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What changed in Green Plains Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Green Plains Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+367 added−360 removedSource: 10-K (2025-02-07) vs 10-K (2024-02-09)

Top changes in Green Plains Inc.'s 2024 10-K

367 paragraphs added · 360 removed · 288 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

67 edited+25 added−24 removed28 unchanged
Biggest changeWe also transport renewable corn oil by rail and barges to national markets as well as to exporters for shipment on vessels to international markets. 10 Table of Contents Through Green Plains Trade, we provide marketing services of natural gas to our ethanol plants and to other third parties including the procurement of both the pipeline capacity and natural gas.
Biggest changeThrough Green Plains Trade, we provide marketing services for our ten ethanol plants for all of the co-products produced at these locations as well as market ethanol for a third party and also provide marketing services to our ethanol plants for natural gas procurement.
We market distillers grains and high protein ingredients to local, domestic and international markets through Green Plains Trade. The bulk of our demand is delivered to geographic regions that do not have significant local corn, distillers grains or high protein ingredients production. We sell to international markets indirectly through exporters.
We market distillers grains to local, domestic and international markets through Green Plains Trade. The bulk of our demand is delivered to geographic regions that do not have significant local corn, distillers grains or high protein ingredients production. We sell to international markets indirectly through exporters.
To that end, we are currently executing on a number of initiatives to develop and implement proven agricultural, food and industrial biotechnology systems that allow for product diversification, new market opportunities and production of additional value-added low-carbon ingredients, such as Ultra-High Protein, dextrose, renewable corn oil and more, as well as offering these technologies to the broader biofuels industry.
To that end, we are currently executing on a number of initiatives to develop and implement proven agricultural, food and industrial biotechnology systems that allow for product diversification, new market opportunities and production of additional value-added low-carbon ingredients, such as Ultra-High Protein, low-CI dextrose, renewable corn oil and more, as well as offering these technologies to the broader biofuels industry.
In July 2023, we announced a technology collaboration with Equilon Enterprises LLC, which allows us to use FQT’s precision separation and processing technology with Shell Fiber Conversion Technology. The two technologies will combine fermentation, mechanical separation and processing, and fiber conversion into one platform.
In July 2023, we announced a technology collaboration with Equilon Enterprises LLC, which allows us to use FQT’s precision separation and processing technology with Shell Fiber Conversion Technology. The two technologies combine fermentation, mechanical separation and processing, and fiber conversion into one platform.
Over our history, we have incorporated new technologies like renewable corn oil extraction and Selective Milling Technology™ into our manufacturing processes that have enabled us to run more efficiently and improve our financial results.
Over our history, we have incorporated new technologies like renewable corn oil extraction and Selective Milling Technology™ into our manufacturing processes that have enabled us to run more efficiently and improve our yields and financial results.
Our distillers grains and high protein feed ingredients compete against other feed ingredients including soybean meal, canola meal, ground corn, corn gluten meal and distillers grains from other ethanol producers domestically and abroad.
Our distillers grains and Ultra-High Protein feed ingredients compete against other feed ingredients including soybean meal, canola meal, ground corn, corn gluten meal and distillers grains from other ethanol producers domestically and abroad.
Regulatory Matters Government Ethanol Programs and Policies We are sensitive to governmental policies that impact ethanol, feedstocks for renewable fuels and decarbonization, which in turn may impact the volume of ethanol and other ingredients we produce. Legislation and regulatory rule making at the federal, state and international level can impact us across all business segments.
Regulatory Matters Government Ethanol Programs and Policies We are sensitive to domestic and foreign governmental policies that impact ethanol, feedstocks for renewable fuels and decarbonization, which in turn may impact the volume of ethanol and other ingredients we produce. Legislation and regulatory rule making at the federal, state and international level can impact us across all business segments.
We are one of the largest ethanol producers in North America. • Agribusiness and Energy Services. Our agribusiness and energy services segment includes grain procurement, with approximately 20.2 million bushels of grain storage capacity, and our commodity marketing business, which markets, sells and distributes the ethanol, distillers grains, Ultra-High Protein and renewable corn oil produced at our ethanol plants.
We are one of the largest ethanol producers in North America. • Agribusiness and Energy Services. Our agribusiness and energy services segment includes grain procurement, with approximately 20.2 million bushels of grain storage capacity, and our commodity marketing business, which markets, sells and distributes the ethanol, distillers grains and renewable corn oil produced at our ethanol plants.
Our internally developed operating margin management system allows us to monitor commodity price risk exposure in the spot market and on the forward curve at each of our operations and seeks to lock in favorable margins, when available, or if appropriate, temporarily reduce production levels during periods of compressed margins. Technology Integration.
Our internally developed operating margin management system allows us to monitor commodity price risk exposure in the spot market and on the forward curve at each of our operations and helps us to lock in favorable margins, when available, or if appropriate, temporarily reduce production during periods of compressed margins. Technology Integration.
Our ethanol production segment includes the production of ethanol, distillers grains, Ultra-High Protein and renewable corn oil at ten biorefineries in Illinois, Indiana, Iowa, Minnesota, Nebraska and Tennessee.
Our ethanol production segment includes the production, storage and transportation of ethanol, distillers grains, Ultra-High Protein and renewable corn oil at ten biorefineries in Illinois, Indiana, Iowa, Minnesota, Nebraska and Tennessee.
At capacity, our facilities are capable of processing approximately 310 million bushels of corn per year and producing approximately 903 million gallons of ethanol, 2.2 million tons of distillers grains and Ultra-High Protein, and 300 million pounds of renewable corn oil, a low-carbon feedstock for biodiesel and renewable diesel.
At capacity, our facilities are capable of processing approximately 310 million bushels of corn per year and producing approximately 903 million gallons of ethanol, 2.2 million tons of distillers grains and Ultra-High Protein, and 310 million pounds of renewable corn oil, a low-carbon feedstock for biodiesel, renewable diesel and sustainable aviation fuel.
Compliance with existing and anticipated environmental laws and regulations may increase our overall cost of doing business, including capital costs to construct, maintain, operate and upgrade equipment and facilities. Our business may also be impacted by government policies, such as tariffs, duties, subsidies, import and export restrictions and outright embargos.
Compliance with existing and anticipated environmental laws and regulations may increase our overall cost of doing business, including capital costs to construct, maintain, operate and upgrade equipment and facilities. Our business may also be impacted by domestic and foreign government policies, such as clean fuel programs, tariffs, duties, subsidies, import and export restrictions and outright embargos.
We use forward contracts to sell a portion of our ethanol, distillers grains, Ultra-High Protein and renewable corn oil production or buy some of the corn, natural gas, or ethanol we need to partially offset commodity price volatility.
As market conditions warrant, we use forward contracts to sell a portion of our ethanol, distillers grains, Ultra-High Protein and renewable corn oil production or buy some of the corn, natural gas, or ethanol we need to partially offset commodity price volatility.
The solids, or wet cake, that exit the centrifuge are conveyed to the dryer system and dried at varying temperatures to produce distillers grains. Syrup is reapplied to the wet cake prior to drying to provide additional nutrients.
The solids, or wet cake, that exit the centrifuge are conveyed to the dryer system and dried at varying temperatures to produce 9 Table of Contents distillers grains. Syrup is reapplied to the wet cake prior to drying to provide additional nutrients.
We also market ethanol for a third-party producer as well as buy and sell ethanol, distillers grains, Ultra-High Protein, renewable corn oil, grain, natural gas and other commodities in various markets. • Partnership.
We also market ethanol for a third-party producer as well as buy and sell ethanol, distillers grains, renewable corn oil, grain, natural gas and other commodities in various markets.
We continue the transition from a commodity-processing business to a value-added agricultural technology company creating sustainable, high-value ingredients from existing resources.
We continue the transition from a commodity-processing business to a value-added agricultural technology company creating lower carbon, high-value ingredients from existing resources.
Reducing the CI of our fuel ethanol could allow us to benefit from state and federal clean fuel programs, including LCFS and federal tax credits under the IRA, and could position our low-carbon ethanol as a potential feedstock for ATJ pathways to produce SAF.
Reducing the CI of our ethanol could allow us to benefit from state, federal and foreign clean fuel programs, including LCFS programs at the state level and federal tax credits under the IRA, including the 45Z Clean Fuel Production Credit, and could position our low-carbon ethanol as a potential feedstock for ATJ pathways to produce SAF.
Access to diversified markets allows us to sell product to customers offering the highest net price. Also, through Green Plains Trade, our renewable corn oil is sold primarily to renewable diesel and biodiesel plants and, to a lesser extent, feedlot and poultry markets.
Access to diversified markets allows us to sell product to customers offering the highest net price. Our renewable corn oil is sold primarily to renewable diesel and biodiesel plants and, to a lesser extent, feedlot and poultry markets.
Risk management is a core competency and we use a variety of risk management tools and hedging strategies in an effort to maintain a disciplined approach.
Risk management is a core competency and we use a variety of sophisticated risk management tools and hedging strategies to maintain a disciplined approach.
This has the potential to create a new process to liberate all available distillers corn oil currently bound in the fiber fraction of the corn kernel, generate cellulosic sugars for production of low-carbon ethanol, and enhance and expand available high protein to produce high-quality ingredients for global animal feed diets.
This has the potential to liberate all of the remaining distillers corn oil currently bound in the fiber fraction of the corn kernel, generate cellulosic sugars for production of low-carbon ethanol, and enhance and expand available high protein to produce high-quality ingredients for global pet, livestock and aquaculture diets.
Our collaboration is expected to complete the construction of a facility at Green Plains York and begin commissioning in early 2024. Competitive Strengths We are focused on managing commodity price risks, improving operational efficiencies and optimizing market opportunities to create an efficient platform with diversified income streams. Our competitive strengths include: Disciplined Risk Management .
Our collaboration completed the construction of a large demonstration facility at Green Plains York and began commissioning during 2024. Competitive Strengths We are focused on managing commodity price risks, improving operational and transportation efficiencies and optimizing market opportunities to create an efficient platform with diversified income streams. Our competitive strengths include: Disciplined Risk Management .
As part of our carbon reduction strategy, we committed our seven biorefineries in Nebraska, Iowa and Minnesota to carbon capture and sequestration projects through carbon pipeline transport, four with Summit Carbon Solutions and our three Nebraska biorefineries with another provider, which will lower GHG emissions through the capture of carbon dioxide at each of these biorefineries, significantly lowering their CI.
As part of our carbon reduction strategy, we committed our seven biorefineries in Nebraska, Iowa and Minnesota to carbon capture and sequestration projects through carbon pipeline transport, our four Iowa and Minnesota facilities with Summit Carbon Solutions and our three Nebraska biorefineries with Trailblazer CO2 Pipeline LLC, which will lower GHG emissions through the capture of biogenic carbon dioxide at each of these biorefineries, significantly lowering their CI, in some cases by more than half.
According to the USDA, on average, a 56 pound bushel of corn produces approximately 2.9 gallons of ethanol, 17 pounds of dried distillers grains and 0.6 pounds of corn oil. Outside of the United States, sugarcane is the primary feedstock used to produce ethanol.
According to the USDA, on average, a 56 pound bushel of corn produces approximately 2.9 gallons of ethanol, 17 pounds of dried distillers grains and 0.6 pounds of corn oil.
For more information on our partnership, please visit www.greenplainspartners.com . Alternatively, investors may visit the SEC website at www.sec.gov to access our reports, proxy and information statements filed with the SEC.
Alternatively, investors may visit the SEC website at www.sec.gov to access our reports, proxy and information statements filed with the SEC.
Additionally, ATJ technologies are emerging and being commercialized that use low-CI ethanol as a feedstock to produce SAF. In January 2023, Green Plains, United Airlines and Tallgrass formed a joint venture, Blue Blade Energy, to develop and then commercialize a novel ATJ SAF technology.
Additionally, ATJ technologies are emerging and being 5 Table of Contents commercialized that use low-CI ethanol as a feedstock to produce SAF. In January 2023, Green Plains, United Airlines and Tallgrass formed a joint venture, Blue Blade Energy, to explore development and commercialization of ATJ SAF.
Deliveries within 150 miles of our plants and the partnership’s fuel terminal facilities are generally transported by truck. Deliveries to distant markets are shipped using major U.S. rail carriers that can switch cars to other major railroads, allowing our plants to ship product throughout the United States and to international export terminals.
Deliveries to distant markets are shipped using major U.S. rail carriers that can switch cars to other major railroads, allowing our plants to ship product throughout the United States and to international export terminals.
We have service agreements to acquire the natural gas we need and transport the gas through pipelines to our plants. Electricity . Our plants require on average approximately 0.9 kilowatt hours of electricity per gallon of production. Local utilities supply the necessary electricity to all of our ethanol plants. Water .
Depending on production parameters, our ethanol plants use on average approximately 28,000 BTUs of natural gas per gallon of production. We have service agreements to acquire the natural gas we need and transport the gas through pipelines to our plants. Electricity . Our plants require on average approximately 0.9 kilowatt hours of electricity per gallon of production.
The grain is used as feedstock for our ethanol plants. Bulk grain commodities are traded on commodity exchanges and inventory values are affected by changes in these markets.
We buy bulk grain, primarily corn, from area producers, and provide grain drying and storage services to those producers. The grain is used as feedstock for our ethanol plants. Bulk grain commodities are traded on commodity exchanges and inventory values are affected by changes in these markets.
Agribusiness and Energy Services Segment Our agribusiness and energy services segment includes grain storage at our ethanol plants of approximately 20.2 million bushels, detailed in the following table: Facility Location On-Site Grain Storage Capacity (thousands of bushels) Central City, Nebraska 1,400 Fairmont, Minnesota 1,611 Madison, Illinois 1,015 Mount Vernon, Indiana 1,034 Obion, Tennessee 8,168 Otter Tail, Minnesota 628 Shenandoah, Iowa 886 Superior, Iowa 1,770 Wood River, Nebraska 3,293 York, Nebraska 363 Total 20,168 We buy bulk grain, primarily corn, from area producers, and provide grain drying and storage services to those producers.
The company owns and operates one fuel terminal with a storage capacity of approximately 180 thousand gallons and throughput capacity of approximately 40 mmgy. 10 Table of Contents Agribusiness and Energy Services Segment Our agribusiness and energy services segment includes grain storage at our ethanol plants of approximately 20.2 million bushels, detailed in the following table: Facility Location On-Site Grain Storage Capacity (thousands of bushels) Central City, Nebraska 1,400 Fairmont, Minnesota (1) 1,611 Madison, Illinois 1,015 Mount Vernon, Indiana 1,034 Obion, Tennessee 8,168 Otter Tail, Minnesota 628 Shenandoah, Iowa 886 Superior, Iowa 1,770 Wood River, Nebraska 3,293 York, Nebraska 363 Total 20,168 (1) Plant idled in January 2025.
We transport our renewable corn oil by truck to locations in a close proximity to our ethanol plants primarily in the southeastern and midwestern regions of the United States.
We transport our renewable corn oil by truck to locations in a close proximity to our ethanol plants primarily in the southeastern and midwestern regions of the United States. We also transport renewable corn oil by rail and barges to national markets as well as to exporters for shipment on vessels to international markets.
We also enhance the value by aggregating volumes at various storage facilities which can be sold to either the plants or various intermediary markets and end markets.
We provide marketing services of natural gas to our ethanol plants including the procurement of both the pipeline capacity and natural gas. We also enhance the value by aggregating volumes at various storage facilities which can be sold to either the plants or various intermediary markets and end markets.
Ethanol has become a valuable blend component that comprises approximately 10.1% of the domestic surface transportation gasoline supply with the potential to grow with higher blending rates. Additionally, government incentives to produce SAF through ATJ pathways could provide additional demand for low-CI ethanol for conversion to SAF.
Business Strategy Ethanol is a valuable low CI oxygenate that comprises approximately 10.1% of the domestic surface transportation gasoline supply in the U.S. with the potential to grow with increased offering of higher blends, including E15 and E85. Additionally, government incentives to produce SAF through ATJ pathways could provide additional demand for low-CI ethanol for conversion to SAF.
As part of our transformation to a value-added agricultural technology company, we began producing Ultra-High Protein using FQT's MSC™ technology in 2020 and are deploying this technology across various locations to help meet growing demand for protein feed ingredients and low-carbon renewable corn oil.
As part of our transformation to a value-added agricultural technology company, we began producing Ultra-High Protein using FQT's MSC™ technology in 2020 and have deployed this technology across half of our biorefinery locations, in addition to one joint venture, to help meet growing demand for protein feed ingredients and low-carbon renewable corn oil to use as a feedstock for producing advanced biofuels such as renewable diesel, biodiesel and SAF, as the MSC™ technology enhances renewable corn oil yields.
Plant Location Plant Production Capacity (mmgy) Central City, Nebraska (1) 116 Fairmont, Minnesota 119 Madison, Illinois 90 Mount Vernon, Indiana (1) 90 Obion, Tennessee (1) 120 Otter Tail, Minnesota 55 Shenandoah, Iowa (1) 82 Superior, Iowa 60 Wood River, Nebraska (1) 121 York, Nebraska 50 Total 903 (1) Produces Ultra-High Protein. 8 Table of Contents Our business is directly affected by the supply and demand for ethanol and other fuels in the markets served by our assets.
Plant Location Plant Production Capacity (mmgy) Central City, Nebraska (1) (2) 116 Fairmont, Minnesota (3) (4) 119 Madison, Illinois 90 Mount Vernon, Indiana (1) 90 Obion, Tennessee (1) 120 Otter Tail, Minnesota (3) 55 Shenandoah, Iowa (1) (3) 82 Superior, Iowa (3) 60 Wood River, Nebraska (1) (2) 121 York, Nebraska (2) 50 Total 903 (1) Produces Ultra-High Protein.
We accomplish this, in part, by our competitive compensation practices, training initiatives, and growth opportunities within the company. On December 31, 2023, we had 921 full-time, part-time, temporary and seasonal employees, including 170 employees at our corporate office in Omaha, Nebraska.
Human Capital Resources Attracting, retaining and developing talented employees is essential to our success. We accomplish this, in part, by our 12 Table of Contents competitive compensation practices, training initiatives, and growth opportunities within the company. On December 31, 2024, we had 923 full-time, part-time, temporary and seasonal employees, including 144 employees at our corporate office in Omaha, Nebraska.
We completed a modernization and upgrade initiative at four facilities in 2021 and two facilities in 2022, resulting in improved operational reliability and reductions in natural gas, electricity and water usage, decreasing our carbon footprint. Through our ownership of FQT and other partnerships, we are currently undergoing a number of initiatives to further improve margins.
We completed a modernization and upgrade initiative at four facilities in 2021 and two additional facilities in 2022, resulting in improved operational reliability and reductions in natural gas, electricity and water usage, decreasing our operating expenses and carbon footprint.
FQT CST™ allows for the production of both food and industrial grade low-carbon glucose and dextrose at a dry mill ethanol plant to target applications in food production, renewable chemicals and synthetic biology. We also anticipate modifying additional biorefineries to include FQT CST™ production capabilities to meet anticipated future customer demands.
FQT’s CST™ allows for the production of both food and industrial grade low-carbon glucose and dextrose at a dry mill ethanol plant to target applications in food production, in addition to serving as a feedstock for renewable chemicals and synthetic biology.
Ethanol is a significant component of the biofuels industry, which includes all transportation fuels derived from renewable biological materials. Ethanol is an excellent oxygenate and source of octane. When added to petroleum-based transportation fuels, oxygenates reduce vehicle emissions. Ethanol is the most economical oxygenate and source of octane available on the market and its production costs are competitive with gasoline.
Outside of the United States, sugarcane is the primary feedstock used to produce ethanol. 8 Table of Contents Ethanol is a significant component of the biofuels industry, which includes all transportation fuels derived from renewable biological materials. Ethanol is an excellent oxygenate and source of octane. When added to petroleum-based transportation fuels, oxygenates reduce vehicle emissions.
In September 2022, we broke ground at our biorefinery in Shenandoah, Iowa, as the first location to deploy FQT's CST™ at commercial scale, which is expected to begin commissioning in the first quarter of 2024.
In September 2022, we broke ground at our biorefinery in Shenandoah, Iowa, as the first location to deploy FQT's CST™ at commercial scale, and during 2024 the company achieved successful ongoing production of dextrose syrups with CST™.
Demand for corn from ethanol plants and other corn consumers exists in all areas and regions in which we operate. According to the Renewable Fuels Association, there were 115 operational plants in Illinois, Indiana, Iowa, Minnesota, Nebraska and Tennessee, which are the states where we have production facilities as of December 31, 2023.
According to the Renewable Fuels Association, there were 117 operational plants in Illinois, Indiana, Iowa, Minnesota, Nebraska and Tennessee, which are the states where we have production facilities as of December 31, 2024. The largest concentration of operational plants is located in Iowa, Nebraska and Illinois, where approximately 50% of all operational production capacity is located.
Local municipalities supply all of the necessary water for our plants that do not have onsite wells. Most of the water used in an ethanol plant is recycled in the production process.
Each facility either uses city water or operates a filtration system to purify the well water that is used for its operations. Local municipalities supply all of the necessary water for our plants that do not have onsite wells. Most of the water used in an ethanol plant is recycled in the production process. Transportation, Delivery and Terminal Services .
Industrial uses for renewable corn oil are primarily as a feedstock for renewable diesel and biodiesel. Additionally, it is also used as a livestock feed additive. 9 Table of Contents Natural Gas . Depending on production parameters, our ethanol plants use on average approximately 27,500 BTUs of natural gas per gallon of production.
Across our entire platform, we extract on average approximately 1.0 pound of renewable corn oil per bushel of corn used to produce ethanol. Industrial uses for renewable corn oil are primarily as a feedstock for renewable diesel and biodiesel. Additionally, it is also used as a livestock feed additive. Natural Gas .
Business Strategy We believe that global demand for protein for human consumption will continue to rise, requiring larger amounts of high protein feed for animals and aquaculture. Our transformation capitalizes on this market insight, in an effort to capture higher co-product returns.
We believe that global demand for protein will continue to rise, requiring larger amounts of high protein feed for pets, livestock and aquaculture. While faced with growing competition from expanded U.S. soy crushing capacity, our transformation aims to capitalize on this market insight, in an effort to capture higher co-product returns and reduce the volatility of earnings.
While some of our plants satisfy a majority of their water requirements from wells located on their respective properties, each plant also obtains drinkable water from local municipal water sources. Each facility either uses city water or operates a filtration system to purify the well water that is used for its operations.
Local utilities supply the necessary electricity to all of our ethanol plants. Water . While some of our plants satisfy a majority of their water requirements from wells located on their respective properties, each plant also obtains drinkable water from local municipal water sources.
Any significant additional ethanol production capacity, or reduced demand for gasoline, could create excess supply in world markets, resulting in lower ethanol prices throughout the world, including the United States. Other Competition Alternative fuels, gasoline oxygenates and ethanol production methods are continually under development. Ethanol production technologies also continue to evolve.
Under the RFS, certain parties are obligated to meet an advanced biofuel standard, and Brazilian sugarcane ethanol qualifies as an advanced biofuel. Any significant additional ethanol production capacity, or reduced demand for gasoline, could create excess supply in world markets, resulting in lower ethanol prices throughout the world, including the United States.
Our transformation into a sustainable ingredient producer continues centering around FQT's MSC™ and CST™ technologies. These technologies enhance our ability to produce value-added ingredients, while expanding renewable corn oil 6 Table of Contents yields. FQT provides additional intellectual property rights, including those aimed at developing and implementing proven, value-added agriculture, food and industrial biotechnology systems, CST™ and MSC™.
These technologies enhance our ability to produce lower CI, value-added ingredients, while expanding renewable corn oil yields. FQT provides additional intellectual property rights, including those aimed at developing and implementing proven, value-added agriculture, food and industrial biotechnology systems, CST™ and MSC™, as well as engineering expertise for designing ethanol facilities with lower energy use, operational expenses and carbon intensity.
We anticipate changes could occur primarily in the area of cellulosic ethanol, or from biodigesters at landfills or livestock production facilities.
Other Competition Alternative fuels, gasoline oxygenates and ethanol production methods are continually under development. Ethanol production technologies also continue to evolve. We anticipate changes could occur primarily in the area of cellulosic ethanol, or from biodigesters at landfills or livestock production facilities.
Since market price fluctuations among these commodities are not always correlated, ethanol production has been and may continue to be unprofitable at times. We use a variety of risk management tools and hedging strategies to monitor real-time operating price risk exposure at each of our operations to obtain favorable margins, when available.
From time to time, we use a variety of risk management tools and hedging strategies to monitor real-time operating price risk exposure at each of our operations in an effort to obtain favorable margins, when available.
The remaining product is washed and clarified into a wet protein stream which is dried in a ring dryer to produce Ultra-High Protein meal with protein concentrations of 50% or greater. Renewable Corn Oil. Renewable corn oil systems extract non-edible renewable corn oil from the thin stillage evaporation process immediately before the production of distillers grains.
The remaining product is washed and clarified into a wet protein stream which is dried in a ring dryer to produce Ultra-High Protein meal with protein concentrations of approximately 50%. Our new specialty feed ingredient, Sequence™ has protein concentrations of approximately 60%. Renewable Corn Oil.
Our Competition Domestic Ethanol Competitors We are one of the largest consolidated owners of ethanol plants in the United States. We compete with other domestic ethanol producers in a highly fragmented industry. Our competitors also include plants owned by farmers, cooperatives, oil refiners and retail fuel operators.
We compete with other domestic ethanol producers in a highly fragmented industry. Our competitors also include plants owned by farmers, cooperatives, oil refiners and retail fuel operators. These competitors may continue to operate their plants even when market conditions are not favorable due to the benefits realized from their other operations.
As of December 31, 2023, the partnership’s leased railcar fleet consisted of approximately 2,180 railcars with an aggregate capacity of 65.4 mmg. We expect the partnership’s railcar volumetric capacity to fluctuate over the normal course of business as the existing railcar leases expire and we enter into or acquire new railcar leases. Terminal and Distribution Services.
We expect the railcar volumetric capacity to fluctuate over the normal course of business as the existing railcar leases expire and we enter into or acquire new railcar leases.
Refer to Note 5 - Acquisition and Dispositions included in the notes to the audited consolidated financial statements included herein for more information. We group our business activities into the following three operating segments to manage performance: • Ethanol Production.
Refer to Note 4 – Merger and Dispositions in the notes to the consolidated financial statements included herein for more information. Operating Segments Ethanol Production Segment Industry Overview.
Ethanol Plants. We operate ten ethanol plants, located in six states, that produce ethanol, distillers grains, Ultra-High Protein and renewable corn oil.
Ethanol is the most economical oxygenate and source of octane available on the market and its production costs are competitive with gasoline. Ethanol Plants. We operate ten ethanol plants, located in six states, that produce ethanol, distillers grains, Ultra-High Protein and renewable corn oil.
The biorefineries producing Ultra- 5 Table of Contents High Protein, a feed ingredient with protein concentrations of 50% or greater and yeast concentrations of 25%, also increase the production of renewable corn oil and produce other higher-value products, such as post-MSC distillers grains. We successfully completed full scale 60% protein production runs using FQT's MSC™ system.
The biorefineries producing Ultra-High Protein, a feed ingredient with protein concentrations of 50% or greater and yeast concentrations of 25%, have also increased renewable corn oil yields. We repeatedly demonstrated full scale 60% protein production runs using FQT's MSC™ system, which we have branded as Sequence™. We market this specialty feed ingredient to aquaculture customers globally.
The fall harvest period typically results in higher handling margins and stronger financial results during the fourth quarter of each year. Through Green Plains Trade, we market the ethanol we and a third party produce to local, regional, national and international customers. We also purchase ethanol from independent producers for pricing arbitrage.
We market the ethanol we and a third party produce to local, regional, national and international customers. We also purchase ethanol from independent producers for pricing arbitrage.
Hedging losses may be offset by a decreased cash price for corn and natural gas and an increased cash price for ethanol, distillers grains, Ultra-High Protein and renewable corn oil. Depending on the circumstance, we vary the amount of hedging or other risk mitigation strategies we undertake and sometimes choose not to engage in hedging transactions at all.
Hedging losses may be offset by a decreased cash price for corn and natural gas and an increased cash price for ethanol, distillers grains, Ultra-High Protein and renewable corn oil.
We do not intend to make any further public comment regarding the review until the Board has approved a specific action or otherwise determines that additional disclosure is appropriate or required.
The company does not intend to make any further public comment regarding the review until the Board has approved a specific action or otherwise determines that additional disclosure is appropriate or required. Departures As part of the company’s selling, general and administrative rationalization initiatives, the position of EVP-Commercial Operations was eliminated, effective February 6, 2025. Mr.
We continue to evaluate additional technological opportunities to expand our capabilities and product offerings in the coming years. Proven Leadership Team . Our senior leadership team has specific expertise across all of our businesses, including plant operations and management, commodity markets and risk management, quality assurance, quality control, ingredient nutrition, marketing and innovation and ethanol marketing and distribution.
Our senior leadership team has specific expertise across all of our businesses, including plant operations and management, commodity markets and risk management, quality assurance, quality control, ingredient nutrition, marketing and innovation, regulatory, legal, policy, and ethanol marketing and distribution. Our leadership team’s level of operational and financial expertise is essential to successfully executing our business strategies. Operational Excellence .
This comprehensive evaluation is intended to explore a broad range of opportunities for the company to enhance long-term shareholder value, including, but not limited to, acquisitions, divestitures, a merger or sale, partnerships and financings.
The company will continue to monitor the potential margin available to determine any changes to future operations. Strategic Review As previously announced, the company initiated a strategic review process in February 2024 to explore a broad range of opportunities to enhance long-term shareholder value, including, but not limited to, acquisitions, divestitures, a merger or sale, partnerships and financings.
Renewable corn oil is produced by processing the syrup through a decanter-style, or disk-stack, centrifuge. The centrifuges separate the relatively light renewable corn oil from the heavier components of the syrup. Across our entire platform, we extract on average approximately 1.0 pound of renewable corn oil per bushel of corn used to produce ethanol.
Renewable corn oil systems extract non-edible renewable corn oil from the thin stillage evaporation process immediately before the production of distillers grains. Renewable corn oil is produced by processing the syrup through a decanter-style, or disk-stack, centrifuge. The centrifuges separate the relatively light renewable corn oil from the heavier components of the syrup.
We continue to focus on making incremental operational improvements to enhance performance using real-time production data and systems to monitor our operations and optimize performance. Risk Management and Hedging Activities Our margins are highly dependent on commodity prices, particularly for ethanol, corn, distillers grains, Ultra-High Protein, renewable corn oil and natural gas.
Risk Management and Hedging Activities Our margins are highly dependent on commodity prices, particularly for ethanol, corn, distillers grains, Ultra-High Protein, renewable corn oil and natural gas. Since market price fluctuations among these commodities are not always correlated, ethanol production has been and may continue to be unprofitable at times.
On January 9, 2024, pursuant to the Merger Agreement, we completed the acquisition of all the publicly held common units of the partnership not already owned by us and our affiliates. As a result of the Merger, the partnership common units are no longer publicly traded.
The Partnership Merger On January 9, 2024, the transactions contemplated by the Merger Agreement were completed, and the company acquired all of the publicly held common units of the partnership not already owned by the company and its affiliates. During the fourth quarter of 2024, the partnership was dissolved.
The largest concentration of operational plants is located in Iowa, Nebraska and Illinois, where approximately 50% of all operational production capacity is located. Foreign Ethanol Competitors We also compete globally with production from other countries. Brazil is the second largest ethanol producer in the world after the United States.
Foreign Ethanol Competitors We also compete globally with production from other countries. Brazil is the second largest ethanol producer in the world after the United States. Brazil primarily produces ethanol made from sugarcane, which may be less expensive to produce than ethanol made from corn depending on feedstock prices.
These competitors may continue to operate their plants even when market conditions are not favorable due to the benefits realized from their other operations. As of December 31, 2023, the top four producers accounted for approximately 40% of the domestic production capacity with production capacities ranging from 903 mmgy to 3,005 mmgy.
As of December 31, 2024, the top four producers accounted for approximately 39% of the domestic production capacity with production capacities ranging from 903 mmgy to 3,015 mmgy. Demand for corn from ethanol plants and other corn consumers exists in all areas and regions in which we operate.
Most of our ethanol plants are situated near major highways or rail lines to ensure efficient product movement. We are able to move product from our ethanol plants to bulk terminals via truck, railcar or barge. We also manage the logistics and transportation requirements of our customers to improve our fleet’s efficiency and reduce operating costs.
Most of our ethanol plants are situated near major highways or rail lines to ensure efficient product movement. Deliveries within 150 miles of our plants and the fuel terminal facility are generally transported by truck.
The company recorded a pretax gain on the sale of the Atkinson plant of $4.1 million recorded within corporate activities. Refer to Note 5 - Merger and Dispositions included in the notes to the audited consolidated financial statements included herein for more information.
The proceeds from the sale were used to repay the outstanding balance of the Green Plains Partners term loan due July 20, 2026. Refer to Note 4 – Merger and Dispositions in the notes to the consolidated financial statements included herein for more information.
Recent Developments The following is a summary of our significant recent developments. Additional information about these items can be found elsewhere in this report or in previous reports filed with the SEC. Strategic Review The Board of Directors is initiating a formal review process to evaluate strategic alternatives for the company.
Additional information about these items can be found elsewhere in this report or in previous reports filed with the SEC. Clean Sugar Technology The company has achieved successful ongoing production of dextrose syrups with CST ™ at its Shenandoah facility.
Removed
Green Plains Partners LP, a master limited partnership, is our primary downstream storage and logistics provider since its assets are the principal method of storing and delivering the ethanol we produce. As of December 31, 2023, we owned a 48.8% limited partner interest, a 2.0% general partner interest and all of the partnership’s incentive distribution rights.
Added
We are a leader in deploying carbon capture technology to reduce the CI of our biofuels at several of our production facilities. We group our business activities into the following two operating segments to manage performance: • Ethanol Production.
Removed
The public owned the remaining 49.2% limited partner interest. The partnership is consolidated in our financial statements, and we record a noncontrolling interest for the economic interest in the partnership held by the public common unitholders.
Added
A critical step to significantly reduce the CI of ethanol is carbon capture technology, which we are deploying at multiple locations.
Removed
Our master limited partnership provides fuel storage and transportation services through owning, operating, developing and acquiring ethanol and fuel storage tanks, terminals, transportation assets and other related assets and businesses. The partnership’s assets include 24 ethanol storage facilities, two fuel terminal facilities and approximately 2,180 leased railcars.
Added
We have executed agreements for the future purchase, financing and installation of carbon capture equipment at our three Nebraska plants. We anticipate completion of these Nebraska biorefinery carbon capture projects in the second half of 2025, and Summit Carbon Solutions intends to be operational in 2027.
Removed
As of December 31, 2023, we have installed and are operating FQT MSC™ technology at five of our biorefineries. Installation at additional biorefineries is expected over the course of the next few years, both at our other locations and across the broader industry.
Added
There are very few ethanol production facilities with carbon capture in place today, and we believe we may be among the first to produce lower-CI ethanol at scale. In addition, we are exploring alternative options for biogenic carbon dioxide utilization where pipeline transport or direct injection may not be feasible.
Removed
We anticipate completion of our three Nebraska biorefinery carbon capture projects in 2025, and the Summit Carbon Solutions projects in 2026. In addition, we are collaborating with global partners to explore innovative options for carbon use, such as synthetic methane production at Madison and Obion. We intend to sequester the carbon from fermentation at Mount Vernon as well.
Added
Our 50/50 joint venture with Tharaldson Ethanol Plant I LLC (Tharaldson Ethanol) owns the MSC™ technology assets added adjacent to the Tharaldson Ethanol plant in Casselton, North Dakota which produces Ultra-High Protein and increases renewable corn oil yields. We share in the protein and renewable corn oil uplift, with no additional exposure to the Tharaldson Ethanol production.
Removed
Our leadership team’s level of operational and financial expertise is essential to successfully executing our business strategies. Operational Excellence . Our facilities are staffed with experienced personnel who are encouraged to share operational knowledge and expertise across business segments and locations.
Added
These assets completed commissioning and shipped the first commercial quantities during the second quarter of 2024. Including GP Turnkey Tharaldson's capacity, the annual Ultra-High Protein capacity we market is approximately 430 thousand tons.
Removed
Cooperation Agreement On February 6, 2024, we entered into a Cooperation Agreement with a large shareholder whereby we agreed to announce our strategic review and the large shareholder agreed to certain standstill and voting obligations. 7 Table of Contents The Partnership Merger On September 16, 2023, the company entered into a Merger Agreement to acquire all of the publicly held common units of the partnership not already owned by the company and its affiliates.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur success depends, in part, on our ability to attract and retain competent employees. Qualified employees, including but not limited to finance and accounting, managers, engineers, merchandisers, and other personnel must be hired for each of our locations and our corporate office.
Biggest changeWe may not be able to hire and retain qualified personnel to operate our facilities. Our success relies on our ability to attract and retain skilled and capable employees. Each of our locations, as well as our corporate office, requires qualified professionals across key roles, including but not limited to engineering, merchandising, finance, accounting, management, and other critical functions.
Our revenues are dependent on market prices for ethanol which can be volatile as a result of a number of factors, including but not limited to: the price and availability of competing fuels and oxygenates for fuels; the domestic and global supply and demand for ethanol, gasoline and corn; the price of gasoline, crude oil and corn; global political or economic issues, including but not limited to the war in Ukraine including sanctions associated therewith, other global conflicts; and government policies that impact the supply, demand and pricing of corn, crude oil, gasoline, ethanol and other liquid fuels.
Our revenues are dependent on market prices for ethanol which can be volatile as a result of a number of factors, including but not limited to: the price and availability of competing fuels and oxygenates for fuels; the domestic and global supply and demand for ethanol, gasoline and corn; the price of gasoline, crude oil and corn; global political or economic issues, including but not limited to the war in Ukraine including sanctions associated therewith, other global conflicts; and domestic and foreign government policies that impact the supply, demand and pricing of corn, crude oil, gasoline, ethanol and other liquid fuels.
Acquisitions involve numerous risks that could harm our business, including: (1) difficulties integrating the operations, technologies, products, existing contracts, accounting processes and personnel and realizing anticipated synergies of the combined business; (2) risks relating to environmental 20 Table of Contents hazards on purchased sites; (3) risks relating to developing the necessary infrastructure for facilities or acquired sites, including access to rail networks; (4) difficulties supporting and transitioning customers; (5) diversion of financial and management resources from existing operations; (6) the purchase price exceeding the value realized; (7) risks of entering new markets or areas outside of our core competencies; (8) potential loss of key employees, customers and strategic alliances from our existing or acquired business; (9) unanticipated problems or underlying liabilities; and (10) inability to generate sufficient revenue to offset acquisition and development costs.
Acquisitions involve numerous risks that could harm our business, including: (1) difficulties integrating the operations, technologies, products, existing contracts, accounting processes and personnel and realizing anticipated synergies of the combined business; (2) risks relating to environmental hazards on purchased sites; (3) risks relating to developing the necessary infrastructure for facilities or acquired sites, including access to rail networks; (4) difficulties supporting and transitioning customers; (5) diversion of financial and management resources from existing operations; (6) the purchase price exceeding the value realized; (7) risks of entering new markets or areas outside of our core competencies; (8) potential loss of key employees, customers and strategic alliances from our existing or acquired business; (9) unanticipated problems or underlying liabilities; and (10) inability to generate sufficient revenue to offset acquisition and development costs.
These provisions discourage proxy contests, making it difficult for our shareholders to take other corporate actions without the consent of our board of directors, which include: (1) board members can only be removed for cause with an affirmative vote of no less than two-thirds of the outstanding shares; (2) shareholder action can only be taken at a special or annual meeting, not by written consent except where required by Iowa law; (3) shareholders are restricted from making proposals at shareholder meetings; and (4) the board of directors can issue authorized or unissued shares of stock.
These provisions discourage proxy contests, making it difficult for our shareholders to take other corporate actions without the consent of our board of directors, which include: (1) board members 26 Table of Contents can only be removed for cause with an affirmative vote of no less than two-thirds of the outstanding shares; (2) shareholder action can only be taken at a special or annual meeting, not by written consent except where required by Iowa law; (3) shareholders are restricted from making proposals at shareholder meetings; and (4) the board of directors can issue authorized or unissued shares of stock.
Elimination of a refinery's obligation effectively lowers the amount of renewable fuels required to be blended, and by extension the amount of RINs that need to be retired, which can impact their values and ultimately blending levels of renewable fuels. There are multiple on-going legal challenges to how the EPA has handled SREs and RFS rulemakings.
Elimination of a refinery's obligation effectively lowers the amount of renewable fuels required to be blended, and by extension the amount of RINs that need to be retired, which can impact their values and ultimately blending levels of renewable fuels. There are multiple on-going legal challenges to how the EPA has handled SREs and RFS rulemakings. The D.C.
With the current administration, climate change legislation in the U.S. is likely to receive increased focus and consideration over the next several decades, with numerous proposals having been made and are likely to continue to be made at the international, national, regional and state levels of government that are intended to limit emissions of GHG and capture carbon.
Climate change legislation in the U.S. is likely to receive increased focus and consideration over the next several decades, with numerous proposals having been made and are likely to continue to be made at the international, national, regional and state levels of government that are intended to limit emissions of GHG and capture carbon.
Our failure to achieve our production, sales and pricing targets, including, but not limited to: construction, yield, sales, margin, pricing, or financial results associated with our total transformation strategies could have an adverse effect on our business, financial condition or results of operations. Government biofuels programs could change and impact the ethanol market.
Our failure to achieve our production, sales and pricing targets, including, but not limited to: construction, yield, sales, margin, pricing, or financial results associated with our total transformation strategies could have an adverse effect on our business, financial condition or results of operations. Domestic and foreign government biofuels programs could change and impact the ethanol market.
To the extent federal or state laws or regulations are modified, repealed and/or enacted, it may result in the demand for ethanol being reduced, which could negatively and materially affect our financial performance. Future demand for ethanol is uncertain and changes in public perception, consumer acceptance and overall consumer demand for transportation fuel could affect demand.
To the extent domestic and/or foreign federal or state laws or regulations are modified, repealed and/or enacted, it may result in the demand for ethanol being reduced, which could negatively and materially affect our financial performance. Future demand for ethanol is uncertain and changes in public perception, consumer acceptance and overall consumer demand for transportation fuel could affect demand.
While we have considered potential risks with transitioning to a low-carbon economy, and we believe our products are low 25 Table of Contents carbon and result in a reduction of GHG emissions compared to alternatives, any significant legislative changes at the international, national, state or local levels could significantly affect our ability to produce and sell our products, could increase the cost of the production and sale of our products and could materially reduce the value of our products.
While we have considered potential risks with transitioning to a low-carbon economy, and we believe our products are low carbon and result in a reduction of GHG emissions compared to alternatives, any significant legislative changes at the international, national, state or local levels could significantly affect our ability to produce and sell our products, could increase the cost of the production and sale of our products and could materially reduce the value of our products.
Our ability to manage growth effectively could impact our results of operations, financial position and cash flows. New ethanol process technologies could emerge that require less energy per gallon to produce or increase yields of various products and in some cases develop new coproducts and result in lower production costs or more favorable economics for a plant.
Our ability to manage change and/or growth effectively could impact our results of operations, financial position and cash flows. New ethanol process technologies could emerge that require less energy per gallon to produce or increase yields of various products and in some cases develop new co-products and result in lower production costs or more favorable economics for a plant.
In addition, periods of sustained losses create uncertainty as to whether some or all of our deferred tax assets will be realizable in the future. If the United States were to withdraw from or materially modify certain international trade agreements, our business, financial condition and results of operations could be materially adversely affected.
In addition, periods of sustained losses create uncertainty as to whether some or all of our deferred tax assets will be realizable in the future. If the United States were to withdraw from or materially modify certain international trade agreements, our business, 17 Table of Contents financial condition and results of operations could be materially adversely affected.
After 2022, volumes are determined by the EPA in coordination with the Secretaries of Energy and Agriculture, taking into account such factors as impact on environment, energy security, future rates of 15 Table of Contents production, cost to consumers, infrastructure, and other factors such as impact on commodity prices, job creation, rural economic development or food prices.
After 2022, volumes are determined by the EPA in coordination with the Secretaries of Energy and Agriculture, taking into account such factors as impact on environment, energy security, future rates of production, cost to consumers, infrastructure, and other factors such as impact on commodity prices, job creation, rural economic development or food prices.
Newly constructed plants could operate more efficiently and reliably than the legacy fleet of plants constructed nearly 20 years ago, which includes our assets, putting us at a competitive disadvantage.
Newly constructed plants could operate more efficiently and reliably than the legacy fleet of plants constructed approximately 20 years ago, which includes our assets, putting us at a competitive disadvantage.
Uncertainty regarding future actions to be taken by OPEC+ members or other oil exporting countries could lead to increased volatility in the price of oil, which could adversely affect our business, future financial condition and 21 Table of Contents results of operations. Increased ethanol industry penetration by oil and other multinational companies could impact our margins.
Uncertainty regarding future actions to be taken by OPEC+ members or other oil exporting countries could lead to increased volatility in the price of oil, which could adversely affect our business, future financial condition and results of operations. Increased ethanol industry penetration by oil and other multinational companies could impact our margins.
Such claims could result in fines, settlements or suspended trading privileges, which could have a material adverse impact on our business, financial condition or operating results. Our success depends on our ability to manage our growing and changing operations. Since our formation in 2004, our business has grown significantly in size, products and complexity.
Such claims could result in fines, settlements or suspended trading privileges, which could have a material adverse impact on our business, financial condition or operating results. Our success depends on our ability to manage our changing operations. Since our formation in 2004, our business has changed significantly in size, products and complexity.
The selection and execution of a strategic alternative may lead to similar disruptions, and parties advocating for alternatives not selected may solicit support for such other alternatives, causing further disruption. 26 Table of Contents Risks Related to our Common Stock The price of our common stock may be highly volatile and subject to factors beyond our control.
The selection and execution of a strategic alternative may lead to similar disruptions, and parties advocating for alternatives not selected may solicit support for such other alternatives, causing further disruption. Risks Related to our Common Stock The price of our common stock may be highly volatile and subject to factors beyond our control.
Price and supply are subject to various market forces, 13 Table of Contents such as weather, domestic and global demand, global political or economic issues, including but not limited to the war in Ukraine including sanctions associated therewith, other global conflicts, shortages, export prices, crude oil prices, currency valuations and government policies in the United States and around the world, over which we have no control.
Price and supply are subject to various market forces, such as weather, domestic and global supply and demand, global political or economic issues, including but not limited to the war in Ukraine including sanctions associated therewith, other global conflicts, shortages, export prices, crude oil prices, currency valuations and government policies in the United States and around the world, over which we have no control.
Despite management’s belief that our tax return positions are fully supportable, certain positions may be successfully challenged by federal, state and local jurisdictions. Financial performance of our equity method investments are subject to risks beyond our control and can vary substantially from period to period.
Despite management’s belief that our tax return positions are fully supportable, certain positions may be successfully challenged by federal, state and local jurisdictions, adversely affecting our financial position. Financial performance of our equity method investments are subject to risks beyond our control and can vary substantially from period to period.
A significant increase in supply of biofuels beyond the RFS mandated volumes could have an adverse impact on ethanol prices. Moreover, changes to the RFS could negatively impact the price of ethanol or cause imported sugarcane or corn ethanol from Brazil to become more economical than domestic corn ethanol.
A significant increase in supply of biofuels beyond the RFS mandated volumes could have an adverse impact on ethanol prices. Moreover, changes to the RFS could negatively impact the price of ethanol or cause imported sugarcane or corn ethanol from other countries to become more economical than domestic corn ethanol.
Integrated oil companies and merchant refiners are increasingly investing in retrofitting refineries or building new refineries to produce renewable diesel, and partnering with commodity processors to supply soybean oil, distillers corn oil and other feedstocks, which could adversely impact the market for our renewable corn oil and Ultra-High Protein. Our agribusiness operations are subject to significant government regulations.
Integrated oil companies and merchant refiners are increasingly investing in retrofitting refineries or building new refineries to produce renewable diesel, and partnering with commodity processors to supply soybean oil, distillers corn oil and other feedstocks, which could adversely impact the market for our renewable corn oil and Ultra-High Protein. 21 Table of Contents Our agribusiness operations are subject to significant government regulations.
In general, renewable corn oil prices follow the prices of heating oil and soybean oil, though LCFS programs incentivize the lower CI of renewable corn oil as a feedstock relative to soybean oil. Federal incentives for sustainable aviation fuel also provide higher credit values for lower CI.
In general, renewable corn oil prices follow the prices of heating oil and soybean oil, though 14 Table of Contents LCFS programs incentivize the lower CI of renewable corn oil as a feedstock relative to soybean oil. Federal incentives for sustainable aviation fuel also provide higher credit values for lower CI.
We are required to maintain specified financial ratios, including minimum cash flow coverage, working capital and tangible net worth under certain loan agreements. A breach of these covenants could result in default, and if such default is not cured or waived, our lenders could accelerate our debt and declare it immediately due and payable.
We are required to maintain specified financial ratios, including minimum cash flow coverage, working capital and leverage ratios under certain loan agreements. A breach of these covenants could result in default, and if such default is not cured or waived, our lenders could accelerate our debt and declare it immediately due and payable.
Should our production practices not meet the EPA’s requirements for RIN generation in the future, we would need to export the ethanol, purchase RINs in the open market or sell our ethanol at a discounted price to compensate for the absence of RINs.
Should our production practices not meet the EPA’s requirements for RIN generation in the future, we would need to export the ethanol, purchase RINs in the open market 19 Table of Contents or sell our ethanol at a discounted price to compensate for the absence of RINs.
These announcements coincide with pledges to ban the sale of internal combustion engines in countries such as Japan and the United Kingdom by 2035, as well as a statewide ban in California, which several states are imitating.
These 16 Table of Contents announcements coincide with pledges to ban the sale of internal combustion engines in countries such as Japan and the United Kingdom by 2035, as well as a statewide ban in California, which several states are imitating.
Our ability to repay current and anticipated future debt will depend on our financial and operating performance and successful implementation of our business strategies. Our financial and operational performance will depend on numerous factors including prevailing economic conditions, commodity prices, and financial, business and other factors beyond our control.
Our ability to repay current and anticipated future debt will depend on our financial and operating performance and successful implementation of our business strategies. Our financial and operational performance will depend on numerous factors including prevailing economic conditions, commodity prices, and financial, business and other factors beyond our 18 Table of Contents control.
We cannot provide assurance that our backup systems are sufficient to mitigate hardware or software failures, which could result in business disruptions that negatively impact our operating results and damage our reputation. 23 Table of Contents We could be adversely affected by cyber-attacks, data security breaches and significant information technology systems interruptions.
We cannot provide assurance that our backup systems are sufficient to mitigate hardware or software failures, which could result in business disruptions that negatively impact our operating results and damage our reputation. We could be adversely affected by cyber-attacks, data security breaches and significant information technology systems interruptions.
Additionally, exports of distiller grains could be impacted by the enactment of foreign policy, or expanded production of soybean meal or distillers grains elsewhere. 14 Table of Contents Natural Gas. The price and availability of natural gas are subject to volatile market conditions.
Additionally, exports of distiller grains could be impacted by the enactment of foreign policy, or expanded production of soybean meal or distillers grains elsewhere. Natural Gas. The price and availability of natural gas are subject to volatile market conditions.
Ethanol, distillers grains, Ultra-High Protein or renewable corn oil that we purchase or market and subsequently sell to others could result in similar claims if the product does not meet applicable contract specifications, which could have an adverse impact on our profitability.
Ethanol, distillers grains, Ultra-High Protein or renewable corn oil that we purchase or market and subsequently sell to others could result in similar claims if the product does not meet applicable contract specifications, which could have an adverse impact on our 22 Table of Contents profitability.
A change in Chevron precedent could impact how the EPA can administer the RFS, impose limitations on the Treasury Department’s ability to promulgate regulations around IRA provisions, including SAF tax credits and the 45Z Clean Fuel Production Credit, 45Q carbon capture and sequestration tax credits, EV tax credits and other clean energy programs.
The change in Chevron precedent impacts how the EPA can administer the RFS, impose limitations on the Treasury Department’s ability to promulgate regulations around IRA provisions, including SAF tax credits and the 45Z Clean Fuel Production Credit, 45Q carbon capture and sequestration tax credits, EV tax credits and other clean energy programs.
Extreme weather conditions can interfere with our operations and cause damage resulting from extreme weather, which may not be fully insured. However, at this time, we are unable to determine the extent to which any potential climate change may lead to increased weather hazards affecting our operations.
Extreme weather conditions can interfere with our operations and cause damage resulting 25 Table of Contents from extreme weather, which may not be fully insured. However, at this time, we are unable to determine the extent to which any potential climate change may lead to increased weather hazards affecting our operations.
Despite the implementation of numerous cybersecurity measures (including but not limited to, ongoing collaboration and engagement with the Department of Homeland Security, access controls, data encryption, internal and third-party vulnerability assessments, employee training, continuous protection and monitoring, and maintenance of backup and protective systems), our information technology systems may still be vulnerable to cybersecurity threats and other electronic security breaches.
We have implemented numerous cybersecurity measures, including but not limited to, ongoing collaboration and engagement with the Department of Homeland Security, access controls, data encryption, internal and third-party vulnerability assessments, employee training, continuous protection and monitoring, and maintenance of backup and protective systems. Our information technology systems may still be vulnerable to cybersecurity threats and other electronic security breaches.
While many trade groups, academics and government agencies support ethanol as a fuel additive that promotes cleaner air and reduces GHG emissions, others claim growing corn and producing ethanol consumes more energy, emits more GHG 16 Table of Contents emissions than other fuels and depletes water resources.
While many trade groups, academics and government agencies support ethanol as a fuel additive that promotes cleaner air and reduces GHG emissions, others claim growing corn and producing ethanol consumes more energy, emits more GHG emissions than other fuels and depletes water resources.
The final RVO for 2023, 2024 and 2025 set biodiesel and renewable diesel volumes below current production levels, which has contributed to lower D4, D5 and D6 RIN values in 2023 and 2024.
The final RVO for 2023, 2024 and 2025 set biodiesel and renewable diesel volumes below existing production levels, which contributed to lower D4, D5 and D6 RIN values in 2023 and 2024.
Global events, such as COVID-19, greatly decreased miles traveled and in turn, the demand for ethanol. Consumer demand for gasoline may be impacted by various transportation trends, such as widespread adoption of electric vehicles. Numerous automakers have announced plans to phase out the production of gasoline and diesel powered vehicles by the mid-2030s.
Global events, such as international health epidemics, greatly decreased miles traveled and in turn, the demand for ethanol. Consumer demand for gasoline may be impacted by various transportation trends, such as widespread adoption of electric vehicles. Numerous automakers have announced plans to phase out the production of gasoline and diesel powered vehicles by the mid-2030s.
Likewise, national, state and regional LCFS like that of California, Oregon, Washington state or Canada could be favorable or harmful to U.S. corn ethanol, depending on how the regulations are crafted, enforced, repealed and/or modified.
Likewise, international, national, state and/or regional LCFS programs like that of California, Oregon, Washington state or Canada could be favorable or harmful to U.S. corn ethanol, depending on how the laws and regulations are crafted, enforced, interpreted, repealed and/or modified.
We operate in a very competitive environment and compete with other domestic ethanol producers in a relatively fragmented industry. The top four producers account for approximately 40% of the domestic production capacity with production capacity ranging from 903 mmgy to 3,005 mmgy.
We operate in a very competitive environment and compete with other domestic ethanol producers in a relatively fragmented industry. The top four producers account for approximately 39% of the domestic production capacity with production capacity ranging from 903 mmgy to 3,015 mmgy.
As a result, if a subsidiary is unable to satisfy its loan obligations, we may not be able to prevent default by providing additional cash to that subsidiary, even if sufficient cash exists elsewhere within our organization.
As a result, if a subsidiary is unable to satisfy its 24 Table of Contents loan obligations, we may not be able to prevent default by providing additional cash to that subsidiary, even if sufficient cash exists elsewhere within our organization.
In the event we are unable to comply with these covenants in the future, we cannot provide assurance that we will be able 18 Table of Contents to obtain the necessary waivers or amend our loan agreements to prevent default.
In the event we are unable to comply with these covenants in the future, we cannot provide assurance that we will be able to obtain the necessary waivers or amend our loan agreements to prevent default.
We are closely monitoring legislation and regulations that may impact the future sales of electric vehicles as well as vehicles with internal combustion engines in various states and around the world. Our business is directly affected by the supply and demand for ethanol and other fuels in the markets served by our assets.
We continue to monitor legislation and regulations that may impact the future sales of electric vehicles as well as vehicles with internal combustion engines in various states and around the world. Our business is directly affected by the supply and demand for ethanol and other fuels in the markets served by our assets.
Notwithstanding, on April 12, 2022, the President announced that he had directed the EPA to issue an emergency waiver to allow for the continued sale of E15 during the June 1 to September 15 period. On April 28, 2023, the EPA issued an emergency waiver to allow for continued sale of E15 during the 2023 summer driving season.
Notwithstanding, on April 12, 2022, the President announced that he had directed the EPA to issue an emergency waiver to allow for the continued sale of E15 during the June 1 to September 15 period.
If we are unable to hire and retain productive, skilled personnel, we may not be able to maximize production, optimize plant operations or execute our business strategy. Compliance with and changes in tax laws could adversely affect our performance.
If we are unable to hire and retain top talent, we may not be able to maximize production, optimize plant operations and effectively execute our business strategy. Compliance with and changes in tax laws could adversely affect our performance.
If realized, these bans would accelerate the decline of liquid fuel demand for surface transportation and by extension demand for ethanol, biodiesel and renewable diesel. The EPA has proposed CAFE standards, which would require aggressive EV deployment by Original Equipment Manufacturers.
If realized, these bans would accelerate the decline of liquid fuel demand for surface transportation and by extension demand for ethanol, biodiesel and renewable diesel. The EPA has implemented CAFE standards, which could require aggressive EV deployment by Original Equipment Manufacturers, though these regulations are subject to change.
Future events could result in impairment of long-lived assets, which may result in charges that adversely affect our results of operations. Long-lived assets, including property, plant and equipment, intangible assets, goodwill and equity method investments, are evaluated for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Long-lived assets, including property, plant and equipment, intangible assets, goodwill and equity method investments, are evaluated for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Ethanol and other products that we produce are or have been exported to Canada, Mexico, Brazil, China and other countries. The previous administration expressed antipathy towards certain existing international trade agreements and significantly increased tariffs on goods imported into the United States, which in turn led to retaliatory actions on U.S. exports.
Ethanol and other products that we produce are or have been exported to Canada, Mexico, Brazil, China and other countries. In a previous term, the Trump administration significantly increased tariffs on goods imported into the United States, which in turn led to retaliatory actions on U.S. exports.
Should our combined revenue from ethanol, distillers grains, Ultra-High Protein and renewable corn oil fall below our cost of production, we could decide to slow or suspend production at some or all of our ethanol plants, which could also adversely affect our results of operations and financial position.
Should our combined revenue from ethanol, distillers grains, Ultra-High Protein and renewable corn oil fall below our cost of production, we could decide to slow or suspend production at some or all of our ethanol plants, which could also adversely affect our results of operations and financial position. 13 Table of Contents The products we buy and sell are subject to price volatility and uncertainty.
Carbon Capture and Sequestration projects we are committed to could be delayed or cease operations. We have seven facilities committed to carbon capture and sequestration projects. The projects we are committed to may 17 Table of Contents be delayed or suspend operations for various reasons prior to us realizing any benefit.
Carbon Capture and Sequestration projects we are committed to could be delayed or cease operations. We have seven facilities committed to carbon capture and sequestration projects, including ongoing construction of carbon capture equipment at three of our facilities. The projects we are committed to may be delayed or suspend operations for various reasons prior to us realizing any benefit.
Four of our plants currently maintain Efficient Producer Pathways to operate at increased capacities. Separately, CARB began implementation of the California LCFS in 2011, which aims to decrease the CI of transportation fuel in the state. In 2018, CARB strengthened GHG benchmarks to 20% reductions vs 1990 levels by 2030.
Four of our plants currently maintain Efficient Producer Pathways to operate at increased capacities. Separately, CARB began implementation of the California LCFS in 2011, which aims to decrease the CI of transportation fuel in the state.
Any inability to generate or obtain RINs could adversely affect our operating margins. Under the RFS, biofuel producers generate different types of RINs to attach to each gallon produced depending on the feedstock, pathway and level of GHG reduction.
Under the RFS, biofuel producers generate different types of RINs to attach to each gallon produced depending on the feedstock, pathway and level of GHG reduction.
If we produce or purchase ethanol, distillers grains, Ultra-High Protein or renewable corn oil that does not meet the specifications defined in our sales contracts, we may be subject to quality claims. We could be required to refund the purchase price of any non-conforming product or replace the non-conforming product at our expense.
We may be required to provide remedies for ethanol, distillers grains, Ultra-High Protein or renewable corn oil that do not meet the specifications defined in our sales contracts. If we produce or purchase ethanol, distillers grains, Ultra-High Protein or renewable corn oil that does not meet the specifications defined in our sales contracts, we may be subject to quality claims.
Since we use exchange-traded futures contracts as part of our business, we are required to comply with a wide range of requirements imposed by the Commodity Futures Trading Commission, National Futures Association and the exchanges on which we trade. These regulatory bodies are responsible for safeguarding the integrity of the futures markets and protecting the interests of market participants.
Since we use exchange-traded futures contracts as part of our business, we are subject to the Commodity Exchange Act and are required to comply with a wide range of requirements imposed by the Commodity Futures Trading Commission (CFTC), Federal Energy Regulatory Commission (FERC), National Futures Association and the exchanges on which we trade.
Any event that causes failures or interruption in such hardware or software systems could result in disruption of our business operations, have a negative impact on our operating results, and damage our reputation, which could negatively affect our financial condition, results of operation, cash flows. We may not be able to hire and retain qualified personnel to operate our facilities.
Any event that 23 Table of Contents causes failures or interruption in such hardware or software systems could result in disruption of our business operations, have a negative impact on our operating results, and damage our reputation, which could negatively affect our financial condition, and results of operation.
This growth places substantial demands on our management, systems, internal controls, and financial and physical resources.
These changes place substantial demands on our management, systems, internal controls, and financial and physical resources.
While we have taken reasonable efforts to protect ourselves, and to date, we have not experienced any material losses related to cyber-attacks, we cannot assure our shareholders that any of our security measures would be sufficient in the future.
While we have taken reasonable efforts to protect ourselves, we cannot assure our shareholders that our security measures would be sufficient in the future.
As a market participant, we are subject to regulation concerning trade practices, business conduct, reporting, position limits, record retention, the conduct of our officers and employees, and other matters. Failure to comply with the laws, rules or regulations applicable to futures trading could have adverse consequences.
As a market participant, we are subject to regulation concerning trade practices, business conduct, reporting, position limits, record retention, the conduct of our officers and employees, and other matters.
By operating a business through this arrangement, we do not have control over operating decisions as we would if we owned the business outright.
By operating a business through this arrangement, we do not have control over operating decisions as we would if we owned the business outright. Specifically, we cannot act on major business initiatives without the consent of the other investors.
Export restrictions or tariffs could limit sales opportunities outside of the United States. Commodities futures trading is subject to extensive regulations. The futures industry is subject to extensive regulation.
Export restrictions or tariffs could limit sales opportunities outside of the United States. Commodities futures trading is subject to extensive regulations. The futures industry is subject to extensive regulation. In addition to trading physical commodities, the company may engage in trading of futures, forward and options contracts, and other derivative instruments.
The products we buy and sell are subject to price volatility and uncertainty. Our operating results are highly sensitive to commodity prices. Corn. We are generally unable to pass increased corn costs to our customers since ethanol competes with other fuels. We continue to see considerable volatility in corn prices.
Our operating results are highly sensitive to commodity prices. Corn. We are generally unable to pass increased corn costs to our customers since ethanol competes with other fuels. We continue to see considerable volatility in corn prices. Ethanol plants, livestock industries and other corn-consuming enterprises put significant price pressure on local corn markets.
While we strive to comply with all environmental requirements, we cannot provide assurance that we have been in compliance at all times or will not incur material costs or liabilities in connection with these requirements.
While we strive to comply with all environmental requirements, we cannot provide assurance that we have been in compliance at all times or will not incur material costs or liabilities in connection with these requirements. Private parties, including current and former employees, could bring personal injury or other claims against us due to the presence of hazardous substances.
Furthermore, additional debt may be necessary to complete these transactions, which could have a material adverse effect on our financial condition. Failure to adequately address the risks associated with acquisitions or joint ventures could have a material adverse effect on our business, results of operations and financial condition.
Furthermore, additional debt may be necessary to complete these transactions, which could have a material adverse effect on our financial condition.
Future demand may be influenced by economic incentives to blend based on the relative value of gasoline versus ethanol, taking into consideration the octane value of ethanol, environmental requirements and the value of RFS credits known as RINs. A significant increase in supply of biofuels beyond the RFS mandated levels could have an adverse impact on ethanol prices.
Future demand may be influenced by economic incentives to blend based on the relative value of gasoline versus ethanol, taking into consideration the octane value of ethanol, environmental requirements and the value of RFS credits known as RINs. Prior actions by the EPA to grant SREs without accounting for the lost gallons, for example, resulted in lower RIN prices.
The most recent Scoping Plan from CARB in 2022 sets a target of 85% GHG reductions vs 1990 levels no later than 2045. An indirect land usage charge component is included in the GHG emission calculation, which may have an adverse impact on the market for corn-based ethanol in California.
In 2024, CARB voted to amend the LCFS, which strengthened GHG benchmarks to 30% reductions vs 1990 levels by 2030, and 90% reductions vs 1990 levels by 2045. An indirect land usage charge component is included in the GHG emission calculation, which may have an adverse impact on the market for corn-based ethanol in California.
We are exposed to credit risk that could result in losses or affect our ability to make payments should a counterparty fail to perform according to the terms of our agreement. We are exposed to credit risk from a variety of customers, including major integrated oil companies, large independent refiners, petroleum wholesalers and other ethanol plants.
Any losses experienced by these entities could adversely impact our results of operations and the value of our investment. We are exposed to credit risk that could result in losses or affect our ability to make payments should a counterparty fail to perform according to the terms of our agreement.
Our operations could be adversely impacted by legislation, administration actions, court rulings, EPA actions, or lawsuits that may reduce the RFS mandated volumes of conventional ethanol and other biofuels through the RVO levels, a change in the RFS point of obligation from blenders and importers to retailers, or SREs. The D.C.
Our operations could be adversely impacted by domestic and/or foreign legislation, administration actions, court rulings, EPA actions, or lawsuits that may reduce clean fuel mandates, such as the RFS, Canada's clean fuel regulations, California's LCFS, or similar mandated volumes of conventional ethanol and other biofuels.
When discretionary blending is financially unattractive, the demand for ethanol may be reduced. New incentives for SAF could open new markets for ethanol through ATJ technologies, though existing commercial production is limited as of this filing.
When discretionary blending is financially unattractive, the incremental demand for ethanol may be reduced. New incentives for SAF could open new markets for ethanol through ATJ technologies that use low-CI ethanol as a feedstock to produce SAF, which are emerging and being commercialized.
Changes in environmental regulations may require us to modify existing plant and processing facilities, which could significantly increase our cost of operations. TTB regulations apply when producing our undenatured ethanol. These regulations carry substantial penalties for non-compliance and therefore any non-compliance may adversely affect our financial operations or adversely impact our ability to produce undenatured ethanol.
These regulations carry substantial penalties for non-compliance and therefore any non-compliance may adversely affect our financial operations or adversely impact our ability to produce undenatured ethanol. Any inability to generate or obtain RINs could adversely affect our operating margins.
Specifically, we cannot act on major business initiatives without the consent of the other investors. 24 Table of Contents The company recognizes these investments within other assets on the consolidated balance sheets and its proportionate share of earnings on a separate line item in the consolidated statements of operations.
The company recognizes these investments within other assets on the consolidated balance sheets and its proportionate share of earnings on a separate line item in the consolidated statements of operations. As a result, the amount of net investment income recognized from these investments can vary substantially from period to period.
The RFS mandates the minimum volume of renewable fuels that must be blended into the transportation fuel supply each year, which affects the domestic market for ethanol. Through 2022, the EPA undertook rulemaking to set the RVO for the following year, though at times months or years would pass without a finalized RVO.
In the U.S., through 2022, the EPA undertook rulemaking to set the RVO for the following year, though at times months or years would pass without a finalized RVO.
We are also exposed to credit risk with major suppliers of petroleum products and agricultural inputs when we make payments for undelivered inventories. Our fixed-price forward contracts are subject to credit risk when prices change significantly prior to delivery.
Our fixed-price forward contracts are subject to credit risk when prices change significantly prior to delivery.
Corn stored in a temporary open pile may be damaged by rain or warm weather before the corn is dried, shipped or moved into a permanent storage structure. Our business may be adversely impacted by the follow on impacts of the COVID-19 pandemic.
Corn stored in a temporary open pile may be damaged by rain or warm weather before the corn is dried, shipped or moved into a permanent storage structure. Any such change or conditions could adversely affect our profitability. Our ethanol-related assets may be at greater risk of terrorist attacks, threats of war or actual war, than other possible targets.
The outcome of trade negotiations or lack thereof, has had and/or may continue to have a material effect on our business, financial condition and results of operations. Our debt exposes us to numerous risks that could have significant consequences to our shareholders.
The administration has expressed antipathy towards certain existing international trade agreements, and has discussed plans to once again increase tariffs on imported goods. The outcome of trade negotiations or lack thereof, has had and/or may continue to have a material adverse effect on our business, financial condition and results of operations.
Competitors could successfully deploy carbon capture technology and achieve lower CI scores before we are able to do so, which could 22 Table of Contents put us at a competitive disadvantage. We may be required to provide remedies for ethanol, distillers grains, Ultra-High Protein or renewable corn oil that do not meet the specifications defined in our sales contracts.
Competitors could successfully deploy carbon capture technology and achieve lower CI scores before we are able to do so, which could put us at a competitive disadvantage, and adversely affect our operations, financial position and cash flows.
In late 2023, CARB proposed changes to the LCFS which would increase compliance requirements, including traceability of crop-based feedstocks beginning in 2028, an automatic accelerator mechanism to increase carbon credit values in the event of over-compliance by obligated parties, and other changes which could impact our ability to participate in and profit from the program.
The amendments to the LCFS also increase compliance requirements, including a more stringent verification for credits, potential credit forfeitures in the event of increases in operational CI scores, and other changes which could impact our ability to participate in and profit from the program.
Private parties, including current and former 19 Table of Contents employees, could bring personal injury or other claims against us due to the presence of hazardous substances. We are also exposed to residual risk by our land and facilities which may have environmental liabilities from prior use.
We are also exposed to residual risk by our land and facilities which may have environmental liabilities from prior use. Changes in environmental regulations may require us to modify existing plant and processing facilities, which could significantly increase our cost of operations. TTB regulations apply when producing our undenatured ethanol.
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Ethanol plants, livestock industries and other corn-consuming enterprises put significant price pressure on local corn markets.
Added
Domestic and foreign governments have adopted biofuels programs that drive demand for biofuels. In the United States, the RFS mandates the minimum volume of renewable fuels that must be blended into the transportation fuel supply each year, which affects the domestic market for ethanol. Similarly, Canada has adopted clean fuel regulations incenting the use of biofuels, as have other countries.
Removed
As of this filing, according to Prime the Pump, E15 is sold year-round at approximately 3,244 stations. The U.S. Supreme Court currently has two cases on its docket that could impact one of the most important principles in administrative law called “Chevron deference,” based on a landmark case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc .
Added
In 2023 and 2024, the EPA also issued emergency waivers to allow for continued sale of E15 15 Table of Contents during the summer driving season. As of this filing, according to Prime the Pump, E15 is sold year-round at approximately 3,724 stations. A string of 2024 U.S. Supreme Court decisions, namely Loper Bright Enterprises v. Raimondo, SEC v.
Removed
The Chevron deference is a doctrine of judicial deference given to administrative actions. Should the U.S. Supreme Court modify this doctrine, it could adversely impact current and/or future rulemaking and regulations which in turn could negatively and materially impact our financial performance.
Added
Jarkesy and Corner Post, Inc. v. Board of Governors of the Federal Reserve, have redefined the power of federal agencies, as well as overturned the important principle of administrative law called "Chevron deference," based on a landmark case, Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. The Chevron deference was a doctrine of judicial deference to administrative interpretations.
Removed
Moreover, any changes to RFS, whether by legislation, EPA action or lawsuit, originating from issues associated with the market price of RINs could negatively impact the demand for ethanol, discretionary blending of ethanol and/or the price of ethanol. Prior actions by the EPA to grant SREs without accounting for the lost gallons, for example, resulted in lower RIN prices.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Senior Vice President Business Technology has certain IT industry certifications and brings 30 years of IT background spanning all facets of technology, including applications, infrastructure and cybersecurity. Our Director of IT Security has over 20 years of experience in cybersecurity, including duties as an Information Security Officer in the United States Air Force.
Biggest changeWe invest in regular and ongoing cybersecurity training for our IT department and company overall. Our Senior Vice President Business Technology has IT industry certifications and brings over 30 years of IT background spanning all facets of technology, including applications, infrastructure and cybersecurity.
As part of this oversight, the company's IT leadership meets on a quarterly basis with the Audit Committee and on an annual basis with the company's Board of Directors.
As part of this oversight, the company's IT leader meets on a quarterly basis with the Audit Committee and on an annual basis with the company's Board of Directors.
Additionally, we follow federal and state statutory and regulatory guidance and have adopted internal policies and standards in alignment with these federal and state requirements. Furthermore, we collaborate with external experts, consultants and auditors in routinely evaluating and testing our information systems controls.
We also follow applicable federal and state statutory and regulatory guidance and have adopted internal policies and standards in alignment with these federal and state requirements. Furthermore, we collaborate with external experts, consultants and auditors in routinely evaluating and testing our information systems controls.
Item 1C. Cybersecurity. Risk Management and Strategy We promote a company-wide culture of cybersecurity risk management to ensure that cybersecurity risk considerations are an integral part of decision-making at every level. We have implemented cyber defenses to safeguard our information systems and protect the confidentiality, integrity and availability of our data.
Item 1C. Cybersecurity. Risk Management and Strategy We promote a company-wide culture of cybersecurity risk management to ensure that cybersecurity risk considerations are an integral part of decision-making at all organizational levels. To protect the confidentiality, integrity and availability of our data and information systems, we have implemented cyber defenses and continuously enhance them to address evolving threats.
During these update meetings, IT leadership provides the Audit Committee and Board of Directors updates regarding any changes around our cyber defenses, ongoing IT initiatives, and emerging threats and plans to pro-actively encounter these threats. Management continuously monitors the effectiveness of our cybersecurity defenses. We invest in regular and ongoing cybersecurity training for our IT department and company overall.
During these update meetings, IT provides the Audit Committee and 27 Table of Contents Board of Directors updates regarding any changes around our cyber defenses, ongoing IT initiatives, and emerging threats and plans to pro-actively counter these threats. Management continuously monitors the effectiveness of our cybersecurity defenses.
We perform annual cyber security training to remind our employees about the importance of keeping our systems safe, and perform regular third-party phishing campaigns. Governance The Audit Committee of the Board of Directors has oversight of management's efforts with respect to IT systems and cybersecurity.
We perform annual cyber security and technology processes training programs and regular third-party phishing campaigns to raise awareness of potential threats. Governance The Audit Committee of the Board of Directors has oversight of management's efforts with respect to IT systems and cybersecurity.
We also perform an annual cyber table-top exercise with a regulatory agency to help us test and continue to develop our Cyber Incident Response Plan. Our cybersecurity program includes a well-documented process for oversight of cybersecurity risks associated with our third-party service providers. We evaluate our third parties prior to any engagements.
We also perform an annual pen-testing, cyber table-top exercise to help us test and refine our formal Cyber Incident Response Plan. We maintain a well-documented process to oversee cybersecurity risks associated with our third-party service providers.
We also request System and Organization Controls reports from our third-party vendors to obtain reasonable assurance that their controls are present and functioning. Our IT policies communicate our expectations of employees and contractors to maintain the security of our IT systems.
We evaluate our third parties prior to any engagements and review their System and Organization Controls reports to obtain reasonable assurance that their controls meet our security standards. Our IT policies communicate our expectations for employees and contractors regarding the security of our IT systems.
As of December 31, 2023, we have not identified an indication of a cybersecurity incident that would have a material impact on our business and consolidated financial statements.
Our Director of IT Security has over 20 years of experience in cybersecurity, including duties as an Information Security Officer in the United States Air Force. As of December 31, 2024, we have not identified an indication of a cybersecurity incident that would have a material impact on our business and consolidated financial statements.
Our cybersecurity program is comprehensive in scope and covers the systems supporting our various lines of business. 27 Table of Contents Our cybersecurity program follows the National Institute of Standards and Technology, as well as the Cybersecurity and Infrastructure Security Agency frameworks.
Our information technology (IT) department actively monitors and evaluates our cybersecurity practices to ensure alignment with our business objectives and operational needs. Our cybersecurity program is comprehensive in scope and covers the systems supporting all our business operations. Our program is built on industry-standard frameworks, including the National Institute of Standards and Technology, and the Cybersecurity and Infrastructure Security Agency.
Removed
Our information technology (IT) department continuously evaluates whether our cybersecurity risk management is aligned with our business objectives and operational needs.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeEthanol Production Segment We own approximately 1,569 acres of land and lease approximately 78 acres of land at and around our ethanol production facilities. As detailed in our discussion of the ethanol production segment in Item 1 – Business , our ethanol plants have the capacity to produce approximately 903 million gallons of ethanol per year.
Biggest changeAs detailed in our discussion of the ethanol production segment in Item 1 – Business , our ethanol plants have the capacity to produce approximately 903 million gallons of ethanol per year.
We lease approximately 50,500 square feet of manufacturing space in Omaha, Nebraska for our Optimal Aquafeed LLC operations, where we manufacture and store fish food, feed ingredients and other related products.
We lease approximately 50,500 square feet of manufacturing space in Omaha, Nebraska for our Optimal Aquafeed LLC operations, where we manufacture and store fish food, feed ingredients and other related products. Our marketing operations are conducted primarily at our corporate office, in Omaha, Nebraska.
Removed
Our marketing operations are conducted primarily at our corporate office, in Omaha, Nebraska. 28 Table of Contents Partnership Segment Our partnership owns approximately five acres of land and leases approximately 29 acres of land at two locations in two states, as disclosed in Item 1 – Business , where its fuel terminals are located, and owns approximately 29 acres of land and leases approximately two acres of land where its storage facilities are located at our ethanol production facilities.
Added
Ethanol Production Segment We own approximately 1,599 acres of land and lease approximately 79 acres of land at and around our ethanol production facilities. Additionally, we own approximately five acres of land and lease approximately five acres of land at our fuel terminal facility.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings. We are currently involved in litigation that has occurred in the ordinary course of doing business. We do not believe this will have a material adverse effect on our financial position, results of operations or cash flows. Item 4. Mine Safety Disclosures. Not applicable. 29 Table of Contents PART II
Biggest changeItem 3. Legal Proceedings. We are currently involved in litigation that has occurred in the ordinary course of doing business. We do not believe this will have a material adverse effect on our financial position, results of operations or cash flows. Item 4. Mine Safety Disclosures. Not applicable. 28 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDividend Policy On June 18, 2019, the company’s board of directors suspended its future quarterly cash dividend following the June 14, 2019 dividend payment, in order to retain and redirect cash flow to the company’s operating expense equalization plan, the deployment of high-protein technology, its stock repurchase program and other corporate purposes.
Biggest changeDividend Policy In order to retain and direct cash flow to the company’s operating strategy, the deployment of high-protein technology, the deployment of Clean Sugar Technology™ and other corporate purposes, the company did not pay a cash dividend on its shares of common stock for the years ended December 31, 2024 and 2023, respectively.
The program may be suspended, modified or discontinued at any time, without prior notice. We did not repurchase any shares during 2023. Since inception, the company has repurchased 7.4 million shares of common stock for approximately $92.8 million under the program. Recent Sales of Unregistered Securities None.
The program may be suspended, modified or discontinued at any time, without prior notice. We did not repurchase any shares during 2024. Since inception, the company has repurchased 7.4 million shares of common stock for approximately $92.8 million under the program. Recent Sales of Unregistered Securities None.
Equity Compensation Plans Refer to Item 12 – Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters for information regarding shares authorized for issuance under equity compensation plans. 30 Table of Contents Performance Graph The following graph compares our cumulative total return with the S&P SmallCap 600 Index and the Nasdaq Clean Edge Green Energy Index (CELS) for each of the five years ended December 31, 2023.
Equity Compensation Plans Refer to Item 12 – Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters for information regarding shares authorized for issuance under equity compensation plans. 29 Table of Contents Performance Graph The following graph compares our cumulative total return with the S&P SmallCap 600 Index and the Nasdaq Clean Edge Green Energy Index (CELS) for each of the five years ended December 31, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock Our common stock trades under the symbol “GPRE” on Nasdaq. Holders of Record We had 1,741 holders of record of our common stock, not including beneficial holders whose shares are held in names other than their own, on February 5, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock Our common stock trades under the symbol “GPRE” on Nasdaq. Holders of Record We had 1,706 holders of record of our common stock, not including beneficial holders whose shares are held in names other than their own, on February 4, 2025.
The graph assumes a $100 investment in our common stock and each index at December 31, 2018, and that all dividends were reinvested. *$100 invested on 12/31/18 in stock or index, including reinvestment of dividends.
The graph assumes a $100 investment in our common stock and each index at December 31, 2019, and that all dividends were reinvested. *$100 invested on 12/31/19 in stock or index, including reinvestment of dividends.
This figure does not include approximately 62.0 million shares held in depository trusts.
This figure does not include approximately 62.4 million shares held in depository trusts.
Issuer Purchases of Equity Securities Employees and directors may surrender shares when restricted stock grants are vested to satisfy statutory minimum required payroll tax withholding obligations.
The company does not anticipate declaring cash dividends on its common stock for the foreseeable future. Issuer Purchases of Equity Securities Employees and directors may surrender shares when restricted stock grants are vested to satisfy statutory minimum required payroll tax withholding obligations.
The following table lists the shares that were surrendered during the fourth quarter of 2023: Period Total Number of Shares Withheld Average Price Paid per Share October 1 - October 31 1,868 $ 28.75 November 1 - November 30 — — December 1 - December 31 175 25.44 Total 2,043 $ 28.46 Our board of directors authorized a share repurchase program of up to $200.0 million of our common stock.
The following table lists the shares that were surrendered during the fourth quarter of 2024: Period Total Number of Shares Withheld Average Price Paid per Share October 1 - October 31 1,429 $ 12.85 November 1 - November 30 7,856 10.95 December 1 - December 31 847 10.58 Total 10,132 $ 11.19 Our board of directors authorized a share repurchase program of up to $200.0 million of our common stock.
Fiscal year ending December 31. 12/18 12/19 12/20 12/21 12/22 12/23 Green Plains Inc. $ 100.00 $ 119.60 $ 102.08 $ 269.42 $ 236.40 $ 195.48 S&P SmallCap 600 100.00 122.78 136.64 173.29 145.39 168.73 Nasdaq Clean Edge Green Energy 100.00 142.67 406.35 395.62 276.35 248.97 The information in the graph will not be considered solicitation material, nor will it be filed with the SEC or incorporated by reference into any future filing under the Securities Act or the Exchange Act, unless we specifically incorporate it by reference into our filing.
Fiscal year ending December 31. 12/19 12/20 12/21 12/22 12/23 12/24 Green Plains Inc. $ 100.00 $ 85.35 $ 225.28 $ 197.67 $ 163.45 $ 61.44 S&P SmallCap 600 100.00 111.29 141.13 118.41 137.42 149.37 Nasdaq Clean Edge Green Energy 100.00 284.83 277.30 193.70 174.51 141.58 The information in the graph will not be considered solicitation material, nor will it be filed with the SEC or incorporated by reference into any future filing under the Securities Act or the Exchange Act, unless we specifically incorporate it by reference into our filing.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe legislation (1) created a new Clean Fuel Production Credit of $0.02 per gallon per CI point reduction for any fuel below a 50 CI threshold from 2025 to 2027, section 45Z of the Internal Revenue Code, which could impact our fuel ethanol, depending on the level of GHG reduction for each gallon; (2) created a new tax credit for SAF of $1.25 to $1.75 per gallon for 2023 and 2024, depending on the GHG reduction for each gallon, that could possibly involve some of our low carbon ethanol through an ATJ pathway, depending on the life cycle analysis model being used (this credit expires after 2024 and shifts to the 45Z Clean Fuel Production Credit, where it qualifies for up to $0.035 per gallon per CI point reduction below a 50 CI threshold); (3) expanded the carbon capture and sequestration credit, section 45Q of the Internal Revenue Code, to $85 for each metric ton of carbon dioxide sequestered, which could impact our carbon capture strategies, though it cannot be claimed in conjunction with the 45Z Clean Fuel Production Credit, which could prove to be more valuable; (4) extended the $1.00 per gallon biomass-based diesel tax credit through 2024, which could impact our renewable corn oil values, as this co-product serves as a low-carbon feedstock for renewable diesel and bio diesel production (this credit expires after 2024 and shifts to the 45Z Clean Fuel Production credit, where all non-SAF fuels qualify for $0.02 per gallon for each point of CI reduction under the 50 CI threshold); (5) funded $500 million of biofuel blending infrastructure, which could impact the availability of higher level ethanol blended fuel; (6) increased funding for climate smart agriculture and working lands conservation programs for farmers by $20 billion; and (7) provided credits for the production and purchase of electric vehicles, which could impact the amount of internal combustion engines built and sold longer term, and by extension impact the demand for liquid fuels including ethanol.
Biggest changeThe legislation (1) created a new Clean Fuel Production Credit, section 45Z of the Internal Revenue Code, of $0.02 per gallon per CI point reduction for any fuel below a 50 CI threshold from 2025 to 2027, which could impact our fuel ethanol, depending on the level of GHG reduction for each gallon; (2) created a new tax credit for SAF, section 40B of the Internal Revenue Code, of $1.25 to $1.75 per gallon for 2023 and 2024, depending on the GHG reduction for each gallon, that could possibly involve some of our renewable corn oil or low carbon ethanol as feedstock through an ATJ pathway, depending on the life cycle analysis model being used (this credit expired after 2024 and shifts to the 45Z Clean Fuel Production Credit, where it qualifies for up to $0.035 per gallon per CI point reduction below a 50 CI threshold); (3) expanded the carbon capture and sequestration credit, section 45Q of the Internal Revenue Code, to $85 for each metric ton of carbon dioxide sequestered, which could impact our carbon capture strategies, though it cannot be claimed in conjunction with the 45Z Clean Fuel Production Credit, which could prove to be more valuable; (4) extended the $1.00 per gallon biomass-based diesel tax credit (this credit expired after 2024 and shifts to the 45Z Clean Fuel Production 33 Table of Contents credit, where all non-SAF fuels qualify for $0.02 per gallon for each point of CI reduction under the 50 CI threshold); (5) funded $500 million of biofuel blending infrastructure, which could impact the availability of higher level ethanol blended fuel; (6) increased funding for climate-smart agriculture and working lands conservation programs for farmers by $20 billion; and (7) provided credits for the production and purchase of EVs, which could impact the amount of internal combustion engines built and sold longer term, and by extension impact the demand for liquid fuels including ethanol.
In addition, the manner in which the EPA administers the RFS and related regulations can have a significant impact on the actual amount of ethanol and other biofuels blended into the domestic fuel supply. Federal mandates and state-level clean fuel standards supporting the use of renewable fuels are a significant driver of ethanol demand in the U.S.
In addition, the manner in which the EPA administers the RFS and related regulations can have a significant impact on the actual amount of ethanol and other biofuels blended into the domestic fuel supply. Federal and foreign mandates and state-level clean fuel standards supporting the use of renewable fuels are a significant driver of ethanol demand in the U.S.
On July 2, 2021, the Circuit Court vacated the EPA’s rule so the future of summertime, defined as June 1 to September 15, sales of E15 is uncertain. The Supreme Court declined to hear a challenge to this ruling.
Circuit. On July 2, 2021, the Circuit Court vacated the EPA’s rule so the future of summertime, defined as June 1 to September 15, sales of E15 is uncertain. The Supreme Court subsequently declined to hear a challenge to this ruling.
To that end, we are currently executing on a number of initiatives to develop and implement proven agricultural, food and industrial biotechnology systems that allow for product diversification, new market opportunities and production of additional value-added low-carbon ingredients, such as Ultra-High Protein, dextrose, renewable corn oil and more, as well as offering these technologies to the broader biofuels industry.
To that end, we are currently executing on a number of initiatives to develop and implement proven agricultural, food and industrial biotechnology systems that allow for product diversification, new market opportunities and production of additional value-added low-carbon ingredients, such as Ultra-High Protein, glucose and dextrose corn syrups, renewable corn oil and more, as well as offering these technologies to the broader biofuels industry.
Overview Green Plains is an Iowa corporation, founded in June 2004 as a producer of low-carbon fuels and has grown to be a leading biorefining company maximizing the potential of existing resources through fermentation and patented agribusiness technologies. We continue the transition from a commodity-processing business to a value-added agricultural technology company creating sustainable, high-value ingredients from existing resources.
Overview Green Plains is an Iowa corporation, founded in June 2004 as a producer of low-carbon fuels and has grown to be a leading biorefining company maximizing the potential of existing resources through fermentation and patented agribusiness technologies. We continue the transition from a commodity-processing business to a value-added agricultural technology company creating lower carbon, high-value ingredients from existing resources.
SREs can reduce or waive entirely the obligation for a refinery, which has the practical effect of reducing the RVO, and by extension the amount of RINs that need to be retired, which can impact their values and ultimately blending levels of renewable fuels. There are multiple on-going legal challenges to how the EPA has handled SREs and RFS rulemakings.
SREs can reduce or waive entirely the obligation for a refinery, which has the practical effect of reducing the RVO, and by extension the number of RINs that need to be retired, which can impact their values and ultimately blending levels of renewable fuels. There are multiple on-going legal challenges to how the EPA has handled SREs and RFS rulemakings.
The EPA also indicated that corn kernel fiber would contribute to the finalized cellulosic volumes, and could move to approve registrations that have been languishing for years at the agency. The EPA also removed a proposed e-RIN program to support electric vehicles from the final rule, but indicated they may move forward with it in a separate rulemaking.
The EPA also indicated that corn kernel fiber would contribute to the finalized cellulosic volumes, and could move to approve registrations that have been languishing for years at the agency. The EPA also removed a proposed e-RIN program to support EVs from the final rule, but indicated they may move forward with it in a separate rulemaking.
Legislation and Regulation We are sensitive to government programs and policies that affect the supply and demand for ethanol and other fuels, which in turn may impact the volume of ethanol and other products we handle.
Legislation and Regulation We are sensitive to domestic and foreign government programs and policies that affect the supply and demand for ethanol and other fuels, which in turn may impact the volume of ethanol and other products we handle.
As of this filing, according to Prime the Pump, there were approximately 3,244 retail stations selling E15 year-round, up from 2,923 at the beginning of the year.
As of this filing, according to Prime the Pump, there were approximately 3,724 retail stations selling E15 year-round, up from 3,244 at the beginning of the year.
Refer to Note 5 - Acquisition and Dispositions included in the notes to the audited consolidated financial statements included herein for more information. We have installed and are operating FQT MSC™ technology at five of our biorefineries.
Refer to Note 4 – Merger and Dispositions included in the notes to the audited consolidated financial statements included herein for more information. We have installed and are operating FQT MSC™ technology at five of our biorefineries.
As part of our carbon reduction strategy, we committed our seven biorefineries in Nebraska, Iowa and Minnesota to carbon capture and sequestration projects through carbon pipeline transport, four with Summit Carbon Solutions and three with another provider, which will lower GHG emissions through the capture of carbon dioxide at each of these biorefineries, significantly lowering their CI.
As part of our carbon reduction strategy, we committed our seven biorefineries in Nebraska, Iowa and Minnesota to carbon capture and sequestration projects through carbon pipeline transport, four with Summit Carbon Solutions and three with Trailblazer CO2 Pipeline LLC, which will lower GHG emissions through the capture of biogenic carbon dioxide at each of these biorefineries, significantly lowering their CI.
On January 9, 2024, pursuant to the Merger Agreement, we completed the acquisition of all the publicly held common units of the partnership not already owned by us and our affiliates. As a result of the Merger, the partnership common units are no longer publicly traded.
On January 9, 2024, pursuant to the Merger Agreement, we completed the acquisition of all the publicly held common units of the partnership not already owned by us and our affiliates. As a result of the Merger, the partnership common units are no longer publicly traded. During the fourth quarter of 2024, the partnership was dissolved.
Our business may also be impacted by government policies, such as tariffs, duties, subsidies, import and export restrictions and outright embargos.
Our business may also be impacted by domestic and foreign government policies, such as incentives, tariffs, duties, subsidies, import and export restrictions and outright embargos.
Sales of EVs in the U.S. were approximately 1.2 million vehicles during 2023, which represented approximately 7.6% of new vehicles sales, up from 5.9% in 2022. Transition of the light duty surface transportation fleet from internal combustion engines to EVs could decrease the demand for ethanol.
Sales of EVs in the U.S. were approximately 1.3 million vehicles during 2024, which represented approximately 8.1% of new vehicles sales, up from 7.6% in 2023. Transition of the light duty surface transportation fleet from internal combustion engines to EVs could decrease the demand for ethanol.
Through our value-added ingredients initiative, we produce Ultra-High Protein, a feed ingredient with protein concentrations of 50% or greater and yeast concentrations of 25%, increase production of renewable corn oil and produce other higher value products, such as post-MSC™ distillers grains. We successfully completed full scale 60% protein production runs using FQT's MSC™ system.
Through our value-added ingredients initiative, we produce Ultra-High Protein, a feed ingredient with protein concentrations of 50% or greater and yeast concentrations of 25%, increase production of renewable corn oil and produce other higher value products, such as post-MSC™ distillers grains.
Global Ethanol Supply and Demand According to the USDA Foreign Agriculture Service, domestic ethanol exports through November 30, 2023, were approximately 1,274 mmg, which was consistent with the 1,277 mmg for the same period of 2022.
Global Ethanol Supply and Demand According to the USDA Foreign Agriculture Service, domestic ethanol exports through November 30, 2024, were approximately 1,720 mmg, which was 35% higher than 1,274 mmg for the same period of 2023.
The EPA also proposed a modest increase in biomass based diesel volumes over the three years, setting the volumes at 2.82 billion for 2023, 3.04 billion for 2024 and 3.35 billion for 2025.
In June 2023, the EPA finalized RVOs for 2024 and 2025, setting the implied conventional ethanol levels at 15 billion gallons for 2024 and 2025. The EPA also proposed a modest increase in biomass based diesel volumes over the three years, setting the volumes at 2.82 billion for 2023, 3.04 billion for 2024 and 3.35 billion for 2025.
Ethanol Supply and Demand According to the EIA, domestic ethanol production averaged 1.0 million barrels per day for both 2023 and 2022. Refiner and blender input volume increased to 888 thousand barrels per day for 2023, which was consistent compared with the 884 thousand barrels per day in 2022.
Ethanol Supply and Demand According to the EIA, domestic ethanol production averaged 1.1 million barrels per day during 2024 and compared to 1.0 million per day in 2023. Refiner and blender input volume increased to 895 thousand barrels per day for 2024, which was 1% higher than the 888 thousand barrels per day in 2023.
We currently estimate that net ethanol exports will range from 1.4 to 1.6 billion gallons in 2024, based on historical demand from a variety of countries and certain countries that seek to improve their air quality, reduce greenhouse gas emissions through low carbon fuel programs and eliminate 33 Table of Contents MTBE from their own fuel supplies.
We currently estimate that net ethanol exports will range from 1.8 to 2.0 billion gallons in 2025, based on historical demand from a variety of countries and certain countries that seek to improve their air quality, reduce greenhouse gas emissions through low carbon fuel programs and eliminate MTBE from their own fuel supplies. Fluctuations in currencies relative to the U.S.
Canada was the largest export destination for U.S. ethanol accounting for approximately 47% of domestic ethanol export volume, driven in part by their national clean fuel standard. The United Kingdom, the Netherlands, South Korea, and India accounted for approximately 11%, 8%, 7% and 6%, respectively, of U.S. ethanol exports.
Canada was the largest export destination for U.S. ethanol accounting for approximately 36% of domestic ethanol export volume, driven in part by their national clean fuel standard. The United Kingdom, India, Columbia, and the Netherlands accounted for approximately 32 Table of Contents 13%, 10%, 7% and 7%, respectively, of U.S. ethanol exports.
Gasoline demand increased approximately 0.1 million barrels per day, or 1%, in 2023 compared to the prior year. U.S. domestic ethanol ending stocks decreased by approximately 0.9 million barrels compared to the prior year, or 4%, to 23.6 million barrels as of December 31, 2023.
Gasoline demand was consistent compared to the prior year at 8,840 thousand barrels per day in 2024. U.S. domestic ethanol ending stocks increased by approximately 0.1 million barrels compared to the prior year to 23.6 million barrels as of December 31, 2024.
The One-Pound Waiver, which was extended in May 2019 to allow E15 to be sold year-round to all vehicles model year 2001 and newer, was challenged in an action filed in Federal District Court for the D.C. Circuit.
On October 21, 2024, the U.S. Supreme Court agreed to review the various Circuit Court rulings on SREs to determine the proper venue. The One-Pound Waiver, which was extended in May 2019 to allow E15 to be sold year-round to all vehicles model year 2001 and newer, was challenged in an action filed in Federal District Court for the D.C.
We do not intend to make any further public comment regarding the review until the Board has approved a specific action or otherwise determines that additional disclosure is appropriate or required.
The company does not intend to make any further public comment regarding the review until the Board has approved a specific action or otherwise determines that additional disclosure is appropriate or required. Industry Factors Affecting our Results of Operations U.S.
We use various financial instruments to manage and reduce our exposure to price variability. For more information about our commodity price risk, refer to Item 7A. - Qualitative and Quantitative Disclosures About Market Risk, Commodity Price Risk in this report.
We use various financial instruments to manage and reduce our exposure to price variability. For more information about our commodity price risk, refer to Item 7A. - Qualitative and Quantitative Disclosures About Market Risk, Commodity Price Risk in this report. Effects of Inflation We do not expect inflation to have a material impact on our future results of operations.
Soybean processing capacity in the U.S. has been expanding to meet the rising demand for vegetable oils to produce renewable fuels. According to the National Oilseed Processors Association, as of December 31, 2023, soybean crush was 195.3 million bushels, up from the 177.5 million bushels as of December 31, 2022.
Soybean processing capacity in the U.S. has been expanding to meet the rising demand for vegetable oils to produce renewable fuels. According to the National Oilseed Processors Association, for the fourth quarter of 2024, soybean crush was 600 million bushels, up 26 million bushels from the 574 million bushels crushed during the fourth quarter of 2023.
Our profitability could be significantly impacted by price movements of the aforementioned commodities. More information about our business, properties and strategy can be found under Item 1 – Business and a description of our risk factors can be found under Item 1A – Risk Factors .
More information about our business, properties and strategy can be found under Item 1 – Business and a description of our risk factors can be found under Item 1A – Risk Factors .
The market price of detached RINs can affect the price of ethanol in certain markets and can influence purchasing decisions by obligated parties. Of note, the RIN mechanism for proposed e-RINs could vary from the traditional process.
The market price of detached RINs can affect the price of ethanol in certain markets and can influence purchasing decisions by obligated parties.
Since market price fluctuations of these commodities are not always correlated, our operations may be unprofitable at times. We use a variety of risk management tools and hedging strategies to monitor price risk exposure at our ethanol plants and lock in favorable margins or reduce production when margins are compressed.
We use a variety of risk management tools and hedging strategies to monitor price risk exposure at our ethanol plants and lock in favorable margins or reduce production when margins are compressed. Our profitability could be significantly impacted by price movements of the aforementioned commodities.
Ethanol policies are influenced by concerns for the environment, diversifying the fuel supply, supporting U.S. farmers and reducing the country’s dependence on foreign oil. Consumer acceptance of FFVs and increased use of higher ethanol blends in non-FFVs may be necessary before ethanol can achieve further growth in the U.S. light duty surface transportation fleet market share.
Consumer acceptance of FFVs, availability of higher ethanol blends and increased use of higher ethanol blends in non-FFVs may be necessary before ethanol can achieve further growth in the U.S. light duty surface transportation fleet market share.
The EPA has also indicated it will undertake rulemaking to allow for the elimination of the One-Pound Waiver for E10 in several Midwestern states in time for the 2024 summer driving season, which would have the practical effect of allowing for E15 to be sold year round in the following states: Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin.
The EPA has also allowed for the elimination of the One-Pound Waiver for E10 in several Midwestern states beginning with the 2025 summer driving season, which would have the practical effect of allowing for E15 to be sold year- round in the following states: Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin. 34 Table of Contents In October 2019, the White House directed the USDA and EPA to move forward with rulemaking to expand access to higher blends of biofuels.
Strategic Review The Board of Directors is initiating a formal review process to evaluate strategic alternatives for the company. This comprehensive evaluation is intended to explore a broad range of opportunities for the company to enhance long-term shareholder value, including, but not limited to, acquisitions, divestitures, a merger or sale, partnerships and financings.
Strategic Review As previously announced, the company initiated a strategic review process in February 2024 to explore a broad range of opportunities to enhance long-term shareholder value, including, but not limited to, acquisitions, divestitures, a merger or sale, partnerships and financings.
Our collaboration is expected to complete the construction of a facility at Green Plains York and begin commissioning in early 2024. Our profitability is highly dependent on commodity prices, particularly for ethanol, distillers grains, Ultra-High Protein, renewable corn oil, soybean meal, corn, and natural gas.
Our collaboration completed the construction of a facility at Green Plains York and began commissioning during 2024. Our profitability is highly dependent on commodity prices, particularly for ethanol, distillers grains, Ultra-High Protein, renewable corn oil, soybean meal, corn, and natural gas. Since market price fluctuations of these commodities are not always correlated, our operations may be unprofitable at times.
In addition, expansion of clean fuel standards in other states and countries, or a national LCFS could increase the demand for ethanol, depending on how they are structured.
In addition, expansion of clean fuel standards in other states and countries, or a national LCFS could increase the demand for ethanol, depending on how they are structured. Incentives for automakers to produce FFVs phased out in 2020, and the EPA's proposed Corporate Average Fuel Economy (CAFE) standards further incentivize EV production.
We intend to sequester the carbon from fermentation at Mount Vernon as well. Reducing the CI of our fuel ethanol could allow us to benefit from state and federal clean fuel programs, including LCFS and federal tax credits under the IRA, and could position our low-carbon ethanol as a potential feedstock for ATJ pathways to produce SAF.
Reducing the CI of our fuel ethanol could allow us to benefit from state and federal clean fuel programs, including LCFS and federal tax credits under the IRA, and could position our low-carbon ethanol as a potential feedstock for ATJ pathways to produce SAF. 31 Table of Contents SAF is a drop-in fuel, chemically identical to petroleum-based jet fuel and can be blended into the fuel supply at varying levels.
Green Plains Partners LP, a master limited partnership, is our primary downstream storage and logistics provider since its assets are the principal method of storing and delivering the ethanol we produce. As of December 31, 2023, we owned a 48.8% limited partner interest, a 2.0% general partner interest and all of the partnership’s incentive distribution rights.
Green Plains Partners LP, a master limited partnership, was our primary downstream storage and logistics provider since its assets are the principal method of storing and delivering the ethanol we produce.
The USDA rolled out the Higher Blend Infrastructure Incentive Program in the summer of 2020, providing competitive grants to fuel terminals and retailers for installing equipment for dispensing higher blends of ethanol and biodiesel. In December 2021, the USDA announced it would administer another infrastructure grant program.
This includes funding for infrastructure, labeling changes and allowing E15 to be sold through E10 infrastructure. The USDA rolled out the Higher Blend Infrastructure Incentive Program in the summer of 2020, providing competitive grants to fuel terminals and retailers for installing equipment capable of dispensing higher blends of ethanol and biodiesel.
There are numerous additional clean energy credits included in this law, including investment tax credits for construction of clean energy infrastructure, that could impact us and our overall competitiveness.
There are numerous additional clean energy credits included in this law, including investment tax credits for construction of clean energy infrastructure, that could impact us and our overall competitiveness. Regulatory rulemaking for the administration of these programs is underway, and the final regulations could impact many aspects of our business. On April 30, 2024, the U.S.
Effects of Inflation While inflation has increased relative to recent years, we do not expect it to have a material impact on our future results of operations. However, inflation has and may continue to impact the interest rate environment in which we operate, resulting in a higher cost of capital. Refer to
However, inflation has and may continue to impact the interest rate environment in which we operate, resulting in a higher cost of capital. Refer to
Bills have also been introduced to require higher levels of octane blending, allow for year-round sales of higher blends of ethanol and require car manufacturers to produce vehicles that can operate on higher ethanol blends. We believe it is unlikely that any of these bills will become law in the current Congress.
Bills have also been introduced to require or otherwise incentivize higher levels of octane blending, allow for year-round sales of higher blends of ethanol, require car manufacturers to produce vehicles that can operate on higher ethanol blends and provide incentives for reducing the CI of biofuels including ethanol.
We began pilot scale batch operations at the FQT CST™ production facility at our Innovation Center at York in the second quarter of 2021, which allows for the production of both food and industrial grade low-carbon glucose and dextrose to target applications in food production, renewable chemicals and synthetic biology.
The FQT CST™ technology allows for the production of both food and industrial grade low carbon-intensity glucose and dextrose corn syrups to target applications in food production, renewable chemicals and synthetic biology.
Fluctuations in currencies relative to the U.S. Dollar could impact the U.S. ethanol competitiveness in the global market. Protein and Vegetable Oil Supply and Demand Our dried distillers grains and high protein ingredients compete against other ethanol producers domestically and abroad, as well as with soybean meal, canola meal, and other protein feed ingredients.
Our dried distillers grains and Ultra-High Protein ingredients compete against other ethanol producers domestically and abroad, as well as with soybean meal, canola meal, and other protein feed ingredients.
In September 2022, we broke ground at our biorefinery in Shenandoah, Iowa, as the first location to deploy FQT CST™ at commercial scale. We also anticipate modifying additional biorefineries to include FQT CST™ production capabilities to meet anticipated future customer demands. Additionally, we have taken advantage of opportunities to divest certain assets to reallocate capital toward our current growth initiatives.
The facility is currently capable of producing 60 million pounds of product per year, and we also anticipate modifying additional biorefineries to include FQT CST™ production capabilities to meet anticipated future customer demand. Additionally, we have taken advantage of opportunities to divest certain assets to reallocate capital toward our current growth initiatives.
In 2021, we formed a 50/50 joint venture with Tharaldson Ethanol, which will own the MSC™ technology assets added adjacent to the Tharaldson Ethanol plant in North Dakota to produce Ultra-High Protein and increase renewable corn oil yields. We anticipate these assets will be operational in early 2024.
Our 50/50 joint venture with Tharaldson Ethanol Plant I LLC (Tharaldson Ethanol) owns the MSC™ technology assets added adjacent to the Tharaldson Ethanol plant in Casselton, North Dakota which produces Ultra-High Protein and increases renewable corn oil yields. These assets completed commissioning and shipped the first commercial quantities during the second quarter of 2024.
The IRA, signed into law in 2022, provided for an additional $500 million in USDA grants for biofuel infrastructure. On June 26, 2023, the USDA announced the initial $50 million in awards, and laid out a process for distributing the remaining $450 million, with $90 million being made available each quarter.
On June 26, 2023, the USDA announced the initial $50 million in awards, and laid out a process for distributing the remaining $450 million, with $90 million being made available each quarter. A string of 2024 U.S. Supreme Court decisions, namely Loper Bright Enterprises v. Raimondo, SEC v. Jarkesy and Corner Post, Inc. v.
In July 2023, we announced a technology collaboration with Equilon Enterprises LLC, which allows us to use FQT’s precision separation and processing technology with Shell Fiber Conversion Technology. The two technologies will combine fermentation, mechanical separation and processing, and fiber conversion into one platform.
In January 2023, Green Plains, United Airlines and Tallgrass formed a joint venture, Blue Blade Energy, to develop and then commercialize a novel ATJ SAF technology. In July 2023, we announced a technology collaboration with Equilon Enterprises LLC, which allows us to use FQT’s precision separation and processing technology with Shell Fiber Conversion Technology.
SAF can be produced from vegetable and waste oil feedstocks, such as our renewable corn oil. Additionally, ATJ technologies are emerging and being commercialized that use low-CI ethanol as a feedstock to produce SAF. In January 2023, Green Plains, United Airlines and Tallgrass formed a joint venture, Blue Blade Energy, to develop and then commercialize a novel ATJ SAF technology.
There is an increasing focus on using this fuel to reduce the carbon footprint of air travel. SAF can be produced from vegetable and waste oil feedstocks, such as our renewable corn oil. Additionally, ATJ technologies are emerging and being commercialized that use low-CI ethanol as a feedstock to produce SAF.
We anticipate completion of our three Nebraska biorefinery carbon capture projects in 2025, 32 Table of Contents and the Summit Carbon Solutions projects in 2026. In addition, we are collaborating with global partners to explore innovative options for carbon use, such as synthetic methane production at Madison and Obion.
We anticipate completion of these Nebraska biorefinery carbon capture projects in the second half of 2025. Summit Carbon Solutions intends to be operational in 2027. In addition, we are collaborating with global partners to explore innovative options for carbon use where pipeline transport or direct injection may not be feasible.
Removed
The public owned the remaining 49.2% limited partner interest. The partnership is consolidated in our financial statements, and we record a noncontrolling interest for the economic interest in the partnership held by the public common unitholders.
Added
We successfully completed full scale 60% protein production runs using FQT's MSC™ system, which is our new specialty feed ingredient branded as Sequence™.
Removed
We are focused on generating stable and growing operating margins through our business segments and risk management strategy. SAF is a drop-in fuel, chemically identical to petroleum-based jet fuel and can be blended into the fuel supply at varying levels. There is an increasing focus on using this fuel to reduce the carbon footprint of air travel.
Added
Including GP Turnkey Tharaldson's capacity, the annual Ultra-High Protein capacity we market is approximately 430 thousand tons. The world's first commercial scale FQT CST™ facility in Shenandoah, Iowa has achieved successful ongoing production of dextrose syrups with CST™.
Removed
Cooperation Agreement On February 6, 2024, we entered into a Cooperation Agreement with a large shareholder whereby we agreed to announce our strategic review and the large shareholder agreed to certain standstill and voting obligations. Industry Factors Affecting our Results of Operations U.S.
Added
We are focused on generating stable and growing operating margins through our business segments and risk management strategy.
Removed
Incentives for automakers to produce FFVs phased out in 2020, and the EPA's recently proposed Corporate Average Fuel Economy (CAFE) standards further incentivize EV production, with the administration's stated goal of having EVs represent two-thirds of vehicles sold by 2032.
Added
We have executed agreements for the future purchase, financing and installation of carbon capture equipment at our three Nebraska plants. The rights of way for the laterals to connect our Nebraska biorefineries have been secured, and all necessary Class VI sequestration well permits have been issued.
Removed
Regulatory rulemaking for the administration of these programs is underway, and the final regulations could impact many aspects of our business. 34 Table of Contents The RFS sets a floor for biofuels use in the United States.
Added
The two technologies will combine fermentation, mechanical separation and processing, and fiber conversion into one platform.
Removed
In June 2023, the EPA finalized RVOs for 2023, 2024 and 2025, setting the implied conventional ethanol levels at 15.25 billion gallons for 2023, and 15 billion for 2024 and 2025, inclusive of 250 million gallons of supplemental volume in 2023 to reflect a court-ordered remand of a previously lowered RVO.
Added
The Board of Directors continues to progress the strategic review process, working with its financial advisors, BMO Capital Markets Corp. and Moelis & Company, and legal advisors Vinson & Elkins LLP.
Removed
On April 12, 2022, the President announced that he had directed the EPA to issue an emergency waiver to allow for the continued sale of E15 during the summer months, and that the temporary waiver should be extended as long as the gasoline supply emergency lasts.
Added
As part of the strategic review process, in early 2025, the company idled its Fairmont, Minnesota facility and launched a corporate reorganization and cost reduction initiative that will significantly reduce selling, general and administrative expenses on an ongoing basis.
Removed
On April 28, 2023, the administration announced emergency waivers for the 2023 summer driving season of June 1 to September 15.
Added
As part of this initiative, the company has identified early in 2025 approximately $30 million of financial improvement annually, inclusive of savings from idling the Fairmont facility and realigning corporate and trade group selling, general and administrative functions to reflect current strategic priorities, and is continuing to identify more opportunities that may reduce selling, general and administrative functions further.
Removed
In October 2019, the White House directed the USDA and EPA to move forward with rulemaking to expand access to higher blends of biofuels. This includes funding for infrastructure, labeling changes and allowing E15 to be sold through E10 infrastructure.
Added
As a result of the reorganization, the company expects to take a one-time charge in the first quarter of 2025 of approximately $5 million to $7 million based on current estimates.
Removed
To respond to COVID-19 health crisis and attempt to offset the subsequent economic damage, Congress passed multiple relief measures, most notably the CARES Act in March 2020, which created and funded multiple programs that have impacted our industry. The CARES Act also allowed for certain net operating loss carrybacks, which has allowed us to receive certain tax refunds.
Added
Dollar could impact the U.S. ethanol competitiveness in the global market. Protein and Vegetable Oil Supply and Demand We continue to believe that over time demand will outpace supply leading to higher co-product returns.
Removed
In December 2020, Congress passed and the then President signed into law an annual spending package coupled with another COVID relief bill, which included additional funds for the Secretary of Agriculture to distribute to those impacted by the pandemic.
Added
While global protein demand has continued to grow precipitously since the advent of our transformation, so too has the production of vegetable proteins from multiple companies in an effort to capitalize on this trend, most notably in U.S. soy crushing capacity, which has led to an over-supplied domestic market and compressed protein values.
Removed
The language of the bill specifically included biofuels producers as eligible for some of this aid, and in May 2022, the USDA distributed funds to us in the amount of $27.7 million pursuant to this bill. In July 2023, the USDA distributed supplemental program funds to us in the amount of $3.4 million.
Added
Soybean oil stocks were at 1.24 billion pounds as of December 31, 2024, which was slightly down from the 1.36 billion pounds of stocks as of December 31, 2023. Soybean meal production was 14.2 million short tons for the fourth quarter of 2024, up from the 13.5 million short tons from the same period in the prior year.
Removed
We employ maintenance and operations personnel at each of our facilities, which are regulated by the Occupational Safety and Health Administration. 35 Table of Contents The U.S. ethanol industry relies heavily on tank cars to deliver its product to market.
Added
Ethanol policies are influenced by concerns for the environment, diversifying the fuel supply, supporting U.S. farmers and reducing the country’s dependence on foreign oil.
Removed
In 2015, the DOT finalized the Enhanced Tank Car Standard and Operational Controls for High-Hazard and Flammable Trains, or DOT specification 117, which established a schedule to retrofit or replace older tank cars that carry crude oil and ethanol, braking standards intended to reduce the severity of accidents and new operational protocols.
Added
Department of Treasury issued regulatory guidance along with an updated GREET lifecycle assessment model for the 40B SAF tax credit, which included a pathway for U.S. corn ethanol to qualify as a feedstock for SAF if the carbon intensity is lowered through utilization of various technologies and practices, including carbon capture and climate smart agriculture practices.
Removed
The rule has increased the lease costs for railcars in the short term and may increase the lease costs long term. Our partnership's fleet is DOT 117 compliant.
Added
On June 22, 2024, the USDA put out a Request for Information on the Production of Biofuel Feedstocks using climate smart practices, which could inform rulemaking for the 45Z Clean Fuel Production Credit. On January 10, 2025, the U.S.
Added
Department of Treasury issued a notice of intent to propose rulemaking on the 45Z Clean Fuel Production Credit, which it published on February 3, 2025 in Internal Revenue Bulletin 2025-6, and on January 15, 2025 the Department of Energy released an updated 45Z GREET LCA model for calculating CI values of various feedstocks and finished fuels under 45Z.
Added
Additionally, on January 15, 2025, the USDA put forth interim rules around climate smart agriculture for crops serving as feedstocks for biofuel production, including corn, soybeans and sorghum, though it was not incorporated into Treasury’s 45Z proposed rulemaking at this time.
Added
While the proposed regulations are subject to change, and the GREET model could continue to be updated, as of this filing the GREET model indicates that CCS could reduce the CI of corn ethanol by 32 points, and that distillers corn oil used to produce biodiesel, renewable diesel or SAF has a lower CI score relative to most other feedstocks.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAccordingly, our computation of EBITDA, adjusted EBITDA, and segment EBITDA may not be comparable with a similarly titled measure of other companies. 40 Table of Contents The following table reconciles net loss including noncontrolling interest to adjusted EBITDA (in thousands): Year Ended December 31, 2023 2022 2021 Net loss $ (76,299) $ (103,377) $ (44,146) Interest expense (1) 37,703 32,642 67,144 Income tax expense (benefit) (5,617) 4,747 1,845 Depreciation and amortization (2) 98,244 92,698 91,952 EBITDA 54,031 26,710 116,795 Other income (3) (3,440) (27,712) — Gain on sale of assets, net (5,265) — (29,601) Proportional share of EBITDA adjustments to equity method investees 180 180 184 Adjusted EBITDA $ 45,506 $ (822) $ 87,378 (1) Interest expense for the year ended December 31, 2021 includes a loss on extinguishment of convertible notes of $22.1 million and a loss on settlement of convertible notes of $9.5 million.
Biggest changeThe following table reconciles net loss including noncontrolling interest to adjusted EBITDA (in thousands): Year Ended December 31, 2024 2023 2022 Net loss $ (81,189) $ (76,299) $ (103,377) Interest expense 33,095 37,703 32,642 Income tax expense (benefit), net of equity method income taxes 5,153 (5,617) 4,747 Depreciation and amortization (1) 90,587 98,244 92,698 EBITDA 47,646 54,031 26,710 Other income (2) — (3,440) (27,712) Gain on sale of assets (30,723) (5,265) — Proportional share of EBITDA adjustments to equity method investees 1,792 180 180 Adjusted EBITDA $ 18,715 $ 45,506 $ (822) (1) Excludes the amortization of operating lease right-of-use assets and amortization of debt issuance costs.
Inventory values are affected by the month-to-month spread in the futures markets. These spreads are also less volatile than overall market value of our inventory and tend to follow historical patterns, but cannot be mitigated directly.
Inventory values are affected by the month-to-month spread in the futures markets. These spreads are also less volatile than the overall market value of our inventory and tend to follow historical patterns, but cannot be mitigated directly.
Commodity Price Risk Our business is highly sensitive to commodity price risk, particularly for ethanol, corn, distillers grains, Ultra-High Protein, renewable corn oil and natural gas.
Commodity Price Risk Our business is highly sensitive to commodity price risk, particularly for ethanol, corn, distillers grains (including Ultra-High Protein), renewable corn oil and natural gas.
Refer to Note 17 – Commitments and Contingencies included in the notes to consolidated financial statements for more information. Item 7A. Qualitative and Quantitative Disclosures About Market Risk. We use various financial instruments to manage and reduce our exposure to various market risks, including changes in commodity prices and interest rates.
Refer to Note 16 – Commitments and Contingencies included in the notes to consolidated financial statements for more information. Item 7A. Qualitative and Quantitative Disclosures About Market Risk. We use various financial instruments to manage and reduce our exposure to various market risks, including changes in commodity prices and interest rates.
Ineffectiveness of the hedges is recognized in the current period to the extent the change in fair value of the inventory is not offset by the change in fair value of the derivative. Please refer to Note 11 - Derivative Financial Instruments included in the notes to the audited consolidated financial statements included herein for further details.
Ineffectiveness of the hedges is recognized in the current period to the extent the change in fair value of the inventory is not offset by the change in fair value of the derivative. Please refer to Note 10 - Derivative Financial Instruments included in the notes to the audited consolidated financial statements included herein for further details.
The less correlated portion of inventory and purchase and sale contract market values, known as basis, is much less volatile than the overall market value of exchange-traded futures and tends to follow historical patterns. We manage this less volatile risk by constantly monitoring our position relative to the price changes in the market.
The less correlated portion of inventory and purchase and sale contract market values, known as basis, is much less volatile than the overall market value of 46 Table of Contents exchange-traded futures and tends to follow historical patterns. We manage this less volatile risk by constantly monitoring our position relative to the price changes in the market.
These derivative financial instruments are recognized in current assets or current liabilities at fair value. 36 Table of Contents At times, we hedge our exposure to changes in inventory values and designate qualifying derivatives as fair value hedges. The carrying amount of the hedged inventory is adjusted in the current period for changes in fair value.
These derivative financial instruments are recognized in current assets or current liabilities at fair value. At times, we hedge our exposure to changes in inventory values and designate qualifying derivatives as fair value hedges. The carrying amount of the hedged inventory is adjusted in the current period for changes in fair value.
Each 45 Table of Contents SOFR rate loan shall bear interest for each day at a rate per annum equal to the Term SOFR rate for the outstanding period plus a Term SOFR adjustment and an applicable margin of 2.25% to 2.50%, which is dependent on undrawn availability under the facility.
Each SOFR rate loan shall bear interest for each day at a rate per annum equal to the Term SOFR rate for the outstanding period plus a Term SOFR adjustment and an applicable margin of 2.25% to 2.50%, which is dependent on undrawn availability under the facility.
Ethanol prices are sensitive to world crude oil supply and demand, the price of crude oil, gasoline, corn, the price of substitute fuels, refining capacity and utilization, government regulation and consumer demand for alternative fuels. Corn prices are affected by weather conditions, yield, changes in domestic and global supply and demand, and government programs and policies.
Ethanol prices are sensitive to world crude oil supply and demand, the 45 Table of Contents price of crude oil, gasoline, corn, the price of substitute fuels, refining capacity and utilization, government regulation and consumer demand for alternative fuels. Corn prices are affected by weather conditions, yield, changes in domestic and global supply and demand, and government programs and policies.
For our agribusiness and energy services segment, our primary sources of revenue include sales of ethanol, distillers grains and renewable corn oil that we market for our ethanol plants, in which we earn a marketing fee, sales of ethanol we market for a third-party and sales of other commodities purchased in the open market.
For our agribusiness and energy services segment, our primary sources of revenue include sales of ethanol, distillers grains and renewable corn oil that we market for our ethanol plants, in which we earn a marketing fee, sales of ethanol and Ultra-High Protein we market for a third-party and sales of other commodities purchased in the open market.
The vast majority of our revenues are from forward contracts accounted for as derivatives under ASC 815 as disclosed in the tables within Note 4 - Revenue and Note 11 - Derivative Financial Instruments included in the notes to the audited consolidated financial statements included herein. Revenues include net gains or losses from derivatives related to products sold.
The vast majority of our revenues are from forward contracts accounted for as derivatives under ASC 815 as disclosed in the tables within Note 3 - Revenue and Note 10 - Derivative Financial Instruments included in the notes to the audited consolidated financial statements included herein. Revenues include net gains or losses from derivatives related to products sold.
It is possible that throughput volumes could fluctuate in the future, depending on various factors that drive each biorefinery’s variable contribution margin, including future driving and gasoline demand for the industry, demand for valuable coproducts we produce, and the supply and pricing of renewable feedstocks needed to operate our biorefineries.
It is possible that throughput volumes could fluctuate in the future, depending on various factors that drive each biorefinery’s variable contribution margin, including future driving and gasoline demand for the industry, demand for valuable co-products we produce, and the supply 37 Table of Contents and pricing of renewable feedstocks needed to operate our biorefineries.
During the first quarter of 2023, this revolving credit facility was extended five years to mature on April 30, 2028. Advances are subject to variable interest rates equal to SOFR plus 1.75%. At December 31, 2023, the outstanding principal balance was $7.0 million on the facility and the interest rate was 7.15%.
During the first quarter of 2023, this revolving credit facility was extended five years to mature on April 30, 2028. Advances are subject to variable interest rates equal to SOFR plus 1.75%. At December 31, 2024, the outstanding principal balance was $7.3 million on the facility and the interest rate was 6.12%.
Based on our forecasts, we believe we will maintain compliance at each of our subsidiaries for the next twelve months or have sufficient liquidity available on a consolidated basis to resolve noncompliance.
Based on our forecasts, we anticipate we will maintain compliance at each of our subsidiaries for the next twelve months and have sufficient liquidity available on a consolidated basis to resolve noncompliance.
Other income (expense) includes interest earned, interest expense and other non-operating items, as well as $3.4 million and $27.7 million grants received from the USDA for the year-ended December 31, 2023 and 2022, respectively, related to the Biofuel Producer Program. Income from Equity Method Investees.
Other income (expense) includes interest earned, interest expense and other non-operating items, as well as $3.4 million and $27.7 million grants received from the USDA for the years-ended December 31, 2023 and 2022, respectively, related to the Biofuel Producer Program. Income (Loss) from Equity Method Investees, Net of Income Taxes.
For the year ended December 31, 2023, revenues included net gains of $4.8 million and cost of goods sold included net gains of $30.2 million associated with derivative instruments. Ethanol Production Segment In the ethanol production segment, net gains and losses from settled derivative instruments are offset by physical commodity purchases or sales to achieve the intended operating margins.
For the year ended December 31, 2024, revenues included net gains of $9.6 million and cost of goods sold included net gains of $0.2 million associated with derivative instruments. Ethanol Production Segment In the ethanol production segment, net gains and losses from settled derivative instruments are offset by physical commodity purchases or sales to achieve the intended operating margins.
At December 31, 2023, our subsidiaries had approximately $126.8 million of net assets that were not available to use in the form of dividends, loans or advances due to restrictions contained in their credit facilities. Net cash provided by operating activities was $56.3 million in 2023 compared to $69.7 million in 2022.
At December 31, 2024, our subsidiaries had approximately $12.8 million of net assets that were not available to use in the form of dividends, loans or advances due to restrictions contained in their credit facilities. Net cash provided by (used in) operating activities was $(30.0) million in 2024 compared to $56.3 million in 2023.
Our exposure to market risk, which includes the impact of our risk management activities resulting from our fixed-price purchase and sale contracts and derivatives, is based on the estimated net income effect resulting from a hypothetical 10% change in price for the next 12 months starting on December 31, 2023, are as follows (in thousands): Commodity Estimated Total Volume Requirements for the Next 12 Months (1) Unit of Measure Net Income Effect of Approximate 10% Change in Price Ethanol 903,000 Gallons $106,788 Corn 310,000 Bushels $114,315 Distillers grains (2) 2,200 Tons (3) $27,409 Renewable corn oil 300,000 Pounds $10,279 Natural gas 26,400 MmBTU $3,884 (1) Estimated volumes assume production at full capacity.
Our exposure to market risk, which includes the impact of our risk management activities resulting from our fixed-price purchase and sale contracts and derivatives, is based on the estimated net income effect resulting from a hypothetical 10% change in price for the next 12 months starting on December 31, 2024, are as follows (in thousands): Commodity Estimated Total Volume Requirements for the Next 12 Months (1) Unit of Measure Net Income Effect of Approximate 10% Change in Price Ethanol 903,000 Gallons $118,410 Corn 310,000 Bushels $104,701 Distillers grains (2) 2,200 Tons (3) $24,266 Renewable corn oil 310,000 Pounds $9,869 Natural gas 26,400 MmBTU $5,352 (1) Estimated volumes assume production at full capacity.
Year Ended December 31, 2023 compared with the Year Ended December 31, 2022 Consolidated Results Consolidated revenues decreased $367.1 million in 2023 compared with 2022 primarily due to lower average selling prices and lower volumes sold on ethanol, distillers grains and renewable corn oil within our ethanol production segment as described below.
Year Ended December 31, 2024 compared with the Year Ended December 31, 2023 Consolidated Results Consolidated revenues decreased $836.9 million in 2024 compared with 2023 primarily due to lower weighted average selling prices on ethanol, distillers grains and renewable corn oil, partially offset by higher volumes sold on ethanol and renewable corn oil within our ethanol production segment as described below.
Corn feedstock costs include gains and losses on related derivative financial instruments not designated as cash flow hedges, inbound freight charges, inspection costs and transfer costs, as well as reclassifications of gains and losses on cash flow hedges from accumulated other comprehensive income or loss.
Corn feedstock costs include gains and losses on related derivative financial instruments not designated as cash flow hedges, inbound freight charges, inspection costs and transfer costs, as well as reclassifications of gains and losses on cash flow hedges from accumulated other comprehensive income or loss. Direct labor includes all compensation and related benefits of personnel involved in ethanol production.
We also had $251.0 million available under our committed revolving credit agreement, subject to restrictions or other lending conditions. Funds at certain subsidiaries are generally required for their ongoing operational needs and restricted from distribution.
On December 31, 2024, we had $173.0 million in cash and cash equivalents and $36.4 million in restricted cash. We also had $200.7 million available under our committed revolving credit agreement, subject to restrictions or other lending conditions. Funds at certain subsidiaries are generally required for their ongoing operational needs and restricted from distribution.
The current projected estimate for capital spending for 2024 is approximately $125 million to $150 million, which is subject to review prior to the initiation of any project. The estimate includes additional expenditures for various capital projects, which are expected to be financed with cash on hand and with cash provided by operating activities.
The current projected estimate for capital spending for 2025 is approximately $20 million to $35 million, which is subject to review prior to the initiation of any project, and expected to be financed with cash on hand and with cash provided by operating activities.
(2) Includes Ultra-High Protein (3) Distillers grains quantities are stated on an equivalent dried ton basis. 47 Table of Contents Agribusiness and Energy Services Segment In the agribusiness and energy services segment, our inventories, physical purchase and sale contracts and derivatives are marked to market.
(2) Includes Ultra-High Protein (3) Distillers grains quantities are stated on an equivalent dried ton basis. Agribusiness and Energy Services Segment In the agribusiness and energy services segment, our physical purchase and sale contracts and derivatives are marked to market. Our inventories are carried at the lower of cost or net realizable value, except fair-value hedged inventories.
Ethanol Production Segment On February 9, 2021, Green Plains SPE LLC, a wholly-owned special purpose subsidiary and parent of Green Plains Obion and Green Plains Mount Vernon issued $125.0 million of junior secured mezzanine notes due February 2026 with BlackRock for the purchase of all notes issued.
Ethanol Production Segment On February 9, 2021, Green Plains SPE LLC, a wholly-owned special purpose subsidiary and parent of Green Plains Obion and Green Plains Mount Vernon issued $125.0 million of junior secured mezzanine notes due February 2026 with BlackRock. These notes accrue interest at an annual rate of 11.75% and will mature on February 9, 2026.
For our partnership segment, our revenues consist primarily of fees for receiving, storing, transferring and transporting ethanol and other fuels. Cost of Goods Sold. For our ethanol production segment, Cost of goods sold includes materials, direct labor, shipping and plant overhead costs. Materials include the cost of corn feedstock, denaturant and process chemicals.
Cost of Goods Sold. For our ethanol production segment, cost of goods sold includes materials, direct labor, shipping and plant overhead costs. Materials include the cost of corn feedstock, denaturant and process chemicals.
Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements. Components of Revenues and Expenses Revenues . For our ethanol production segment, our revenues are derived primarily from the sale of ethanol, distillers grains, Ultra-High Protein and renewable corn oil.
For our ethanol production segment, our revenues are derived primarily from the sale of ethanol, distillers grains, Ultra-High Protein and renewable corn oil.
Revenues increased as a result of hedging activities by $10.9 million.
Revenues also increased as a result of hedging activities by $2.7 million.
Our inventories are carried at the lower of average cost or net realizable value, except fair-value hedged inventories. To reduce commodity price risk caused by market fluctuations for purchase and sale commitments of grain and grain held in inventory, we enter into exchange-traded futures and options contracts that serve as economic hedges.
To reduce commodity price risk caused by market fluctuations for purchase and sale commitments of grain and grain held in inventory, we enter into exchange-traded futures and options contracts that serve as economic hedges.
We may sell additional assets or equity or borrow capital to improve or preserve our liquidity, expand our business or acquire businesses. Debt We were in compliance with our debt covenants at December 31, 2023.
A continued sustained period of unprofitable operations, however, may strain our liquidity. We may sell additional assets or equity or borrow capital to improve or preserve our liquidity, expand our business or acquire businesses. 43 Table of Contents Debt We were in compliance with our debt covenants at December 31, 2024.
Comparability The following summarizes various events that affect the comparability of our operating results for the past three years: • September 2023 Atkinson, Nebraska ethanol plant was sold and certain storage assets of this plant were acquired from the partnership prior to being sold. • May 2022 Received a $27.7 million grant from the USDA as part of the Biofuel Producer Program.
Comparability The following summarizes various events that affect the comparability of our operating results for the past three years: • September 2024 Sale of terminal located in Birmingham, Alabama • September 2023 Sale of ethanol plant located in Atkinson, Nebraska • May 2022 Received a $27.7 million grant from the USDA as part of the Biofuel Producer Program.
At December 31, 2023, the outstanding principal balance was $99.0 million on the facility and the interest rate was 9.41%. Green Plains Commodity Management has an uncommitted $40.0 million revolving credit facility to finance margins related to its hedging programs, which is secured by cash and securities held in its brokerage accounts.
At December 31, 2024, the outstanding principal balance was $133.5 million on the facility and the interest rate was 7.88%. Green Plains Commodity Management has an uncommitted $40.0 million secured revolving credit facility to finance margins related to its hedging programs.
We frequently draw from and repay these facilities which results in significant cash movements reflected on a gross basis within financing activities as proceeds from and payments on short-term borrowings.
Additionally, Green Plains Finance Company, Green Plains Trade, Green Plains Grain and Green Plains Commodity Management use revolving credit facilities to finance working capital requirements. We frequently draw from and repay these facilities which results in significant cash movements reflected on a gross basis within financing activities as proceeds from and payments on short-term borrowings.
A 10% increase in interest rates would affect our interest cost by approximately $1.7 million per year. 46 Table of Contents Refer to Note 12 – Debt included in the notes to the audited consolidated financial statements included herein for more information about our debt.
At December 31, 2024, we had $578.6 million in debt, $140.8 million of which had variable interest rates. A 10% increase in interest rates would affect our interest cost by approximately $1.4 million per year. Refer to Note 11 – Debt included in the notes to the audited consolidated financial statements included herein for more information about our debt.
We incurred capital expenditures of $108.5 million in 2023 primarily for Ultra-High Protein expansion projects at Mount Vernon and Obion, the clean sugar expansion project at Shenandoah and for various other capital projects.
We incurred capital expenditures of $95.1 million in 2024 primarily for the clean sugar expansion project at Shenandoah and for various other capital projects.
In the event a subsidiary is unable to comply with its debt covenants, the subsidiary’s lenders may determine that an event of default has occurred, and following notice, the lenders may terminate the commitment and declare the unpaid balance due and payable. 44 Table of Contents Corporate Activities In March 2021, we issued $230.0 million of unsecured 2.25% convertible senior notes due in 2027, or the 2.25% notes.
In the event a subsidiary is unable to comply with its debt covenants, the subsidiary’s lenders may determine that an event of default has occurred, and following notice, the lenders may terminate the commitment and declare the unpaid balance due and payable.
Income from equity method investees represents our proportional share of earnings from our equity method investees. Results of Operations We maintained an average utilization rate of approximately 89% of capacity during 2023, compared with 91% of capacity for the prior year. Our operating strategy is to transform our company to a value-add agricultural technology company.
Income (loss) from equity method investees, net of income taxes represents our proportional share of earnings from our equity method investees. Results of Operations We maintained an average utilization rate of approximately 94% of capacity during 2024, compared with 89% of capacity for the prior year.
Corporate activities include selling, general and administrative expenses, consisting primarily of compensation, professional fees and overhead costs not directly related to a specific operating segment.
Corporate activities include gain on sale of assets and selling, general and administrative expenses, consisting primarily of compensation, professional fees and overhead costs not directly related to a specific operating segment. During the normal course of business, our operating segments do business with each other.
We monitor and manage this exposure as part of our overall risk management policy to reduce the adverse effect market volatility may have on our operating results. We may hedge these commodities as one way to mitigate risk; however, there may be situations when these hedging activities themselves result in losses.
We monitor and manage this exposure as part of our overall risk management policy to reduce the adverse effect market volatility may have on our operating results.
Changes in the market value of grain inventories, forward purchase and sale contracts, and exchange-traded futures and options contracts are recognized as a component of cost of goods sold. Operations and Maintenance Expense. For our partnership segment, transportation expense is the primary component of operations and maintenance expense.
Changes in the market value of grain inventories, forward purchase and sale contracts, and exchange-traded futures and options contracts are recognized as a component of cost of goods sold. Selling, General and Administrative Expenses. Selling, general and administrative expenses are recognized at the operating segment and corporate level.
Net cash used in investing activities was $106.9 million in 2023 compared to $105.3 million in 2022 primarily due to higher cash provided by lower capital expenditures and proceeds from the sale of assets in 2023, offset by the proceeds from the sale of marketable securities in the prior year.
Net cash used in investing activities was $62.1 million in 2024 compared to $106.9 million in 2023 primarily due to higher proceeds from the sale of assets, lower capital expenditures and lower investments in equity method investees.
Operating loss in our ethanol production segment decreased $50.8 million in 2023 compared with 2022 primarily due to increased margins on ethanol production as outlined above. Depreciation and amortization expense for the ethanol production segment was $89.5 million for 2023 compared with $81.5 million during 2022, with the increase primarily due to Ultra-High Protein assets placed in service.
Operating loss in our ethanol production segment increased $20.8 million in 2024 compared with 2023 primarily due to decreased margins on ethanol production as outlined above. Depreciation and amortization expense for the ethanol production segment was $82.8 million for 2024 compared with $92.7 million during 2023, with the decrease primarily due to certain assets becoming fully depreciated.
Corporate Activities Operating loss was impacted by an increase in corporate activities of $0.8 million for 2023 compared with 2022, primarily due to increased personnel costs and transaction costs related to the Merger Agreement, partially offset by the gain on the sale of assets during 2023.
Corporate Activities Operating loss was impacted by a decrease in corporate activities of $34.9 million for 2024 compared with 2023, which was primarily due to an increase in gain on sale of assets and a decrease in personnel costs compared to the same period in 2023.
Capital resources for maintenance and growth 43 Table of Contents expenditures are funded by a variety of sources, including cash generated from operating activities, borrowings under credit facilities, or issuance of public or private debt or equity securities. Our ability to access capital markets for debt under reasonable terms depends on our financial condition, credit ratings and market conditions.
We fund our operating expenses and service debt primarily with operating cash flows. Capital resources for maintenance and growth expenditures are funded by a variety of sources, including cash generated from operating activities, borrowings under credit facilities, or issuance of public or private debt or equity securities.
These intersegment activities are treated like third-party transactions with origination, marketing and storage fees charged at estimated market values. Consequently, these transactions affect segment performance; however, they do not impact our consolidated results since the revenues and corresponding costs are eliminated.
Consequently, these transactions affect segment performance; however, they do not impact our consolidated results since the revenues and corresponding costs are eliminated.
At December 31, 2023, the outstanding principal balance on the 2.25% notes was $230.0 million. In June 2019, we issued $115.0 million of 4.00% convertible senior notes due in 2024, or the 4.00% notes. During May 2021, we entered into a privately negotiated agreement with certain noteholders of our 4.00% notes.
At December 31, 2024, the outstanding principal balance on the 2.25% notes was $230.0 million. In June 2019, we issued $115.0 million of 4.00% convertible senior notes due in 2024, or the 4.00% notes. On May 25, 2022, we gave notice calling for the redemption of our outstanding 4.00% notes, totaling an aggregate principal amount of $64.0 million.
Transportation expense includes rail car leases, shipping and freight and costs incurred for storing ethanol at destination terminals. Gain on Sale of Assets. We completed the sale of the ethanol plant located in Atkinson, Nebraska in September 2023. The sale of Atkinson resulted in a pretax gain of $4.1 million recorded at the corporate level.
We also completed the sale of the ethanol plant located in Atkinson, Nebraska in September 2023. The sale of Atkinson resulted in a pretax gain of $4.1 million recorded at the corporate level. Other Income (Expense).
The 2.25% notes bear interest at a rate of 2.25% per year, payable on March 15 and September 15 of each year.
Corporate Activities In March 2021, we issued $230.0 million of unsecured 2.25% convertible senior notes due in 2027, or the 2.25% notes. The 2.25% notes bear interest at a rate of 2.25% per year, payable on March 15 and September 15 of each year.
Sudden changes in commodity prices may require cash deposits with brokers for margin calls or significant liquidity with little advanced notice to meet margin calls, depending on our open derivative positions. We continuously monitor our exposure to margin calls and believe we will continue to maintain adequate liquidity to cover margin calls from our operating results and borrowings.
We use derivative financial instruments to reduce the market risk associated with fluctuations in commodity prices. Sudden changes in commodity prices may require cash deposits with brokers for margin calls or significant liquidity with little advanced notice to meet margin calls, depending on our open derivative positions.
The following table reconciles segment EBITDA to consolidated adjusted EBITDA (in thousands): Year Ended December 31, 2023 2022 2021 Adjusted EBITDA: Ethanol production (1) $ 26,769 $ (8,619) $ 55,056 Agribusiness and energy services 31,689 39,798 19,716 Partnership 51,678 52,429 53,109 Intersegment eliminations 114 3,580 (587) Corporate activities (2) (56,219) (60,478) (10,499) EBITDA 54,031 26,710 116,795 Other income (3) (3,440) (27,712) — Gain on sale of assets, net (5,265) — (29,601) Proportional share of EBITDA adjustments to equity method investees 180 180 184 Adjusted EBITDA $ 45,506 $ (822) $ 87,378 (1) Operating loss for ethanol production includes an inventory lower of average cost or net realizable value adjustment of $2.6 million and $12.3 million for the year-ended December 31, 2023 and 2022, respectively.
(2) Other income for the years-ended December 31, 2023 and 2022, include grants received from the USDA related to the Biofuel Producer Program of $3.4 million and $27.7 million, respectively. 40 Table of Contents The following table reconciles segment EBITDA to consolidated adjusted EBITDA (in thousands): Year Ended December 31, 2024 2023 2022 Adjusted EBITDA: Ethanol production (1) $ 39,645 $ 78,561 $ 47,390 Agribusiness and energy services 31,935 31,689 39,798 Corporate activities (2) (23,934) (56,219) (60,478) EBITDA 47,646 54,031 26,710 Other income (3) — (3,440) (27,712) Gain on sale of assets (30,723) (5,265) — Proportional share of EBITDA adjustments to equity method investees 1,792 180 180 Adjusted EBITDA $ 18,715 $ 45,506 $ (822) (1) Ethanol production includes an inventory lower of cost or net realizable value adjustment of $2.1 million, $2.6 million, and $12.3 million for the years-ended December 31, 2024, 2023, and 2022, respectively.
Ethanol Production Segment Key operating data for our ethanol production segment is as follows: Year Ended December 31, 2023 2022 Ethanol sold (thousands of gallons) 840,819 872,133 Distillers grains sold (thousands of equivalent dried tons) 1,933 2,213 Ultra-High Protein Sold (thousands of tons) 223 67 Renewable corn oil sold (thousands of pounds) 279,861 281,730 Corn consumed (thousands of bushels) 289,267 301,868 42 Table of Contents Revenues in our ethanol production segment decreased $254.3 million in 2023 compared with 2022 primarily due to lower ethanol, distillers grains and renewable corn oil volumes sold driven partially by the disposition of our Atkinson, Nebraska plant resulting in decreased revenues of $82.3 million, $28.4 million and $1.3 million, respectively, as well as lower weighted average selling prices on ethanol, distillers grains and renewable corn oil resulting in decreased revenues of $96.8 million, $32.4 million and $14.4 million, respectively.
The following discussion provides greater detail about our segment performance. 41 Table of Contents Ethanol Production Segment Key operating data for our ethanol production segment is as follows: Year Ended December 31, 2024 2023 Ethanol (thousands of gallons) 846,226 840,819 Distillers grains (thousands of equivalent dried tons) 1,890 1,933 Ultra-High Protein (thousands of tons) 248 223 Renewable corn oil (thousands of pounds) 290,801 279,861 Corn (thousands of bushels) 289,454 289,267 Revenues in our ethanol production segment decreased $757.5 million in 2024 compared with 2023 primarily due to lower weighted average selling prices on ethanol, distillers grains and renewable corn oil resulting in decreased revenues of $614.5 million, $114.7 million and $49.8 million, respectively, partially offset by higher ethanol and renewable corn oil volumes sold resulting in increased revenues of $13.6 million and $7.0 million, respectively.
(2) Excludes the amortization of operating lease right-of-use assets and amortization of debt issuance costs. (3) Other income for the year-ended December 31, 2023 and 2022, includes a grant received from the USDA related to the Biofuel Producer Program of $3.4 million and $27.7 million, respectively.
(2) Corporate activities for the years-ended December 31, 2024 and 2023 include a $30.7 million and $4.1 million gain on sale of assets, respectively. (3) Other income for the years-ended December 31, 2023 and 2022 include grants received from the USDA related to the Biofuel Producer Program of $3.4 million and $27.7 million, respectively.
Please refer to Note 16 - Income Taxes included in the notes to the audited consolidated financial statements included herein for further details. Recently Issued Accounting Pronouncements For information related to recent accounting pronouncements, see Note 2 – Summary of Significant Accounting Policies included in the notes to the audited consolidated financial statements included herein.
Please refer to Note 15 - Income Taxes included in the notes to the audited consolidated financial statements included herein for further details.
For our agribusiness and energy services segment, purchases of ethanol, distillers grains, renewable corn oil and grain are the primary component of cost of goods sold.
Shipping costs incurred by the company, including railcar costs, are also reflected in cost of goods sold. Plant overhead consists primarily of plant utilities, repairs and maintenance, and outbound freight charges. For our agribusiness and energy services segment, purchases of ethanol, distillers grains, renewable corn oil and grain are the primary component of cost of goods sold.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2022, compared to the year ended December 31, 2021, can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 10, 2023. 38 Table of Contents Segment Results We report the financial and operating performance for the following three operating segments: (1) ethanol production, which includes the production of ethanol, distillers grains, Ultra-High Protein and renewable corn oil, (2) agribusiness and energy services, which includes grain handling and storage, commodity marketing and merchant trading for company-produced and third-party ethanol, distillers grains, renewable corn oil, natural gas and other commodities, and (3) partnership, which includes fuel storage and transportation services.
Segment Results We report the financial and operating performance for the following two operating segments: (1) ethanol production, which includes the production, storage, and transportation of ethanol, distillers grains, Ultra-High Protein and renewable corn oil and (2) agribusiness and energy services, which includes grain handling and storage, commodity marketing and merchant trading for company-produced and third-party ethanol, distillers grains, renewable corn oil, natural gas and other commodities.
Operating activities compared to the prior year were primarily affected by higher cash provided by lower inventory and lower net loss compared to the prior year, partially offset by higher cash used related to lower accounts payables.
Operating activities compared to the prior year were primarily affected by an increase in cash used for inventory and lower collections of accounts receivable.
We believe that our ability to obtain financing at reasonable rates based on these factors remains sufficient and provides a solid foundation to meet our future liquidity and capital resource requirements. On December 31, 2023, we had $349.6 million in cash and cash equivalents and $29.2 million in restricted cash.
Our ability to access capital markets for debt under reasonable terms depends on our financial condition, credit ratings and market conditions. We believe that our ability to obtain financing at reasonable rates based on these factors remains sufficient and provides a solid foundation to meet our future liquidity and capital resource requirements.
Our board of directors authorized a share repurchase program of up to $200.0 million of our common stock. Under the program, we may repurchase shares in open market transactions, privately negotiated transactions, accelerated share buyback programs, tender offers or by other means.
Under the program, we may repurchase shares in open market transactions, privately negotiated transactions, accelerated share buyback programs, tender offers or by other means. The timing and amount of repurchase transactions are determined by our management based on market conditions, share price, legal requirements and other factors.
To date, we have repurchased approximately 7.4 million shares of common stock for approximately $92.8 million under the program. We believe we have sufficient working capital for our existing operations. A continued sustained period of unprofitable operations, however, may strain our liquidity.
The program may be suspended, modified or discontinued at any time without prior notice. We did not repurchase any common stock in 2024, 2023 or 2022. To date, we have repurchased approximately 7.4 million shares of common stock for approximately $92.8 million under the program. We believe we have sufficient working capital for our existing operations.
We minimize our credit risk by entering into transactions with high quality counterparties, limiting the amount of financial exposure it has with each counterparty and monitoring their financial condition. Market risk is the risk that the value of the financial instrument might be adversely affected by a change in commodity prices or interest rates.
Market risk is the risk that the value of the financial instrument might be adversely affected by a change in commodity prices or interest rates.
Agribusiness and Energy Services Segment Revenues in our agribusiness and energy services segment decreased $114.7 million while operating income also decreased $8.3 million in 2023 compared with 2022. The decrease in revenues was primarily due to a decrease in ethanol, natural gas and distillers grains trading margins, partially offset by an increase in renewable corn oil trading volumes.
Agribusiness and Energy Services Segment Revenues in our agribusiness and energy services segment decreased $79.8 million while operating income increased $0.1 million in 2024 compared with 2023. The decrease in revenues was primarily due to lower weighted average ethanol and natural gas trading prices.
Distillers grains prices are impacted by livestock numbers on feed, prices for feed alternatives and supply, which is associated with ethanol plant production. Natural gas prices are influenced by severe weather in the summer and winter and hurricanes in the spring, summer and fall.
Distillers grains and Ultra-High Protein prices are impacted by livestock numbers on feed, prices for feed alternatives and supply, which is associated with ethanol plant production. Renewable corn oil prices are impacted by prices for renewable diesel fuel, diesel fuel and competing feedstocks.
Cost of goods sold in our ethanol production segment decreased $317.1 million for 2023 compared with 2022 due to lower weighted average corn prices, lower corn volumes processed and hedging activities, resulting in decreased costs of $300.2 million, $91.1 million and $46.3 million, respectively, as well as lower chemicals and other costs of $26.8 million and lower utility costs of $6.4 million, partially offset by higher ethanol volumes purchased of $150.2 million, as well as higher freight costs of $7.9 million.
Cost of goods sold in our ethanol production segment decreased $722.5 million for 2024 compared with 2023 primarily due to lower weighted average corn prices, lower ethanol volumes purchased and lower input costs related to natural gas resulting in decreased costs of $502.5 million, $166.1 million and $83.6 million, respectively, partially offset by higher production labor costs and higher repairs and maintenance costs resulting in increased costs of $15.9 million and $10.6 million, respectively.
Other factors include North American energy exploration and production, and the amount of natural gas in underground storage during injection and withdrawal seasons. During 2022, we locked in natural gas purchases above current market rates, which adversely impacted our 2023 margins.
Natural gas prices are influenced by severe weather in the summer and winter and hurricanes in the spring, summer and fall. Other factors include North American energy exploration and production, and the amount of natural gas in underground storage during injection and withdrawal seasons.
We also completed the sale of the ethanol plant located in Ord, Nebraska in March 2021. The sale of Ord resulted in a pretax gain of $35.9 million recorded at the corporate level. Selling, General and Administrative Expense. Selling, general and administrative expenses are recognized at the operating segment and corporate level.
Selling, general and administrative expenses that cannot be allocated to an operating segment are referred to as corporate activities. Gain on Sale of Assets. We completed the sale of the terminal located in Birmingham, Alabama in September 2024. The sale of the terminal resulted in a pretax gain of $30.7 million recorded at the corporate level.
To reduce commodity price risk caused by market fluctuations, we enter into exchange-traded futures and options contracts that serve as economic hedges. Our results are impacted when there is a mismatch of gains or losses associated with the derivative instrument during a reporting period when the physical commodity purchases or sale has not yet occurred.
To reduce commodity price risk caused by market fluctuations, we enter into exchange-traded futures and options contracts that serve as economic hedges.
Depending on the margin environment, we may exercise operational discretion that results in reductions in production volumes.
Our operating strategy is to transform our company to a value-add agricultural technology company creating lower carbon, high-value ingredients from existing resources. Depending on the margin environment, we may exercise operational discretion that results in reductions in production volumes.
Additionally, we had lower revenues within our agribusiness and energy services segment as a result of decreased trading margins. Net loss decreased $27.1 million in 2023 compared with 2022 primarily due to higher margins in our ethanol production segment, partially offset by lower margins in our agribusiness and energy services segment.
Net loss increased $4.9 million in 2024 compared with 2023 primarily due to lower margins in our ethanol production segment partially offset by a gain on the sale of assets from the Birmingham Transaction and decreased depreciation expense.
We also have small equipment financing loans, finance leases on equipment or facilities, and other forms of debt financing.
Prepayments totaling $56.0 million, $3.0 million and $1.0 million were made during the years ended December 31, 2024, 2023 and 2022, respectively. 44 Table of Contents We also have small equipment financing loans, finance leases on equipment or facilities, and other forms of debt financing.
Aggregate minimum lease payments under the operating lease agreements for future fiscal years as of December 31, 2023 totaled $86.9 million . As of December 31, 2023, we had contracted future purchases of grain, ethanol, distillers grains, and natural gas valued at approximately $166.4 million and future commitments for storage and transportation valued at approximately $27.0 million .
As of December 31, 2024, we had contracted future purchases of grain, ethanol, distillers grains, and natural gas valued at approximately $196.6 million, future commitments for storage and transportation valued at approximate ly $38.9 million, and accumulated commitments related to the construction of carbon capture and sequestration equipment at our three Nebraska plants of $17.9 million.
During the normal course of business, our operating segments do business with each other. For example, our agribusiness and energy services segment procures grain and natural gas and sells products, including ethanol, distillers grains and renewable corn oil of our ethanol production segment. Our partnership segment provides fuel storage and transportation services for our agribusiness and energy services segment.
For example, our agribusiness and energy services segment procures grain and natural gas and sells products, including ethanol, distillers grains, Ultra-High Protein, and renewable corn oil of our ethanol production segment. These intersegment activities are treated like third-party transactions with origination, marketing and storage fees charged at estimated market values.
Refer to Note 12 – Debt included in the notes to the audited consolidated financial statements included herein for more information about our debt. Contractual Obligations and Commitments In addition to debt, our material future obligations include certain lease agreements and contractual and purchase commitments related to commodities, storage and transportation.
Contractual Obligations and Commitments In addition to debt, our material future obligations include certain lease agreements and contractual and purchase commitments related to commodities, storage and transportation. Aggregate minimum lease payments under the operating lease agreements for future fiscal years as of December 31, 2024 totale d $82.3 million.
By using derivatives to hedge exposures to changes in commodity prices, we are exposed to credit and market risk. Our exposure to credit risk includes the counterparty’s failure to fulfill its performance obligations under the terms of the derivative contract.
Our exposure to credit risk includes the counterparty’s failure to fulfill its performance obligations under the terms of the derivative contract. We minimize our credit risk by entering into transactions with high quality counterparties, limiting the amount of financial exposure it has with each counterparty and monitoring their financial condition.
Our business is highly sensitive to the price of commodities, particularly for corn, ethanol, distillers grains, Ultra-High Protein, renewable corn oil and natural gas. We use derivative financial instruments to reduce the market risk associated with fluctuations in commodity prices.
This excludes an estimated $110 million of additional expenditures related to our carbon capture and sequestration projects expected to occur in 2025 and to be funded through project related financing. Our business is highly sensitive to the price of commodities, particularly for corn, ethanol, distillers grains (including Ultra-High Protein), renewable corn oil and natural gas.
Income Taxes We recorded income tax benefit of $5.6 million for 2023 compared to an income tax expense of $4.7 million in 2022. The increase in the amount of tax benefit recorded for 2023 was primarily due to a decrease in the valuation allowance recorded against certain deferred tax assets.
Income Taxes We recorded income tax expense, including income tax benefit from equity method investees of $5.2 million for 2024 compared to an income tax benefit of $5.6 million in 2023.
(2) Corporate activities for the year-ended December 31, 2023 and 2021 includes a $4.1 million and $29.6 million net gain on sale of assets, respectively.
(4) Corporate activities for the years-ended December 31, 2024 and 2023 include a $30.7 million and $4.1 million gain on sale of assets, respectively. We use EBITDA, adjusted EBITDA, and segment EBITDA as measures of profitability to compare the financial performance of our reportable segments and manage those segments.
Intersegment Eliminations Intersegment eliminations of revenues decreased by $0.6 million for 2023 compared with 2022 primarily due to decreased intersegment marketing and commodity service fees within the agribusiness and energy services segment as a result of lower production volumes, partially offset by increased storage and throughput fees paid to the partnership segment.
Intersegment Eliminations Intersegment eliminations of revenues decreased by $0.3 million for 2024 compared with 2023 primarily due to decreased freight revenue associated with the ethanol production segment.
(2) Corporate activities for the year-ended December 31, 2023 and 2021 includes a $4.1 million and $29.6 million net gain on sale of assets, respectively.
(2) Ethanol production includes an inventory lower of cost or net realizable value adjustment of $2.1 million, $2.6 million, and $12.3 million for the years-ended December 31, 2024, 2023, and 2022, respectively. (3) Depreciation and amortization for corporate activities includes impairment of a research and development technology intangible asset of $3.5 million for the year-ended December 31, 2024.
(3) Other income for the year-ended December 31, 2023 and 2022, includes a grant received from the USDA related to the Biofuel Producer Program of $3.4 million and $27.7 million, respectively. 41 Table of Contents Total assets by segment are as follows (in thousands): Year Ended December 31, 2023 2022 Total assets (1) Ethanol production $ 1,173,218 $ 1,157,791 Agribusiness and energy services 413,937 489,083 Partnership 102,776 108,680 Corporate assets 254,300 386,437 Intersegment eliminations (4,909) (18,860) $ 1,939,322 $ 2,123,131 (1) Asset balances by segment exclude intercompany balances.
Total assets by segment are as follows (in thousands): Year Ended December 31, 2024 2023 Total assets (1) Ethanol production $ 1,234,635 $ 1,275,562 Agribusiness and energy services 412,006 413,937 Corporate assets 143,716 254,300 Intersegment eliminations (8,183) (4,477) $ 1,782,174 $ 1,939,322 (1) Asset balances by segment exclude intercompany balances.
Adjusted EBITDA increased $46.3 million in 2023 compared with 2022 primarily due to higher margins in our ethanol production segment, partially offset by lower margins in our agribusiness and energy services segment and lower other income from the grants received from the USDA related to the Biofuel Producer Program.
Adjusted EBITDA decreased $26.8 million in 2024 compared with 2023 primarily due to lower margins in our ethanol production segment, partially offset by lower corporate personnel costs. Interest expense decreased $4.6 million in 2024 compared with 2023 primarily due to lower debt balances.
Removed
Direct labor includes all compensation and related benefits of personnel 37 Table of Contents involved in ethanol production. Shipping costs incurred by the company, including railcar costs, are also reflected in cost of goods sold. Plant overhead consists primarily of plant utilities, repairs and maintenance, and outbound freight charges.

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