West African agriculture company Dekel Agri-Vision reported robust financial results for the first half of the year, driven by high production levels and historically high crude palm oil (CPO) prices. Despite a slight decline compared to the same period in 2023, with fresh fruit bunch (FFB) volumes and CPO production decreasing by 8.1% and 7.7% respectively, the operation remained stable.
CPO sales quantities increased by 7.7% year-on-year, mainly due to higher stock levels resulting from a delayed high season in early 2023. The average CPO sales price for the first half of 2024 was €770 per tonne, a 17.6% decrease from the previous year. However, international CPO prices held steady at around €900 per tonne, with local prices gradually aligning, reaching €773 per tonne by June 2023.
The CPO extraction rate for the period improved slightly to 22%, with recent monthly rates exceeding 23%, indicating positive prospects for the second half of 2024. Meanwhile, Dekel’s cashew operation maintained a conservative approach as the company awaited the commissioning of new shelling and peeling equipment ordered in January. Deliveries of the new equipment began last week, with the remaining shipments expected by September.
Commissioning of the new equipment, overseen by a “highly credentialed” cashew processing consultant, is set to commence in the coming weeks. Dekel anticipates an improvement in cashew production volumes and quality by late in the third quarter of 2024. Additionally, there has been a significant increase in whole cashew sales prices recently, expected to positively impact third-quarter production and sales.
Executive director Lincoln Moore expressed confidence in the company’s performance, stating, “We expect to deliver another strong first-half financial performance from the palm oil operation with the continued sustained period of robust production levels and relatively high historical CPO prices.” He added, “We continue to conservatively produce from the cashew operation whilst we eagerly await the commissioning of new equipment which we believe is finally edging towards conclusion. We are pleased to see a recent increase in cashew prices which will also greatly assist the financial metrics of the cashew operation moving forward.”
Dekel Agri-Vision PLC (LON:DKL) aspires to become a leading agro-industrial company in West Africa, one that creates value for shareholders whilst at all times placing the interests of the local communities and environment in which it operates in at the heart of its operations.
