REG - Dekel Agri-Vision - February Palm Oil and Cashew Operation Update

Dekel Agri-VisionAnnouncement

13/03/2023 07:00

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RNS Number : 6629S  Dekel Agri-Vision PLC  13 March 2023

 

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

 

Dekel Agri-Vision Plc / Index: AIM / Epic: DKL / Sector: Food Producers

 

Dekel Agri-Vision Plc

('Dekel' or the 'Company')

February Palm Oil Production Update and Cashew Operation Update

 

Dekel Agri-Vision Plc (AIM: DKL), the West African agriculture company focused
on building a portfolio of sustainable and diversified projects, is pleased to
provide a February production update for its Ayenouan palm oil project in
Côte d'Ivoire ('Palm Oil Operation') and an update on progress regarding the
ramp-up of production of our large-scale cashew processing plant at Tiebissou,
Côte d'Ivoire (the 'Cashew Operation').

 

Key Highlights

Palm Oil Operation

·      As per guidance in last months update, Fresh Fruit Bunch ('FFB')
volumes in February did remain lower than prior year.  However, the Company
saw an increase in volumes in the last 5 days of the month.  This increase in
volumes has continued into early March and FFB volumes are currently ahead of
March volumes produced last year.

·      The local market consensus is that the FFB high season did not
commence until late February.  Whilst there can be no guarantees that higher
volumes will be sustained, the Directors are buoyed by the fact that FFB
volumes have improved materially over the past 2 weeks.

·      The Company is continuing to see strong local Crude Palm Oil
('CPO') demand resulting in CPO sales prices remaining close to record levels
at €984 per tonne.  Strong local demand is driving a local price premium.
 During February, the CPO price achieved was c.5% higher than the
international CPO price.  Palm Kernel Oil ('PKO') prices have decreased from
their all time peak levels last year and the international price is currently
trading at around €1,025.  With regional PKO demand softening, sales are
being carefully managed to optimise prices.

·      The CPO extraction rate of 23.3% was a record for the month of
February and together with the CPO price premium being achieved; the Company's
gross margin percentages remain healthy, albeit the Directors would clearly
like to see the early March momentum in FFB volumes continue to enhance
overall gross margins.

 

                                              Feb-23  Feb-22    Change

 FFB processed (tonnes)                       9,418   13,683    -31.2%
 CPO Extraction Rate                          23.3%   22.3%     4.5%
 CPO production (tonnes)                      2,198   3,057     -28.1%
 CPO Sales (tonnes)                           2,102   3,660     -42.6%
 Average CPO price per tonne                  €984    €979      1.0%
 Palm Kernel Oil ('PKO') production (tonnes)  131     259       49.4%
 PKO Sales (tonnes)                           Nil     407       n/a
 Average PKO price per tonne                  n/a     €1,447    n/a

 

Cashew Operation

·      The Raw Cashew Nut ('RCN') buying season has now commenced and
the Company is now actively purchasing RCN.

·      The backlog stock of unpeeled cashew inventory announced last
month is now largely completed and are seeing an uplift in daily production
figures.  As stated last month, the Company will commence publishing
financial statistics on a quarterly basis at the end of March with the
reporting date on or around the 15th following each quarter.

·      Customer feedback for the Company's cashew products continues to
be extremely positive out of Rotterdam and the US which bodes well in terms of
maximising prices as production continues to ramp up.

 

Lincoln Moore, Dekel's Executive Director, said: "Following a slow start to
the Palm Oil Operation high season it is pleasing to see indications in the
early March that FFB volumes are lifting.  With CPO prices and CPO extraction
rates remaining strong we are keen to capitalise on these supportive factors
and look forward to reporting stronger results next month for the Palm Oil
Operation as well as our first quarterly production report for the Cashew
Operation."

 

** ENDS **

 

For further information, please visit the Company's website
www.dekelagrivision.com or contact:

 

 Dekel Agri-Vision Plc                     +44 (0) 207 236 1177

 Youval Rasin

 Shai Kol

 Lincoln Moore

 WH Ireland Ltd (Nomad and Joint Broker)   +44 (0) 20 7220 1666

 James Joyce

 Darshan Patel

 Optiva Securities Limited (Joint Broker)  +44 (0) 203 137 1903

 Christian Dennis

 Daniel Ingram

 

Notes:

Dekel Agri-Vision Plc is a multi-project, multi-commodity agriculture company
focused on West Africa. It has a portfolio of projects in Côte d'Ivoire at
various stages of development: a fully operational palm oil project in
Ayenouan where fruit produced by local smallholders is processed at the
Company's 60,000tpa capacity crude palm oil mill and a cashew processing
project in Tiebissou, which is currently transitioning to full commercial
production in 2023.

 

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