Small Cap Strategist is published by Crystal Equity Research an independent research resource on small capitalization stocks. Follow along as we discuss the most recent trends in the small-cap sector, investigate interesting companies and pan a few not-so-promising stocks.
seems to be ample supply of advanced biofuel developers in the U.S. and
Europe.I mentioned a number of them in the
most recent posts.Brazil has a stake in
the battle as well with Gran Bio, a subsidiary of one of Brazil’s
family-run holding companies, Gran Investimentos S.A.
though Brazil has been in the ethanol business for quite some time, Gran Bio is
a relative newcomer to advanced biofuels. It has only been around for three years.However, it has seems to have caught up with
some of the U.S. players.Gran Bio
claims it will have a commercial scale plant up and running by the end of
2014.We were not able to confirm
progress on this plant before this article was posted, but some structures were already in place at the beginning of the year.Gran Bio says it is aiming for an 82 million
liter name plate production capacity, which is pretty ambitious for an initial plant.
Gran Bio Plant in Alagoas, Northeast Brazil
a year ago Gran Bio set up a joint development partnership with Rhodia.The plan is to produce n-butanol using sugar
cane straw and bagasse.The ethanol
producers rely on the same feedstock, but it is doubtful there will be any
problem from Gran Bio as there are plentiful supplies of such waste in Brazil.Rhodia, of course, is a subsidiary of the Solvay Group, S.A.
which is a big user of n-butanol for its paints and solvents.
with an ample supply of feedstock and a good supporter in its target market, it
seems like Gran Bio is well positioned.Gran Bio must be feeling quite confident also.Last year the company announced its intention
to set up an office in the U.S.They
hired an industry veteran away from Codexis
lead the U.S. entry.Gran Bio also
invested in American Process, which has technologies for pre-treatment of
moves like setting up commercial production and entering new geographies
requires capital.Gran Bio seems to be
positioned well financially as well.In
early 2013, the company took in approximately US$265 million from Brazil’s
development bank, BNDES, through a BNDES subsidiary BNDESPAR.Brazil now owns about 15% of Gran Bio.
is interesting to observe how easily the Brazilian government acts on its
policy priorities through direct investment in renewable energy.In the U.S. even a loan guarantee meets with
the harshest of criticism and vociferous claims of political malfeasance.U.S. consumers need not worry.They will have their renewable chemicals
eventually as adequately capitalized companies from other countries will expand
in the U.S. market to deliver those chemicals.U.S. investors will just not have an opportunity to invest in them.
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