Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from the line of JinMing Liu of [Gushan Environmental]. Please proceed.
JinMing Liu - Ardour Capital Investments
Yeah. I have first, are your Sichuan, Hebei, province facilities in production right now?
Wai Sun Kwong
Yes.
JinMing Liu - Ardour Capital Investments
Okay. And on the VAT refund in the plant and I mean I noticed while you peers in Fujian province announced they received that certificates for both their facilities, why you didn’t received the certificates for your Fujian province facility.
Wai Sun Kwong
Well we have if you just refer to the announcement we made. We have already got the certificate for processing the VAT rebate for Shanghai and also Beijing, so we are moving step-by-step on that front.
JinMing Liu - Ardour Capital Investments
Okay. Another thing is can you help, what is your current selling price for your biodiesel?
Wai Sun Kwong
It is around RMB4,100 per ton.
JinMing Liu - Ardour Capital Investments
On that front can you help me understand the difference between the gross fuel price of diesel and your reported selling price, because I noticed the average diesel selling price in China right now is about RMB5,000 per ton or maybe a little bit less?
Wai Sun Kwong
Firstly the different, I guess your price would probably be inclusive of VAT.
JinMing Liu - Ardour Capital Investments
Yes.
Wai Sun Kwong
VAT is 17%. Now if you take that away, I think it will come to roughly RMB5100 or something like that and then of course because of -- this is a price where you would find probably the big companies like SINOPEC and PetroChina are able to charge, but we are actually pricing our biodiesel products, due to weak demand of diesel in general, at a significant discount to that. If you look at it will be RMB1000.
JinMing Liu - Ardour Capital Investments
Okay. So your discount through the leading big oil company over there is about RMB1000?
Wai Sun Kwong
Yes. It’s a quite a significant discount, in fact we have operated for many years in this industry and we have not faced a situation like this before.
JinMing Liu - Ardour Capital Investments
Then what is your relation with your customers.
Wai Sun Kwong
What do you mean?
JinMing Liu - Ardour Capital Investments
My question is what's the regional deep discount, whether your customers are ??
- To read the full transcript on Seeking Alpha, click here »
