Richard B's  Instablog

Richard B
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Former Corporate Finance Professional with Deloitte specializing in M&A, presently serving as outside corporate director and as Managing Director of BMK Advisors, LLC
My company:
BMK Strategic Advisors, LLC
My blog:
Passing Through.....
  • Expiration of US Tariff on Imported Ethanol Should Benefit Cosan and Petrobras 0 comments
    Jan 16, 2012 7:46 AM | about stocks: CZZ, PBR

    The US tariff on imported ethanol expired December 30th, making Sugar-based ethanols produced by Cosan (NYSE:CZZ) and Petrobras (NYSE:PBR) more price competitive.  If you couple this with the fact that sugar-based ethanols are less disruptive on food prices than corn-based ethanol, demand from social activists will likely increase.

    According to a recent article in the Rio Times (, demand for imports of Brazilian based ethanol will increase 10-fold once sugar plantings, including plantings by CZZ, increase to meet the new demand.

    Recently CZZ has been trading at the lower end of its 52-week range, due primarily margin slippage resulting from supply and demand factors relative to sugar.  One would expect that with the increased demand for sugar-based ethanol, margins will recover and revenues will soar.

    Disclosure: I am long CZZ.

    Additional disclosure: I have increased my long position in CZZ since the first of the year.

    Stocks: CZZ, PBR
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  • the recent expiration of the US tariff on sugar based ethanol should favorably affect shareholder value.
    Jan 11, 2012
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