Dekel Agri-Vision PLC on Monday reported a drop in crude palm oil sales but anticipates establishing a second revenue stream shortly in August trading update.

The palm oil and cashew grower in West Africa produced 1,024 tonnes of crude palm oil in August 2022, a 39% decrease from the 1,678 tonnes recorded in August last year. Sales declined 38% year-on-year, mirroring the decrease in production.

Fresh fruit bunch volumes remained low as well, having stayed unusually low in like-for-like terms since February. Fresh fruit bunches are the raw material for palm oil.

The price of local crude palm oil remains high. It reached €1,030 in August 2022, 8.7% higher than in August 2021.

The company noted early indications that fresh fruit bunch volumes are trending upwards. As local demand remains consistent around €1,000 mark, the company is optimistic looking further into the year.

All key equipment is on site at their cashew project, including 11 shelling machines which are now being installed and commissioned, according to Dekel Agri-Vision. It expects a ‘significant uplift in production capacity’ at the time of next month’s report.

Executive Director Lincoln Moore said: ‘We are now on the cusp of delivering our short-term objective of operating our palm oil operation and cashew operation in tandem. With crude palm oil prices continuing to trade at close to long-term highs, we are hopeful that we will see fresh fruit bunch volumes improve, particularly in the next high season, so we can capitalise fully on these supportive prices.

‘We now have all key equipment for the cashew operation on site and are undertaking the final installation and commissioning phase. We are entering an exciting phase of reaching our objective of operating an enlarged company with two material revenue streams from 2023 onwards.’

Shares in Dekel Agri-Vision were trading 4.9% higher at 3.20 pence each in London on Monday afternoon.

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