Dekel Agri-Vision (LON:DKL), the West Africa-based agricultural company, continues to show resilience and progress in its operations, as evidenced by its latest Q3 update. The company, known for its multi-commodity approach, delivered steady palm oil production figures and reported significant developments in its growing cashew business.
In its palm oil division, the company achieved a robust performance despite being within the annual low season. Year-to-date crude palm oil (CPO) volumes are tracking well, reflecting confidence in hitting full-year targets. While production dipped by 7.5% compared to last year—due to an unusually late high season in 2023—palm oil prices have remained strong, trending upwards. The local market price of CPO was slightly down by 4.9% at €777/tonne, compared to exceptional figures from last year. Still, with international prices currently around €950/tonne, the company remains optimistic. “There is no guarantee that local prices should converge to international levels, but historically, these prices have been more closely aligned,” commented Nick Spoliar, Research Analyst at Zeus Capital.
The nascent cashew operation has also seen significant advancements. After months of troubleshooting issues with shelling and peeling equipment, Dekel Agri-Vision has now received and begun installing the final pieces of remedial equipment. This new equipment is expected to materially improve throughput by Q4, positioning the cashew operation for a much stronger performance in 2025. Spoliar noted, “With this equipment now on site, we await further updates on the installation process and production rate ramp-up in the coming months.”
Despite the current low cashew production levels, the future looks bright for Dekel’s cashew business. Zeus forecasts predict that by 2026, this division could contribute over €12 million in revenue, providing a strong boost to the company’s overall financials. This transformation, from a cost centre to a significant contributor, is expected to have a meaningful impact on profitability over the next few years.
On a financial level, Dekel Agri-Vision has managed to maintain steady forecasts, with no changes to its full-year expectations. The stability in both palm oil production and prices, coupled with the expected ramp-up in cashew production, provides a positive outlook. The company’s ability to maintain momentum in challenging market conditions speaks volumes about its operational strategy and long-term potential.
On a Final Note, Dekel Agri-Vision’s Q3 update paints a picture of a company on the brink of substantial growth, especially as its cashew operations gain momentum. With strong fundamentals in the palm oil division and the potential for a significant contribution from cashews, Dekel is well-positioned for a transformative 2025 and beyond.
