REX American Resources Corporation

What they do

REX owns 76.1% of One Earth Energy (Gibson City, IL) and 99.7% of NuGen Energy (Marion, SD), both consolidated, plus minority interests of 10.3%, 10.3%, 5.7% and 10.3% in four Big River Resources plants in Iowa, Illinois and Wisconsin. The six plants together shipped about 722 million gallons of ethanol in the year ended January 31, 2026, of which REX's effective share was roughly 294 million gallons. Plants convert corn into ethanol and sell by-products including dried distillers grains and distillers corn oil, and REX hedges corn, natural gas and product prices with forward contracts and futures.

Revenue drivers

• Ethanol — The core product; consolidated plants (One Earth and NuGen) sell denatured ethanol, with REX's consolidated operations selling 141.7 million gallons in the six months ended July 31, 2026 at an average $1.72 per gallon net of hedging.
• Dried distillers grains — Feed by-product sold by the consolidated plants; 300,113 tons sold in the first six months of fiscal 2026 at an average $161.03 per ton, up from $144.66 a year earlier.
• Distillers corn oil — Smaller by-product stream; 48.2 million pounds sold in the first half of fiscal 2026 at an average $0.63 per pound versus $0.50 a year earlier.
• Section 45Z production tax credits — Credits earned on ethanol production flow through as production tax credit income; the company reported $18.4 million net of estimated monetization expenses in the second quarter of 2026 as a direct contribution to gross profit.

Recent performance

In fiscal 2026 REX reported revenue of $650.5 million, net income of $83.0 million and diluted EPS of $2.50, versus $642.5 million, $58.2 million and $1.65 in fiscal 2025. For the second quarter ended July 31, 2026, net sales and revenue were $168.5 million, gross profit was $53.3 million versus $14.3 million a year earlier, and net income attributable to REX was $34.9 million, or $1.06 per diluted share, versus $0.22. Income before income taxes and noncontrolling interests was $48.1 million for the quarter versus $12.1 million in the prior-year quarter, with the company citing improved crush margins and 45Z tax credits. At July 31, 2026, REX reported $379.5 million of cash, cash equivalents and short-term investments and no bank debt.

Strategy

REX is concentrating capital on its One Earth complex: a carbon capture and sequestration project and an ethanol capacity expansion at Gibson City. The EPA issued a draft Class VI injection well permit for three wells on August 17, 2026, opening a public comment period; construction of the capture and compression facility is complete but testing is not, and no CO2 pipeline or well can be built until further permits are received. One Earth has an EPA construction permit to expand from 150 million to 175 million gallons per year, with a further permit targeted for 200 million gallons, and the company expects the expansion to become operational during fiscal 2026. Capital expenditures to date on the carbon capture project and related expansion total $191.2 million. The company has also completed the construction phase of the expansion and is working through commissioning.

Risks

• Crush spread volatility — Plant margins depend on the spread between ethanol, distillers grains, distillers corn oil and corn prices, and the company states that at times plants may run at negative or minimally positive operating margins.
• Corn price and supply exposure — Corn is the principal raw material and rising prices raise production costs that may not be passed through to customers, since ethanol competes with non-corn-based fuels.
• Limited hedging horizon — Fixed-price contracts generally extend no more than four months forward, so management says it cannot predict the realized crush spread or the likelihood of future income or loss beyond that window.
• Permitting-dependent carbon project — The One Earth sequestration project still requires final federal, state and county permits and the company has acknowledged no assurance of ultimate success or timing after investing $191.2 million to date.

Outlook

Management points to the One Earth capacity expansion becoming operational during fiscal 2026 and to the Class VI draft permit as milestones advancing its long-term strategy. Results remain tied to crush margins and to the Section 45Z production tax credit, which added $18.4 million to second-quarter gross profit and helped lower the effective tax rate in fiscal 2025. The company says it continues to work on the carbon sequestration project with the agencies involved and cannot begin pipeline construction until further approvals are received.