Bunky, re CCGY. I guess I'm still in the wait and see camp. Increased capacity is nice, and demand levels are certainly improving.....but the big question for me is margins. Their cost of inputs is most likely rising as well, and biodeisel prices are kept fixed by the govt.
This is what the company said in a PR from May 2008:
"The recent spike in the cost of our raw materials associated with the rapid increase in global crude oil prices and agricultural commodity prices in Asia and China during the quarter, combined with a stagnant wholesale diesel price in China impacted our results for this quarter,"
"""We have made the necessary adjustments by shifting our focus away from biodiesel production and toward the sale of higher value-added specialty chemicals, the market for which is not regulated by the Chinese government.""
This is the problem for producers/refiners. They get squeezed in both good and bad times. Perhaps the best time for them is coming out of a slowdown IF input prices lag increases in fuel prices. I don't really like the sector, and so don't follow all the commodity pricing trends for CCGY. I would think that anyone looking closely at this as an investment would have to do at least that level of DD before jumping in here. Perhaps others can comment.
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