FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.
Date of Report (Date of earliest event reported) November 10, 1995.
HIGH PLAINS CORPORATION
(Exact name of registrant as specified in its charter)
Kansas #1-8680
(State or other jurisdiction of (Commission File
incorporation) Number)
200 W. Douglas #48-0901658
Suite #820 (IRS Employer
Wichita, Kansas 67202 Identification No.)
(Address of principal
executive offices)
(316)269-4310
(Registrant's telephone number)
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Item 5. Other Events.
High Plains Corporation, in response to repeated shareholder
questions, announced that, as of today, ethanol prices have
increased by approximately $.12 per gallon, FOB the Company's
plants, over the average price received for the product during the
Company's last fiscal quarter. In past years, ethanol pricing for
wintertime delivery began increasing in August and September, but
did not materially increase during the current year until October.
In addition, the Company announced significant increases in the
sales price of distiller's grain, the Company's co-product, since
August 1995 when dried distiller's grain spot prices were $95.00
per ton. The current spot price for the Company's dried distiller's
grain is $150.00 per ton, a 58% increase. The Company manufactures
about 180,000 tons of dry basis distiller's grain per year.
While grain prices continue to rise, the Company believes it has
protected itself from any further major effects of higher grain
prices. This has been accomplished by forward-contracting on
approximately 70% of the Company's projected grain needs until the
1996 harvest and by increased distiller's grain prices. As grain
prices increase, the sales price of the Company's grain co-product,
distiller's grain, traditionally increases to provide additional
revenue to assist in covering the higher cost of grain.
In regard to continuity of ethanol's blending excise tax incentive,
the Company believes that its position is much stronger after the
attempt by U.S. Representative Archer to limit the incentive was
eliminated. United States Representative and Speaker of the House,
Newt Gingrich, and Senator Phil Gramm joined many other
Congressional leaders endorsing ethanol's tax incentive. Gingrich
stated that his support for ethanol stemmed from the fact that the
ethanol program actually saves the American people over two billion
dollars per year in reduced farm support and otherwise necessary
rural economic development expenditures. In encouraging this
conclusion, the ethanol industry provided evidence that ethanol's
excise tax reduction is necessary in order to allow ethanol to
compete with the price of gasoline. Gasoline is able to be sold at
price levels that do not reflect its true cost, due to continuing
and massive oil and gas subsidies.
On March 1, 1996, CARB Phase 2, the second phase of California Air
Resource Board's air quality program, is scheduled to begin. At
that time, gasoline volatility state-wide in California will be
further reduced to 7 pounds per square inch (psi). The 7 psi
volatility limit will apply for eight months of the year, March
through October. Demand for ETBE, a low vapor pressure oxygenate
made from ethanol, is expected to increase as a result of the
difficulty in manufacturing gasoline with such a low vapor
pressure. Oxygenates are required state-wide in California, and
ETBE appears to be an ideal oxygenate due to its superior blending
characteristics, such as low vapor pressure (less than half the
vapor pressure of the competitive oxygenate), higher boiling point,
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and increased octane.
Raymond G. Friend, Executive Vice President and Chief Financial
Officer stated, "In our last fiscal quarter, our revenues exceeded
$20 million and were 148% above the prior year's comparable
quarter, even with the lower than normal seasonal prices over the
recent quarter. Now, that ethanol prices have risen, our financial
results should show improvement throughout the winter."
Based in Wichita, Kansas, High Plains Corporation is the largest
publicly traded company whose sole business is Ethanol. It is one
of the largest producers of Ethanol west of the Mississippi River,
with up to 58 million gallons per year of capacity from their two
plants. Clean-burning ethanol reduces pollutants in automotive
gasoline and increases octane levels for better engine performance
without increasing gas pump prices.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant had duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
Date November 10, 1995 HIGH PLAINS CORPORATION
Raymond G. Friend
Executive Vice President
Chief Financial Officer
