Green Plains Partners (GPP) 31 Oct 232023 Q3 Earnings call transcript

Good morning, and welcome to the Green Plains Inc. and Green Plains Partners Third Quarter 2023 Earnings Conference Call. [Operator Instructions]I will now turn the call over to your host, Phil Boggs, Executive Vice President of Investor Relations. Mr. Boggs, please go ahead.

morning, good and you, everyone. Thank Plains Welcome to Green Inc. XXXX Green Partners quarter Plains third earnings call. and call today's Executive Chief Jim on Todd Officer; Stark, Officer. Participants Financial are and Chief Becker, President and you statements is statements, predictions, can page There which the Presentations this are corporate and about projections on Events presentation be call, slide available we under find on will future the a events. it Investor both websites.During other link or and making forward-looking that are on based statements assumptions and expectations These to current uncertainties. subject and are risks could materially Exchange press other the and Form results Commission. call during differ Actual our discussed because XX-Q and in in releases this reports of and today's Risk and made of Form factors Factors filings section and with comments XX-K, Securities conference the not forward-looking duty turn do Becker. undertake to like to any call I'd update the to statement.Now over Todd any We

positive headwinds, momentum continue opportunities see QX. and on gain the some but first-half beyond.The consistent of that thanks an morning, This and quarter the EBITDA to to and into protein market and July We record good that be morning, bringing Thanks, started believe really demonstrate continued we the this and to after real platform's quarter, strong rate reported everyone we focused operations our continued for available. $XX which benefits team we ultra-high today. Phil and our to our joining progressed in ethanol begin results and on we as quarter sales. XX.X% and can of million and executed our and was forward start build in QX to call platform third moving These operating back the of on capabilities rates and into will has were these we very for production

for largely in We higher well fourth has said, every the corn ourselves X we perform quarter, QX, have we headwind we were on our gas have now past five-year look. for significant needs In the buy produce. still although basis or significantly oil corn a of lock been higher in market while basis finished up the the years I pricings, the expanded corn bringing able quarter addition, than as market for on have below the the on focus we are in the than winter As to has the in forward based which and product to average at veg a to market.In QX, the moderated market better open or as generally our reference, to same as margins current during continued quarter, below the at covered positioned in And basis. physical across crop. was we $X.XX remain in areas fourth old the some we our current just last and dynamics own

bushel. -- new in the end Not addition, platform. market In slightly on and quarter.During a ultra-high like production the ethanol only was restarted quarter our that curve when we Wood of is is inverted operating for operated the entire yields our quarter, try pace the platform this at and the on set July always in levels MSC quarter. We we so to our against highs see to negative set did in across higher slight new per always more we are consistent protein reduce the consistently, entire our to achieved and as system rates protein average as and continue the inventories, up late ethanol River record third the remains fourth

our bushel across bushel. process last averaged month original recall X example, in was Shenandoah, pounds investment and our our per that thesis to on per continue over pounds X X pounds X.X we to you for We apply refine learnings locations, based will and

So we out the volumes and decarbonization, online through lower later opportunities JV of some we production, fewer way. veg dive with Tharaldson, our with that largest I will although platform.Our ever achieve than is dynamics -- launch this investments oil we which and continuing that our into but coming Pro, XXXX marketing. are locations clean current we more MSC our XX exciting come targeted be protein will I update call, built, and on in also in ingredient roll slated deeply are XXXX QX facility to you the can and to will originally economics, our sugar other anticipated,

with cash the above platform of plant that. the we Partners. with in improved benefiting With merger today, Green also and liquidity paper third flow our end definitive agreement the from to year quarter flow on stronger even margins our better Plains strong fourth in cash Atkinson free a Our generation sale turning executed month, quarter free to we expect and the yet.Last

process work completion and of the the the continuing are through anticipate We to year. before end

expect transaction hand the you the partnership accretion, in expenses now, and corporate the we flow near-term after reduce on partnership, quality will the of hit and results. for deal and credit the that the our align update call close.And will between to provide Green call Plains We unitholders. overall shareholders but QX simplify cash and it governance, out expense -- will interest SG&A governments financial that generate will earnings be the the an improve strategic and combined proposed to enterprise Jim structure the to I'll There over and QX, one-time some related

attributable third and was consolidated million than the which X.X% approximately ago. quarter lower of the compared revenues everyone. million, is third or morning, $XX.X ethanol year same Todd, distillers of period a The 'XX. to to 'XX lower quarter revenue you, QX Thank good for the grains Plains prices for in as and $XXX.X were lower Green dry

in the but quarter, range reported of we Plains capacity.For loss second stated of was quarter year period. loss for share. net in We the $X.XX anticipate Green Todd in negative $XX.X to rate share to XX.X% same same million, a during run a our per plants mid-XX% targeting the in million the utilization or compared XXXX. $XX perform, XX.X% the quarter or attributable XX.X% per to of our diluted to our period utilization rates year, earlier, As net stated year. period reported this plant for was to $X.XX continue from that improved quarter the That of compares last in million the to rate $XX.X million diluted compares third income the prior the EBITDA significantly $XX.X

at $XX.X million in a We lower crush in realized was Our compared $XX.X million. prior expense for depreciation million amortization and ago negative slightly versus of a year. consolidated 'XX by million QX the $XX.X $X.X year to

$XX.X $XXX.X capitalized XXXX. of for the driven associated interest. well, other businesses.For our million of quarter with fees million of decrease in in the $X.X higher end a for for a quarter, $X.X deferred in buy-in in recording segments tax our $X.X the a quarter, was was to increase This performed benefit legal than Our was quarter, the total tax Ag opportunities and amortization all tax period million result QX compared the EBITDA, loss available includes which in year-over-year third the is prior impact and with which third of quarter.Our XXXX. reduce million, us $XX.X million the same benefit expense carried year. net deferred and the GPP This line which our against allowance in be in reported increase Energy debt to by million year's assets. about driven $XX.X income for allowed to which million prior SG&A was the merchant carryforwards forward At was company those legal to This the tax may tax segment was were by increase quarter. the compared during the assets, our the valuation $X.X of was indefinitely. Interest costs The million the benefit activities

for minority solid, working liquidity $XXX.X around capital which cash, Plains Inc., end continue $XXX to and for should equivalents million our approximately in that included revolver. with the of year our available the million rate cash interest normalized We Green anticipate along excluding remained be quarter restricted the at position XX%.Our under cash tax

growing execution as we platform next well execute favorable are positioned on fundamentals transformation to our strength of industry Our the is and strong financial the to plan. steps due of our

third other safety in capital. capital of our MSC sugar clean million million platform, protein maturities regulatory to $X about approximately build no reminder, $X quarter, Shenandoah growth XXXX borrowing and million million to X.X%.For being across initiatives and X/X quarter the our is debt debt we around locked overall our in until the leading have allocated a we and of rate, and $XX As maintenance, $XX of a fixed initiatives, including during other cost to for at the

to million of slightly the 'XX. the CapEx partnership timing with range in plants.For remainder and will income quarterly a distributable we million $X.XXX the diligently the to ago. the for of million flow million of The adjusted XXXX, MSC we larger ratio Green the for of coverage quarter, million in $XX declared had $X.X $XX.X for the cash same per reported same our continue lower with of on million couple the of $XX.X line Partners, of distribution work a $XX Plains of for quarter, unit at quarter $XX technology permitting net deployment For we X.XXx reported a quarter. of the million anticipate a be as year for an the period than $XX.X The partnership for EBITDA

XX in Todd. flow adjusted million year.Now ratio, distributions $XX.X the adjusted resulting back in made call over cash last months, million, and for the principal of the adjustment the of of payments any the coverage produced X.XXx -- a past has like million, $XX.X turn I'd $XX.X excluding to Over distributable to partnership EBITDA declared

Thanks, Jim.

well all produce consistent our So on our be of at of and again. continues in the those kernel from our protein our each higher renewable that We achieve consistently forward to maximizing tie we pointed back opportunity biorefineries we theme, starting one a making are yields, to business and corn can path and rates to to higher matter. to initiatives of need maximize operate what once ingredients run the corn low-carbon core oil focused

and a the longer automation protein them, to and Madison, than the we states, X ultra-high process on we to continues platform.Today, executive which great be the investing favorable been from we hired Our needed Fairmont, Minnesota across facilities we and and We've care how continues they in pending operating focused outcomes put into our goal correctly. both both making to have take of fully modernization is in technology MSC new to technology. a do have of and that team know leadership it Construction progress are towards thought. the permitting Illinois assets lot and operations aged

remain Yet, achieve our to is per as all starting almost Illinois turnkey the we We be X.X platform. total joint achieve the to achieving addition about the bushel. full of to approximately platform.Our was is with in base permit at in in in higher total some path have will track good tons on grow. our quarter our excited Fluid the venture long over in per be our terms plant consistently the and to quarter production yields a with installation.What XXX,XXX Tharaldson products than over XXX,XXX really of MSC pounds with I'm on yields across improved the will bushel of also path in the are the X of yield plant the Technologies annual to We volume of in at tons of the capacity with MSC to are the higher ever locations could sales entire and continues potential Quip built start-up largest all production that and of daily run, significantly prior we unlock pounds XXXX. our of believe This will first bring commissioning and our

that we Our commercial base with a we always This successfully product our high confirms protein on believed products diverse of work to in is great focused have what customer that produce. all demand. the have sell team we

business new during a this have and to number to to XX% base continue quarter we the We We XX% have of increased opportunities. alone. customers by customer solid access

begin sales protein XX% River XX% We next South Wood product initiative, the things customers that's that America, successful world during to and protein be and third quarter also years. over of delivering the end to the the and going around exciting now Asia.Now and several protein Middle XX% Our executed most full-scale we to selling talk in growing our East a quarter. about are protein is XX% doing and production we're additional protein commercial in important protein one deliver position North to an began the are and because demand quantities Europe, let's the at a to run of fourth

our process as in as systems to scale. great debottleneck to transition We high protein protein to Wood these lined are around XX% something continuing the trials utilized full the XX a learn is and the MSC first XX.X% XX% at as why biologically overall XX% and during mechanically goal business and how large-scale this, for we in several a the in in production job team repeat to production out front quarter. our Once in is XX% unique.We we of both XX% in our with it. business which from diets, to We The of task, the during our achieved have are We the product now the here did consistently XX very XXXX. produced difficult world. we and and River, well as see U.S. have know as starting office have plant can being at the customers we we along ask portfolio around achieving committed additional commercial of product Pro remain dedicating our to to us Pro system

getting digestibility on high-quality the addition already gluten we protein, received updated protein from taste lower value nutritional our of during have. quarter from meal the and corn data and ultra-high we profiles advantage to In relative from CI to mills the wet our our are

what feedstock fourth we we on be we been have corn facilities renewable third during production our quarter in EBITDA for we Now year could look X a a oil turnkey corn in be from $XX to $XXX achieved the opportunity operating, and XXXX partial than quarter running anticipate contributions our fiscal plus platform growing.As will the million we've remains higher several JV, that even at impact XXXX the soybean I protein based coming a don't ultra-high intensity. our producers the Pricing million oil, the EBITDA we of months, you among for maintains of know and production spend great in higher we the corn new in time this you values the most online, choice face its to of lot oil due most as carbon call of advantage diesel renewable product. was about to our crush think a capacity distinct our market. this and during to this at know need need of on QX sold strong everything QX current lower year.In

to of significant are committed carbon are Solutions year towards into beyond.Decarbonization factor developed strategy about We oil million take so per the to most our year happy in premium the corn Four feedstocks. a well continues believe get year we take that can be advantaged that more that. don't we and positive corn crucial gallons opportunities. The advantage participation platform has pursuing. beginning is The XXXX XXX the we're as even Summit to in So renewable believe positioned and sequestration of advantaged and is projects. is oil representing renewable step our industry low-carbon approximately next ignore IRA, we drivers Carbon in facilities we capture

XXXX startup. in now project New indicating at a will We although and gets are gallons. and continue Nebraska, away up on stranded XXXX project million past about many make to the over on for on They right confident Summit this facilities now startup. City, represents appears in Wood completed, and Central great River plants This looking track Navigator this we is noted of that separate the X progress our expect project be end to permitting a are quarter, XXX of project.As CCS a York

decarbonized that which, on.We a eye goes through get the our in only feedstock close we when also We be and SAF capture ethanol be ultimately, keeping milestone we have a crucial fuel, of ingredient from pathways, fuel diversified of are we delineation critical beginning the CI to provides significant storage administration know, our all as drive a XXXX year. further development expect of Decarbonization in end sequestration early of you advantage effect. CI before not and low ethanol will sustainable for XXZ the believe on more the clarity capture into platform a some carbon and in positions fuel produce the having a lower for partnerships expanded ethanol and to to the carbon aviation but

waiting are a at game-changing for We the a installations have to can. We completing our additional drive quickly excluding than we we are XX% have million, anything partial $XXX corn truly of have clean first final only a with starting products.So plans demonstrating our mill JV XXXX base you where $XX and uplift This as to gear. the around for regard For in could about years to pounds forward oil $XXX couple million commercial the we end year business, commercial exceeds lower Shenandoah as looking during technology true anticipated well. of annual renewable and us approaching to XXXX, which to to contributions customers QX a electrical sugar discussions contribution score corn have ongoing out at completion excluding uplift product We Plains.Our the at incumbent in carbon intensity it to of dextrose XXXX, and oil to the which EBITDA capture from million capacity facility XX% of CI be our lower of lower $XXX look Shenandoah, value is track elsewhere the basically could it mechanically well completed market path world's carbon we year depending from to when the million XXX commissioning our plus technology, transformation laid from quarter, the we should have Iowa before as deployed. any we is clean been we base begin by a as our we sugar interest pricing carbon that our time are in on be potential to and value up got wet Tharaldson expand corn sales has the the and and shown disruptive to believe still X Green is it reflects of for that renewable the least protein, our goes, intensity MSC with on facilities the to results we EBITDA does than oil million that brand-new actually the MSC to ago? the veg oil of that how for XX% -- leave of this

Chinese $XX We prices drop, and approximately million see in develops $XX have we'll to business cooking used will credits.Our continue and allow government what impact consistently see oil what in we'll really diesel receive XXXX corporate recently seen to has. generates renewable EBITDA come once if as million And $XX is more $XX the to to SG&A oil projects tax our so and million Energy Ag the annually veg our million. again, online it

Just protein in both marketing as well and our and pre-invested as technology to technology. we be have clear, marketing sugar

off XXXX, be positioning our for a on your for and that's and ethanol other even our QX assumption strategy, fundamentals will proud see the having incremental significant do always So out entire for ready but timing of the operations are we believe we go. core I'm to to most should terms are say, strong demand products value the that us of on from or move from that projects course, together put we pulling own with in we relative critically, when ups startup for solid as incredibly ethanol delivering will completion facilities, kick greater you as success are Yes, focused notwithstanding quarter-to-quarter. to let seasonally for new those margins, additional fully of foreseeable our consistent in we a but well.As markets. products, decarbonization there. into in current possible team and quarter based, platform remain future, we our we see these advantage also I'll of from MSC we normal downs

changes margin to and significant XX from capabilities value-added a with months. commercial our many new maximize team new throughout team many, our hires needed the industry and also organization the a in on for team in over our leadership that the XX new of can leaders senior This distribution wet building executive made that's team products to that in have decades value-added commodity management. has milling We our operations operational built have production We plants. focused marketing expertise leadership past of and who was assembled expertise.We management traditional

this in taking of on as recruiting great new resources human members' we leave of and have also CFO. as are And care talent. can't We our Jim leadership I taking course, team focusing needs out, over

and of challenging we compete be from of inspired out. deliver bench We would knew the many new who results and dedication every sales of a finance management our help week of trade, this from the and across in of with our have by products.We in and humbled all also members on course, passion our in to position team of course, to I'm organization many the week And all leaders to process. execute by transformation us production to to our a great employees organization, technology our to industry nutrition leaders marketing, and plant continue on

Thanks Finally, before joining put call will and before profits do, continuously else foremost, Q&A for safety, I start our commitment that, can.And our anything to I'll is, the leave safety preach of we today, it we we first and I can and there. anytime our this with never employees session.

first Jordan question Levy with Truist is from Securities. Our Instructions] [Operator

maybe economics what mix are are and a the sort talk those we and Maybe customer if things, year getting they you did when months ago? start look versus to versus so like look back it at looking now, just side that's of protein Maybe we start the shaping of into how could or just now seems start the we're of the that if where XX how how time to to how you up, allocations. year on changed

little the on first with prices a lower to we've corn have in paper the financial is better that, protein economics. against talk let's hanging kind of and there about seen gotten basically prices What just economics increasing financial. bit So clearly

during roaring has Now well. structure, margin quarter, back protein well back price weakness for roaring which soybean as the last the as we come but basis, has that as overall overall the affects in quarter, saw meal come the

business good we're Shenandoah with our back, in every calls partnered there. by seen we So higher single all in get it's We relative incumbent optimistic of when selling plant their terms growing for terms volumes our we from the to continues our we've across we're part And from of seeing The and year with uplift general, that of grow as contract to that new volumes our to rates. of to that all competitiveness in well.So relatively of for report, that started company and and product the volumes into base around demand in lot customer showing species market. species.We're continue a our continue product of speaking, see food got price with ago, in we're inclusion use the renewed across more happy and from to We growing pet see XX up uplift we XXXX. the of whole coming even XXX% out products. months

the some to if other sort plants, or carbon ] market And being talk [ the you and of in are around few gave types of the things. commentary the carbon the the the in of of confidence on over just you're able kind to plants side with over other diversification the execute next the I and all maybe some strategy rather. the there recent could you -- then how to continuing moving some to that market and pursue. thinking headlines the about just the you just strategy. the appreciate you Maybe on of years have Maybe of

to pipeline building -- great been to has else I of able to done. They've Nobody core else start with with they've away. the nobody with XX% able secured a do we partner job been new and what that. XX% pipeline Yes, think the Summit strategies right -- our has a

of plants any we're challenges, that they're It's it's they gives early I that They've absolutely and the permit, confident the their to in making normal A have to comes that the that overall permitting, established. with kind believe they they'll building we're be While and uplift massive to which that they And do industry right routing We think Obviously, relative what route to massive certainly lot going of prepared headwinds it's sure just waiting other some fully about to believe local seen of strongly of I their think everything -- get economic we get and it's funding. end. their -- our a Summit volumes, thing need pipeline then without they its not execute. confident raised. raise to just some final pipeline to communities, line overall.And through can and their final makes terms they and project the permit, Iowa Summit about -- where cease and in the advantaged to need. rerouting. is made a Dakota. And the get other that's get also from that early South they'll process pick and an concessions really those confident Dakota, strong in confident we're from North North we're they up of for through the so what well the the team it make really That's in we're they to It's that with negotiate.First we is Iowa more investment. that made obviously continue has running the decided some operations, right Dakota funding takes their the as ability increase standpoint choice. to

really they're far.In had really we and longer, that shareholder favorable be little project will Nebraska, to e-cons our a takes and we're as initiative and So Plains the the believe advantaged great feel there in a our a during so startup will we comes in we to different it bit but drives ] to for And of earlier really terms like like Green a good just for calls but [ early our outlined execution very those significantly Summit capability overall, shareholders. from when then online, well. really the in. carbon really that startup. Maybe XXXX be early especially position discussions, it mentioned e-cons we we're we are position, Those earn

is UBS. The Gupta Manav next from with question

-- was bit help trying it I little you a So more XXZ? also if can by when a oil to bit understand we understand, pullback prices. can treasury of in from little guidance wondering we us seen corn And the -- to a get have as I'm relates when where we could to

think of DX. more of I it's function a

You on, that coming move corn need oil. be of the corn should lot a And LCFS demand up, for prices then as which higher. have would capacity oil

whatever So then more and on understand near- do corn to can provide trying hike? guidance how some see XXZ you you oil medium-term price to --

Yes, Devin thanks. our me I IRA call. have here with led who

him So where on I'll we're on at let that. comment

to will We're XXZ. out by Hey Manav, the with out days. still end rearview XXB they were the the that come going by government and inform by said expecting life of guidance put likely had on that XX. they the modeling in their SAF there that's thinking for mirror the SAF Obviously, year September XX cycle

we're using into could how farm XXZ far guidance the still they're of carbon slip we see As but and and as can year. carbon hope that, next end year, early that the play capture in model optimistic that the by will

Yes.

your have and seen second on and So oil third question move and as drop. from a we we corn LCFS, that to perspective,

values the the unwind due got rally to fourth a at sold meal corn overall we most that I and our highs, of the little higher and oil think market saw bit oil. retreat between We quarter. oil for from of was meal although dynamics

So That impact, down I disgraceful and tax oil, the it ability sure Chinese our States make start-ups.Overall, the United to get cooking I that which into we at some to earn the on we're the as maybe the script renewable thing to was used we away one about and to think the It's we in in credits. is diesel mentioned as at wanted have come we it is big sitting this in happy us and another delays Gulf. downtimes position point. has at that some in locked locked saw least

product as overall pressured we're going down position that overall, given I our think see that.But oil ] we're still closely product, of it start-ups well. plants as that mid-XXs getting stabilize to where against of a defend trading any well. here I we've we our make U.S.-made transpires, a and credits, was think in preloaded think the some prices at very sure ethanol premium to and day. that the as seen watch some against a on And we're of we'll and that [ it But prices I foreign-made newer focused on tax

higher great see high-XXs we're what is of then So overall, RINs And significantly of is pretty just little a California DX the I round I then all economics think still kind not RINs rulemaking agnostic overall, XXs. and sure unhappy that's last those, committed DX, still the LCFS, goal, seen more was to and DX lastly, the it is And that values. well.And the the that, lastly, what EPA of overall, making wins. -- are -- equalization program than those But the And to DX these that. think, and are in you've about and RINs successful. let equalize of was really be

an between is think then kind I and into between a Plains, Green oil the program the will the So available an industry credit the and continues really, all protein carbon moving into an lot we of to mean, just advantaged position as as tax time the and industry, second rebalancing into in obviously between biodiesel XXXX, that we're of XXZ LCFS think time. feedstock not overall RINs, lowest but look, it over we contribution. it's just to be we what And and continue make large think the

market Todd, rally, XQ. you in somewhere full could I'm even if versus clarify? hoping better so the that very fundamentals really this say XQ, are quickly, get you benefit were you at not can for And the of hedged ethanol XQ would you

though margin it, Yes, I in been QX. that been the seen mean come I highs. volatile, off have seen of It's weeks, if couple we've the available think you last better it you've overall structures during watched

watch as export as to aging Wednesday, than a is an seen last highs. million that's a kind the some mentioned. we XXX,XXX of months, for up, basis have day, And for to that. those coming it we definitely million better the more team the little volume. speaking, structure its to is operational adventure, the X wish on off come a have So noise would there of new below old calls, good the margin and over good daily that transpires which what XXX every as of had start is have seen, plants out barrels ethanol. we production. We've at preached the We've several we'll driving small a There's to aged. But demand the assets XX remain got plant operational we that address some hedged bit demand But our faced is what we has trying and our see XX overall, has headwinds well. over But are a about overall, positions we what -- products we team to back watch than is say. of but But some to issues remained our open -- days last -- other management sorry.And to to day, day seen just had got generally and a I of industry solid. have it I've or I prior I hire crush

it's harder run to So just plants. these

on that weekly in seeing you're basis data, think but we're a I EIA generally, stabilized.

ROTH question next MKM. is Craig from with The Irwin

that's in just production majority year you Pro give read year? maybe from the back about said most. Can the the be of XX even end Can I in this Todd, XX High Pro, to maybe maybe over see the you on XX% being of 'XX, to or progressing we potentially you how Pro last ask color up wanted that you So quarter. us

Yes.

and the types is of good out product demand really protein because in. I the interest for the the in we've seeing product. ratios, standpoint, trials And things been a long that those from in that conversion not feed digestibility, but coming think we're are terms only of these of what of we're we seeing what learned quality of product, the

the programs, of make I For market XX us, as non-carbon the when we in new as programs, XXXX for thing move short is time a like this Pro magic the we long a and today, then make think in things time. can non-government-related wand much uptick and takes but products as never starting fast biggest do been term very, to those new what's the to into we to as type about there's can relative in we my and XXXX.Look, could if it XXX% wave product can very

to us. all lead for are going to So Pro roads XX

so scaled as River we our as there. lot higher great last had is we the a point.But those XX problem what learning moving to full We this protein look lot and can of it's around can't at do to what we in the to solve next plant make at of changes. plants a time we're we do look at We But and -- some things ultimately bring have start is go are traditional that's and systems that second some spend there just the keep I It's some it to above of in XX%. at biological, those initiative Pro some basically Pro success commercial We learned quarter. during clear private path of to mechanical. from initiatives but is -- some lot of XX The a XXX% XX% We'll of making up. to need Pro. then of a much time think XX on year we're even range going then Wood that we We it XX% to spent a our before what and scale.

So very do for product you about start getting what what more need about to now. but -- in these you really we're averaging that, calls products.So we're excited is into when which happy really is the we're that

high Asia, for is sold the smaller we've but from in the is going quantities, quantities And East, focused and America well. it's we're this Now into but Pro the larger really digestibility, conversion volumes, there for it's there just really South and XX low-carbon, we're about some feed demand that. United on though, business States, U.S. there, margin excited the commercial is so ratio need Middle to then high-quality, product there, not now time as growing, Southeast take structure

the But potential you renewable the of it maybe give oil model, was the Devin. couple there's week, impact confident D.C. maybe related year? it The So model not look by credits related SAF why carbon the for the my follow-up question, likely fuels gas, potentially open anything on And in whether I anything to changes you about the I and may an finalized the of industry. or color The dialogue mean, is we're that this ethanol? is or lobbyists from that credits there changes this people meeting in Is of suggested end model last they're the revised. green made in looking for one delay way or to in is us is we disadvantaged be would in model. right.Can at the the the or treasury and that [indiscernible] with happened made be Greek just that suggesting that you're the particular, to needs Greek to original have Greek

Yes, tweaking the actually to heard heard something ethanol we've the play Minnesota Craig, so fuel. in He soy-based administration the we all comment that exact on there. that feedstocks gas, the to going play from They're in to aviation indications heard the that model President. we can may in. they renewable be at We've same thing. want He's and able tomorrow. they be the is sustainable will Ultimately, the think We've looking natural ] for arrive that. degree [ at from topic

they place timing there that and to the does are we play Greek at while are model, a looking confident there. be for slip still will us So the updating

Stephens. is question Ben from with next The Bienvenu

facilities. I on wanted offered up and from commentary pick the Todd, to the then that your around Tharaldson X you contribution MSC

what the of about scaling million something kind year's you to determines range help million think it else? Can or us ramping the there? You $XX talked EBITDA. Is and to about production $XXX next of the

timing, Tharaldson, think we gallons it kind there. of what XXX XXX between and at gallon, gets you at, a call and what that it's let's we range. just about a of guided I little to mean happen watching the look Yes. converted, a bit spreads million bit and earlier When gets us it's middle the of $X.XX of little the we it, in soy corn gallons, million plus will right

back ratio of against for it's kind watching and domestic at that meal. saying exports values and we're looking the than better markets for corn sometimes get soy what we So the values of -- the are are just then doing we it domestic also What better in is the are back. included point. not is some soybean of at even this of But this than export. It's XX late. basis -- come that in Pro seen roaring sometimes is meal But volatility we've and as

a gallon the in range range of contribution, put we is it just the of from we outlined then but of go kind we a middle that as kind it, So a there. $X.XX and around that

the you demand there, you're encouraging. clean commissioning technology about overwhelming seeing that is really is second Shenandoah and which talked of question on and sugar My the

in investments think as talk to your do appetite a about bit production, flow and would other we start expanding head the little of of into self-fund you you that? you've made be some that from potentially a your for cash place that can picks down you up the some you pace of about doing to As And your wind XXXX projects already? CapEx as think

Yes.

next is carbon a all working that water, build to don't look look of really But to make need what where locally got at through what's easiest or obviously, Madison are solution, one after to this an resources a electricity there that's expansion of type aren't We Where like that is of we're a speaking, Shenandoah, things. a from we best customers is, and which plan where to that, relatively to on, gas think I that. the plant point. going Is maybe plants Nebraska is look one we have it Or easy sure those all it in? that, Obion be look online? at we'll first after our the fund. to we'll with

see for we that.When well cash at quarter look to we then generation cash how relatively the quarter fourth up lot to we're of -- start now levels, levels. look we'll more. we've high flow the speaking, debt But set going into a we at although balance free cash -- up are our still and we sheet we generating our cash learned have low on we're sheet and what with set generation, balance help this really self-fund So is

is sitting in You still high-rate around saw rate our X% a environment.

New capital is much more expensive.

the to plant would finance be. if we easily months XX well, balance we over as I What have start anything. needed where next to off fund that we #X do to take XX start would of, the can So care say, generation should very should sheet? flow beyond look we assets at to say, free we But that, cash

Samuelson next is Adam The Goldman from Sachs. with question

in [indiscernible] on Adam. I the your wondering quarter? margins could your color actually that is impacted forward? for basis And This and corn expectation what you going provide would be if how was this some has

will proteins. Kadavy. now of quick He's anytime runs to seen, commercial commercializes, have of to all on our the we you. anything operations and and everybody Anything to marketing our all well him it Grant of our all he introduce under and EVP we'll get Operations. introduced be I'll us move a as him platform. him But -- basis calls Yes. of runs and Commercial across wanted our give he's Grant I what today, Grant. let With He'll future comment corn on the

quick the basis. corn So real Grant, on

Sure.

third the we crop new the quarter, from During and did crop. transition old see

the harvest say scenario decrease season, a into crop the see we normalization a then a potential we've normalized So into corn balance through year. for did and basis overall basis. of the quarter, the during the material more would of new in more fourth corn the of Heading I seen

exports, ask be could for your And as forward? going if I outlook will your follow-up, on expectations a where ethanol

a so someday little export capacity, little XXX,XXX we've bit said, is less. someday barrels As seen we a a is day higher, of or

we time. uptake see fuel going and carbon randomly have to really generally, I to the again, price we got the no program ship interesting good an to. going watch drop in volumes started We've lower that opened world see again. then us continues produce we still. where Brazilian out have we That and the think place is the we'll Middle prices U.S., bit.But an market Brazilian of overall, of on you when East, have out the high around starting see on And for this products at exports we We octane But where for Canada obviously, there. globally. low to planet, from a -- and to they're with prices ethanol there what's have we generally also strong watch strong little has at, But but advantage up today. Brazilian a what It's the strong. some sugar world, the again our because EU may

we're our get other some to at So least business able coming way.

levels at So throughout really remain I the year. we'll think those

me. one last And for

has As we've competitiveness? seen how the divergence High prices that soy Pro between and pricing meal, impacted the DDGS

back, has $XXX has well. historically sitting we to book meal and come think our I something at is more you widened weak or quarter wider Nebraska which Well, you've has roaring that quarter, earlier the basis at at soy meal levels, start got spreads then where well. futures viewpoint and [ levels a or to us the sitting Shenandoah like When prices, to margin it rallied that is strong strong able then saw while prices. soy very what back meal gives margins. was in bit I of little we're what ] on Indiana seen areas the the it achieve kind that now quite have distillers have out the $XXX that and Dakota spreads that's think the to as $XXX, North $XXX, strong generally, you've there's -- distillers narrowed has still prices as during But spread some up distillers

today. I overall, we're a think position generally, So better in

The next Craig-Hallum. from with Eric Stine question is

is mean, roughly it's EBITDA that if you that. in I and 'XX, run as better have you end the to in I you ex-ethanol it Not 'XX? commentary carbon somewhere into I of given million $XXX that plus Summit missed I think might capture million know about for gave rate 'XX. mean, the range. know of talked around low and million at for I 'XX, obviously previously $XXX I that $XXX sure range opportunity, upside to a guess get So

it's million, know we Summit million we're on was gave Yes. coming $XXX stands. talking I really 'XX. Nebraska previous to in with start we gave, in but because $XXX to that I don't think what it guidance still it's the advantage in And an 'XX that about

that? XXXX, And take take on margin into put that. Phil, when yields, comments staying when expanded on in take of that, still of top you do have you as the other guidance And so veg top protein ranges. take then you Pro, any when previous that, where you production and overall you get when we ethanol you XX on -- we're oil do

in No, I XXXX that still the Thermal and previously. bring think facilities, that's bullied sometime forward We're we The to Todd. those in XXXX out completing those ranges Madison ]. facilities [ online with right, path new includes

is from question with next of The Tiano Salvator Bank America.

Yes.

wanted I are changes. to made the So aging these and of you firstly, base kind guys asset understand, you about making comments some

assets. on from Can some should also your you the these And years? terms of what meaningful whether us EBITDA CapEx [ next this we to going expect modernize plant? few entails ] in in details contribution spend any provide just You're

to we the rounded We out capabilities have plants just more we to the at get produced But up round was starting quarter And plants. last these produced go. of XX%, to ways what look, still Well, what can CapEx. from this we of quarter a we're XX% these at this unlock X.X%. of

of through that's some And automation. coming

that. bit little a it's do lower, So to cheaper

can permit we're just capability and on expand for to There's coming ethanol that over managing much making rate give less better. what yeast sure to CapEx not maximizing not are operating protein, every going to it's so And making that day. over -- as the down be the in those have it's human high-cost we're XXX% consistently which we we we to were just plants a We we whether going can is permit as whether better fast believe, well. automation, our our and gets have because bit literally can run how capacity, employees a that we for error, hopefully, us room it applied fermenter, -- to we every our obviously, of because enzyme make waiting when headway plant these can much the working unlock full how at on make as make, ultimately headwind and for to at that's we stated these to ethanol much more assets. relative applied more unlock, not much learned, how through I we to applied put operate road. we're as clock I at Illinois, can Madison still day and it's got we or single more of our around held mean, in because plants, we're the not same was want of labor, but back get it times.And automation to

a heard It's have to the I've next -- run you and take team make thing run it a in. is a gear. we brought I all have bit invest the that's like of you when old the uncomfortable so and these analogy harder us of you new ethanol.And people taking And plants level. Ferrari, more to bit So When few it's to don't that some new and team the correct and in times. you a -- in smart for we The us we plants. team a these can really have can part is that when second little this want far why first use

going You to run our as but going can. we've hard know we it to break lot you a a keep get through already. as while so that try you plants, bit, to we're modernize and little going.And they're say then We you done

Now maximize that we're going investment. to

much relative is range? And to Jim, past I our normal what our as previous our our guidance. so don't plans CapEx think CapEx change

CapEx you I big or $XX to million Sal's MSC another and somewhere when we on $XX to million historically, to in answer other growth -- million dextrose CapEx would say look outside or projects initiatives at between $XX the $XX that we million question, maintenance spend have. sugar

range we of capital So spend, in the will modernization, annual $XX that the $XX of upgrades million contain basis. if would we within kind normal take so those the within together on be spend to on you an -- X million will that

we get $XXX around -- CapEx, to be of including capital few really over bit get next year, you one you look historically, that's probably of to not little when would initiatives. minus growth the built what in years. million big during to it's at the look I spent more there little last the from MSCs year.But way certainly down might But next going So or to year, be plus less maintenance a still we're a -- when tell dialed in at in you,

we once flow fund where to plus Also So additional good there's from completed, capital that these forward. remind is about an help are free us that we projects side. going the stays can home $XX feel of partnership you, cash very the million managing

Perfect. And I also side. XX to wanted little a the clarify on bit Pro

you're getting Firstly, the renewals.

some High next it as clarify think Pro. targets your from will comments the upside perhaps but contribution Pro So $XXX -- High And to as that high you from protein Pro million little was a High the to XX% comprise million $XX regarding is -- can there bit there's XX% we year, were QX, XX%, going about secondly, that? sales think I X%, of be

upside can in to whether assumed of in how what will you that the does your terms what get case, What's -- essentially million? be So do upside $XXX -- what's base that we $XX mean and quantify or million not?

Yes.

So much XX full it to Pro, get like uplift. time takes

where rather to market. to can we and we've And adapt market now quantities, the commercial so starts Pro that's make that that. proven to XX The

for it increases of year well, it's of not probably, during percentage. our Pro as XX at the look XX% and we a when to -- the shipping, XXXX goal think XX% probably I platform

gallons we between XX XXX that's look a Tharaldson Pro.Now earnings, market gallons which XX identified roughly outline of if executed and and just gallons, XXX and grow $X.XX you for gave right that's the outlined million guidance all -- and is about year demand about pro million getting at really better million of all about XX that gets enough $XXX our us margin, of now. the to of half if today, When we million have Pro wide guidance, protein about or that we So spread because into fiscal will meal corn the for our XX it's do that the of midrange It's produce. during year. converted we you XXXX the

narrows on that, watching the how much top And of happens. -- the then the in, that, us end that possibly corn how see of uptake range. the gives and higher watching it the going fast top us So Pro lower it on and the depending we watching of And And obviously then XX on what's end there. gives of Argentina range. meal the on if base

the As accelerates grows probably That's year, into upside [indiscernible] the then where it we during is. said, 'XX. towards the it and

from Andrew next BMO. The with is Strelzik question

guess I to levels. respect out far has your of thinking lock changed is corn question prices in your and and anything oil to that the did the you some decision How to willingness on that of much the side how do So on the higher go? at basis? an first And the with ongoing

animal above QX, think that I were some starting for I prices much. out but is look, mean put noticed downtimes. We able and to veg we different market, corn oil but I quarter, sure, But mean, locked wish we we higher, in right? mean, oil it a weaken. We didn't. for the are to we saw -- a I not it in it locked little of just I we very bit there

extend coverage anyway. market mean, the so And I than that much further doesn't

to sales get were most of we able So on. our

nothing to able is IRA credits be oil think against change above pound our 'XX the to view to the steady corn available But we'll all the meal $X.XX all.Our maybe focused view conversion because overall, at and think 'XX today. There's strong volatility. I XXZs dramatic I that with we deal oil of stabilized to on happen. it that in is a our and -- quarter-to-quarter for I fortunate in the the some to online. that. we're once do and generally, starts -- But mean It's $X.XX of and to doesn't have we're oil market advantage and

you And news away the Nebraska and then headlines and you optimism guys have are around the from obviously, of what lot that plant. there's around been a sequestration doing carbon

plants way is, to within question sight Nebraska Or guess, with any of hurdles specifically anything that how those could get plants you are EBITDA those my guess the that there I optimism? the So line the from thinking is the are of about there I left? carbon Or potential in sequestration?

Yes.

funded. think no needed. I is for The of line funding what there. on There's Most our is It's very track. project sight project. needed of that strong is

compression standpoint able been we've to as secure well. then a from and need -- So what we

just lot evaluate lot a -- really which that part we and it's process. so right about -- into not overall, day, have don't And an every So of of Wyoming, the transportable way kind of a it's which what's a of going ready, state to permitting of It's -- then EPA into it. we most happen. that primacy you converting and assets happening has derisked like there has

that's think key. I

those key is Summit confident, to couple we're numbers I I our one then that choice Dakota of like outlined really where It's with in when biggest the to we're at that assets which advantaged which Nebraska for it having project strong great which they're the none from and a the of outlined in persevering to producers is quite different EPA states, is and happens, are permits XX position.So in think if Green go it's the Nebraska, but advantaged to it's the state. standpoint you're why look, discussion, we the they're at XX advantaged still that's XX still or of in backlog in the think day, end of what Summit, which It's well, to advantage a as in going make in still shareholders, is today, permitting, primacy. relative previously the North a Nebraska there. as frankly, we a least why of Plains or

I more And just clarification. one could squeeze then if in

to mentioned in about as contribution there gotten change you the basis? delta X-year better. basis third corn was or roll the can where and it's relative Did much quarter. the Obviously, think in we the the average how forward quantify the or You we

the talk I and Grant a there yet, is but and little I stabilizing. traditional just levels, little let the is, corn where more what getting lows we're from ahead, recently fully maybe the I'll a highest towards kind what think of Nebraska seen go don't but basis, But of key about bit here we've think that we're Iowa Grant. we're

Yes.

that in one lack seen of was production the changes specifically, we've and saw off in a I now Todd had in year we've improved where areas be we of have one is think year-over-year production Nebraska, dramatically. of the coming crop the as had where change to a mentioning, levels Nebraska, we major that production we're greatest

in to levels to bit seen over quite CME. If year were $X in last in again, the high at its corn at was of basis the I'd bushel. well have, off a Basis you excess say, basis Nebraska, $X a we've of close normalized levels come where values look where

I the that you're in slight last you and going think in to return movements basis see puts we to that post saw to and the few see downs going we expect market, sort crop but ups get harvest, don't farmer once years. traditional their of away, the levels we're values

Kristen with Oppenheimer. next is The question from Owen

for Two me. quick ones

protein. on First, MSC

then, soybean mentioned not spread you looking speak much. the bit soybean If And corn of sort over meal corn, versus the to very out stocks ratio, can you little a Todd, DDGs. tight, so

So willing wanted just for to XXXX? how lock ask you're to pricing much in

awarded business price basis. of people other -- lot business few to most for that on again. the are don't see redid plenty of XXXX flat longer-term than a the sales to Well, extended we of Kind corn spread were on more it DDGs has quarter-by-quarter, when from for customers the like A pet is between lot move starting We strong, meal to and continues means and it of look you is out of even done year. which strong. than meal the remains whole forward, basis and forward, done against a remain out our

well to the that out spread. You go a April further or ton all than and can $XXX go out way you're over

business short. does.But oil So we'll of playing thesis this we've a had relative we genetics soy. and way developed corn over was to thesis I indicated, out see have and that kind mean and world corn that was -- long as acres the advantaged we've to and it's protein the that the wait playing we've yields our what That tightness outlined. in a short that it's -- world's with in time, and is

was kind out nicely. through it's So the We of it years playing some went where opposite.

were ramping up. of remember So as kind we

what's Some that finally, of of think USDA was last it's while.And this that a But readjusted XXX that saw kind we'll state. acreage the XXXX. And next and look for at But And like shift change to the it even will any at doesn't what's look a thing I given numbers. advantaged going is current the stay blade much. for big I as point, in even days. And was the we've around the opposite we to in think happening.

that we're position. pretty So happy about

apologies of just backdrop year? own. talk markets no related advantage a an where half discussion there, a of the additional up except the if and of favorable sort the And corn, first about sugar how are you discuss about question, of scaled then if I'm you but And bit in given just you just offtake you terms get dextrose, talking little Shenandoah your the coming the there? can capacity did in for this, wondering for quickly online can

Yes.

that to So corn the bushel. prices, relative a lower towards relatively $X they're high still

So on remained players. been traditional allocation who strong. dextrose the they've has us from customers say We've steady call seen put pricing to

the from growing then is something and ours with demand the confectionery the and into hit from demand, Offtakes, -- at we window I frankly, candy want point beverage you Fort a quite at this position. MSC, and make that.But all definitely so way down are learned there's from that we or brand-new you in So take -- chemical pounds use sheet not be on, because year. correctly expected. probably one next a have that was, dextrose demand dramatically years the to generally, few strong other we a we're we're XXXX, in -- a out coming negotiating supply think I and over for there's longer going customers as sure technology to It's several XXX project like Dodge changed we announced and balance commissioning than million we ago think, to

going end So generally motto we're to on of going -- ours. going you discussions bit bit of you, are we speaking, of a enough I kind tell to negotiate.As spoken production But of of be to very And -- I careful. we the this we done that most trying say, some get happen. a in have by that we're will we think our produce is our, that we'll and for for year a it's as get the to a XXXX of if of

have us going be from product buying if elsewhere. arrangement that we're that we a -- won't look you use we'll dextrose, or we you and else then to you buy dextrose buy products bilateral from you'll If the

of using feel operations. So into lot made buy our we like a dextrose we product that's

first our but good And we so have partners. rate that's --

position bilateral some have finally it's and we not as where that markets half well. year other It's our first certified get to grade certainly extras we it's the anything beverage is -- believe food we're up arrangements last will a scale not So that's we in that's and that really the antagonistic. and -- in the just of the fact not then more and move go into as a

that going about XX think a happy to of and as great So can we we're see, years. are really that to And that.As we're more X more in there's you of take well technologies tons position. new or are lots new over dextrose online next coming the just

the platform its margin really is the world to the -- first structure do. nothing can stronger at will dextrose quarter. there's a make what than next plant and We will And is margin structure kind from in extreme of the show happen our world this there

this Todd turn closing it I'll to Becker At time, for No further questions. remarks. any

could A business, questions. have Well, I We of for thanks like core think more unlock our which feel lot patient us. in a had being cover. a to on track. we We're to We that's lot with that more momentum focus more really starting getting we getting terms of wish on but gain go more grains, technologies. we renewed more. alcohol, oil, our Yes, getting faster in in building on distillers to new

And that products. And Shenandoah the We've op decommission in it. some we clean and all the for the the of for demand have of starting initiatives. our start first quarter, demand identified changer. is into plant, to in transpire earnings that's to carbon from then really great and game 'XX sugar We get see we next our

to So overall a but this on well. on was returning like the there track. board, I back to win operations normal, good more unlock feel quarter to a as get

all So support, next you and we appreciate quarter. we'll see you. Thank your

This for conference concludes you participating. Thank today's call.

now You may disconnect.