Dekel Agri-Vision Plc (LON:DKL), the West African agriculture company focused on building a portfolio of sustainable and diversified projects, has provided its Q1 2024 production for the Ayenouan palm oil project in Côte d’Ivoire and the cashew processing plant at Tiebissou, Côte d’Ivoire.
Palm Oil Operation Update
· The Palm Oil Operation reported a strong Q1 2024 with Fresh Fruit Bunch (‘FFB’) volumes and Crude Palm Oil (‘CPO’) production increasing 30% and 23.5% respectively compared to Q1 2023.
o March 2024 monthly production was marginally lower than March 2023
· CPO sales quantities increased 18.8% in Q1 2024 compared to last year. The relatively high levels of CPO inventory, and in particular PKO inventory held at the end of Q1 2024 compared to last year should underpin strong sales volumes during Q2 2024.
· The Q1 2024 average CPO sales price achieved was €762 per tonne, a 21.8% decrease from the record Q1 2023 CPO sales prices. The local CPO price in March 2024 continued to trend upwards month on month increasing 2.4% compared to February 2024. Whilst encouraging, local CPO prices remain below international CPO prices as efforts continue locally to manage food prices.
· The CPO extraction rate for Q1 2024 of 21.2% was slightly lower than Q1 2023. Early guidance in April 2024 shows CPO extraction rates increasing towards 22%.
· Overall, due to the relatively strong production volume, we maintain on track to deliver a strong H1 2024 performance.
| Mar-24 | Mar-23 | Change | Q1-24 | Q1-23 | Change | |
| FFB processed (tonnes) | 23,579 | 24,508 | -3.8% | 54,381 | 41,819 | 30.0% |
| CPO Extraction Rate | 20.9% | 21.6% | -3.2% | 21.2% | 22.3% | -4.9% |
| CPO production (tonnes) | 4,929 | 5,302 | -7.0% | 11,510 | 9,318 | 23.5% |
| CPO Sales (tonnes) | 4,509 | 4,048 | -11.4% | 9.317 | 7,843 | 18.8% |
| Average CPO price per tonne | €777 | €967 | -19.6% | €762 | €974 | -21.8% |
| Palm Kernel Oil (‘PKO’) production (tonnes) | 259 | 280 | -3.9% | 641 | 493 | 30.0% |
| PKO Sales (tonnes) | 86 | 383 | -50.7% | 194 | 413 | -53.0% |
| Average PKO price per tonne | €686 | €973 | -29.5% | €733 | €973 | -24.7% |
Cashew Operation Update
· The Cashew Operation was intentionally slowed down during Q1 2024 to preserve raw cashew nut (‘RCN’) inventory while we await the arrival of new off the shelf shelling and peeling equipment. This is reflected in the numbers outlined in the table below. While the throughput of the existing shelling and peeling equipment can reach expected breakeven production levels, the output of unpeeled cashews remains too high hindering gross margins.
· All new shelling and peeling equipment was ordered in January 2024, with deliveries expected to start arriving in June 2024, which will be announced in due course. With optimal performance of the shelling and peeling stations working in tandem with the other 10 well performing stations, we expect to see a material improvement in cashew production volumes and quality during Q3 2024.
· New shelling and peeling equipment installation being overseen by a highly credentialled cashew processing consultant. Other new cashew processors in our region using this new off the shelf technology shelling and peeling systems are also achieving excellent results.
| Q1-24 | Q1-23 | Change | |
| RCN Inventory | |||
| Opening RCN Inventory (tonnes) | 1,751 | 1,841 | -4.9% |
| RCN Purchased (tonnes) | 190 | 820 | 76.8% |
| RCN Processed (tonnes) | (275) | (533) | -48.4% |
| RCN Sold (tonnes) | (42) | Nil | n/a |
| Closing RCN Inventory (tonnes) | 1,624 | 2,128 | 23.6% |
| Cashew Processing | |||
| Opening Cashews (tonnes) | 176 | 111 | 58.6% |
| RCN Processed (tonnes) | 275 | 533 | -48.4% |
| Cashew Extraction Rate | 18.2% | 23.1% | -21.6% |
| Cashew Produced (tonnes) | 50 | 123 | -59.3% |
| Cashew Sales (tonnes) | 93 | 103 | -9.7% |
| Closing Cashews (tonnes) | 133 | 131 | 1.5% |
| Average Sales prices per tonne | |||
| – Unpeeled Cashews | €3,150 | €3,375 | -6.7% |
| – Peeled Cashews | €3,250 | €4,500 | -27.8% |
Lincoln Moore, Dekel‘s Executive Director, said: “The Palm Oil Operation remains on track to deliver a strong H1 2024 performance and continues to underpin the Company’s financial performance. The major catalyst for the next phase of growth and share price performance is the Cashew Operation. With shelling and peeling equipment scheduled for delivery in June and installation being overseen by a highly credentialled cashew processing consultant, we are edging closer towards being in a position to ramp up production at optimum levels of quality.”
