Dekel Agri-Vision potential for an exceptional period of profitability during H1 2023

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.

Key Highlights

·      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.

Oct-22Oct-21Change
FFB processed (tonnes)7,66111,603-34.0%
CPO Extraction Rate21.8%20.1%8.5%
CPO production (tonnes)1,6772,331-28.1%
CPO Sales (tonnes)1,5672,301-31.9%
Average CPO price per tonne€1,057€96010.1%
Palm Kernel Oil (‘PKO’) production (tonnes)131136-3.7%
PKO Sales (tonnes)22514951.0%
Average PKO price per tonne€1,151€94621.7%
Palm Kernel Cake (‘PKC’) production (tonnes)Nil221n/a
PKC Sales (tonnes)Nil24n/a
Average PKC price per tonnen/a€80n/a

CPO Production

·      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.

CPO Sales

·      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.

Cashew Operation

·      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 Directorsaid: “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.”

Click to view all articles for the EPIC:
Or click to view the full company profile:
Facebook
Twitter
LinkedIn
Dekel Agri-Vision PLC

More articles like this

Dekel Agri-Vision PLC

Palm oil futures rise on soyoil strength

Malaysian palm oil futures rose on Wednesday, tracking strength in Dalian’s palm olein contract and Chicago soyoil, although weak exports data limited gains. The benchmark palm oil contract FCPOc3 for May delivery on the Bursa Malaysia Derivatives Exchange

Dekel Agri-Vision PLC

Palm oil futures rise on increase in soyoil

Malaysian palm oil futures rose on Friday on an increase in soyoil and the transition of May contract to the benchmark, narrowing the discount to the April contract, although weak exports capped the upside. The benchmark palm oil contract FCPOc3 for May delivery on the Bursa

Dekel Agri-Vision PLC

Palm Oil rises on strong crude oil futures

Palm oil futures edged up on Wednesday, extending gains from the previous session, as a bigger-than-expected fall in January inventories of the tropical oil in top producer Malaysia lent support. The benchmark palm oil contract for

Dekel Agri-Vision PLC

Palm Oil prices expected to surge

The world of vegetable oil is a complex one, with prices fluctuating in response to a variety of factors. One of the key players in this industry, palm oil, is set to experience a significant surge

Dekel Agri-Vision PLC

Palm ends higher on rival oils’ support

Malaysian palm oil futures closed up on Thursday for a sixth straight session, with gains in rival oils supporting the market. The benchmark palm oil contract FCPOc3 for March delivery on the Bursa Malaysia Derivatives Exchange increased 39

Dekel Agri-Vision PLC

Palm oil rises on support from rival oils

Malaysian palm oil futures rose on Monday for a third straight session, supported by gains in rival Dalian and Chicago soyoil. The benchmark palm oil contract FCPOc3 for March delivery on the Bursa Malaysia Derivatives Exchange climbed 10

Dekel Agri-Vision PLC

Analysts predict better crude palm oil prices in 2024

Analysts have foreseen better crude palm oil (CPO) prices in 2024, as El Nino weather is expected to affect palm oil supply. RHB Investment Bank, the largest investment bank by asset size in Malaysia, said in

Dekel Agri-Vision PLC

Palm extends gains on production concerns

Malaysian palm oil futures jumped on Monday due to falling inventories and expectations of lower output because of dry weather conditions. The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange was

Dekel Agri-Vision PLC

Dekel Agri-Vision shares rise on record palm oil production

Dekel Agri-Vision PLC on Monday announced that palm oil production soared to record heights in November at its Ayenouan project in Ivory Coast. The West Africa-focused agricultural company said the Ayenouan operation “performed well above expectations”,