Solazyme Inc. (SZYM:US), which makes oils from sugar-consuming algae, rose to its highest in more than a month after it reached commercial-scale production at an Archer- Daniels-Midland Co. (ADM:US) plant in Iowa.
The company climbed 5.5 percent to $8.60 at the close in New York, the highest since Oct. 25. The shares have declined 27 percent this year.
Solazyme, based in South San Francisco, California, produced the renewable oil in 500,000-liter (132,000-gallon) vessels, according to a statement released after the market closed yesterday. The oil is processed into fuel and specialty chemicals.
“Solazyme’s fermentations have reached a scale that, to our knowledge, is the highest level of any algae-based company in the world,” Pavel Molchanov, an analyst at Raymond James & Associates Inc. in Houston, wrote in a note to investors today. “This news is bullish not just for Solazyme but for the algae arena as a whole,” he said.
Solazyme may begin producing 20,000 metric tons of oil annually at the Clinton, Iowa, facility in early 2014, according to the statement. Solazyme and ADM partnered in November to produce specialty oils at the fermentation plant in Iowa.
ADM is the world’s largest corn processor.
To contact the reporter on this story: Justin Doom in New York at email@example.com
To contact the editor responsible for this story: Reed Landberg at firstname.lastname@example.org