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JER Envirotech (JER in Canada) is a Canadian manufacturer of wood-plastic composite (WPC) products. JER mixes wood waste (sawdust, rice husk) with high-grade plastic to produce a better alternative to pure wood and plastic products. JER's WPC products can be used for a wide variety of products across many industries with better characteristics than pure wood or plastic.

By taking wood waste and incorporating it into useful products, JER helps preserve the environment while decreasing the cost of materials. In the current world climate of rising raw material costs and environmental decline, JER plays a vital role as a socially responsible manufacturer.

To develop their patented technology with 42 different WPC compounds, JER worked jointly with the National Research Council of Canada. This partnership means that JER's patents have the backing of the government of Canada.

In the past year, JER has put its first plant into production in Canada and has had several major companies from different industries test their panel boards and pellets (the only WPC product in the industry that can be injection molded) across many different applications. These companies wanted a lower cost material with similar or better quality and lower life-cycle costs than what they had been using. For example, JER's construction panel board not only costs less than the alternatives, but it doesn't rot or warp with moisture, is termite proof, saves on heating costs, is fire retardant, can be nailed or painted just like wood, is sound resistant, and is lighter and easier to work with. JER's other products offer similar benefits.

This year, JER is ramping up their production capacity in Canada and Asia to meet demand. A plant in Malaysia should be ready in a month or two, followed by expansion in Canada in the summer, the Philippines in the fall, and India around the end of the year. A plant in China is planned for about a year from now. Once all this production is in place, JER will be able to satisfy demand such as an agreement to provide 50,000-200,000 homes in coming years in the Philippines. There's massive demand for housing in Asia as that area develops.

JER is currently trading just over $1 in thin trading. Insider buying at $1.04 and a recent private placement with institutions at $1.10 provide support in the $1 area. JER hit a high of $1.45 in November 2005. As JER's plants move into production over the next year, we expect the stock price to react positively.

Those investors wanting to take advantage of the global shift in coming decades as Asia industrializes, but looking for an alternative to energy and metals stocks for diversification purposes, would do well to add JER to the portfolio. The company has enormous potential and is just getting started. We believe that JER is a great buy in this area for the long term, with tremendous upside if Asian demand grows as we expect.

See http://www.jerenvirotech.com/ for more details on JER Envirotech.