Two things to notice about that graph:
1. The CARD model assumes a net cost of $0.25 for debt financing to pay off the capital cost of the plant. PEIX is not in that position. At $0.25 the CARD model is breaking even, whereas PEIX (if it were the exact same plant) is booking profit. It's now net debt free.
2. The bottom line is the red ink on the graph. Other than a few spikes, times were actually worse from early 2012 through to early 2013.
The production margin calculation has PEIX averaging around $0.57 at present. My understanding from the PEIX Operating Metric model is that the balance of costs run PEIX around $0.47/gal. Even at this low net margin, that leaves $0.10 x 50M gal/quarter net before taxes and debt servicing on the remaining $17M outstanding (less investment return on the $40M profit now in the bank).
Just as PEIX didn't pocket kajillions of dollars and turn into a $40 stock when the CARD model said it should in Q2, it's not exactly going down the tubes as the CARD model says it should for Q4. But then that's the problem with using a model for the entire industry, when the model in particular doesn't even stand up against the USDA ongoing production numbers for Iowa plants. The model is a generalization. I highly detailed generalization perhaps, but a generalization nonetheless.
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