(Sharecast News) - West Africa-focussed agriculture company Dekel Agri-Vision released its monthly production update for January on Tuesday, from its Ayenouan palm oil project in Côte d'Ivoire.
The AIM-traded firm reported a significant increase in fresh fruit bunches (FFB) processed, reaching 13,508 tonnes, marking a rise of 71.2% compared to the prior year.
Crude palm oil (CPO) production meanwhile surged 56.2%, totaling 2,839 tonnes for the month.
Despite the decrease in the CPO extraction rate by 8.7% compared to January last year, to 21%, the overall production numbers showed strong growth.
CPO sales volumes for January were up 38% compared to the same period last year, reflecting the company's continued momentum.
However, the average CPO price per tonne softened to €737, showing a decrease of 32.3% from the prior month.
The company put the decline down to local market dynamics, where efforts to manage food prices kept local CPO prices below international levels.
Nevertheless, the company said it maintained healthy gross margins due to lower FFB purchase prices.
Despite challenges in pricing, Dekel Agri-Vision said it was optimistic, expecting an uptick in CPO prices in February.
Moreover, the company said it had initiated steps to enhance its production capacity, with plans to increase production from the second quarter onwards.
Orders for additional cashew equipment had been placed in line with that objective.
"The palm oil operation has started 2024 very well, continuing the excellent performance achieved in 2023," said executive chairman Lincoln Moore.
"We will shortly be entering the production high season and we are operationally well positioned to take advantage of the anticipated spike in production levels over the coming months."
At 1402 GMT, shares in Dekel Agri-Vision were down 6.07% at 1.27p.
Reporting by Josh White for Sharecast.com.
Dekel Agri (DKL)