$DAR KEY READ-THROUGHS FROM DARLING INGREDIENTS’ Q3 2026 EARNINGS CALL Darling’s call points to continued strength across renewable-fuel demand and feed proteins, but with an important redistribution of profits across the supply chain. The immediate positive signal is improving renewable-fuel margin realization after operational and accounting disruptions. The more consequential medium-term signal is that stronger biofuel production should increase competition for fats and oils, potentially transferring part of today’s processing windfall upstream to feedstock suppliers. Separately, tight fishmeal availability supports alternative proteins while creating cost and working-capital pressure for aquaculture. The highest-conviction implications are therefore differentiated by business model, ownership, geography, and timing rather than uniformly positive for renewable energy or agriculture. Country labels refer to corporate domicile. RENEWABLE FUELS AND REFINING DGD’S RECOVERY DIRECTLY BENEFITS VALERO; MARATHON RECEIVES INDUSTRY CONFIRMATION, NOT IDENTICAL EARNINGS UPSIDE (READ-THROUGH 1) Affected companies: Valero Energy (VLO: United States); Marathon Petroleum (MPC: United States). Direction and magnitude: Positive. Potentially substantial within Valero’s renewable-diesel business, but modest relative to its much larger petroleum-refining earnings. Positive, moderate segment-level confirmation for Marathon, with a smaller consolidated impact. The strongest supporting commentary was Stuewe’s statement that “the timing and hedging disconnects from Q3 are behind us” and that DGD was entering Q4 “realizing margins much closer to spot conditions.” DGD delivered approximately $1.30 of EBITDA per gallon on 315 million gallons sold, while management expects approximately 325 million gallons of Q4 production. The identified recovery channels include processing previously accumulated feedstock, improved production tax credit capture, recognition of fuel sales associated with earlier hedge losses, and recovery from the hydrogen outage. For Valero, this is a direct ownership transmission rather than a thematic comparison. Valero owns the other 50% of DGD. Improved joint-venture profitability therefore benefits its economic interest in the same assets. At an illustrative 325 million gallons sold, a $0.25-per-gallon improvement represents approximately $81 million of additional DGD EBITDA and approximately $41 million attributable economically to Valero, before differences in reporting conventions, taxes, and other adjustments. This is a sensitivity, not a forecast of Valero’s reported segment income. The accounting distinction matters. Valero consolidates DGD and reports the renewable-diesel segment before allocating the other owner’s interest. Its approximately $353 million of Q3 segment operating income cannot be compared directly with Darling’s $204 million share of after-fee adjusted EBITDA. Treating both figures as ownership-adjusted earnings would materially overstate the benefit. For Marathon, the read-through operates through shared market economics at Dickinson and the Martinez venture with Neste. Marathon’s prior call reported Martinez utilization of approximately 95% and improving economics from feedstock optimization and regulatory credits. Darling’s commentary supports the persistence of that constructive environment into Q4. However, DGD-specific hedge recoveries, domestic feedstock inventory, and delayed shipments do not automatically exist at Marathon and should not be transferred into its estimates. Near-term catalyst: Subsequent renewable-fuel updates and Q4 earnings will test whether stronger replacement margins translate into reported earnings and cash. Valero had already reported Q3 on October 22, so Darling provides forward confirmation and more detailed attribution, not a previously unknown Q3 earnings beat. Marathon’s next results provide a separate test of industry-wide realization. Longer-duration implication: Existing, reliable capacity can generate attractive incremental cash without another major construction cycle. However, this remains a spread business. The positive signal is better utilization and realization, not proof that current margins constitute a permanent earnings floor. U.S. SAF PREMIUMS VALIDATE CALUMET’S EXPANSION ECONOMICS MORE DIRECTLY THAN A GENERIC RENEWABLE-DIESEL RECOVERY (READ-THROUGH 2) Affected company: Calumet (CLMT: United States). Direction and magnitude: Positive. High strategic relevance to Montana Renewables and potentially material to Calumet’s medium-term cash generation; the immediate earnings benefit is less certain because expansion and turnaround timing remain important. Day stated: “All of our SAF sales are made at a higher net back margin to DGD than RD sales.” He also said U.S. voluntary SAF demand continues to grow, sales have shifted toward the U.S. rather than Europe, and DGD is “getting near our max production.” The transmission mechanism is product-mix economics. A sustainable aviation fuel producer earns incremental value when the SAF netback exceeds the return available from selling renewable diesel, after accounting for conversion costs, yields, logistics, and commercial terms. Darling’s commentary confirms that this premium is being realized commercially in the U.S., rather than existing solely in long-term demand forecasts. That is relevant to Calumet’s September expansion plan for Montana Renewables. The company reported a SAF production run rate of approximately 60 million gallons annually, with targets exceeding 80 million gallons by year-end 2026, exceeding 120 million gallons by spring 2027, and reaching approximately 200 million gallons by year-end 2028. Remaining project capital was reduced to approximately $137 million through a staged expansion using existing equipment. The differentiated implication is that Calumet is expanding into a product market where a major incumbent reports positive incremental netbacks and limited remaining production headroom. This supports the commercial rationale for Calumet’s conversion and debottlenecking investments. It does not establish that Calumet has won DGD customers, secured identical premiums, or contracted its entire future output. The geographic signal is also important. DGD’s shift toward domestic sales because European duties impair export economics supports the value of a U.S.-focused SAF commercialization strategy. Nevertheless, the same shift can increase competition within the U.S. over time. Current premium realization should not be assumed to persist unchanged as additional supply enters. Near-term catalyst: Montana Renewables’ planned Q4 2026 tie-in work and achievement of the year-end production target. Temporary downtime could delay the earnings benefit even if the commercial thesis remains intact. Capacity commissioning and actual sales, rather than nameplate announcements, are the relevant milestones. Longer-duration implication: The spring 2027 and year-end 2028 expansion stages could increase the proportion of output sold into a higher-value market while spreading fixed costs over greater production. The key investment variable is realized incremental cash return after capital expenditure and financing, not SAF volume growth in isolation. HIGHER FEEDSTOCK PRICES COULD CAP RENEWABLE-FUEL MARGINS EVEN WHILE DEMAND REMAINS STRONG (READ-THROUGH 3) Affected companies: Neste (NESTE: Finland); Phillips 66 (PSX: United States). Direction and magnitude: Negative incremental pressure on renewable-fuel processing margins. Potentially meaningful at the Neste group level; material within Phillips 66’s renewable-fuels segment but smaller relative to its consolidated refining business. This is a warning against extrapolating exceptional margins, not evidence of an immediate earnings collapse. Darling expects fat prices to strengthen as biofuel producers increase utilization. Stuewe said the anticipated increase was “not really embedded in the outlook,” while Day described margins as incentivizing producers to “maximize their production.” Management also observed strengthening European fat prices and described trade barriers complicating international feedstock movements. The transmission mechanism is competition for the marginal feedstock unit. Higher utilization increases demand for animal fats, used cooking oil, and substitutable vegetable oils. Once existing inventories are consumed, processors must replenish at prevailing prices. If feedstock costs rise faster than fuel prices and credit values, processing margins compress even while physical demand and plant utilization remain healthy. This distinction matters particularly for Neste. Its October 29 release reported €1.011 billion of Renewable Products comparable EBITDA against €1.555 billion for the group, making renewable-fuel economics a major consolidated earnings driver. The company also reported a $1,068-per-ton comparable sales margin. Darling’s upstream pricing outlook identifies a plausible mechanism through which unusually favorable current margins could normalize. Phillips 66’s October 28 results already demonstrated the importance of realized economics. Renewable Fuels pretax income declined to $191 million from $544 million in Q2, with management citing lower margins, inventory effects, and higher costs. Darling’s call does not establish that Phillips 66’s specific Q3 effects will reverse. It reinforces the need to distinguish spot economics from the costs and revenues actually recognized. Lower RIN prices should not be treated as an independent indicator that renewable-fuel economics are deteriorating. Day explained that stronger diesel prices and favorable feedstock-to-fuel spreads reduce the incentive value required from RINs. Conversely, lower RIN dependence does not eliminate risk: it can leave profitability more dependent on elevated petroleum diesel prices. A decline in diesel prices combined with rising feedstock costs would be particularly unfavorable unless credit values compensate. Near-term catalyst: Feedstock replenishment during November and December, followed by Q4 margin disclosures. Purchasing lead times and hedges can delay the earnings effect into 2027. Neste and Phillips 66 had already reported Q3, so this is a forward margin-risk assessment rather than a prediction of those completed releases. Longer-duration implication: Feedstock sourcing, pretreatment capability, procurement discipline, and geographic flexibility become more important competitive differentiators. Renewable-fuel producers can remain profitable while a larger share of industry economics shifts upstream. A portfolio simultaneously long feedstock suppliers and downstream renewable processors should not assume that both exposures benefit equally from higher fat prices. AGRICULTURE AND OILSEED PROCESSING STRONG PROTEIN DEMAND REDUCES THE SOYBEAN-MEAL OVERSUPPLY RISK ASSOCIATED WITH BIOFUEL-DRIVEN CRUSH EXPANSION (READ-THROUGH 4) Affected companies: Archer-Daniels-Midland (ADM: United States); Bunge Global (BG: Switzerland). Direction and magnitude: Positive for processing demand, utilization, and the resilience of combined oil-and-meal economics. Moderate fundamental significance, but insufficient by itself to justify a company-wide earnings upgrade. Stuewe explicitly challenged the anticipated meal-surplus narrative: he had expected new U.S. soybean-crushing capacity to struggle to place its soybean meal, but “that really hasn’t materialized. In fact, it’s gone the exact opposite.” Management attributed protein-market strength to fishmeal scarcity and growing poultry production, while maintaining a constructive protein outlook into 2027. Soybean crushing produces both oil and meal. Biofuel demand can support oil prices and encourage additional crushing, but the resulting meal must also find buyers. If meal demand is weak, lower meal realizations can offset the oil benefit and constrain utilization. Darling’s commentary indicates that animal-protein demand is absorbing more of that coproduct supply than the earlier bearish scenario assumed. The positive mechanism for ADM and Bunge is therefore broader than rising vegetable-oil prices. Stronger meal demand reduces the risk that oil-driven processing expansion creates an unsalable or heavily discounted coproduct. This supports throughput and the aggregate value recovered from each processed soybean. It does not guarantee higher crush margins because soybean procurement costs, hedges, geography, and logistics remain decisive. The signal is consistent with ADM’s Q2 disclosure of record meal exports from Brazil and the U.S., approximately 5% growth in oilseed processing volumes, and stronger crushing profitability. It provides additional demand-side support ahead of ADM’s November 3 results. However, ADM’s Q2 Ag Services and Oilseeds performance included approximately $100 million of favorable mark-to-market and timing effects, so the prior quarter’s reported profitability should not be extrapolated without normalization. Bunge’s October 29 results offer an important constraint on bullish interpretation. Soybean Processing and Refining adjusted EBIT increased to $565 million from $478 million, but the company maintained total annual EPS guidance and described its full-year soybean segment outlook as slightly lower than previously expected. Darling corroborates supportive industry demand; it does not override Bunge’s more specific forward assessment. A verified supplier/customer linkage further strengthens the sector connection: ADM and Marathon jointly own Green Bison, which supplies refined soybean oil for Marathon’s renewable-diesel production. This creates a direct connection between processing utilization and fuel demand, although the ownership and commercial terms prevent treating every increase in oil prices as an equal profit increase for both parties. Near-term catalyst: ADM’s November 3 earnings and subsequent export, processing, and margin disclosures. For Bunge, which already reported, the relevant catalyst is the evolution of Q4 and 2027 assumptions rather than a fresh Q3 surprise. Longer-duration implication: Persistent poultry and aquaculture demand would reduce the risk that expanding soybean-oil supply destabilizes meal markets. The strongest positive conclusion concerns asset utilization and demand balance, not an unconditional return to peak processing margins. AQUACULTURE AND ANIMAL NUTRITION FISHMEAL SCARCITY IS A CASH-FLOW HEADWIND FOR SALMON FARMING EVEN WHEN REPORTED FARMING COSTS ARE IMPROVING (READ-THROUGH 5) Affected company: Mowi (MOWI: Norway). Direction and magnitude: Negative for feed procurement and working capital, with a potentially moderate delayed effect on farming profitability. This is not a high-conviction prediction of a near-term earnings miss. Darling described fishmeal prices as “very, very elevated” and stated that there was no current indication of a substantial change during 2027. Management also observed strong pricing for alternative proteins, suggesting that substitution may mitigate rather than eliminate the cost pressure. The transmission mechanism runs through feed procurement, feed consumption, and the biological production cycle. Higher ingredient prices increase the cash required to purchase feed and raise the carrying cost of fish under cultivation. The eventual earnings impact emerges when those fish are harvested and sold. Consequently, working-capital absorption can worsen before the full increase appears in realized farming cost per kilogram. Mowi’s own disclosures validate this channel. During its Q2 call, management said feed-price inflation was being driven by marine ingredients and weak pelagic fisheries. It increased expected working-capital tie-up from €100 million to €150 million because of feed inflation. Darling’s October commentary reinforces the risk that this pressure persists rather than reversing quickly. There is meaningful counterevidence against an aggressive short thesis. Mowi’s October 19 trading update reported Q3 blended farming cost of €5.11 per kilogram, down from €5.42 a year earlier, and operational EBIT of €275 million. The company has also identified raw-material hedging, changes in feed formulation, and its Skretting partnership as offsets. Strong biological performance and higher volumes can more than offset ingredient inflation over a particular reporting period. The actionable implication is therefore narrower: recent cost reductions should not automatically be extended into a sustained feed-deflation assumption. Darling’s commentary strengthens the case for preserving a feed-cost and working-capital headwind in forward models. It does not justify adding another €50 million to Mowi’s forecast, because that amount was already incorporated in its earlier guidance. Near-term catalyst: Mowi’s November 4 full results and the next Peruvian fishing season beginning in November. The relevant indicators are procurement coverage, feed-price changes, cash absorption, and the timing of cost recognition. Longer-duration implication: Persistent marine-protein scarcity supports investment in formulation flexibility and alternative ingredients. However, improving fish catches could reverse part of the pressure. The cross-portfolio relationship is clear: the protein-price environment supporting rendering and alternative-protein suppliers can simultaneously pressure aquaculture buyers, without requiring weaker salmon demand. COLLAGEN, SPECIALTY INGREDIENTS, AND CORPORATE TRANSACTIONS TESSENDERLO’S COLLAGEN TRANSACTION REMAINS A DEFERRED VALUE-REALIZATION EVENT, NOT AN IMMINENT CASH CATALYST (READ-THROUGH 6) Affected company: Tessenderlo Group (TESB: Belgium). Direction and magnitude: Negative for near-term transaction timing and confidence in the timing of synergies; potentially moderate strategic significance. The long-term combination remains constructive, but no defensible incremental earnings amount can be assigned. Stuewe said the Tessenderlo venture continues through regulatory review and that management is targeting a close “hopefully in the first quarter of 2027.” The December 2025 definitive agreement originally contemplated closing during 2026. Tessenderlo had already acknowledged uncertainty around approvals in its H1 2026 call, so the new statement extends the original timetable rather than withdrawing a recently guaranteed completion date. The direct relationship is the proposed combination of Tessenderlo’s PB Leiner operations with Darling’s Rousselot business. Darling would own 85% and Tessenderlo 15%. The announced structure requires no initial cash contribution from either party. Consequently, closing should not be modeled as a straightforward cash-sale event that immediately releases substantial proceeds to Tessenderlo shareholders. The negative transmission mechanism is delayed access to integration benefits, commercial coordination, manufacturing optimization, and the strategic value of participation in a larger collagen platform. Until closing, the businesses continue operating separately, and expected synergies remain unrealized. The call supplied no quantified synergy target, closing probability, or guaranteed regulatory timetable. Darling’s operating commentary provides a nuanced view of the eventual asset. Water-soluble collagen demand is growing near 10%, China sales were strong, and Nextida is generating repeat orders. These developments support the attractiveness of the combined market opportunity. However, tariff-driven customer destocking and long supply chains are currently impairing earnings conversion. Strong end-market demand does not ensure immediate supplier margin improvement. Tessenderlo’s retained 15% interest also requires valuation discipline. It represents an economic interest in the combined business, not 100% ownership of its future earnings. Changes in consolidation or investment-accounting presentation should not be confused with changes in underlying economic value. No assumption of immediate dividends, unrestricted cash access, or a specific exit valuation is supported by this call. Near-term catalyst: Regulatory decisions and definitive closing disclosures during the period leading into Q1 2027. The precise timing remains uncertain. The word “hopefully” is materially weaker than confirmation that approvals have been obtained. Longer-duration implication: A larger, better-coordinated collagen platform could improve innovation, manufacturing flexibility, and customer coverage. The high-conviction current conclusion is nevertheless a delayed catalyst, not demonstrated transaction failure and not an immediate earnings uplift. The distinction matters for event-driven positions whose expected return depends on completion within 2026 rather than eventual strategic value.