Report Summary 1. Report Title and Date - Title: "Industrial Silicon: Continuous Decline in Warehouse Receipts, Focus on Upside Potential" - Date: June 19, 2025 [1] 2. Core Viewpoints - The industrial silicon market shows a trend of continuous decline in warehouse receipts, and attention should be paid to its upside potential. The polysilicon market experiences a decline in the futures market due to upstream复产 [1][2]. - The US Senate Finance Committee's draft legislation on the "One Big Beautiful Bill (OBBB)" has brought policy uncertainty to the US photovoltaic market, affecting the polysilicon and related industries [2][4]. 3. Industry Data Summaries 3.1 Industrial Silicon and Polysilicon Futures Market - Si2509: The closing price is 7,425 yuan/ton, with a change of -135 yuan/ton compared to T - 5 and -720 yuan/ton compared to T - 22. The trading volume is 451,986 lots, and the open interest is 317,763 lots [2]. - PS2507: The closing price is 33,370 yuan/ton, down 640 yuan/ton from T - 1 and 885 yuan/ton from T - 5. The trading volume is 94,724 lots, and the open interest is 30,435 lots [2]. 3.2 Basis and Price - Industrial silicon: The spot premium against East China Si5530 is +650 yuan/ton. The prices of East China oxygen - passing Si5530 and Yunnan Si4210 remain unchanged compared to T - 1, at 8,150 yuan/ton and 9,900 yuan/ton respectively [2]. - Polysilicon: The spot premium against N - type re - feedstock is +2,130 yuan/ton. The price of N - type re - feedstock is 35,500 yuan/ton, down 1,000 yuan/ton from T - 5 and 3,250 yuan/ton from T - 22 [2]. 3.3 Profit - Silicon plant profit: The profit of Xinjiang new - standard 553 is - 3,786 yuan/ton, and that of Yunnan new - standard 553 is - 6,938 yuan/ton [2]. - Polysilicon enterprise profit: - 5.5 yuan/kg [2]. 3.4 Inventory - Industrial silicon: The social inventory (including warehouse receipt inventory) is 57.2 million tons, down 1.5 million tons from T - 5 and 2.7 million tons from T - 22. The enterprise inventory is 23.6 million tons, and the industry inventory is 80.8 million tons [2]. - Polysilicon: The manufacturer's inventory is 27.5 million tons, up 0.6 million tons from T - 5 and 2.5 million tons from T - 22 [2]. 3.5 Raw Material Costs - Silicon ore: The price in Xinjiang is 385 yuan/ton, and in Yunnan is 360 yuan/ton [2]. - Washed coal: The price in Xinjiang is 1,290 yuan/ton, and in Ningxia is 900 yuan/ton [2]. - Petroleum coke: The price of Maoming coke is 1,400 yuan/ton, and Yangzi coke is 1,760 yuan/ton [2]. - Electrodes: The price of graphite electrodes is 10,990 yuan/ton, and carbon electrodes is 6,850 yuan/ton [2]. 3.6 Organic Silicon and Aluminum Alloy - Organic silicon (DMC): The price is 10,650 yuan/ton, and the enterprise profit is - 1,427 yuan/ton [2]. - Aluminum alloy (ADC12): The price is 20,150 yuan/ton, and the recycled aluminum enterprise profit is - 750 yuan/ton [2]. 4. Macro and Industry News - The US Senate Finance Committee released the draft of the "One Big Beautiful Bill (OBBB)". Under the Inflation Reduction Act (IRA), the 48E clause will continue to provide a 100% investment tax credit (ITC) for photovoltaic projects using domestic components, but the credit rate will gradually decrease for projects starting in 2026 and later, and will end after 2027 [2][4]. 5. Trend Intensity - Industrial silicon trend intensity: - 1 - Polysilicon trend intensity: - 1 - The trend intensity ranges from - 2 to 2, with - 2 indicating the most bearish and 2 indicating the most bullish [4]

Financial Data and Key Metrics Changes - Revenues decreased to $42.9 million from $72.6 million year-over-year, primarily due to delayed biodiesel contracts in India [3] - Operating loss was $15.6 million, reflecting a $1.6 million increase in SG&A expenses, mainly from legal and transaction costs related to the sale of investment tax credits [4] - Net loss remained roughly flat at $24.5 million compared to Q1 last year [4] - Cash at the end of the quarter was $500,000 after $15.4 million of debt repayment and $1.8 million invested in carbon intensity reduction and dairy RNG expansion [5] Business Line Data and Key Metrics Changes - Dairy RNG business is scaling gas production, expecting to reach 550,000 MMBtu production capacity this year and grow to 1,000,000 MMBtu annually by the end of 2026 [5] - Ethanol plant revenue increased by $1.7 million due to stronger ethanol pricing, with expectations for margin expansion from recent EPA approval of summer E15 blending [4][6] - RNG volumes increased by 17% year-over-year [4] Market Data and Key Metrics Changes - The California Low Carbon Fuel Standard (LCFS) amendments are expected to significantly increase credit prices as supply tightens and demand increases [10] - Aemetis anticipates generating over $60 million annually from LCFS credits once provisional pathways are approved [10] Company Strategy and Development Direction - The company is preparing for an IPO of its India subsidiary, targeting late 2025 or early 2026, and evaluating expansion into RNG and ethanol production in India [7] - Aemetis is focused on sustainable aviation fuel projects and has received necessary permits for a 90 million gallon per year facility [8] - The company is positioned to benefit from federal and state policies enhancing the value of low carbon fuel operations [9] Management's Comments on Operating Environment and Future Outlook - Management expects multiple revenue streams from India, LCFS credits, and federal tax incentives to ramp up as the year progresses, positioning for a stronger second half of 2025 [5] - The company anticipates significant ramp-up in RNG revenues starting in Q3, driven by LCFS pathway approvals and volume growth [14] - Management expressed optimism regarding ethanol margins supported by policy tailwinds and reduced costs from the NVR project beginning in 2026 [14] Other Important Information - Aemetis received $19 million in cash proceeds from the sale of investment tax credits in Q1 2025 and expects additional sales in 2025 [12] - The company is actively working on marketing production tax credits, which will significantly increase its ability to pay down debt during 2025 and 2026 [23] Q&A Session Summary Question: Impact of tariffs on RNG production for 2025 and 2026 - Management indicated that the RNG value chain is primarily domestic, with no direct impact anticipated from tariffs [18] Question: Improvement in the balance sheet and debt outlook for 2025 - Management highlighted the repayment of $15.5 million of debt in Q1 and anticipated continued repayments through the year, supported by increased LCFS revenues and an upcoming IPO [21][22] Question: Dairy RNG OpEx trends - Management expects a dramatic decrease in OpEx per MMBtu as production increases, with current costs affected by startup phases and seasonal factors [28][29] Question: Ethanol segment EBITDA outlook - Management noted that ethanol margins are improving, driven by E15 approval and expected demand increases during the summer [30][32] Question: India business expansion and potential RNG and ethanol opportunities - Management confirmed ongoing exploration of RNG and ethanol opportunities in India, supported by government policies favoring these sectors [39][40] Question: Potential hiccups due to geopolitical issues in India - Management stated that current geopolitical tensions have not impacted their operations or supply chain [42] Question: Opportunities for cheaper debt from EB-5 financing - Management confirmed approval for $200 million in EB-5 financing with net interest costs below 3%, indicating a proactive approach to securing investors [46] Question: Update on 45Z tax credits and emissions rates - Management provided insights on the timing of final rules from Treasury and the potential for increased RNG value based on provisional emissions rates [55][56] Question: Ethanol fundamentals and E15 adoption - Management expressed optimism regarding the impact of E15 adoption in California and the overall positive outlook for ethanol margins [62][64]