Dekel reports strong month at palm oil project

11th Apr 2023 12:09

(Sharecast News) - Dekel Agri-Vision reported a significant increase in monthly production at the Ayenouan palm oil project in Côte d'Ivoire on Tuesday.

The AIM-traded company said fresh fruit bunch volumes and crude palm oil production in March was ahead 56.4% and 48.6%, respectively, year-on-year.

It put the increase in production down to the return of a more typical high-season harvesting month compared to last year.

The increase in production had continued into early April, with the firm expecting to report higher production in April than last year.

Dekel also reported strong local demand for crude palm oil, resulting in CPO sales quantities increasing by 45.2% in March compared to last year.

Palm kernel oil sales quantities were also strong in March, increasing by 206% compared to last year, driven by the timing of bulk PKO sales taking place in March and a 19.4% increase in production.

CPO sales prices remained "robust" at €967 per tonne, with local prices trading at a premium to international prices, which hovered around $1,025 (€940) per tonne during the month.

However, PKO prices had decreased from their all-time peak levels last year, with the international price currently trading at around €1,000 per tonne.

Local PKO demand remained slightly softer, with prices achieved of €973 per tonne.

The board said the CPO extraction rate decreased from record February levels, although it was in line with historical trends at 21.8%, where the delivery of peak FFB volumes "inevitably leads" to increased double-handling of FFB at the mill site awaiting processing.

"It has been fantastic to see the return of a more typical peak harvesting month following last year's flat FFB high season harvest," said executive director Lincoln Moore.

"With CPO prices remaining strong, we are currently capitalising on this period of strong production."

Moore said FFB quantities in early April had continued to look promising, setting the palm oil

operation up for a potentially strong second quarter performance compared to last year.

"We also look forward to providing our first quarterly production report for the cashew operation, which will be released in the coming days."

At 1158 BST, shares in Dekel Agri-Vision were up 6% at 2.65p.

Reporting by Josh White for Sharecast.com.