Agriterra Ld Share Discussion Threads

[the count of monte_cristo] 01/5/2014 15:29

Problem with the palm oil, unless they get a well capitalised partner, is the large upfront investment it would require. I think tje company have got the strategy about right, the beef divisiob in time is going to turn into a cash cow:) the mc peat notes are helpful for seeing the potential but its all about size and scale which clearly takes time and hard work. The pr could be much better and hopefully as we develop we will see some strategic investors come in like say an agri fund like sprotts.

[cyfran101] 01/5/2014 14:05

The palm oil situation is interesting. I previously thought this was a distraction and cashburn too far.

However maybe they could use their experience of organising a network of buyers and follow a DKL business model of buying the mill first (with a partner) and supplying it with smallholder plantations before ramping up their own plantation. DKL are already making a profit on this basis and this also generates a lot of local goodwill.

[cyfran101] 01/5/2014 14:04

Grain is making a profit albeit small and I wouldn't be impressed by a narrow focus on the beef division (ZAM has already shown how dangerous that can be).

I'm all in favour of keeping the diversification of products (particularly as I'm as excited with cocoa as i am with the beef) and the geographical diversification.

I'm a little wary of what the cash burn is but as long as it get us to 2015 when the beef gets interesting and the cocoa starts ramping up I remain in.

[freddie01] 01/5/2014 13:04

Positive rns today and conformation that the beef side is starting to really get going.

[lucky_punter] 01/5/2014 12:17

Agriterra says Mozambique beef operation 'going from strength to strength'
By Ian Lyall

Africa-focused Agriterra (LON:AGTA) is 'going from strength to strength', according to director Andrew Groves.
His comments follow an update on the group's Mozbife field-to-fork beef operation in Mozambique in which it revealed stocking ratios have significantly increased at the Mavonde and Inhazonia farms.

[oiht] 01/5/2014 12:03

Edged up a little. Always nice to see and maybe this is the bottom.

[amt] 01/5/2014 08:35

Probably no downside now as so much bad news in the share price so might be worth a punt.

[the count of monte_cristo] 01/5/2014 08:25

Interesting to see how the grain trading business has been doing...with corn now over 500 (see Bloomberg commodities futures).

With the cocoa business, this is long term, but the company have said that the trading business should be profitable come 2015.

Not defending things SITAIN, just saying that the cocoa business is still in the early investment phase, whereas the beef business is more advanced.

[sitiain] 01/5/2014 08:15

its the rest of the business that is worrying me and share holders.

Easy to keep going on about cattle numbers and NAV.
The spend in Sierra Leone is a concern and the inability of the wheat to make a profit.
Will they become just a ranch..?
The write donws would be horrible.
they must make up their mind
maybe sell off the rest , stay with the moo moos

[the count of monte_cristo] 01/5/2014 07:38

Update on the beef business out....answers many of my questions which I sent onto the company about 2 weeks ago.

No details on when the beef business will turn a profit yet, but with expanding scale it will come and I am happy to wait for it.

Good also to see the scaling up and expansion plans, the 10,000 head of cattle is just the start, to get the true benefits of the scale they need to continue rapidly expanding the business - plenty of demand in Moz, where they import 90% of their beef, plus huge global demand and demand in the KSA as well as in the PRC.

Cash of 8m dollars to fund the continued expansion plans.

My view is that at the current price this could very well multi bag over the next 2 years.

[thomcooper] 29/4/2014 11:57

The dam is a long way from Tete & the dam, whilst having a big lake behind it is in a relatively small section of land. It might flood some floodplain lands temporarily, but I can't see it doing too much damage. Theres also another big lake in between.

Also, is that Belarus article correct - only a few million bucks worth of exports? If so, its hardly worth reading...

IMO, the shareprice is being slowly marked down by th MMs as there is potentially a rights issue on its way if they don't start turning a profit & building up some dosh. There was 1million shares sold last week & then another unknown trade of a further million a few days later. There seems lots of buying of a few 100k though.

Theres over 200m shares on the book between here & 1p, but the book looks slightly weighted to the downside still. I couldn't care less as I want this co. to turn a profit in the short term to show it can operate without shareholder bailouts. If this is possible, then theres huge value here in years to come IMO, but nothing for the next year of so. I'm lousy at timing though. I bought uk propcos in 2010. Took 2-3 years to see a return, but the early bird catches the worm I guess.

Theres no reason why this won't be cheaper in the coming months.

[the count of monte_cristo] 29/4/2014 09:02

doubtful that they would let the Kariba dam swamp the lowlands, potentially killing people and destroying crops, buildings and livelihoods.

[jazzyjeffnett] 29/4/2014 01:06

the kariba dam situation could be a bit of a drag on the share price, as tete would be impacted, money has been raised to fix the dam but not all that would be required? peeps don't like uncertainty but this could be the reason for the drop in the share price

[the count of monte_cristo] 26/4/2014 16:26

Belarus is one of the worlds largest potash producers...witness the recent dispute between Russia and one of Belarus's olgiarchs. Good link by the way, this could potentially benefit agta in the long term, perhaps more with the grian business. It also shows that direct foreign investment is not afraid to invest in Moz. My view is the stock has a seller and until he is cleared we will be up against it, but he can only sell once. Personally I think the decline is due to a number of reasons, as can be said across the entire resource sector, and is not just about the poltical situation which to be honest seems to be showing positive progress. Renamo are a spent force, they have no support from SA like they did during the civil war, most of there fighters are now middle aged and are half heartedly in it, they have a small power base and Moz is on the up and the vast majority of the population would deplore any return to civil war. What Renamo are doing and the only thing they can do is to use occasional acts of violence to give them some leverage and bargaining power in the politics of the country.

My view is that at the current price one could see an investmemt double or triple bag from here over the next few years, all imho. I continue to pick up stock as and when funds permit.

[freddie01] 26/4/2014 15:10

Off Topic


Belarus ready to build assembly plants in Mozambique


25.04.2014 11:20

MINSK, 25 April (BelTA) – Belarus is ready to set up assembly plants in Mozambique, First Deputy Premier of Belarus Vladimir Semashko said as he met with Minister of Foreign Affairs and Cooperation of the Republic of Mozambique Oldemiro Baloi on 25 April, BelTA has learnt.

"Belarus and Mozambique have a significant cooperation potential in many fields, first of all, in agriculture and manufacturing, as well as education. The bilateral trade increased 3.4 times in 2013, however, the absolute number ($9.1 million, including $8.7 million in export) is still very small. We can expand the bilateral trade dozens and even hundreds of times," Vladimir Semashko said.

Agriculture is a priority economic sector in Mozambique. It generates about 24% of the country's GDP. Vladimir Semashko noted that Belarus could supply tractors to Mozambique. According to him, Belarusian tractors "are relatively cheap compared to the world's average and are extremely reliable and modern".

Vladimir Semashko noted that Belarus produces all kinds of machines, devices, tools and equipment for agriculture, from ploughs and seeders to grain harvesters and fodders harvesters. "We are ready to supply these machines to Mozambique if needed," the First Deputy Premier noted.

A joint venture BelAfrica was registered in Mozambique in October 2012. It was co-founded by AfriRent and Promagroleasing. The first deliveries have already been made. Orders are estimated at $30 million.

Vladimir Semashko believes that besides supplying agricultural, road construction and municipal machines, Belarus can also set up assembly plants in Mozambique. "We view the assembly production not only as construction of new plants to meet Mozambique's demand, but also as a platform for subsequent machinery deliveries to South Africa and Central Africa. Our countries could greatly benefit from this business," Vladimir Semashko said.

Belarus has already done it before. For example, Belarusian specialists constructed four powerful plants in Venezuela in four years: a plant to assemble tractors (10,000 tractors per year), trucks (5,000), municipal vehicles (3,000) and Latin America's biggest plant to produce ceramic products. Now the new companies work only one shift. The output can be doubled or even tripled if needed. "We are ready to implement such projects in Mozambique as well," Vladimir Semashko said.

He deems it necessary to set up an intergovernmental commission for trade and economic cooperation that would identify and promote the most promising projects.

The Minister of Foreign Affairs and Cooperation of Mozambique noted: "We would like to follow the example of Belarus". In his words, agriculture dominates the economy of Mozambique. The country is determined to switch from small farming to big commercial agricultural companies. "For that we need qualified personnel and new technologies and we can find all this in Belarus. Trade and agriculture are the sectors that can advance the country to a higher economic level," the minister underlined.

Oldemiro Baloi visited Minsk Tractor Works and was impressed by what he saw: "Statistics is one thing, but to see the real production scale and the company's capacities with your own eyes is quite a different thing".

Belarus expanded its export to Mozambique in 2013 due to potash fertilizes ($6.3 million), tractors and truck tractors ($1.3 million), road construction machines ($0.07 million) and other products of the Industry Ministry. Belarus' import from Mozambique is dominated by raw tobacco.

[the count of monte_cristo] 26/4/2014 12:09

Be interesting to see how the surging price of corn impacts the grain business and its margins & profitability.

[oiht] 25/4/2014 16:47

That looks promising Count. Probably a big chunk of the share weakness is down to political instability.

[the count of monte_cristo] 23/4/2014 18:25

the prices of corn, beef and cocoa have all been on the rise.

Personally I expect the price of cocoa to increase by between 50 to 100% over the next 2-5 years, due to greater demand from the far East and supply constraints.

I think the beef retail outlets will already be making a profit, we know the corn business makes a small profit, the cocoa trading operations should move into profit in 2015 (according to the last video presentation).

I added a few today at 1.47p

[thomcooper] 23/4/2014 13:40

I thought that around 2 & got in. I've been slowly moving into the position as its fallen further. There is some downside though from here:

1 - Mozambique Elections. Small risk in my opinion, but Moz is more corrupt than say Botswana so anything is possible. That being said, theres some pedigree from previous elections. The current leaders are socialists & the minority opposition party are conservatives, so the downside of the socialists not getting in (they've ruled since the beginning of democracy a few decades ago) is that they throw their toys out of their pram & do a Mugabe to stay in power.

2 - The company needs to prove that it can make a profit. It will otherwise quickly burn through its cash pile & need a rights issue. In my opinion, they're possibly slightly over extended expansion wise & need to deliver a big deal on the beef side to make the investments pay.

I have no doubts for this co. in the short term, but shares could fall further (+ a rights issue further diluting price) before they bounce back up. The sector & region is on the money though IMO.

[bluebadger] 23/4/2014 12:25

First rule of investing:

Buy low, sell high.

Surely now is a good time to buy.

[thomcooper] 17/4/2014 21:17

I agree Jimmy, but depends if they can raise cash if they have cashflow problems...I've been loading up here over the past few months & now have a significant holding (for my measly pot anyway). I'll be winding down positions into any upswing in the market if they don't start to show a balanced p&l. I don't see any increased shareholder value by diluting the pot. They should raise enough money to begin with & turn that into a profitable business. Coming back afterwards for more money because the investment hasn't achieved "critical mass" is out of order in my opinion. But we will see. I'm not big enough to be anything more than a passenger. If I were, I'd be making it clear that the execs jobs depended on them doing so. Anything less is incompetent.

[jimmy12345] 17/4/2014 19:17

No need for rights issue. The cash here is near the mcap. The cattle if sent to auction tomorrow would make at least £5 mill as well.

[thomcooper] 17/4/2014 17:23

Who knows. It's not worth a lot until it can prove its profitable. I'm in for the rising tide lifting all boats (assuming the hulls watertight). There seems scope for less expansion to equal a profit. It just depends on the competency of the gaffer.

[the count of monte_cristo] 17/4/2014 11:35

Looking extremely oversold.