REX American Resources (REX) risk factors, FY2026 10-K

Risks Related to our Ethanol and By-Products Business

1. 01The financial returns on our ethanol investments are highly dependent on commodity prices, which are subject to significant volatility, uncertainty and regional supply shortages, so our results could fluctuate substantially
2. 02Our returns on ethanol investments are highly sensitive to corn prices
3. 03Our risk management strategies may be ineffective and may expose us to decreased profitability and liquidity
4. 04The market for natural gas is subject to market conditions that create uncertainty in the price and availability of the natural gas that our ethanol plants use in their manufacturing process
5. 05Fluctuations in the selling price of commodities may reduce profit margins at our ethanol plants
6. 06Inflation could impact the cost and/or availability of material, labor and other input, which could adversely affect our operations
7. 07The price of ethanol and distillers grains may decline as a result of trade restrictions, duties or tariffs on ethanol and distillers grains exports from the United States or from unfavorable foreign currency exchange rates38% rewritten
8. 08Increased ethanol production or decreases in demand for ethanol may result in excess production capacity in the ethanol industry, which may cause the price of ethanol, distillers grains and distillers corn oil to decrease21% rewritten
9. 09There are limited markets for ethanol other than what is federally mandated. Increased consumer acceptance of E-15 and E-85 fuel is likely necessary in order for ethanol to achieve significant market share growth beyond federal mandate levels
10. 10We may not successfully develop our planned carbon sequestration facility near the One Earth Energy ethanol plant
11. 11Carbon capture and sequestration projects are subject to federal, state, and local regulations63% rewritten
12. 12Our ability to generate 45Z production tax credits involves regulatory and market uncertaintiesNew
13. 13We depend on our partners to operate certain of our ethanol investments
14. 14We may not successfully acquire or develop additional ethanol investments or expansion
15. 15Our ethanol plants may be adversely affected by technological advances and efforts to anticipate and employ such technological advances may prove unsuccessful
16. 16Any advances in technology which require significant unanticipated capital expenditures to remain competitive or which reduce demand or prices for ethanol would have a material adverse effect on the results of our ethanol operations
17. 17The U.S. ethanol industry is highly dependent upon a myriad of federal and state legislation and regulation and any changes in legislation or regulation could materially and adversely affect our results of operations and financial position53% rewritten
18. 18The inability to generate or obtain RINs could adversely affect our operating results
19. 19Federal support of cellulosic ethanol may result in reduced incentives to corn-derived ethanol producers
20. 20Our ethanol business is affected by environmental and other regulations which could impede or prohibit our ability to successfully operate our plants
21. 21Our ethanol business may become subject to various environmental and health and safety and property damage claims and liabilities
22. 22Our business is not diversified
23. 23We may not be able to meet commitments to produce and sell ethanol
24. 24We may not be able to meet commitments to purchase commodities
25. 25Our revenue from the sale of distillers grains depends upon its continued market acceptance as an animal feed61% rewritten
26. 26We face significant competition in the ethanol industry
27. 27We may face competition from foreign producers
28. 28We may not be able to hire and retain qualified personnel to operate our ethanol plants and carbon sequestration facility
29. 29Our plants depend on an uninterrupted supply of energy and water to operate. Unforeseen plant shutdowns could harm our business
30. 30We rely on information technology in our operations and financial reporting and any material failure, inadequacy, interruption or security breach of that technology could harm our ability to efficiently operate our business and report our financial results accurately and timely
31. 31We ship much of our products and receive a portion of our corn via rail, which involves risks involving potential regulatory changes that could adversely affect our cash flows and operating results
32. 32We operate in a capital intensive industry. Limitations on external financing could adversely affect our financial performance
33. 33There is a risk of a pandemic that could spread into the United States and other countries

Risks Related to our Former Refined Coal Operations

1. 34Our refined coal operation and its by-products may result in environmental and product liability claims and environmental compliance costs
2. 35We used patented technology42% rewritten

Risks Related to REX and General Risk Factors

1. 36We have concentrations of cash deposits at financial institutions that exceed federal insurance limits
2. 37We may fail to realize the anticipated benefits of mergers, acquisitions, or other investments
3. 38Rising focus on environmental, social and corporate governance matters from investors and regulators may increase our operating costs, bring down the value of our products and assets, and impact our ability to access capital markets
4. 39Federal, state and local jurisdictions may challenge our tax return positions45% rewritten