Jamaica Broilers Chairman Robert Levy has shaken off the hiccups of prevailing depressed ethanol prices in the US and questionable trading in shares, painting a rosy picture for the future of his JB Ethanol venture.

Jamaica Broilers Ethanol plant located in Old Harbour.

Ethanol prices are falling as manufacturers in the US Midwest corn belt were forced to drop their prices in order to cost-effectively move the product by rail or truck to the east coast, explained Levy.

"The logistics to bring it from the Midwest to the east coast has depressed prices. Ethanol cannot be moved by pipes, they dropped the price to be able to move it more effectively," he said.
But an optimistic Levy asserted that as soon as the logistics were sorted out ethanol prices will again begin to rise.

But foremost in Levy's favourable assessment of the venture is the apparently higher cost to produce ethanol from corn in the US against using sugar cane as the feedstock and JB Ethanol's advantage in moving the product.

Levy charged that capital expenditure to construct ethanol plants using corn far outstrips his set-up cost, citing as an example a Georgia plant now
under construction.

According to Levy, the Georgia plant, which covers some 200 acres, is being equipped to convert one million tons of corn to 100 million gallons of ethanol.
"When you look at what is being built to produce 100 million gallons it is unbelievable," Levy remarked.

He explained that given what is on the ground at the Georgia plant JB Ethanol was obviously constructed at a fraction of that cost of a 60-million-gallon corn plant equivalent and is able to produce a comparative amount of ethanol.
"This is the same amount of ethanol we are producing from a plant that we spent US$20 million to set up," he said.
Jamaica Broilers ventured into ethanol production, with great anticipation in August, hoping to capitalise on the US$2.20 per gallon that the product demanded at that time.

But a mere one month after, ethanol prices plummeted to approximately US$1.70 per gallon throwing out projections.
The depressed ethanol prices over recent months then set off a chain of events that left Levy's JB Ethanol plant losing approximately US$3 million.

Compounding that, JB Ethanol had to seek sales on the spot market after a contracted company reneged on a shipping agreement.
"We are trying as hard as we can to come out of this with the same reputation that we went into it," added Levy.
Questions arouse about trading done by executives of the firm in late September around the time the firm notified the Jamaica Stock Exchange of the event that would impact the ethanol producer's profit.

Levy, however, defended the integrity of his operations saying that shares were not sold with the knowledge of a profit notice.
"The first time we heard that there were questions about the timing we contacted the Stock Exchange," Levy told Rotarians at a luncheon last week.
"The stock exchange accepted what we said and came out without a doubt that there was no evidence of insider trading," Levy declared, adding that the number of shares traded were also relatively low.

The fear factor

Feeding the multitude

DANGEROUS PETS