Get ready for E15 Gasoline, which is a 50% increase in Ethanol in Gasoline mixure
December 21, 2009
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RELATED TICKERS: ANDE
, ADM
, MGPI
Equity Plays on Potential Ethanol Boost
By the tickerspy.com Staff , On Tuesday December 1, 2009, 12:32 pm EST
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Though the Environmental Protection Agency has postponed a decision on the potential ethanol boost, studies show promising potential.
In a letter to ethanol support association Growth Energy, the U.S. EPA said, "To achieve the renewable fuel requirements in future years, it is clear that ethanol will need to be blended into gasoline at levels greater than the current limit of 10%." Growth Energy is pushing for the legalization of E15 gasoline, which would have up to 15% ethanol by volume. The EPA explained that should test results remain supportive, the agency "would be in a position to approve E15 for 2001 and newer vehicles" in the mid-2010 timeframe, noting that if problems arise a decision could be delayed further.
The news spurred optimism among biofuel investors, sending the Ethanol and Biofuel Stocks Index up by 7%. The sector is now outperforming the S&P 500 by more than 16% over the last month.
Omaha, Nebraska-based fuel-grade ethanol player Green Plains Renewable Energy (NASDAQ: GPRE - News) is leading the sector higher with an 13% spike today. MGP Ingredients (NASDAQ: MGPI - News) and The Andersons (NASDAQ: ANDE - News) are following with gains of more than 6.5%.
As of the most recent 13F filings with the SEC, which were due in mid-November, 27 Pros were holding Archer Daniels Midland (NYSE: ADM - News) shares among their top-15 U.S.-listed equity positions. The stock is moving higher by more than 3% today, as is ethanol and sugar play Cosan Limited (NYSE: CZZ - News) and consumer electronics retailer turned alternative energy investment company Rex Stores (NYSE: RSC - News).
As of this writing, the Ethanol and Biofuel Stocks Index is one of the the top-10 performing tickerspy Indexes over the last month, up by 23.8%.
Investors can track the Ethanol and Biofuel Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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