AI
Tuesday, September 15, 2009 4:23:27 PM
1. Higher GDP could cause input costs to rise which led to a shutdown of biodiesel last year.
These are vague hypotheticals...I was just trying to update everybody on the specific facts regarding CCGY...not the macroeconomic conditions that may prevail in China in 2010. The primary facts in questions were:
1.) Is the construction of CCGY's new facility fully financed.
Answer: Yes. 100%.
2.) Are the working capital requirements for the new facility fully financed.
Answer: Yes. 100%.
Now, do I ignore input costs? No. Certainly not. But I can log on to the exchange any old day & check the cost of palm oil. And I can hop over to competitors and cross check against their input costs. If input costs get out of control we'll get caught by it just like you get run over by a snail...
You cite some huge estimates for the new plant
I just went through my posts. I don't think I cited or asserted any estimate for the new plant.
2. Your team is playing Chemicals for export, not biodiesel. And those results could be 6 months away.
The new plant is definitely going to give CCGY greater flexibility when selling into internation markets. That doesn't mean that they HAVE to do it, but they probably will. I don't know that it's going to take 6 months to develop that channel, but if it does I've got good news for you! THEY STARTED 6 MONTHS AGO!
Ha! Take a look at 1h09 sales vs 1h08 sales:
Inter'l/Export sales:
1h09: 43% of sales were int'l
1h08: 17% of sales were int'l
In the most recent quarter, 49% of sales were international, so the trend has been going that way. Most likely because margins are so much better in the international market than the domestic. If that condition changes, CCGY will be able to sell more into the domestic market and less into international markets. If waste palm oil from indonesia is cheaper than domestically supplied waste oil, CCGY will have the flexibility to use that feedstock. If they get a good price on waste oil from Malyasia, they'll be able to use that feedstock. If selling diesel to ships provides healthy margins, CCGY will be able to do that.
It's not about being a captive to the export market. It's about having the flexibility to easily sell into that market. Since the new plant sits next to a deep water port, it provides CCGY a little more flexibility, that's all.
These are vague hypotheticals...I was just trying to update everybody on the specific facts regarding CCGY...not the macroeconomic conditions that may prevail in China in 2010. The primary facts in questions were:
1.) Is the construction of CCGY's new facility fully financed.
Answer: Yes. 100%.
2.) Are the working capital requirements for the new facility fully financed.
Answer: Yes. 100%.
Now, do I ignore input costs? No. Certainly not. But I can log on to the exchange any old day & check the cost of palm oil. And I can hop over to competitors and cross check against their input costs. If input costs get out of control we'll get caught by it just like you get run over by a snail...
You cite some huge estimates for the new plant
I just went through my posts. I don't think I cited or asserted any estimate for the new plant.
2. Your team is playing Chemicals for export, not biodiesel. And those results could be 6 months away.
The new plant is definitely going to give CCGY greater flexibility when selling into internation markets. That doesn't mean that they HAVE to do it, but they probably will. I don't know that it's going to take 6 months to develop that channel, but if it does I've got good news for you! THEY STARTED 6 MONTHS AGO!
Ha! Take a look at 1h09 sales vs 1h08 sales: Inter'l/Export sales:
1h09: 43% of sales were int'l
1h08: 17% of sales were int'l
In the most recent quarter, 49% of sales were international, so the trend has been going that way. Most likely because margins are so much better in the international market than the domestic. If that condition changes, CCGY will be able to sell more into the domestic market and less into international markets. If waste palm oil from indonesia is cheaper than domestically supplied waste oil, CCGY will have the flexibility to use that feedstock. If they get a good price on waste oil from Malyasia, they'll be able to use that feedstock. If selling diesel to ships provides healthy margins, CCGY will be able to do that.
It's not about being a captive to the export market. It's about having the flexibility to easily sell into that market. Since the new plant sits next to a deep water port, it provides CCGY a little more flexibility, that's all.
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