Dekel Agri-Vision PLC August 2020 Palm Oil Production Update (5470Y)
September 10 2020 - 1:00AM
UK Regulatory
TIDMDKL
RNS Number : 5470Y
Dekel Agri-Vision PLC
10 September 2020
Dekel Agri-Vision Plc / Index: AIM / Epic: DKL / Sector: Food
Producers
Dekel Agri-Vision Plc ('Dekel' or the 'Company')
August 2020 Palm Oil Production Update
Dekel Agri-Vision Plc, the West African focused agriculture
company, is pleased to provide a production and sales update for
its Ayenouan palm oil project in Côte d'Ivoire (the 'Project') for
August 2020. Year on year crude palm oil ('CPO') production rose
3.6% to 1,551 tonnes in August as materially higher extraction
rates more than offset a 9.7% reduction in fresh fruit bunches
('FFB') delivered to the mill for processing. Together with a 25.7%
increase in global CPO prices for August 2020 (compared to August
2019), September 2020 is expected to see a continuation of the
recent trend of improving year on year financial metrics. A table
providing a breakdown of production, sales and pricing levels
achieved at Ayenouan during August 2020 is set out below.
As previously announced, the Company is issuing CPO production
figures on a monthly basis to provide shareholders with increased
visibility on operations and trading during the pandemic and
associated market volatility. The Company intends to continue
providing monthly data until 30 September at which point it will
consider reverting to quarterly data.
August 2020 Production
Aug 2020 Aug 2019 Increase/
(decrease)
FFB processed (tonnes) 7,044 8,083 -12.85%
CPO production (tonnes) 1,551 1,497 3.61%
CPO sales (tonnes) 1,482 2,140 -30.75%
Average CPO price per tonne EUR538 EUR428 25.70%
PKO production (tonnes) 101 197 -48.73%
PKO sales (tonnes) 203 442 -54.07%
Average PKO price per tonne EUR554 EUR486 14.00%
PKC production (tonnes) 196 295 -33.56%
PKC sales (tonnes) 239 273 -12.45%
Average PKC price per tonne EUR60 EUR56 7.14%
Production
-- 3.61% increase in CPO produced at the mill in August 2020 to
1,551 tonnes (August 2019: 1,497 tonnes)
-- Higher extraction rates due to higher oil content in FFB
offset lower volumes of fruit delivered to the mill
o 22% extraction rate in Aug 2020 compared to 18.5% in Aug
2019
o Lower volumes of FFB delivered to the mill in line with
experience of all operators in the region
-- PKO and PKC production of 101 tonnes and 196 tonnes
respectively - lower than Aug 2019 due to lower volumes of FFB
delivered to the mill and lower outside kernel purchasing
Sales and Pricing
-- Year on year CPO sales performance comparison continues to be
distorted by the 3,000 tonnes of CPO which were held in storage in
June 2019 and sold in Jul/Aug 2019
-- 1,482 tonnes of CPO sold at average prices of EUR538 per
tonne in Aug 2020 compares to 2,140 tonnes sold at EUR428 per tonne
in Aug 2019
o 25.7% year on year increase in CPO prices reflects the 4-5
weeks it takes for local pricing to reflect the improvement in
international benchmarks seen following the reopening of global
markets
o Current international prices of CPO have traded around and
over US$700 per tonne since late July 2020 which points to further
improvement in CPO prices achieved at Ayenouan in September
2020
-- Timings of sales and deliveries continue to distort PKO sales
which came in lower at 203 tonnes in August 2020 compared to 442
tonnes in August 2020
o Currently 860tn of stock held which has been sold but has yet
to leave the tanks - expected to have a very positive impact in
next couple of months
Dekel Agri-Vision Executive Director Lincoln Moore said, "The
theme of lower volumes, at least in terms of fruit delivered to the
mill, being more than offset by significantly higher extraction
rates and CPO prices continued in August 2020. While it is too
early to draw meaningful conclusions on the volumes of fruit
delivered to the mill during September, Ayenouan's trading
performance is expected to continue to benefit from the improving
pricing environment. We know this because CPO is currently trading
at $730 which is materially higher than the reported average
realised price for August. The 4-5 week lag it takes for local
prices to catch up with international benchmarks gives us
confidence that September's realised prices will show an increase
on the EUR538 per tonne achieved in August.
"With the upcoming half year report expected to show a more
profitable H1 financial performance compared to last year, and with
the large scale cashew processing project on course to commence
first production in Q2 2021, Dekel is entering an exciting period
in its development and I look forward to providing further updates
in due course."
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 at
www.dekelagrivision.com or contact:
Dekel Agri-Vision Plc
Youval Rasin
Shai Kol
Lincoln Moore +44 (0) 207 236 1177
Arden Partners Plc (Nomad and Joint Broker)
Paul Shackleton / Ruari McGirr /
Dan Gee-Summons (Corporate Finance)
Simon Johnson (Corporate Broking) +44 (0) 207 614 5900
Optiva Securities Limited (Joint Broker)
Christian Dennis
Jeremy King +44 (0) 203 137 1903
St Brides Partners Ltd (Investor Relations)
Frank Buhagiar
Cosima Akerman
Megan Dennison +44 (0) 207 236 1177
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
including 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 and a cashew processing project in
Tiebissou, which is due to commence production in Q2 2021.
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