REG - Dekel Agri-Vision - October Palm Oil and Cashew Update

Dekel Agri-VisionAnnouncement

10/11/2021 07:05

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RNS Number : 8681R  Dekel Agri-Vision PLC  10 November 2021

 

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

 

Dekel Agri-Vision Plc ('Dekel' or the 'Company')

October Palm Oil Production Update and Cashew Project 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 an October production update for its Ayenouan palm oil project in
Côte d'Ivoire and an update on the timing of the commencement of production
of our large scale cashew processing plant at Tiebissou, Côte d'Ivoire (the
'Cashew Project').

 

Key Highlights

Palm Oil Production

·      28.2% increase in October 2021 compared to October 2020

·      Local CPO prices continued to increase resulting in a 2021
monthly high of €960 in October 2021, a 50.9% increase on average realised
CPO prices compared to October 2020

Cashew Project

·      The commissioning of the Cashew project commenced in early
October as planned and whilst it is continuing to advance towards first
production, supply and final shipment challengers will lead to a delay on the
first production milestone which was expected in mid-November.  See details
below.

 

Lincoln Moore, Dekel's Executive Director, said: "A year of strong production
and even stronger prices continues to set Dekel up for a record year of
financial performance in our palm oil operation in 2021.  Given current
prices remain materially higher than we achieved in this year's high season
earlier in the year we remain optimistic of a further uplift in the financial
performance of the palm oil operation in 2022.

 

"The delay in commencing first cashew production due to supply challengers
impacting parts of the final shipment is frustrating.  However, a substantial
amount of the commissioning phase has been completed successfully and we are
also supplementing locally sourced components which should still see our first
production occur in December."

 

                              Oct-21  Oct-20                    Change

 FFB processed (tonnes)       11,603  9,350                     24.1%
 CPO production (tonnes)      2,331   1,818                     28.2%
 CPO Sales (tonnes)           2,301   1,843                     24.9%
 Average CPO price per tonne  €960    €636                      50.9%
 PKO production (tonnes)      136                129            5.4%
 PKO Sales (tonnes)           149     251                       -40.6%
 Average PKO price per tonne  €946    €564                      67.7%
 PKC production (tonnes)      221     196                       12.8%
 PKC Sales (tonnes)           24      47                        -48.9%
 Average PKC price per tonne  €80     €61                       31.1%

 

Crude Palm Oil

·      Production and Sales: the recent trend of like for like monthly
CPO production continuing to be higher than last year continued with a 28.2%
increase in October 2021 compared to October 2020.  This also led to a 24.9%
increase in like for like CPO sales for the month

·      Prices: CPO sales prices remained very strong at €960, our
highest monthly price achieved this year and 50.9 % higher than prices
achieved in October 2020

o  Whilst international CPO prices continue to trade at multi-year highs over
€1,050 per tonne, we are seeing local prices currently settling around
€950 per tonne.  We believe this is in part due to macro logistics
challengers to export and as a result, we continue to supply at the factory
gate which is materially cheaper than export options

 

Palm Kernel Oil ('PKO') and Palm Kernel Cake ('PKC')

·      Sales:  Lower sales quantities of both PKO and PKC reflect the
continued internal strategy to manage sales to maximise prices and the profit
margins of PKO and PKC.  This strategy has worked well, and we currently hold
higher levels of stock than typical which we expect will unwind before the
next high season commences

·      Prices: 67.7% increase in PKO prices to €946 per tonne compared
to €565 in October 2020.  Local PKO prices continue to improve with October
seeing our highest prices achieved to date this year, albeit local prices
still lag the international price

 

Cashew Project

·      As outlined in our previous announcement dated 9 September, we
were anticipating the commencement of production in mid-November.

·      The main issue has been the arrival of parts of the final
shipment due to global material sourcing issues.

·      As an alternative, we have been able to source short term
alternative components to avoid further delays

·      In terms of the commissioning process status:

o  Electrical supply, the Compressor, Air and the Industrial Water
distribution network has been successfully commissioned

o  Steam supply should be commissioned early next week.

o  The Calibration section including the sorting process has commenced and is
now settling and should be commissioned this week

·      This will be followed by the steaming and drying commissioning
and first production is currently scheduled in December

·      We will keep the market informed of key milestones, including
first production, during and following the commissioning period

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR").  Upon the publication of this announcement via a
Regulatory Information Service ("RIS"), this inside information is now
considered to be in the public domain.

 

** 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

 Arden Partners Plc (Nomad and Joint Broker)  +44 (0) 207 614 5900

 Paul Shackleton / Ruari McGirr /

 Elliot Mustoe (Corporate Finance)

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

 Christian Dennis

 Jeremy King

 

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 crude palm oil mill; a cashew processing project in
Tiebissou, which is due to commence commissioning in December 2021.

 

 

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