TIDMDKL
RNS Number : 8580K
Dekel Agri-Vision PLC
10 May 2022
Dekel Agri-Vision Plc / Index: AIM / Epic: DKL / Sector: Food
Producers
Dekel Agri-Vision Plc ('Dekel' or the 'Company')
April 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 April production
update for its Ayenouan palm oil project in Côte d'Ivoire, and an
update on the timing of the ramp-up of production of our
large-scale cashew processing plant at Tiebissou, Côte d'Ivoire
(the 'Cashew Project').
Key Highlight s
Palm Oil Project
-- The Crude Palm Oil ('CPO') high season volumes have continued
to remain weak in line with guidance provided in our announcement
dated 10 March 2022, with April 2022 production 42.4% lower than
April 2021.
o Our agronomist currently advises that low recent rainfall has
continued to delay the typical ripening timing of fresh fruit
bunches ('FFB') and they remain cautiously optimistic we will see
some improvement in the shortfall of monthly FFB over the next two
months, provided the levels of rainfall increase over the coming
weeks.
-- CPO sales quantities in April 2022 were lower as a percentage
of production than April 2021 as we seek to carefully manage sales
in order to maximise prices, given local Ivory Coast prices
continue to remain materially lower than international prices.
-- CPO prices achieved continue to strengthen with prices of
EUR1,061 per tonne achieved in April 2022, a 32.1% increase
compared to April 2021. In addition, PKO prices remain
significantly higher than the prior year with prices achieved of
EUR1,448, a 72.8% increase compared to April 2021.
-- CPO extraction rate continued its higher trend at 22.5% in
April 2022, 1.1 percentage points higher than April 2021.
-- Overall, despite the weak FFB volumes, the Company is
delivering a strong year-to-date financial performance driven by
high CPO and Palm Kernel Oil ('PKO') prices, in addition to the
relatively greater extraction rate compared to prior year.
Cashew Project
-- Colour sorter due to arrive in the coming weeks and the
shelling machines shortly thereafter which will enable Dekel to
significantly increase production.
Apr-22 Apr-21 Change
FFB processed (tonnes) 13,168 24,010 -45.2%
CPO production (tonnes) 2,965 5,147 -42.4%
CPO sales (tonnes) 1,788 4,971 -64.0%
Average CPO price per tonne EUR1,061 EUR803 32.1%
PKO production (tonnes) 197 322 -38.8%
PKO sales (tonnes) 212 216 -1.9%
Average PKO price per tonne EUR1,448 EUR838 72.8%
Palm Kernel Cake ('PKC')
production (tonnes) 300 529 -43.3%
PKC sales (tonnes) 61 349 -82.5%
Average PKC price per tonne EUR97 EUR80 21.3%
CPO Production
-- The local region continues to experience a relatively weak
high season compared to 2021. With the benefit of further local
market intelligence, we can confirm this is the case throughout the
eastern part of Côte d'Ivoire and further to the east in Ghana. The
western part of Côte d'Ivoire and Liberia are now experiencing more
typical high season volumes.
-- Local agronomists advise that weak recent rainfall is
delaying the timing of the FFB ripening process. There remain quite
healthy levels of FFB on estates which may lead to some uplift in
FFB. However, we also expect that given the relatively low high
season volumes, competition for FFB will also be strong and our
guidance is H1 2022 production will be materially softer than last
year.
-- We will continue to update the market monthly and provide
forward guidance where appropriate.
CPO and PKO Price
-- International CPO prices continue to remain significantly
higher than local prices. We are now pleased to confirm we are
accessing regional export markets which resulted in a 7.5% increase
in CPO sales prices in April 2022 compared to March 2022.
-- We anticipate our CPO prices for May 2022 should continue to
gradually increase from our strategy to partially utilise export
markets where appropriate, while balancing our obligations to local
stakeholders.
-- International PKO prices have recently stabilised at
approximately EUR1,800-EUR1,850 cif Rotterdam. Our current
ex-factory prices achieved of over EUR1,400 remain healthy and over
70% higher than last year.
CPO Sales
-- CPO Sales were low due to both the weak volumes and the
continuing strategy to manage our sales quantities carefully with
the goal of increasing our prices closer to the international
price.
Cashew Project
-- A colour sorter is scheduled to arrive from China on 25 May
2022 with customs release, transportation to site and commissioning
expected to take place in approximately 3 weeks.
-- The first 11 of the 21 shelling machines are scheduled to be
shipped from Italy in late May. 15 shelling machines are required
to operate at full capacity.
-- Importantly, the arrival of the colour sorter together with
the utilisation of the shelling machines we have on site should see
production gradually increase to over 50% of full capacity in June
2022.
-- Whilst the Company's main supplier has experienced logistical
challenges, particularly in relation to raw materials and shipping,
it is pleasing to see we are now getting closer to completing the
commissioning of the Cashew Project which is an important part of
the Company's short and medium term growth strategy.
Lincoln Moore, Dekel 's Executive Director , said: "The recent
monthly trend of weak FFB volumes being largely offset by continued
strong CPO and PKO sales prices, in addition to a relatively strong
CPO extraction rate has continued in April 2022. Whilst there is
cautious optimism we may see some improvement in the recent monthly
shortfall of FFB volumes compared to prior years over the next two
months, we also remain focused on areas we control, specifically
maximising our prices and completing the delivery of the Cashew
Project.
"We would also like to take this opportunity to welcome our new
nominated advisor and joint broker, WH Ireland Ltd, and we look
forward to working with their team on executing our strategy to
increase the scale and diversification of our agri-processing and
logistics operations in Côte d'Ivoire. "
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.
** ENDS **
For further information please visit the Company's website
www.dekelagrivision.com or contact:
Dekel Agri-Vision Plc
Youval Rasin
Shai Kol
Lincoln Moore +44 (0) 207 236 1177
WH Ireland Ltd (Nomad and Joint Broker)
James Joyce
Ben Good +44 (0) 20 7220 1666
Optiva Securities Limited (Joint Broker)
Christian Dennis
Daniel Ingram +44 (0) 203 137 1903
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 commenced production in early January 2022.
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