |        |      |   |        |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Weighted average shares outstanding - basic                                                                |  |                                           | 9,432  |      |   | 9,840  |  
|                                                                                                           |  |                                           |        |      |   |        |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Basic income per share from continuing
 operations attributable to REX common shareholders                 |  | $                                         | 0.43   |      | $ | 0.37   |  
|Basic income per share from discontinued
 operations attributable to REX common shareholders               |  |                                           | 0.05   |      |   | 0.06   |  
|Basic income per share from disposal of
 discontinued operations attributable to REX common shareholders   |  |                                           | 0.01   |      |   |       |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Basic net income per share attributable to
 REX common shareholders                                        |  | $                                         | 0.49   |      | $ | 0.43   |  
|                                                                                                           |  |                                           |        |      |   |        |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Weighted average shares outstanding 
 diluted                                                             |  |                                           | 9,560  |      |   | 10,045 |  
|                                                                                                           |  |                                           |        |      |   |        |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Diluted income per share from continuing
 operations attributable to REX common shareholders               |  | $                                         | 0.43   |      | $ | 0.36   |  
|Diluted income per share from discontinued
 operations attributable to REX common shareholders             |  |                                           | 0.05   |      |   | 0.06   |  
|Diluted income per share from disposal of
 discontinued operations attributable to REX common shareholders |  |                                           | 0.01   |      |   |       |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Diluted net income per share attributable
 to REX common shareholders                                      |  | $                                         | 0.49   |      | $ | 0.42   |  
|                                                                                                           |  |                                           |        |      |   |        |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Amounts attributable to REX common shareholders:                                                           |  |                                           |        |      |   |        |  
|Income from continuing operations, net of
 tax                                                             |  | $                                         | 4,112  |      | $ | 3,650  |  
|Income from discontinued operations, net of
 tax                                                           |  |                                           | 540    |      |   | 538    |  
|                                                                                                           |  |                                           |        |      |   |        |  
|Net income                                                                                                 |  | $                                         | 4,652  |      | $ | 4,188  |  
|                                                                                                           |  |                                           |        |      |   |        |  

The
accompanying notes are an integral part of these unaudited consolidated
condensed financial statements.

4

---



REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIESConsolidated Condensed Statements Of Equity
Unaudited(In Thousands)

|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|------------------------------------- |  | ----------------------- | ------ | -------- | - | ------------------ |  | -------------------- | ------ | -------------------------- | - | ------------- | - | - | ------- |  | - | ------- |  | - | ------ |  | - | ------- | -
|                                      |  | REX
 Shareholders       |        |          |   |                    | 
|                                      |  |                         |        |          |   |                    | 
|                                      |  | Common
 Shares 
 Issued |        | Treasury |   | Paid-in
 
 Capital |  | Retained
 
 Earnings |        | Noncontrolling
 
 Interest |   | Total
 Equity |  
|                                      |  |                         |        |          |   |                    |  |                      |       
|                                      |  | Shares                  |        | Amount   |   | Shares             |  | Amount               |        |                            |   |               |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |  
|Balance at January 31, 2011           |  |                         | 29,853 |          | $ | 299                |  |                      | 20,461 |                            | $ | (193,713      | ) | $ | 142,293 |  | $ | 296,053 |  | $ | 25,032 |  | $ | 269,964 |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|Net income                            |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   | 4,652   |  |   | 904    |  |   | 5,556   |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|Treasury stock acquired               |  |                         |        |          |   |                    |  |                      | 224    |                            |   | (3,563        | ) |   |         |  |   |         |  |   |        |  |   | (3,563  | )
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|Stock options and related tax effects |  |                         |       |          |   |                   |  |                      | (417   | )                          |   | 3,882         |   |   | 33      |  |   |        |  |   |       |  |   | 3,915   |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  
|Balance at April 30, 2011             |  |                         | 29,853 |          | $ | 299                |  |                      | 20,268 |                            | $ | (193,394      | ) | $ | 142,326 |  | $ | 300,705 |  | $ | 25,936 |  | $ | 275,872 |  
|                                      |  |                         |        |          |   |                    |  |                      |        |                            |   |               |   |   |         |  |   |         |  |   |        |  |   |         |  

|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|------------------------------------- |  | ---------------------- |  | -------- | --- | ---------------- | ------ | ------------------ | - | -------------------------------------------- | - | ------------------------ | ------- | ------------- | - | ------- |  | - | --- | - | - | ------ |  | - | ------- | -
|                                      |  | REX
 Shareholders      |  |          |     |                  |        |                    |  
|                                      |  |                        |  |          |     |                  |        |                    |  
|                                      |  | Common
 Shares
 Issued |  | Treasury |     | Paid-in
 Capital |        | Retained
 Earnings |   | Accumulated
 
 Other 
 Comprehensive
 Income |   | Noncontrolling
 Interest |         | Total
 Equity |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                             
|                                      |  | Shares                 |  | Amount   |     | Shares           |        | Amount             |   |                                              |   |                          |         |              
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |    
|Balance at January 31, 2010           |  | 29,853                 |  | $        | 299 |                  | 20,045 |                    | $ | (186,407                                     | ) | $                        | 141,698 |               | $ | 290,984 |  | $ | 49  |   | $ | 28,473 |  | $ | 275,096 |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|Net income                            |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   | 4,188   |  |   |     |   |   | 1,417  |  |   | 5,605   |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|Treasury stock acquired               |  |                        |  |          |     |                  | 2      |                    |   | (30                                          | ) |                          |         |               |   |         |  |   |     |   |   |        |  |   | (30     | )
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|Unrealized holding losses, net of tax |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   | (22 | ) |   |        |  |   | (22     | )
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|Stock options and related tax effects |  |                       |  |          |    |                  | (36    | )                  |   | 340                                          |   |                          | 422     |               |   |        |  |   |    |   |   |       |  |   | 762     |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  
|Balance at April 30, 2010             |  | 29,853                 |  | $        | 299 |                  | 20,011 |                    | $ | (186,097                                     | ) | $                        | 142,120 |               | $ | 295,172 |  | $ | 27  |   | $ | 29,890 |  | $ | 281,411 |  
|                                      |  |                        |  |          |     |                  |        |                    |   |                                              |   |                          |         |               |   |         |  |   |     |   |   |        |  |   |         |  

The accompanying notes are an integral part
of these unaudited consolidated condensed financial statements.

5

---



|                                                                                                                 
|-----------------------------------------------------------------------------------------------------------------
|REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES 
 Consolidated Condensed Statements Of Cash Flows 
 Unaudited

|                                                                                   |  |                                |        |      |   |         |  
|---------------------------------------------------------------------------------- |  | ------------------------------ | ------ | ---- | - | ------- | -
|                                                                                   |  | Three
 Months Ended
 April 30, |       
|                                                                                   |  |                                |       
|                                                                                   |  | 2011                           |        | 2010 |  
|                                                                                   |  |                                |        |      |  
|                                                                                   |  | (In
 Thousands)                |       
|Cash flows from operating activities:                                              |  |                                |        |      |   |         |  
|Net income including noncontrolling interests                                      |  | $                              | 5,556  |      | $ | 5,605   |  
|Adjustments to reconcile net income to net cash provided by operating
 activities: |  |                                |        |      |   |         |  
|Depreciation and amortization                                                      |  |                                | 2,733  |      |   | 3,729   |  
|Income from equity method investments                                              |  |                                | (5,782 | )    |   | (2,847  | )
|Gain on disposal of real estate and property and equipment                         |  |                                | (204   | )    |   | (2      | )
|Dividends received from equity method investees                                    |  |                                | 2,316  |      |   | 802     |  
|Deferred income                                                                    |  |                                | (1,273 | )    |   | (2,320  | )
|Derivative financial instruments                                                   |  |                                | (732   | )    |   | (189    | )
|Unrealized loss on investments                                                     |  |                                |       |      |   | 22      |  
|Deferred income tax                                                                |  |                                | 1,419  |      |   | 1,215   |  
|Changes in assets and liabilities:                                                 |  |                                |        |      |   |         |  
|Accounts receivable                                                                |  |                                | (798   | )    |   | 1,663   |  
|Inventory                                                                          |  |                                | (4,861 | )    |   | 1,268   |  
|Refundable income taxes                                                            |  |                                | 8,503  |      |   | 6,573   |  
|Other assets                                                                       |  |                                | 961    |      |   | 953     |  
|Accounts payable, trade                                                            |  |                                | 1,124  |      |   | (1,334  | )
|Other liabilities                                                                  |  |                                | 160    |      |   | (1,359  | )
|                                                                                   |  |                                |        |      |   |         |  
|Net cash provided by operating activities                                          |  |                                | 9,122  |      |   | 13,779  |  
|                                                                                   |  |                                |        |      |   |         |  
|Cash flows from investing activities:                                              |  |                                |        |      |   |         |  
|Capital expenditures                                                               |  |                                | (555   | )    |   | (632    | )
|Principal payments of note receivable                                              |  |                                |       |      |   | 466     |  
|Proceeds from sale of real estate and property and equipment                       |  |                                | 424    |      |   | 54      |  
|                                                                                   |  |                                |        |      |   |         |  
|Net cash used in investing activities                                              |  |                                | (131   | )    |   | (112    | )
|                                                                                   |  |                                |        |      |   |         |  
|Cash flows from financing activities:                                              |  |                                |        |      |   |         |  
|Payments of long-term debt                                                         |  |                                | (2,840 | )    |   | (13,377 | )
|Stock options exercised                                                            |  |                                | 258    |      |   | 762     |  
|Treasury stock acquired                                                            |  |                                | (477   | )    |   | (30     | )
|                                                                                   |  |                                |        |      |   |         |  
|Net cash used in financing activities                                              |  |                                | (3,059 | )    |   | (12,645 | )
|                                                                                   |  |                                |        |      |   |         |  
|Net increase in cash and cash equivalents                                          |  |                                | 5,932  |      |   | 1,022   |  
|Cash and cash equivalents, beginning of period                                     |  |                                | 91,019 |      |   | 100,398 |  
|                                                                                   |  |                                |        |      |   |         |  
|Cash and cash equivalents, end of period                                           |  | $                              | 96,951 |      | $ | 101,420 |  
|                                                                                   |  |                                |        |      |   |         |  

The accompanying notes are
an integral part of these unaudited consolidated condensed financial statements.

6

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REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES

NOTES TO
UNAUDITED CONSOLIDATED CONDENSED FINANCIAL 
STATEMENTSApril 30, 2011

Note 1. Consolidated
Condensed Financial Statements

The
consolidated condensed financial statements included in this report have been
prepared by the Company, without audit, pursuant to the rules and regulations
of the Securities and Exchange Commission and include, in the opinion of
management, all adjustments necessary to state fairly the information set forth
therein. Any such adjustments were of a normal recurring nature. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with accounting principles generally accepted in the
United States of America have been omitted pursuant to such rules and
regulations, although the Company believes that the disclosures are adequate to
make the information presented not misleading. Financial information as of
January 31, 2011 included in these financial statements has been derived from
the audited consolidated financial statements included in the Companys Annual
Report on Form 10-K for the year ended January 31, 2011 (fiscal year 2010). It
is suggested that these unaudited consolidated condensed financial statements
be read in conjunction with the consolidated financial statements and the notes
thereto included in the Companys Annual Report on Form 10-K for the year ended
January 31, 2011. The results of operations for the interim periods are not
necessarily indicative of the results to be expected for the year.

Basis
of Consolidation  The consolidated condensed financial statements in this
report include the operating results and financial position of REX American
Resources Corporation and its wholly and majority owned subsidiaries. The
Company includes the results of operations of One Earth Energy, LLC (One
Earth) in its Consolidated Condensed Statements of Operations on a delayed
basis of one month. Prior to January 31, 2011, the Company also included the
results of operations of Levelland Hockley County Ethanol, LLC (Levelland
Hockley) on a delayed basis of one month, which was prior to the
deconsolidation of Levelland Hockley (see Note 12).

Nature
of Operations  The Company operates in two reportable segments, alternative
energy and real estate. The Company substantially completed the exit of its
retail business during the second quarter of fiscal year 2009, although it will
continue to recognize revenue and expense associated with administering
extended service policies as discontinued operations.

Note 2. Accounting
Policies

The
interim consolidated condensed financial statements have been prepared in
accordance with the accounting policies described in the notes to the consolidated
financial statements included in the Companys fiscal year 2010 Annual Report
on Form 10-K. While management believes that the procedures followed in the
preparation of interim financial information are reasonable, the accuracy of
some estimated amounts is dependent upon facts that will exist or calculations
that will be accomplished at fiscal year end. Examples of such estimates
include management bonuses, the fair value of financial instruments, reserves
for lower

7

---



of cost or
market inventory calculations, the fair value of contingent consideration
liabilities and the provision for income taxes. Any adjustments pursuant to
such estimates during the quarter were of a normal recurring nature. Actual
results could differ from those estimates.

Revenue Recognition

The
Company recognizes sales from the production of ethanol and distillers grains
when title transfers to customers, upon shipment from its plant.

The
Company includes income from real estate leasing activities in net sales and
revenue. The Company accounts for these leases as operating leases.
Accordingly, minimum rental revenue is recognized on a straight-line basis over
the term of the lease.

Prior
to exiting the retail business, the Company sold retail product service
contracts covering periods beyond the normal manufacturers warranty periods,
usually with terms of coverage (including manufacturers warranty periods) of
between 12 to 60 months. Contract revenues and sales commissions are deferred and
amortized on a straight-line basis over the life of the contracts after the
expiration of applicable manufacturers warranty periods. The Company retains
the obligation to perform warranty service and such costs are expensed as
incurred. All related revenue and expense is classified as discontinued
operations.

Cost of Sales

Ethanol
cost of sales includes depreciation, costs of raw materials, inbound freight
charges, purchasing and receiving costs, inspection costs, other distribution
expenses, warehousing costs, plant management, certain compensation costs, and
general facility overhead charges.

Real
estate cost of sales includes depreciation, real estate taxes, insurance,
repairs and maintenance and other costs directly associated with operating the
Companys portfolio of real property.

Selling, General and Administrative Expenses

The
Company includes non-production related costs from its alternative energy
segment such as professional fees, selling charges and certain payroll in
selling, general and administrative expenses.

The
Company includes costs not directly related to operating its portfolio of real
property from its real estate segment such as certain payroll and related
costs, professional fees and other general expenses in selling, general and
administrative expenses.

The
Company includes costs associated with its corporate headquarters such as
certain payroll and related costs, professional fees and other general expenses
in selling, general and administrative expenses.

8

---



Interest Cost

No
interest was capitalized for the quarters ended April 30, 2011 and 2010. Cash
paid for interest for the quarters ended April 30, 2011 and 2010 was
approximately $617,000 and $1,275,000, respectively.

Financial Instruments

The
Company uses derivative financial instruments to manage its balance of fixed
and variable rate debt. The Company does not hold or issue derivative financial
instruments for trading or speculative purposes. Interest rate swap agreements
involve the exchange of fixed and variable rate interest payments and do not
represent an actual exchange of the notional amounts between the parties. The
swap agreements were not designated for hedge accounting pursuant to ASC 815, Derivatives and Hedging (ASC 815). The
interest rate swaps are recorded at their fair values and the changes in fair
values are recorded as gain or loss on derivative financial instruments in the
Consolidated Condensed Statements of Operations. The Company paid settlements
of interest rate swaps of approximately $664,000 and $356,000 for the quarters
ended April 30, 2011 and 2010, respectively.

Forward
grain purchase and ethanol and distillers grain sale contracts are accounted
for under the normal purchases and normal sales scope exemption of ASC 815
because these arrangements are for purchases of grain that will be delivered in
quantities expected to be used by the Company and sales of ethanol and
distillers grain quantities expected to be produced by the Company over a
reasonable period of time in the normal course of business.

Income Taxes

The
Company applies an effective tax rate to interim periods that is consistent
with the Companys estimated annual tax rate. The Company provides for deferred
tax liabilities and assets for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax basis and operating loss and tax credit
carryforwards. The Company provides for a valuation allowance if, based on the
weight of available evidence, it is more likely than not that some or all of
the deferred tax assets will not be realized. The Company paid no income taxes
during the quarters ended April 30, 2011 and 2010. During the quarters ended
April 30, 2011 and 2010, the Company received tax refunds of $7,217,000 and
$5,495,000, respectively.

As
of April 30, 2011, total unrecognized tax benefits were approximately
$2,733,000 and accrued penalties and interest were $272,000. If the Company
were to prevail on all unrecognized tax benefits recorded, approximately
$129,000 of the reserve would benefit the effective tax rate. In addition, the
impact of penalties and interest would also benefit the effective tax rate.
Interest and penalties associated with unrecognized tax benefits are recorded
within income tax expense. On a quarterly and annual basis, the Company accrues
for the effects of open uncertain tax positions and the related potential
penalties and interest.

9

---



Inventories

Inventories
are carried at the lower of cost or market on a first-in, first-out (FIFO)
basis. Alternative energy segment inventory includes direct production costs
and certain overhead costs such as depreciation, property taxes and utilities
related to producing ethanol and related by-products. Reserves are established
for estimated net realizable value based primarily upon commodity prices. The
components of inventory at April 30, 2011 and January 31, 2011 are as follows
(amounts in thousands):

|                                       |  |                 |        |                   |   |       | 
|-------------------------------------- |  | --------------- | ------ | ----------------- | - | ----- | 
|                                       |  | April 30,
 2011 |        | January 31,
 2011 |  
|                                       |  |                 |        |                   |  
|                                      
|Ethanol and
 other finished goods, net |  | $               | 3,532  |                   | $ | 2,347 | 
|Work in
 process, net                  |  |                 | 2,011  |                   |   | 1,705 | 
|Grain and
 other raw materials         |  |                 | 7,137  |                   |   | 3,767 | 
|                                       |  |                 |        |                   |   |       | 
|Total                                  |  | $               | 12,680 |                   | $ | 7,819 | 
|                                       |  |                 |        |                   |   |       | 

Property and Equipment

Property
and equipment is recorded at cost. Depreciation is computed using the
straight-line method. Estimated useful lives are 15 to 40 years for buildings
and improvements, and 3 to 20 years for fixtures and equipment.

In
accordance with ASC 360-05 Impairment or
Disposal of Long-Lived Assets, the carrying value of long-lived
assets is assessed for recoverability by management when changes in
circumstances indicate that the carrying amount may not be recoverable, based
on an analysis of undiscounted future expected cash flows from the use and
ultimate disposition of the asset. Impairment charges were not significant in
the first quarter of fiscal year 2011 or 2010. Impairment charges result from
the Companys management performing cash flow analysis and represent
managements estimate of the excess of net book value over fair value. Fair
value is estimated using expected future cash flows on a discounted basis or
appraisals of specific properties as appropriate. Long-lived assets are tested
for recoverability whenever events or changes in circumstances indicate that
its carrying amount may not be recoverable. Generally, declining cash flows
from an ethanol plant or deterioration in local real estate market conditions
are indicators of possible impairment.

Investments and Deposits

Restricted
investments, which are principally money market mutual funds and cash deposits,
are stated at cost plus accrued interest, which approximates market. Restricted
investments at April 30, 2011 and January 31, 2011 are required by two states
to cover possible future claims under extended service policies over the
remaining live of the service policy contract. In accordance with ASC 320, Investments-Debt and Equity Securities
the Company has classified these investments as held-to-maturity. The
investments had maturity dates of less

10

---



than one year
at April 30, 2011 and January 31, 2011. The Company has the intent and ability
to hold these securities to maturity.

The
method of accounting applied to long-term investments, whether consolidated,
equity or cost, involves an evaluation of the significant terms of each
investment that explicitly grant or suggest evidence of control or influence
over the operations of the investee and also includes the identification of any
variable interests in which the Company is the primary beneficiary. The Company
consolidates the results of one majority owned subsidiary, One Earth, with a
one month lag. The Company accounts for investments in limited liability
companies in which it may have a less than 20% ownership interest, using the
equity method of accounting when the factors discussed in ASC 323 Investments-Equity Method and Joint Ventures
are met. The excess of the carrying value over the underlying equity in the net
assets of equity method investees is allocated to specific assets and
liabilities. Any unallocated excess is treated as goodwill and is recorded as a
component of the carrying value of the equity method investee. Investments in
businesses that the Company does not control but for which it has the ability
to exercise significant influence over operating and financial matters are
accounted for using the equity method. Investments in which the Company does
not have the ability to exercise significant influence over operating and
financial matters are accounted for using the cost method. The Company accounts
for its investments in Big River Resources, LLC (Big River), Patriot
Renewable Fuels, LLC (Patriot) and NuGen Energy, LLC (NuGen) using the
equity method of accounting and includes the results of these entities on a
delayed basis of one month.

The
Company periodically evaluates its investments for impairment due to declines
in market value considered to be other than temporary. Such impairment
evaluations include, in addition to persistent, declining market prices,
general economic and company-specific evaluations. If the Company determines that
a decline in market value is other than temporary, then a charge to earnings is
recorded in the Consolidated Statements of Operations and a new cost basis in
the investment is established.

Accounting Changes and Recently Issued
Accounting Standards

Periodically,
new accounting pronouncements are issued by the Financial Accounting Standards
Board (FASB) or other standards setting bodies that are adopted by us as of
the specified effective date. Unless otherwise discussed, our management believes
that the impact of recently issued standards that are not yet effective will
not have a material impact on our consolidated financial statements upon
adoption.

Note 3. Comprehensive
Income

Comprehensive
income includes net income and unrealized gains and losses on securities
classified as available for sale (net of the related tax effects), and are
reported separately in shareholders equity.

11

---



The components
of comprehensive income are as follows (amounts in thousands):

|                                                                 |  |                               |       |      |   |       |  
|---------------------------------------------------------------- |  | ----------------------------- | ----- | ---- | - | ----- | -
|                                                                 |  | Three Months Ended
 April 30, |      
|                                                                 |  | 2011                          |       | 2010 |  
|                                                                 |  |                               |       |      |  
|                                                                 |  |                               |       |      |   |       |  
|Net income
 attributable to REX common shareholders              |  | $                             | 4,652 |      | $ | 4,188 |  
|Unrealized
 holding losses on available for sale securities, net |  |                               |      |      |   | (22   | )
|                                                                 |  |                               |       |      |   |       |  
|Total
 comprehensive income                                      |  | $                             | 4,652 |      | $ | 4,166 |  
|                                                                 |  |                               |       |      |   |       |  

Note 4. Leases

At
April 30, 2011, the Company has lease agreements, as landlord, for all or
portions of seven properties. All of the leases are accounted for as operating
leases. The following table is a summary of future minimum rentals on such
leases (amounts in thousands):

|                         |  |                  |       | 
|------------------------ |  | ---------------- | ----- | 
|Years Ended
 January 31, |  | Minimum
 Rentals |      
|                         |  |                  |      
|                        
|Remainder of
 2012       |  | $                | 1,248 | 
|2013                     |  |                  | 1,254 | 
|2014                     |  |                  | 1,124 | 
|2015                     |  |                  | 780   | 
|2016                     |  |                  | 325   | 
|Thereafter               |  |                  | 1,566 | 
|                         |  |                  |       | 
|Total                    |  | $                | 6,297 | 
|                         |  |                  |       | 

Note 5. Fair
Value

The
Company applies ASC 820, Fair Value
Measurements and Disclosures, (ASC 820) which provides a framework
for measuring fair value under GAAP. This accounting standard defines fair
value as the exchange price that would be received for an asset or paid to
transfer a liability (an exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market
participants on the measurement date.

The
Company determines the fair market values of its financial instruments based on
the fair value hierarchy established by ASC 820. ASC 820 requires an entity to
maximize the use of observable inputs and minimize the use of unobservable
inputs when measuring fair value. The standard describes three levels of inputs
that may be used to measure fair values which are provided below. The Company
carries cash equivalents, restricted investments, derivative liabilities and
contingent consideration liabilities at fair value.

Level
1  Quoted prices in active markets for identical assets or liabilities. Level
1 assets

12

---



and
liabilities include debt and equity securities and derivative contracts that
are traded in an active exchange market, as well as certain U.S. Treasury securities
that are highly liquid and are actively traded in over-the-counter markets.

Level
2  Observable inputs other than Level 1 prices such as quoted prices for
similar assets or liabilities; quoted prices in markets that are not active; or
other inputs that are observable or can be corroborated by observable market
data for substantially the full term of the assets or liabilities. Level 2
assets and liabilities include derivative contracts whose value is determined
using a pricing model with inputs that are observable in the market or can be
derived principally or corroborated by observable market data.

Level
3  Unobservable inputs that are supported by little or no market activity and
that are significant to the fair value of the assets or liabilities. Level 3
assets and liabilities include financial instruments whose value is determined
using pricing models, discounted cash flow methods, or similar techniques, as
well as instruments for which the determination of fair value requires
significant management judgment or estimation. Unobservable inputs shall be
developed based on the best information available, which may include the
Companys own data.

The
fair values of interest rate swaps are determined by using quantitative models
that discount future cash flows using the LIBOR forward interest rate curve.
Estimation risk is greater for derivative asset and liability positions that
are either option-based or have longer maturity dates where observable market
inputs are less readily available or are unobservable, in which case interest
rate, price or index scenarios are extrapolated in order to determine the fair
value. The fair values of derivative assets and liabilities include adjustments
for market liquidity, counterparty credit quality, the Companys own credit
standing and other specific factors, where appropriate. To ensure the prudent
application of estimates and management judgment in determining the fair value
of derivative assets and liabilities, various processes and controls have been
adopted, which include: model validation that requires a review and approval
for pricing, financial statement fair value determination and risk
quantification; periodic review and substantiation of profit and loss reporting
for all derivative instruments.

The
fair values of contingent consideration liabilities are determined using
quantitative models that require the use of multiple market inputs including
interest rates. In addition, inputs such as the Companys cost of capital and
the timing of certain cash flows are estimated using managements assumptions
and projections.

Financial
assets and liabilities measured at fair value on a recurring basis at April 30,

13

---



2011 are
summarized below (amounts in thousands):

|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|------------------------- |  | ------- | --- | ------- | - | ------- |  | ---------- | ----- |  | - | ----- | 
|                          |  | Level 1 |     | Level 2 |   | Level 3 |  | Fair Value |      
|                          |  |         |     |         |   |         |  |            |      
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Cash
 equivalents         |  | $       | 2   |         | $ |        |  | $          |      |  | $ | 2     | 
|Restricted
 investments   |  |         | 857 |         |   |        |  |            |      |  |   | 857   | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Total assets              |  | $       | 859 |         | $ |        |  | $          |      |  | $ | 859   | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Derivative
 liabilities   |  | $       |    |         | $ | 4,791   |  | $          |      |  | $ | 4,791 | 
|Contingent
 consideration |  |         |    |         |   |        |  |            | 3,578 |  |   | 3,578 | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Total
 liabilities        |  | $       |    |         | $ | 4,791   |  | $          | 3,578 |  | $ | 8,369 | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 

There
were no assets or liabilities measured at fair value on a non-recurring basis
subsequent to January 31, 2011 through April 30, 2011.

Financial
assets and liabilities measured at fair value on a recurring basis at January
31, 2011 are summarized below (amounts in thousands):

|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|------------------------- |  | ------- | --- | ------- | - | ------- |  | ---------- | ----- |  | - | ----- | 
|                          |  | Level 1 |     | Level 2 |   | Level 3 |  | Fair Value |      
|                          |  |         |     |         |   |         |  |            |      
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Cash
 equivalents         |  | $       | 2   |         | $ |        |  | $          |      |  | $ | 2     | 
|Restricted
 investments   |  |         | 857 |         |   |        |  |            |      |  |   | 857   | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Total assets              |  | $       | 859 |         | $ |        |  | $          |      |  | $ | 859   | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Derivative
 liabilities   |  | $       |    |         | $ | 5,523   |  | $          |      |  | $ | 5,523 | 
|Contingent
 consideration |  |         |    |         |   |        |  |            | 3,578 |  |   | 3,578 | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 
|Total
 liabilities        |  | $       |    |         | $ | 5,523   |  | $          | 3,578 |  | $ | 9,101 | 
|                          |  |         |     |         |   |         |  |            |       |  |   |       | 

Assets
measured at fair value on a non-recurring basis over various dates through
January 31, 2011 are summarized below (amounts in thousands):

|                             |  |         |   |         |   |         |  |                |       |  |   |     | 
|---------------------------- |  | ------- | - | ------- | - | ------- |  | -------------- | ----- |  | - | --- | 
|                             |  | Level 1 |   | Level 2 |   | Level 3 |  | Total 
 Losses |      
|                             |  |         |   |         |   |         |  |                |      
|                             |  |         |   |         |   |         |  |                |       |  |   |     | 
|Property and
 equipment, net |  | $       |  |         | $ |        |  | $              | 4,568 |  | $ | 424 | 

The
fair value of the Companys debt is approximately $78.1 million and $81.2
million at April 30, 2011 and January 31, 2011, respectively.

14

---



Note 6. Property
and Equipment

The
components of property and equipment at April 30, 2011 and January 31, 2011 are
as follows (amounts in thousands):

|                                   |  |                 |         |                   |   |         |  
|---------------------------------- |  | --------------- | ------- | ----------------- | - | ------- | -
|                                   |  | April 30,
 2011 |         | January 31,
 2011 |  
|                                   |  |                 |         |                   |  
|                                  
|Land and
 improvements             |  | $               | 21,812  |                   | $ | 21,899  |  
|Buildings
 and improvements        |  |                 | 44,129  |                   |   | 44,297  |  
|Machinery,
 equipment and fixtures |  |                 | 124,425 |                   |   | 124,439 |  
|Leasehold
 improvements            |  |                 | 447     |                   |   | 440     |  
|Construction
 in progress          |  |                 | 5,072   |                   |   | 4,578   |  
|                                   |  |                 |         |                   |   |         |  
|                                   |  |                 | 195,885 |                   |   | 195,653 |  
|Less:
 accumulated depreciation    |  |                 | (28,361 | )                 |   | (25,842 | )
|                                   |  |                 |         |                   |   |         |  
|                                   |  |                 |         |                   |   |         |  
|                                   |  | $               | 167,524 |                   | $ | 169,811 |  
|                                   |  |                 |         |                   |   |         |  

Note 7. Other
Assets

The
components of other assets at April 30, 2011 and January 31, 2011 are as
follows (amounts in thousands):

|                               |  |                 |       |                   |   |       | 
|------------------------------ |  | --------------- | ----- | ----------------- | - | ----- | 
|                               |  | April 30,
 2011 |       | January 31,
 2011 |  
|                               |  |                 |       |                   |  
|                              
|Deferred
 financing costs, net |  | $               | 927   |                   | $ | 1,006 | 
|Prepaid
 commissions           |  |                 | 1,539 |                   |   | 1,924 | 
|Real estate
 taxes refundable  |  |                 | 1,320 |                   |   | 682   | 
|Other                          |  |                 | 1,691 |                   |   | 2,295 | 
|                               |  |                 |       |                   |   |       | 
|Total                          |  | $               | 5,477 |                   | $ | 5,907 | 
|                               |  |                 |       |                   |   |       | 

Note 8. Long
Term Debt and Interest Rate Swaps

One Earth Energy Subsidiary Level Debt

In
September 2007, One Earth entered into a $111,000,000 financing agreement
consisting of a construction loan agreement for $100,000,000 together with a
$10,000,000 revolving loan and a $1,000,000 letter of credit with First
National Bank of Omaha (the Bank). The construction loan was converted into a
term loan on July 31, 2009 as all of the requirements, for such conversion, of
the construction and term loan agreement were fulfilled. The term loan bears
interest at variable interest rates ranging from LIBOR plus 275 basis points to
LIBOR plus 300 basis points (3.1% -3.3% at April 30, 2011). Beginning with the
first quarterly payment on October 8, 2009, payments are due in 20 quarterly
payments of principal plus accrued interest with the principal portion
calculated based on a 120 month amortization schedule. One final

15

---



installment
will be required on the maturity date (July 31, 2014) for the remaining unpaid
principal balance with accrued interest.

Borrowings
are secured by all of the assets of One Earth. This debt is recourse only to
One Earth and not to REX American Resources Corporation or any of its wholly
owned subsidiaries. As of April 30, 2011, approximately $76.5 million was
outstanding on the term loan. One Earth is also subject to certain financial
covenants under the loan agreement, including required levels of EBITDA, debt
service coverage ratio requirements, net worth requirements and other common
covenants. One Earth was in compliance with all covenants at April 30, 2011.
One Earth has paid approximately $1.4 million in financing costs. These costs
are recorded as deferred financing costs and are amortized ratably over the
term of the loan.

The
Companys proportionate share of restricted assets related to One Earth was
$62.3 million and $59.8 million at April 30, 2011 and January 31, 2011,
respectively. One Earths restricted assets total approximately $84.6 million
and $81.2 million at April 30, 2011 and January 31, 2011, respectively.
Restricted assets may not be paid in the form of dividends or advances to the
parent company or other members of One Earth per the terms of the loan
agreement with the Bank. At April 30, 2011, One Earth was permitted (per the
terms of the loan agreement with the Bank) to pay up to approximately $13.9
million in dividends to its members.

One
Earth has no outstanding borrowings on the $10,000,000 revolving loan as of
April 30, 2011. One Earth also has access to a secondary line of credit of up
to $10,000,000, as adjusted, with First National Bank of Omaha, established as
part of the original $100,000,000 term loan and made accessible as a revolving
line of credit as term loan payments were made. The amount available is reduced
by $250,000 on a quarterly basis. At April 30, 2011, One Earth had $8,500,000
of availability on the secondary line of credit and did not have any borrowings
thereon at April 30, 2011.

One
Earth has letters of credit outstanding that total approximately $196,000 at
April 30, 2011.

One
Earth entered into two forward interest rate swaps in the notional amounts of
$50.0 million and $25.0 million with the Bank. The swap settlements commenced
as of July 31, 2009; the $50.0 million swap terminates on July 8, 2014 and the
$25.0 million swap terminates on July 31, 2011. The $50.0 million swap fixed a
portion of the variable interest rate of the term loan subsequent to the plant
completion date at 7.9% while the $25.0 million swap fixed the rate at 5.49%.
At April 30, 2011, the Company recorded a liability of $4.8 million related to
the fair value of the swaps. The change in fair value is recorded in the
Consolidated Condensed Statements of Operations.

Note 9. Financial
Instruments

The
Company uses interest rate swaps to manage its interest rate exposure at One
Earth by fixing the interest rate on a portion of the entitys variable rate
debt. The Company does not engage in trading activities involving derivative
contracts for which a lack of marketplace quotations would necessitate the use
of fair value estimation techniques.

16

---



The
notional amounts and fair values of derivatives, all of which are not
designated as cash flow hedges at April 30, 2011 are summarized in the table
below (amounts in thousands):

|                     |  |                  |        |                       |   |       | 
|-------------------- |  | ---------------- | ------ | --------------------- | - | ----- | 
|                     |  | Notional
 Amount |        | Fair Value
 Liability |  
|                     |  |                  |        |                       |  
|                    
|Interest
 rate swaps |  | $                | 66,749 |                       | $ | 4,791 | 

As
the interest rate swaps are not designated as cash flow hedges, the unrealized
gain and loss on the derivatives is reported in current earnings. The Company
reported gains of $68,000 in the first quarter of fiscal year 2011 and losses
of $167,000 in the first quarter of fiscal year 2010.

Note 10. Stock
Option Plans

The
Company has stock-based compensation plans under which stock options have been
granted to directors, officers and key employees at the market price on the
date of the grant.

The
total intrinsic value of options exercised during the quarters ended April 30,
2011 and 2010 was approximately $3.0 million and $0.2 million, respectively,
resulting in tax deductions to realize benefits of approximately $0.6 million
and $0.1 million, respectively. The following table summarizes options granted,
exercised and canceled or expired during the three months ended April 30, 2011:

|                                               |  |          |   |                                    |       |                                                           |  |                                             |  |   |       | 
|---------------------------------------------- |  | -------- | - | ---------------------------------- | ----- | --------------------------------------------------------- |  | ------------------------------------------- |  | - | ----- | 
|                                               |  | Shares   |   | Weighted
 Average
 Exercise
 Price |       | Weighted Average
 Remaining
 Contractual Term
 (in years) |  | Aggregate
 Intrinsic
 Value
 (in thousands) | 
|                                               |  |          |   |                                    |       |                                                           |  |                                             | 
|Outstanding at January 31, 2011                |  | 725,903  |   | $                                  | 10.16 |                                                           |  |                                             |  |   |       | 
|Exercised                                      |  | (417,400 | ) | $                                  | 8.01  |                                                           |  |                                             |  |   |       | 
|                                               |  |          |   |                                    |       |                                                           |  |                                             |  |   |       | 
|Outstanding and exercisable at April 30,
 2011 |  | 308,503  |   | $                                  | 13.08 |                                                           |  | 2.1                                         |  | $ | 1,296 | 

At
April 30, 2011, there was no unrecognized compensation cost related to
nonvested stock options.

17

---



Note 11. Income
Per Share from Continuing Operations Attributable to REX Common Shareholders

The
following table reconciles the computation of basic and diluted net income per
share from continuing operations for the period presented (in thousands, except
per share amounts):

|                                                                                             |  |                                    |       |                                    |       |            |   |        |  |        |       |            |        |  |   |      | 
|-------------------------------------------------------------------------------------------- |  | ---------------------------------- | ----- | ---------------------------------- | ----- | ---------- | - | ------ |  | ------ | ----- | ---------- | ------ |  | - | ---- | 
|                                                                                             |  | Three Months Ended
 April 30, 2011 |       | Three Months Ended
 April 30, 2010 |      
|                                                                                             |  |                                    |       |                                    |      
|                                                                                             |  | Income                             |       | Shares                             |       | Per
 Share |   | Income |  | Shares |       | Per
 Share |       
|                                                                                             |  |                                    |       |                                    |       |            |   |        |  |        |       |            |       
|Basic income per share from continuing
 operations attributable to REX common shareholders   |  | $                                  | 4,112 |                                    | 9,432 |            | $ | 0.43   |  | $      | 3,650 |            | 9,840  |  | $ | 0.37 | 
|                                                                                             |  |                                    |       |                                    |       |            |   |        |  |        |       |            |        |  |   |      | 
|Effect of stock options                                                                      |  |                                    |      |                                    | 128   |            |   |        |  |        |      |            | 205    |  |   |      | 
|                                                                                             |  |                                    |       |                                    |       |            |   |        |  |        |       |            |        |  |   |      | 
|Diluted income per share from continuing
 operations attributable to REX common shareholders |  | $                                  | 4,112 |                                    | 9,560 |            | $ | 0.43   |  | $      | 3,650 |            | 10,045 |  | $ | 0.36 | 
|                                                                                             |  |                                    |       |                                    |       |            |   |        |  |        |       |            |        |  |   |      | 

For
the three months ended April 30, 2011, a total of 12,468 shares subject to
outstanding options were not included in the common equivalent shares
outstanding calculation as the effect from these shares is antidilutive. There
were no such shares for the three months ended April 30, 2010.

Note 12. Investments
and Restricted Deposits

The
Company has approximately $743,000 at April 30, 2011 and January 31, 2011 on
deposit with the Florida Department of Financial Services to secure its
obligation to fulfill future obligations related to extended warranty contracts
sold in the state of Florida. As such, this deposit is restricted from use for
general corporate purposes. The deposit earned 2.0% and 2.3% at April 30, 2011
and January 31, 2011, respectively.

In
addition to the deposit with the Florida Department of Financial Services, the
Company has $857,000 at April 30, 2011 and January 31, 2011 invested in a money
market mutual fund to satisfy Florida Department of Financial Services
regulations. As such, this investment is restricted from use for general
corporate purposes. This investment earned 0.1% at April 30, 2011 and January
31, 2011.

18

---



The following
table summarizes equity method investments at April 30, 2011 and January 31,
2011 (amounts in thousands):

|                                 |  |                       |   |                                 |        |                                   |   |        | 
|-------------------------------- |  | --------------------- | - | ------------------------------- | ------ | --------------------------------- | - | ------ | 
|Entity                           |  | Ownership
 Percentage |   | Carrying Amount
 April 30, 2011 |        | Carrying Amount
 January 31, 2011 |  
|                                 |  |                       |   |                                 |        |                                   |  
|                                
|Big River
 Resources, LLC        |  | 10                    | % | $                               | 29,712 |                                   | $ | 29,443 | 
|Patriot
 Renewable Fuels, LLC    |  | 23                    | % |                                 | 22,698 |                                   |   | 21,829 | 
|NuGen
 Energy, LLC               |  | 48                    | % |                                 | 18,371 |                                   |   | 16,077 | 
|                                 |  |                       |   |                                 |        |                                   |   |        | 
|Total Equity
 Method Investments |  |                       |   | $                               | 70,781 |                                   | $ | 67,349 | 
|                                 |  |                       |   |                                 |        |                                   |   |        | 

During
the first quarter of fiscal years 2011 and 2010, the Company recorded income of
$1,271,000 and $1,335,000, respectively as its share of earnings from Big
River.

During
the first quarter of fiscal years 2011 and 2010, the Company recorded income of
$904,000 and $1,512,000, respectively as its share of earnings from Patriot.

Effective
July 1, 2010, the Company purchased a 48% equity interest in NuGen which
operates an ethanol producing facility in Marion, South Dakota with an annual
nameplate capacity of 100 million gallons. The Companys investment included
$2,410,361 paid at closing to the then sole shareholder of NuGen and $6,805,055
contributed directly to NuGen. At July 1, 2010 an additional $6,451,300 was due
based upon cash distributions from NuGen that the Company is entitled to until
such balance is paid (Contingent Consideration). At April 30, 2011 the
Contingent Consideration gross balance due was $4,690,000. The Company
determined that the fair value of the Contingent Consideration was $3,578,000
at April 30, 2011, of which $62,000 is included in other current liabilities
and $3,516,000 is included in other long-term liabilities on the Consolidated
Condensed Balance Sheet. During the first quarter of fiscal year 2011, the
Company recorded income of $3,607,000 as its share of earnings from NuGen.

The
Company has an option to purchase for a purchase price of $1,138,389, (which is
payable in cash, partially based upon cash distributions from NuGen that the
Company is entitled to) additional ownership units from NuGens majority
shareholder, which, if exercised, would result in the Company owning 51% of the
total outstanding voting and economic interests of NuGen on a fully diluted
basis.

Undistributed
earnings of equity method investees totaled approximately $20.4 million and
$18.4 million at April 30, 2011 and January 31, 2011, respectively.

19

---



Summarized
financial information for each of the Companys equity method investees is
presented in the following table for the three months ended March 31, 2011 and
March 31, 2010 (amounts in thousands):

|                                   |  |         |        |           |   |         |  |   |        | 
|---------------------------------- |  | ------- | ------ | --------- | - | ------- |  | - | ------ | 
|March 31,
 2011                    |  | Patriot |        | Big River |   | NuGen   | 
|                                   |  |         |        |           |   |         | 
|                                  
|Net sales
 and revenue             |  | $       | 88,316 |           | $ | 242,245 |  | $ | 81,138 | 
|Gross profit                       |  | $       | 5,462  |           | $ | 23,089  |  | $ | 8,889  | 
|Income from
 continuing operations |  | $       | 3,876  |           | $ | 13,029  |  | $ | 7,850  | 
|Net income                         |  | $       | 3,876  |           | $ | 13,029  |  | $ | 7,850  | 
|                                   |  |         |        |           |   |         |  |   |        | 
|March 31,
 2010                    |  | Patriot |        | Big River |   |         |  |  
|                                   |  |         |        |           |   |         |  |  
|                                  
|Net sales
 and revenue             |  | $       | 56,944 |           | $ | 156,886 |  |   |        | 
|Gross profit                       |  | $       | 9,643  |           | $ | 14,319  |  |   |        | 
|Income from
 continuing operations |  | $       | 6,485  |           | $ | 13,714  |  |   |        | 
|Net income                         |  | $       | 6,485  |           | $ | 13,714  |  |   |        | 

Patriot,
Big River and NuGen have debt agreements that limit and restrict amounts the
companies can pay in the form of dividends or advances to owners. The
restricted net assets of Patriot, Big River and NuGen combined at April 30,
2011 and January 31, 2011 are approximately $356.2 million and $355.1 million,
respectively. The Companys proportionate share of restricted net assets of
Patriot, Big River and NuGen combined at April 30, 2011 and January 31, 2011
are approximately $56.5 million and $52.4 million, respectively.

On
January 31, 2011, the Company sold 814,000 of its membership units in Levelland
Hockley County to Levelland Hockley for $1, reducing the ownership interest in
Levelland Hockley from 56% to 49%. As a result, the Company no longer had a
controlling financial interest in Levelland Hockley, and, therefore, effective
January 31, 2011, the Company deconsolidated Levelland Hockley and began using
the equity method of accounting. In connection with the deconsolidation, the
Company recorded its remaining non controlling equity interest and debt
investments at fair value. The Companys estimate of fair value for all of its
investments in Levelland Hockley was $0 at April 30, 2011 and January 31, 2011.
On April 27, 2011, Levelland Hockley voluntarily filed for protection under
Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy
Court, Northern District of Texas. As a result, the Company no longer can
exercise significant influence over Levelland Hockley and began using the cost
method of accounting. There was no change in the carrying value of the
Companys investments in Levelland Hockley as a result of the change to the
cost method of accounting.

20

---



Note 13. Income
Taxes

The
effective tax rate on consolidated pre-tax income from continuing operations
was 34.7% for the quarter ended April 30, 2011, 30.8% for the year ended
January 31, 2011 and 32.7% for the quarter ended April 30, 2010. The provision
for state taxes was approximately 4% for the quarter ended April 30, 2011, 4%
for the year ended January 31, 2011 and 5% for the quarter ended April 30,
2010.

The
Company files a U.S. federal income tax return and income tax returns in
various states. In general, the Company is no longer subject to U.S. federal,
state or local income tax examinations by tax authorities for years ended
January 31, 2007 and prior. A reconciliation of the beginning and ending amount
of unrecognized tax benefits, including interest and penalties, is as follows
(amounts in thousands):

|                                             |  |   |       | 
|-------------------------------------------- |  | - | ----- | 
|Unrecognized
 tax benefits, February 1, 2011 |  | $ | 2,976 | 
|Changes for
 prior years tax positions      |  |   | 29    | 
|Changes for
 current year tax positions      |  |   |      | 
|                                             |  |   |       | 
|Unrecognized
 tax benefits, April 30, 2011   |  | $ | 3,005 | 
|                                             |  |   |       | 

Note 14. Discontinued
Operations

During
fiscal year 2009, the Company completed the exit of its retail business.
Accordingly, all operations of the Companys former retail segment and certain
sold properties have been classified as discontinued operations for all periods
presented. Once real estate property has been sold, and no continuing
involvement is expected, the Company classifies the results of the operations
as discontinued operations. The results of operations were previously reported
in the Companys retail or real estate segment, depending on when the store
ceased operations. Below is a table reflecting certain items of the
Consolidated Condensed Statements of Operations that were reclassified as
discontinued operations for the periods indicated (amounts in thousands):

|                                                         |  |                               |       |      |   |       |  
|-------------------------------------------------------- |  | ----------------------------- | ----- | ---- | - | ----- | -
|                                                         |  | Three Months Ended
 April 30, |      
|                                                         |  |                               |      
|                                                         |  | 2011                          |       | 2010 |  
|                                                         |  |                               |       |      |  
|                                                        
|Net sales
 and revenue                                   |  | $                             | 1,290 |      | $ | 2,371 |  
|Cost of
 sales                                           |  |                               | 178   |      |   | 613   |  
|Income
 before income taxes                              |  |                               | 678   |      |   | 901   |  
|Provision
 for income taxes                              |  |                               | (263  | )    |   | (363  | )
|Income from
 discontinued operations, net of tax         |  | $                             | 415   |      | $ | 538   |  
|                                                         |  |                               |       |      |   |       |  
|Gain on
 disposal before benefit for income taxes        |  | $                             | 204   |      | $ |      |  
|Provision
 for income taxes                              |  |                               | (79   | )    |   |      |  
|                                                         |  |                               |       |      |   |       |  
|Gain on
 disposal of discontinued operations, net of tax |  | $                             | 125   |      | $ |      |  
|                                                         |  |                               |       |      |   |       |  

21

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Note 15. Commitments
and Contingencies

The
Company is involved in various legal actions arising in the normal course of
business. After taking into consideration legal counsels evaluations of such
actions, management is of the opinion that their outcome will not have a
material effect on the Companys consolidated condensed financial statements.

In
the normal course of its ethanol business, the Company enters into forward
pricing agreements for the purchase of grain and for the sale of ethanol and
distillers grains for delivery in future periods. The Company accounts for
these forward pricing arrangements under the normal purchases and normal
sales scope exemption of ASC 815, Derivatives and Hedging.

One
Earth has forward purchase contracts for 2,606,000 bushels of corn, the
principal raw material for its ethanol plant. One Earth expects to take
delivery of the grain through June 2011.

One
Earth has combined sales commitments for 12.9 million gallons of ethanol and
18,000 tons of distiller grains. One Earth expects to deliver the ethanol and
distiller grains through June 2011.

Note 16. Segment
Reporting

The
Company has two segments: alternative energy and real estate. The Company
evaluates the performance of each reportable segment based on segment profit.
Segment profit excludes income taxes, indirect interest expense, discontinued
operations, indirect interest income and certain other items that are included
in net income determined in accordance with accounting principles generally
accepted in the United States of America. Segment profit includes realized and
unrealized gains on derivative financial instruments. The following table
summarizes

22

---



segment and
other results and assets (amounts in thousands):

|                                                                                     |  |                              |        |      |   |        |  
|------------------------------------------------------------------------------------ |  | ---------------------------- | ------ | ---- | - | ------ | -
|                                                                                     |  | Three Months Ended April 30, |       
|                                                                                     |  | 2011                         |        | 2010 |  
|                                                                                     |  |                              |        |      |  
|Net sales
 and revenue:                                                              |  |                              |        |      |   |        |  
|Alternative
 energy                                                                  |  | $                            | 80,882 |      | $ | 71,022 |  
|Real estate                                                                          |  |                              | 332    |      |   | 250    |  
|                                                                                     |  |                              |        |      |   |        |  
|Total net
 sales and revenues                                                        |  | $                            | 81,214 |      | $ | 71,272 |  
|                                                                                     |  |                              |        |      |   |        |  
|                                                                                     |  |                              |        |      |   |        |  
|Segment
 gross profit (loss):                                                        |  |                              |        |      |   |        |  
|Alternative
 energy                                                                  |  | $                            | 4,778  |      | $ | 8,462  |  
|Real estate                                                                          |  |                              | (98    | )    |   | (265   | )
|                                                                                     |  |                              |        |      |   |        |  
|Total gross
 profit                                                                  |  | $                            | 4,680  |      | $ | 8,197  |  
|                                                                                     |  |                              |        |      |   |        |  
|                                                                                     |  |                              |        |      |   |        |  
|Segment
 profit (loss):                                                              |  |                              |        |      |   |        |  
|Alternative
 energy segment profit (1)                                               |  | $                            | 8,409  |      | $ | 8,613  |  
|Real estate
 segment loss                                                            |  |                              | (167   | )    |   | (327   | )
|Corporate
 expense                                                                   |  |                              | (660   | )    |   | (772   | )
|Interest
 expense                                                                    |  |                              | (42    | )    |   | (49    | )
|Interest
 income                                                                     |  |                              | 141    |      |   | 69     |  
|                                                                                     |  |                              |        |      |   |        |  
|Income from
 continuing operations before income taxes
 and noncontrolling interests |  | $                            | 7,681  |      | $ | 7,534  |  
|                                                                                     |  |                              |        |      |   |        |  

(1)
Includes equity in income of unconsolidated ethanol subsidiaries of $5,782,000
and $2,847,000 in the first quarters of fiscal years 2011 and 2010, respectively.

|                                               |  |                              |         |                   |   |         |  
|---------------------------------------------- |  | ---------------------------- | ------- | ----------------- | - | ------- | -
|                                               |  | April 30,
 2011              |         | January 31,
 2011 |  
|                                               |  |                              |         |                   |  
|Assets:                                        |  |                              |         |                   |   |         |  
|Alternative
 energy                            |  | $                            | 262,038 |                   | $ | 257,202 |  
|Real estate                                    |  |                              | 21,988  |                   |   | 22,235  |  
|Corporate                                      |  |                              | 94,043  |                   |   | 96,285  |  
|                                               |  |                              |         |                   |   |         |  
|Total assets                                   |  | $                            | 378,069 |                   | $ | 375,722 |  
|                                               |  |                              |         |                   |   |         |  
|                                               |  |                              |         |                   |   |         |  
|                                               |  | Three Months Ended April 30, |        
|                                               |  | 2011                         |         | 2010              |  
|                                               |  |                              |         |                   |  
|Sales of
 products alternative energy segment: |  |                              |         |                   |   |         |  
|Ethanol                                        |  |                              | 82      | %                 |   | 84      | %
|Distillers
 grains                             |  |                              | 18      | %                 |   | 16      | %
|                                               |  |                              |         |                   |   |         |  
|Total                                          |  |                              | 100     | %                 |   | 100     | %
|                                               |  |                              |         |                   |   |         |  
|Sales of
 services real estate segment:        |  |                              |         |                   |   |         |  
|Leasing                                        |  |                              | 100     | %                 |   | 100     | %
|                                               |  |                              |         |                   |   |         |  

Certain
corporate costs and expenses, including information technology, employee
benefits and other shared services are allocated to the business segments. The
allocations are generally amounts agreed upon by management, which may differ
from amounts that would be

23

---



incurred if
such services were purchased separately by the business segment. Corporate
assets are primarily cash and deferred income tax benefits.

Cash,
except for cash held by One Earth, is considered to be fungible and available
for both corporate and segment use dependent on liquidity requirements. Cash of
approximately $16.8 million held by One Earth will be used to fund working
capital needs for that entity.

Note 17. Related-Party
Transactions

During
the first quarter of fiscal year 2011 and 2010, the Company purchased
approximately $69.4 million and $32.7 million, respectively, of corn from the
Alliance Grain Elevator, an equity investor in One Earth.

Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations.

Historically,
we were a specialty retailer in the consumer electronics/appliance industry
serving small to medium-sized towns and communities. In addition, we have been
an investor in various alternative energy entities beginning with synthetic
fuel partnerships in 1998 and later ethanol production facilities beginning in
2006.

We
completed our exit of the retail business as of July 31, 2009. Going forward,
we expect that our only retail related activities will consist of the
administration of previously sold extended service plans and the payment of
related claims. All activities related to extended service plans are classified
as discontinued operations.

In
addition, we have owned real estate remaining from our former retail store
operations. The real estate consists of 29 former retail stores and one
distribution center which we include in our real estate segment.

We
currently have approximately $147 million of equity investments in five ethanol
limited liability corporations, one of which we have a majority ownership
interest in. We originally invested approximately $100.6 million in these five
entities. We may consider making

24

---



additional
investments in the alternative energy segment during fiscal year 2011. Our
ethanol ownership interests are summarized in the table below:

|                                                                 |  |                                            |  |                            |   |                                                     | 
|---------------------------------------------------------------- |  | ------------------------------------------ |  | -------------------------- | - | --------------------------------------------------- | 
|Ethanol Ownership Interests as of April 30,
 2011                | 
|                                                                 | 
|Entity                                                           |  | Nameplate
 Production
 Capacity
 (gallons) |  | REXs
 Ownership
 Interest |   | REX Effective
 Nameplate
 Capacity Owned
 (gallons) | 
|                                                                 |  |                                            |  |                            |   |                                                     | 
|One Earth
 Energy, LLC Gibson City, IL                           |  | 100M                                       |  | 74                         | % | 74.0M                                               | 
|NuGen
 Energy, LLC Marion, SD                                    |  | 100M                                       |  | 48                         | % | 48.0M                                               | 
|Patriot
 Renewable Fuels, LLC Annawan, IL                        |  | 100M                                       |  | 23                         | % | 23.0M                                               | 
|Big River
 Resources, LLC W. Burlington, IA                      |  | 92M                                        |  | 10                         | % | 9.2M                                                | 
|Big River
 Resources, LLC Galva, IL                              |  | 100M                                       |  | 10                         | % | 10.0M                                               | 
|Big River
 United Energy, LLC Dyersville, IA                     |  | 100M                                       |  | 5                          | % | 5.0M                                                | 
|Levelland
 Hockley County Ethanol, LLC Hockley County, Texas (1) |  | 40M                                        |  | 49                         | % | 19.6M                                               | 
|                                                                 |  |                                            |  |                            |   |                                                     | 
|Total (1)                                                        |  | 592M                                       |  | n/a                        |   | 169.2                                               | 

(1)
Total excludes nameplate production capacity and the effective nameplate
capacity owned by REX related to the Levelland Hockley operations which ceased
production in January 2011.

Our
ethanol operations are highly dependent on commodity prices, especially prices
for corn, sorghum, ethanol, distillers grains and natural gas. As a result of
price volatility for these commodities, our operating results can fluctuate
substantially. The price and availability of corn and sorghum are subject to
significant fluctuations depending upon a number of factors that affect
commodity prices in general, including crop conditions, weather, federal policy
and foreign trade. Because the market price of ethanol is not always directly
related to corn and sorghum prices, at times ethanol prices may lag movements
in corn prices and, in an environment of higher prices, reduce the overall
margin structure at the plants. As a result, at times, we may operate our
plants at negative or marginally positive operating margins.

We
expect our ethanol plants to produce approximately 2.8 gallons of denatured
ethanol for each bushel of grain processed in the production cycle. We refer to
the difference between the price per gallon of ethanol and the price per bushel
of grain (divided by 2.8) as the crush spread. Should the crush spread
decline, it is possible that our ethanol plants will generate operating results
that do not provide adequate cash flows for sustained periods of time. In such
cases, production at the ethanol plants may be reduced or stopped altogether in
order to minimize

25

---



variable costs
at individual plants. We expect these decisions to be made on an individual
plant basis, as there are different market conditions at each of our ethanol
plants.

We
attempt to manage the risk related to the volatility of grain and ethanol
prices by utilizing forward grain purchase and forward ethanol and distillers
grain sale contracts. We attempt to match quantities of ethanol and distillers
grains sale contracts with an appropriate quantity of grain purchase contracts
over a given period of time when we can obtain an adequate gross margin
resulting from the crush spread inherent in the contracts we have executed.
However, the market for future ethanol sales contracts is not a mature market.
Consequently, we generally execute contracts for no more than three months into
the future at any given time. As a result of the relatively short period of
time our contracts cover, we generally cannot predict the future movements in
the crush spread for more than three months; thus, we are unable to predict the
likelihood or amounts of future income or loss from the operations of our
ethanol facilities.

Fiscal Year

All
references in this report to a particular fiscal year are to REXs fiscal year
ended January 31. For example, fiscal year 2011 means the period February 1,
2011 to January 31, 2012.

Results of Operations

For
a detailed analysis of period to period changes, see the segment discussion
that follows this section as this is how management views and monitors our
business.

Comparison of Three Months Ended April 30,
2011 and 2010

Net
sales and revenue in the quarter ended April 30, 2011 were $81.2 million
compared to $71.3 million in the prior years first quarter, representing an
increase of $9.9 million. Net sales and revenue do not include sales from real
estate operations classified as discontinued operations. The increase was
primarily caused by higher sales in our alternative energy segment of $9.9
million. Net sales and revenue from our real estate segment were $0.3 million
in the first quarters of fiscal years 2011 and 2010.

The
following table reflects the approximate percent of net sales for each major
product and service group for the following periods:

|                  |  |                               |       |      |  |       |  
|----------------- |  | ----------------------------- | ----- | ---- |  | ----- | -
|                  |  | Three Months Ended
 April 30, |      
|                  |  |                               |      
|Product
 Category |  | 2011                          |       | 2010 | 
|                  |  |                               |       |      | 
|Ethanol           |  |                               | 81.3  | %    |  | 83.6  | %
|Distiller
 grains |  |                               | 18.3  |      |  | 15.9  |  
|Leasing           |  |                               | 0.4   |      |  | 0.4   |  
|Other             |  |                               |      |      |  | 0.1   |  
|                  |  |                               |       |      |  |       |  
|Total             |  |                               | 100.0 | %    |  | 100.0 | %
|                  |  |                               |       |      |  |       |  

26

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Gross
profit of $4.7 million (5.8% of net sales and revenue) in the first quarter of
fiscal year 2011 was approximately $3.5 million lower than the $8.2 million
(11.5% of net sales and revenue) recorded in the first quarter of fiscal year
2010. Gross profit for the first quarter of fiscal year 2011 decreased by $3.7
million compared to the prior year from our alternative energy segment. The decrease
was primarily a result of lower crush spreads realized during the current year
compared to the prior year. Gross loss for the first quarter of fiscal year
2011 decreased by $0.2 million compared to the prior year from our real estate
segment.

Selling,
general and administrative expenses for the first quarter of fiscal year 2011
were $2.3 million (2.9% of net sales and revenue), an increase of $0.2 million
from $2.1 million (2.9% of net sales and revenue) for the first quarter of
fiscal year 2010. Compared to the prior year, these expenses increased
approximately $0.3 million in the alternative energy segment and decreased
approximately $0.1 million in the corporate and other category, respectively.

Interest
income of $0.2 million for the first quarter of fiscal year 2011 is comparable
to the $0.1 million for the first quarter of fiscal year 2010.

Interest
expense was $0.7 million for the first quarter of fiscal year 2011 compared to
$1.4 million for the first quarter of fiscal year 2010. The decrease was
primarily attributable to the alternative energy segment as we no longer
consolidate the operations of Levelland Hockley which had approximately $0.6
million of interest expense in the first quarter of fiscal year 2010.

During
the first quarters of fiscal years 2011 and 2010, we recognized income of
approximately $5.8 million and $2.8 million, respectively, from our equity
investments in Big River, Patriot and NuGen. Big River has a 92 million gallon
nameplate plant which has been in operation since 2004. Big River opened an
additional 100 million gallon nameplate plant during the second quarter of
fiscal year 2009 and acquired a 50.5% ownership in a 100 million gallon
nameplate plant in August 2009. Patriot has a 100 million gallon nameplate
plant which has been in operation since the second quarter of fiscal year 2008.
We acquired a 48% ownership interest in NuGen, which operates a 100 million
gallon nameplate plant, on July 1, 2010.

Due
to the inherent volatility of the crush spread, we cannot predict the
likelihood of future operating results from Big River, Patriot and NuGen being
similar to historical results.

We
recognized gains of $68,000 and losses of $167,000 during the first quarters of
fiscal years 2011 and 2010, respectively, primarily related to forward starting
interest rate swap agreements that One Earth entered into during fiscal year
2007. In general, declining interest rates have a negative effect on our
interest rate swaps and vice versa, as our swaps fixed the interest rate of
variable rate debt. Should interest rates decline, we would expect to
experience losses on the interest rate swaps. We would expect to incur gains on
the interest rate swaps should interest rates increase. We cannot predict the
future movements in interest rates; thus, we are unable to predict the
likelihood or amounts of future gains or losses related to interest rate swaps.

Our
effective tax rate was 34.7% and 32.7% for the first quarter of fiscal years
2011 and 2010, respectively. Our effective tax rate increased, as the
noncontrolling interests in the income

27

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or loss of
consolidated subsidiaries is presented in the Consolidated Condensed Statements
of Operations after the income tax provision or benefit. The noncontrolling
interests in the income of One Earth was a lower proportion of pre-tax income
in fiscal year 2011 compared to the pre-tax income of One Earth and Levelland
Hockley for fiscal year 2010.

As
a result of the foregoing, income from continuing operations including
noncontrolling interests was $5.0 million for the first quarter of fiscal year
2011 versus $5.1 million for the first quarter of fiscal year 2010.

During
fiscal year 2009, we closed our remaining retail store and warehouse operations
and reclassified all retail related results as discontinued operations. As a
result of these closings and certain other retail store and real estate
property closings from prior years, we had income from discontinued operations,
net of tax, of $0.4 million in the first quarter of fiscal year 2011 compared
to $0.5 million in the first quarter of fiscal year 2010. One property
classified as discontinued operations was sold during the first quarter of
fiscal year 2011, resulting in a gain, net of taxes of $0.1 million. There was
no such gain or loss during the first quarter of fiscal year 2010.

Income
related to noncontrolling interests was $0.9 million and $1.4 million during
the first quarters of fiscal years 2011 and 2010, respectively, and represents
the owners (other than REX) share of the income or loss of Levelland Hockley
and One Earth in fiscal year 2010. The 2011 non controlling interests
represents the non-REX owners share of One Earth only, as we deconsolidated
Levelland Hockley as of January 31, 2011.

As
a result of the foregoing, net income attributable to REX common shareholders
was $4.7 million for the first quarter of fiscal year 2011 compared to $4.2
million for the first quarter of fiscal year 2010.

Business Segment Results

We have two
segments: alternative energy and real estate. The real estate segment was
formerly included in the retail segment. The following sections discuss the
results of operations for each of our business segments and corporate and
other. As discussed in Note 16, our chief operating decision maker (as defined
by ASC 280, Segment Reporting)
evaluates the operating performance of our business segments using a measure we
call segment profit. Segment profit includes gains and losses on derivative
financial instruments. Segment profit excludes income taxes, indirect interest
expense, discontinued operations, indirect interest income and certain other
items that are included in net income determined in accordance with accounting
principles generally accepted in the United States of America. Management
believes these are useful financial measures; however, they should not be
construed as being more important than other comparable GAAP measures.

Items
excluded from segment profit generally result from decisions made by corporate
executives. Financing, divestiture and tax structure decisions are generally
made by corporate executives. Excluding these items from our business segment

28

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performance
measure enables us to evaluate business segment operating performance based
upon current economic conditions.

The
following table sets forth, for the periods indicated, sales and profits by
segment (amounts in thousands):

|                                                                                    |  |                              |        |      |   |        |  
|----------------------------------------------------------------------------------- |  | ---------------------------- | ------ | ---- | - | ------ | -
|                                                                                    |  | Three Months Ended April 30, |       
|                                                                                    |  | 2011                         |        | 2010 |  
|                                                                                    |  |                              |        |      |  
|Net sales
 and revenue:                                                             |  |                              |        |      |   |        |  
|Alternative
 energy                                                                 |  | $                            | 80,882 |      | $ | 71,022 |  
|Real estate                                                                         |  |                              | 332    |      |   | 250    |  
|                                                                                    |  |                              |        |      |   |        |  
|Total net
 sales and revenues                                                       |  | $                            | 81,214 |      | $ | 71,272 |  
|                                                                                    |  |                              |        |      |   |        |  
|                                                                                    |  |                              |        |      |   |        |  
|Segment
 gross profit (loss):                                                       |  |                              |        |      |   |        |  
|Alternative
 energy                                                                 |  | $                            | 4,778  |      | $ | 8,462  |  
|Real estate                                                                         |  |                              | (98    | )    |   | (265   | )
|                                                                                    |  |                              |        |      |   |        |  
|Total gross
 profit                                                                 |  | $                            | 4,680  |      | $ | 8,197  |  
|                                                                                    |  |                              |        |      |   |        |  
|                                                                                    |  |                              |        |      |   |        |  
|Segment
 profit (loss):                                                             |  |                              |        |      |   |        |  
|Alternative
 energy segment profit                                                  |  | $                            | 8,409  |      | $ | 8,613  |  
|Real estate
 segment loss                                                           |  |                              | (167   | )    |   | (327   | )
|Corporate
 expense                                                                  |  |                              | (660   | )    |   | (772   | )
|Interest
 expense                                                                   |  |                              | (42    | )    |   | (49    | )
|Interest
 income                                                                    |  |                              | 141    |      |   | 69     |  
|                                                                                    |  |                              |        |      |   |        |  
|Income from
 continuing operationsbefore
 income taxes and noncontrolling interests |  | $                            | 7,681  |      | $ | 7,534  |  
|                                                                                    |  |                              |        |      |   |        |  

Alternative Energy

The
alternative energy segment includes the consolidated financial statements of
Levelland Hockley (fiscal year 2010) and One Earth (fiscal years 2011 and 2010)
and, our equity method and cost method investments in ethanol facilities, the
income related to those investments and certain administrative expenses. One
Earth became fully operational during the third quarter of fiscal year 2009. As
of January 31, 2011, we no longer had a controlling financial interest in Levelland
Hockley, and, therefore, we deconsolidated the entity. Thus, the results of
Levelland Hockley are included in the sales by product group and operating data
tables below for fiscal year 2010 only.

29

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The following
table summarizes sales by product group (amounts in thousands):

|                        |  |                               |        |      |   |        | 
|----------------------- |  | ----------------------------- | ------ | ---- | - | ------ | 
|                        |  | Three Months Ended
 April 30, |       
|                        |  | 2011                          |        | 2010 |  
|                        |  |                               |        |      |  
|                        |  |                               |        |      |   |        | 
|Ethanol                 |  | $                             | 66,058 |      | $ | 59,529 | 
|Dried
 distiller grains |  |                               | 14,528 |      |   | 9,258  | 
|Other                   |  |                               | 296    |      |   | 2,235  | 
|                        |  |                               |        |      |   |        | 
|Total                   |  | $                             | 80,882 |      | $ | 71,022 | 
|                        |  |                               |        |      |   |        | 

The following
table summarizes certain operating data:

|                                                          |  |                               |        |      |   |        | 
|--------------------------------------------------------- |  | ----------------------------- | ------ | ---- | - | ------ | 
|                                                          |  | Three Months Ended
 April 30, |       
|                                                          |  | 2011                          |        | 2010 |  
|                                                          |  |                               |        |      |  
|                                                          |  |                               |        |      |   |        | 
|Average
 selling price per gallon of ethanol              |  | $                             | 2.35   |      | $ | 1.73   | 
|Average
 selling price per ton of dried distiller
 grains |  | $                             | 183.22 |      | $ | 121.32 | 
|Average cost
 per bushel of grain                         |  | $                             | 6.56   |      | $ | 3.67   | 
|Average cost
 of natural gas (per mmbtu)                  |  | $                             | 4.37   |      | $ | 5.65   | 

Net
sales and revenue increased $9.9 million to $80.9 million primarily a result of
higher prices realized from ethanol and dried distiller grains sales. Ethanol
sales increased from approximately $59.5 million in the prior year to
approximately $66.1 million in the current year. The average selling price per
gallon of ethanol increased from $1.73 in the prior year to $2.35 in the
current year. Our ethanol sales were based upon approximately 28.2 million
gallons in the current year compared to 34.5 million gallons in the prior year.
The decline in gallons of ethanol sold results primarily from including the
results of Levelland Hockley in the prior year but not in the current year
after deconsolidation. Dried distiller grains sales increased from
approximately $9.3 million in the prior year to approximately $14.5 million in
the current year. The average selling price per ton of dried distiller grains
increased from $121.32 in the prior year to $183.22 in the current year. Our
dried distiller grains sales were based upon approximately 81,000 tons in the
current year compared to approximately 76,000 tons in the prior year. Other
product sales decreased from approximately $2.2 million in the prior year to
approximately $0.3 million in the current year; primarily a result of the
deconsolidation of Levelland Hockley at January 31, 2011. We expect that future
sales of other products will be consistent with those sales we experienced
during the first quarter of fiscal year 2011. We expect that net sales and
revenue in future periods will be based upon production of approximately 100
million to 115 million gallons of ethanol and 300,000 to 320,000 tons of dried
distiller gains per year. This expectation assumes that One Earth will continue
to operate at or near nameplate capacity, which is dependent upon the crush
spread realized.

30

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Gross
profit from these sales was approximately $4.8 million during the first quarter
of fiscal year 2011 compared to $8.5 million during the first quarter of fiscal
year 2010. Gross profit declined primarily as a result of lower crush spreads
realized during the current year compared to the prior year. The crush spread
for the current year was approximately $0.01 per gallon of ethanol sold
compared to the prior year which was approximately $0.42 per gallon of ethanol
sold. This trend was partially offset by the higher selling prices realized for
dried distiller grains. Grain accounted for approximately 86.7% ($66.0 million)
of our cost of sales during the first quarter of fiscal year 2011 compared to
74.1% ($46.3 million) during the first quarter of fiscal year 2010. Natural gas
accounted for approximately 4.8 % ($3.6 million) of our cost of sales during
the first quarter of fiscal year 2011 compared to 8.9 % ($5.5 million) during
the first quarter of fiscal year 2010. Given the inherent volatility in
ethanol, distillers grain and grain prices, we cannot predict the likelihood
that the spread between ethanol, distillers grain and grain prices in future
periods will remain favorable or consistent compared to historical periods.

We
attempt to match quantities of ethanol and distillers grains sale contracts
with an appropriate quantity of grain purchase contracts over a given period of
time when we can obtain an adequate margin resulting from the crush spread
inherent in the contracts we have executed. However, the market for future ethanol
sales contracts is not a mature market. Consequently, we generally execute
contracts for no more than three months into the future at any given time. As a
result of the relatively short period of time our contracts cover, we generally
cannot predict the future movements in the crush spread for more than three
months. Approximately 10% of our forecasted ethanol and distillers grain
production during the next 12 months has been sold under fixed-price contracts.
As a result of these positions, the effect of a 10% adverse change in the price
of ethanol from the current pricing would result in a decrease in revenues of
approximately $23.5 million. Similarly, approximately 7% of our estimated corn
usage for the next 12 months was subject to fixed-price contracts. As a result
of these positions, the effect of a 10% adverse change in the price of corn
from current pricing would result in an increase in cost of goods sold of
approximately $22.7 million.

Selling,
general and administrative expenses were approximately $1.6 million in the
first quarter of fiscal year 2011, a $0.3 million increase from $1.3 million in
the first quarter of fiscal year 2010. Selling related expenses increased at
One Earth from higher commissions and freight charges related to distillers
grains sales, which is the majority of the increase in selling, general and
administrative expenses in the current year. We expect selling, general and
administrative expenses to remain consistent with the first quarter of fiscal
year 2011 results in future periods.

Interest
expense decreased approximately $0.7 million in the current year from the prior
year to $0.6 million. This decrease is primarily a result of including the
results of Levelland Hockley in the prior year but not in the current year.
Based on current interest rates, we expect interest expense in future quarters
to be consistent with the first quarter of fiscal year 2011 levels based on
current debt levels.

31

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Income
from equity method investments in Big River, Patriot and NuGen increased from
$2.8 million in the prior year to $5.8 million in the current year. We
recognized $1.3 million of income from Big River in the first quarter of fiscal
year 2011 consistent with the prior year first quarter. We recognized $0.9
million of income from Patriot in the first quarter of fiscal year 2011
compared to $1.5 million in the first quarter of fiscal year 2010. We
recognized approximately $3.6 million of income from NuGen in the current year;
there was no income recognized in the first quarter of fiscal year 2010 given
that the acquisition of our interest in NuGen was effective July 1, 2010. Big
River and NuGen had successful risk management results and grain procurement
opportunities which aided these entities in posting results equal to or better
than prior year results. The decline in Patriots profitability from the prior
year level is primarily a result of narrowing crush spreads in the current
year. Given the inherent volatility in the factors that affect the crush spread,
we cannot predict the likelihood that the trend with respect to income from
equity method investments will continue in future periods.

Gains
on derivative financial instruments held by One Earth were $0.1 million in the
current year compared to losses of $0.2 million in the prior year. Since the
gains or losses on these derivative financial instruments are primarily a
function of the movement in interest rates, we cannot predict the likelihood
that such gains or losses in future periods will be consistent with current
year results.

As
a result of the factors discussed above, segment profit decreased to $8.4
million in the first quarter of fiscal year 2011 compared to $8.6 million in
the first quarter of fiscal year 2010.

Real Estate

The
real estate segment includes all owned real estate including those previously
used as retail store and distribution center operations, our real estate
leasing activities and certain administrative expenses. It excludes results
from discontinued operations.

At
April 30, 2011, we have lease agreements, as landlord, for all or parts of six
owned former retail stores (67,000 square feet leased and 10,000 square feet
vacant). We have 23 owned former retail stores (293,000 square feet) that are
vacant at April 30, 2011. We are marketing these vacant properties for lease or
sale. In addition, one former distribution center is partially leased (266,000
square feet), partially occupied by our corporate office personnel (10,000
square feet) and partially vacant (211,000 square feet).

Net
sales and revenue increased in the first quarter of fiscal year 2011 to
$332,000 from $250,000 in the first quarter of fiscal year 2010. This increase
is primarily the result of a lease we entered into for a portion of a former
distribution center which began during the fourth quarter of fiscal year 2010.
We expect lease revenue for the remainder of fiscal year 2011 to be consistent
with the first quarter of fiscal year 2011 based upon leases currently
executed.

Gross
loss in the first quarter of fiscal year 2011 was approximately $98,000
compared to approximately $265,000 in the first quarter of fiscal year 2010.
Gross loss improved compared

32

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to the prior
year as a result of fewer vacant properties during fiscal year 2011 compared to
fiscal year 2010. We expect gross loss for the remainder of fiscal year 2011 to
be consistent with the first quarter of fiscal year 2011 based upon leases
currently executed. If we are successful in our marketing efforts related to
vacant properties, we would expect gross profit (loss) to improve over the
first quarter of fiscal year 2011 results.

As
a result of the factors discussed above, segment loss decreased to
approximately $167,000 in the first quarter of fiscal year 2011 from
approximately $327,000 in the first quarter of fiscal year 2010.

Corporate and Other

Corporate
and other includes certain administrative expenses of the corporate headquarters,
interest expense and investment income not directly allocated to the
alternative energy or real estate segments.

Selling,
general and administrative expenses were approximately $660,000 in the first
quarter of fiscal year 2011 compared to approximately $772,000 in the first
quarter of fiscal year 2010. We expect these expenses for the remainder of
fiscal year 2011 to be consistent with the first quarter of fiscal year 2011
results.

Interest
income was approximately $141,000 in the first quarter of fiscal year 2011
compared to approximately $69,000 in the first quarter of fiscal year 2010. The
increase in interest income is primarily a result of interest earned on tax
refunds collected in the first quarter of fiscal year 2011. We expect interest
income in future periods to be lower than the first quarter of fiscal year 2011
results and consistent with historical comparable results.

Liquidity and Capital Resources

Net
cash provided by operating activities was approximately $9.1 million for the
first quarter of fiscal year 2011, compared to $13.8 million for the first
quarter of fiscal year 2010. For the first three months of fiscal year 2011,
cash was provided by net income of $5.6 million, adjusted for non-cash items of
$2.9 million, which consisted of depreciation and amortization, income from
equity method investments, deferred income and the deferred income tax
provision. Dividends received from our equity method investees were $2.3
million in the first quarter of fiscal year 2011. In addition, refundable
income taxes provided cash of $8.5 million, primarily a result of federal tax
refunds received. Accounts receivable and inventory used cash of $0.8 million
and $4.9 million, respectively, a result of higher commodity prices and normal
variations in production and sales levels. An increase in accounts payable
provided cash of $1.1 million which is a result of higher commodity prices and
the timing of vendor payments and inventory receipts.

Net
cash provided by operating activities was approximately $13.8 million for the
first quarter of fiscal year 2010. For the first three months of fiscal year
2010, cash was provided by net income of $5.6 million, adjusted for non-cash
items of $0.2 million, which consisted of depreciation and amortization, income
from equity method investments, deferred income and the

33

---



deferred
income tax provision. Dividends received from our equity method investees were
$0.8 million in the first quarter of fiscal year 2010. In addition, refundable
income taxes provided cash of $6.6 million, primarily a result of federal tax
refunds received. Accounts receivable and inventory provided cash of $1.6
million and $1.3 million, respectively, a result of normal variations in
production and sales levels. The primary use of cash was a decrease in accounts
payable of $1.3 million which is a result of the timing of vendor payments and
inventory receipts.

At
April 30, 2011, working capital was $102.1 million compared to $101.3 million
at January 31, 2011. This increase is primarily a result of cash generated from
operations. The ratio of current assets to current liabilities was 5.0 to 1 at
April 30, 2011 and 5.1 to 1 at January 31, 2011.

Cash
of $0.1 million was used in investing activities for the first quarter of
fiscal year 2011, consistent with cash used during the first quarter of fiscal
year 2010. During the first quarter of fiscal year 2011, we had capital
expenditures of approximately $0.6 million, primarily related to improvements
at the One Earth ethanol plant. We received approximately $0.4 million as
proceeds from the sale of one real estate property.

Cash
of $0.1 million was used in investing activities for the first quarter of
fiscal year 2010. During the first quarter of fiscal year 2010, we had capital
expenditures of approximately $0.6 million, primarily related to improvements
at the Levelland Hockley ethanol plant and certain real estate properties. We
received approximately $0.5 million from Patriot as repayments on their
promissory note.

Cash
used in financing activities totaled approximately $3.1 million for the first
quarter of fiscal year 2011 compared to $12.6 million for the first quarter of
fiscal year 2010. Cash was used by debt payments of $2.8 million, primarily on
One Earths term loans. Stock option activity generated cash of $0.3 million.
We used $0.5 million to repurchase our common stock during the first quarter of
fiscal year 2010.

Cash
used in financing activities totaled approximately $12.6 million for the first
quarter of fiscal year 2010. Cash was used by debt payments of $13.4 million,
primarily on Levelland Hockleys and One Earths term loans. Approximately $9.8
million of the debt payments related to a revolving line of credit at One
Earth. Stock option activity generated cash of $0.8 million.

We
believe we have sufficient working capital and credit availability to fund our
commitments and to maintain our operations at their current levels for the next
twelve months and foreseeable future.

We
plan to seek and evaluate various investment opportunities. We can make no
assurances that we will be successful in our efforts to find such
opportunities.

34

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Forward-Looking Statements

This
Form 10-Q contains or may contain forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. Such statements can be
identified by use of forward-looking terminology such as may, expect,
believe, estimate, anticipate or continue or the negative thereof or
other variations thereon or comparable terminology. Readers are cautioned that
there are risks and uncertainties that could cause actual events or results to
differ materially from those referred to in such forward-looking statements.
These risks and uncertainties include the risk factors set forth from time to
time in the Companys filings with the Securities and Exchange Commission and
include among other things: the impact of legislative changes, the price
volatility and availability of corn, sorghum, distiller grains, ethanol,
gasoline and natural gas, ethanol plants operating efficiently and according to
forecasts and projections, changes in the national or regional economies,
weather, the effects of terrorism or acts of war and changes in real estate
market conditions. The Company does not intend to update publicly any
forward-looking statements except as required by law. Other factors that could
cause actual results to differ materially from those in the forward-looking
statements are set forth in Item 1A of the Companys Annual Report on Form 10-K
for the fiscal year ended January 31, 2011 (File No. 001-09097).

Item 3. Quantitative and Qualitative Disclosures About Market
Risk

We
are exposed to the impact of market fluctuations associated with interest rates
and commodity prices as discussed below.

Interest Rate Risk

We
are exposed to market risk from changes in interest rates. Exposure to interest
rate risk results primarily from holding term and revolving loans that bear
variable interest rates. Specifically, we have approximately $76.5 million
outstanding in debt as of April 30, 2011, that is variable-rate. Interest rates
on our variable-rate debt are determined based upon the market interest rate of
LIBOR plus 275 to 300 basis points. A 10% adverse change (for example from 4.0%
to 4.4%) in market interest rates would affect our interest cost on such debt
by approximately $0.2 million per year in the aggregate.

One
Earth entered into two forward interest rate swaps in the notional amounts of
$50.0 million and $25.0 million with the First National Bank of Omaha during
fiscal years 2008 and 2007. The $50.0 million swap fixed the variable interest
rate of a portion of One Earths term loan at 7.9%, while the $25.0 million
swap fixed the variable interest rate of a portion of One Earths term loan at
5.49%. The swap settlements commenced on July 31, 2009; the $50.0 million swap
terminates on July 8, 2014 and the $25.0 million swap terminates on July 31,
2011. A hypothetical 10% change (for example, from 4.0% to 3.6%) in market
interest rates at March 31, 2011 would change the fair value of the interest
rate swaps by approximately $0.5 million.

Commodity Price Risk

We
generally do not employ derivative instruments such as futures and options to
hedge

35

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our commodity
price risk. Our strategy is to flat price a portion of our electricity and
natural gas requirements, and to purchase the remainder on a floating index. A
sensitivity analysis has been prepared to estimate our exposure to ethanol,
grain and natural gas price risk. Market risk related to these factors is
estimated as the potential change in income resulting from a hypothetical 10%
adverse change in our average corn, natural gas price and ethanol prices as of
April 30, 2011. The volumes are based on our actual use and sale of these
commodities for the quarter ended April 30, 2011. The results of this analysis
are as follows:

|            |  |                                               |            |                  |  |                                         |  |                                         |    |   |   |           | 
|----------- |  | --------------------------------------------- | ---------- | ---------------- |  | --------------------------------------- |  | --------------------------------------- | -- | - | - | --------- | 
|            |  | Volume for the
 Quarter Ended
 April 30, 2011 |            | Unit of
 Measure |  | Hypothetical
 Adverse
 Change in
 Price |  | Approximate
 Adverse
 Change to
 Income |   
|            |  |                                               |            |                  |  |                                         |  |                                         |   
|            |  |                                               |            |                  |  |                                         |  |                                         |    |   |   |           | 
|Natural Gas |  |                                               | 805,366    |                  |  | MMBtu                                   |  |                                         | 10 | % | $ | 352,000   | 
|Ethanol     |  |                                               | 28,163,449 |                  |  | Gallons                                 |  |                                         | 10 | % | $ | 6,597,000 | 
|Corn        |  |                                               | 10,052,247 |                  |  | Bushels                                 |  |                                         | 10 | % | $ | 6,608,000 | 

Item 4. Controls and Procedures

Our
management evaluated, with the participation of our Chief Executive Officer and
Chief Financial Officer, the effectiveness of our disclosure controls and
procedures, as of the end of the period covered by this report. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer concluded
that our disclosure controls and procedures are effective to ensure that
information required to be disclosed by us in the reports that we file or
submit under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commissions rules and forms and is accumulated and communicated to
our management, including our Chief Executive Officer and Chief Financial
Officer, as appropriate, to allow timely decisions regarding required
disclosure.

There
were no changes in our internal control over financial reporting that occurred
during our last fiscal quarter that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.

PART II. OTHER
INFORMATION

Item 1A. Risk Factors

During
the quarter ended April 30, 2011, there have been no material changes to the
risk factors discussed in our Annual Report on Form 10-K for the year ended
January 31, 2011.

36

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Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds

Dividend Policy

We
did not pay dividends in the current or prior years. We currently have no
restrictions on the payment of dividends. Our consolidated and unconsolidated
ethanol subsidiaries have certain restrictions on their ability to pay
dividends to us.

Issuer Purchases of Equity Securities

|                     |  |  |                                |  |                           |       |                                                                                              |  |                                                                                        |  |  |         |  | 
|-------------------- |  |  | ------------------------------ |  | ------------------------- | ----- | -------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------- |  |  | ------- |  | 
|Period               |  |  | Total Numberof SharesPurchased |  | AveragePricePaid perShare |       | Total Number of
 Shares Purchased
 as Part of Publicly
 Announced Plans
 or Programs (1) (2) |  | Maximum Number
 of Shares that May
 Yet Be Purchased
 Under the Plans
 or Programs (1) | 
|                     |  |  |                                |  |                           |       |                                                                                              |  |                                                                                        | 
|February
 1-28, 2011 |  |  |                               |  | $                         |      |                                                                                              |  |                                                                                       |  |  | 468,044 | 
|March 1-31,
 2011    |  |  | 500                            |  |                           | 15.88 |                                                                                              |  | 500                                                                                    |  |  | 467,544 | 
|April 1-30,
 2011    |  |  | 223,536                        |  |                           | 15.90 |                                                                                              |  | 28,606                                                                                 |  |  | 438,938 | 
|                     |  |  |                                |  |                           |       |                                                                                              |  |                                                                                        |  |  |         | 
|Total                |  |  | 224,036                        |  | $                         | 15.90 |                                                                                              |  | 29,106                                                                                 |  |  | 438,938 | 
|                     |  |  |                                |  |                           |       |                                                                                              |  |                                                                                        |  |  |         | 

|    |                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | On October
 7, 2010, our Board of Directors increased our share repurchase authorization
 by an additional 500,000. At April 30, 2011, a total of 438,938 shares
 remained available to purchase under this authorization.                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                            
|(2) | A total of
 194,930 shares of common stock were purchased by us other than through a
 publicly announced plan or program. The shares were acquired on April 13,
 2011 as tenders of the exercise price of stock options exercised by one director
 and two executive officers. The cost of these shares, determined as the fair
 market value on the date they were tendered, was approximately $3,086,000.

Item 6. Exhibits.

The
following exhibits are filed with this report:

| |      |                                                                                                                                                                                                                                              
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4(a) | Fifth Amendment of Construction Loan Agreement dated May 31, 2011
 among One Earth Energy, LLC, First National Bank of Omaha, as a Bank and as
 Administrative Agent, Accounts Bank and Collateral Agent, and the other Banks
 party thereto.
| |      |                                                                                                                                                                                                                                              
| | 31   | Rule
 13a-14(a)/15d-14(a) Certifications                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                              
| | 32   | Section 1350
 Certifications                                                                                                                                                                                                                 

37

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SIGNATURES

Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.

| |                                               
| | ----------------------------------------------
| | REX American
 Resources Corporation
Registrant

|                          |  |                                        |  |             
|------------------------- |  | -------------------------------------- |  | ------------
|Signature                 |  | Title                                  |  | Date        
|                          |  |                                        |  |             
|                          |  |                                        |  |             
|/s/
 Stuart A. Rose       |  | Chairman of the Board                  |  | June 2, 2011
|                          |  | (Chief Executive Officer)              |  |             
|(Stuart
 A. Rose)         |  |                                        |  |             
|                          |  |                                        |  |             
|/s/
 Douglas L. Bruggeman |  | Vice President, Finance
 and Treasurer |  | June 2, 2011
|                          |  | (Chief Financial Officer)              |  |             
|(Douglas
 L. Bruggeman)   |  |                                        |  |             

38

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