Dekel Agri-Vision Plc (LON:DKL), the West African agriculture company focused on building a portfolio of sustainable and diversified projects, has provided an October production update for its Ayenouan palm oil project in Côte d’Ivoire and an update on progress regarding the ramp-up of production of our large-scale cashew processing plant at Tiebissou, Côte d’Ivoire.
· Dekel achieved a 26.1% improvement in fresh fruit bunches (‘FFB’) processed as compared to last month and a further improvement in crude palm oil (‘CPO’) extraction rates to 21.8% as compared to 21.3% last month.
· However, like for like monthly CPO production volumes remained low compared to the October 2021 record monthly production of 2,331tns (28.1% lower).
· CPO prices remain very strong with prices achieved continuing at close to all-time highs (€1,057 per tonne). International CPO prices increased materially during October from around €950 per tonne to €1,100 – 1,150 per tonne.
· The Cashew Operation capacity increased significantly during October and is well on track to meet the Company’s 2023 objective of processing 10,000tn of raw cashew nuts (‘RCN’).
· First cashew export container shipment to Europe of 16 tonnes was completed in late October at an average price of approximately €4,900 per tonne.
|FFB processed (tonnes)||7,661||11,603||-34.0%|
|CPO Extraction Rate||21.8%||20.1%||8.5%|
|CPO production (tonnes)||1,677||2,331||-28.1%|
|CPO Sales (tonnes)||1,567||2,301||-31.9%|
|Average CPO price per tonne||€1,057||€960||10.1%|
|Palm Kernel Oil (‘PKO’) production (tonnes)||131||136||-3.7%|
|PKO Sales (tonnes)||225||149||51.0%|
|Average PKO price per tonne||€1,151||€946||21.7%|
|Palm Kernel Cake (‘PKC’) production (tonnes)||Nil||221||n/a|
|PKC Sales (tonnes)||Nil||24||n/a|
|Average PKC price per tonne||n/a||€80||n/a|
· FFB quantities improved 26.1% compared to last month, however volumes were 34.0% lower than October 2021. Volumes appear to be gradually improving towards long terms averages but they remain materially lower than this time last year when record volumes were achieved.
· The CPO extraction rate achieved in October of 21.8% is very strong for a low season month, in addition to being 8.5% higher than October 2021.
CPO and PKO Price
· Local CPO prices achieved of €1,057 were 10.1% higher than September 2021. International CPO prices increased materially during October and are currently trading at €1,100 -1,150 per tonne.
· 31.9% lower like-for-like CPO sales quantities in October reflect the reduction in CPO produced resulting from weak FFB volumes and our continued efforts to carefully manage sales volumes where appropriate to maximise pricing.
· Further to the Company’s announcement on 10 October 2022, the production capacity of the Cashew Operation has materially increased and is tracking well to meet our goal of processing 10,000tn in 2023.
· We exported our first container of cashews to Europe consisting of 16 tonnes at an average price of c.€4.9kg with whole cashews priced at €5.8kg. This a profitable price for our first shipment and we expect our sales prices may increase further as we become a reliable, sustainable, high quality producer.
Lincoln Moore, Dekel Agri-Vision’s Executive Director, said: “We believe we are entering an exciting period in terms of potential revenue and profit up lift. With the palm oil operation high season only 90 days away it is pleasing to see signs of gradual normalisation of FFB levels. Given the continued high CPO prices there is the potential for an exceptional period of profitability during H1 2023 if normalised FFB levels are achieved. In addition, the Cashew Operation is well poised to add additional profit to the Group as production continues to ramp up.”