Dekel Agri-vision Share Discussion Threads

[rivaldo] 14/12/2020 08:25

CPO prices have been rising for three consecutive days, and La Nina is expected to continue until next March, reducing Malaysian palm oil production until then and keeping prices high during DKL's peak season:

[rivaldo] 11/12/2020 07:40

Arden have a new research note out - they reiterate their 8.1p valuation, but don't update their numbers yet.

The crucial paragraph is this, showing the current CPO price almost 30% above their forecast price for 2021:

"The palm oil price (CIF Rotterdam in US$) has continued a robust climb from a recent low of US$510/MT (€421/MT) in May 2020 to a current level of US$925/MT (€763/MT), as at 7 December 2020. If the price remains at this level into the next calendar year, this would bode well for Dekel Agri-Vision as it enters its high season in palm oil processing –which runs from January to June. We are currently forecasting an average palm oil price of €600/MT for the whole of 2021."

[outlawinvestor] 10/12/2020 11:42

On the brink of a new 52-week high according to the FT!

As of last trade Dekel Agri-Vision Plc (DKL:LSE) traded at 4.00, -4.08% below its 52-week high of 4.17, set on Jan 13, 2020.

[...] <- that was a link to FT page kindly censored by ADVFN, never mind!

[2magpies] 10/12/2020 09:07

Yes, very positive indeed.

A proper company, actually producing something.

And they clearly know what they are doing.

[chadders] 10/12/2020 08:12

Terrific update.The positive trend continues unabated.

[rivaldo] 10/12/2020 07:14

November's update is out - and it's terrific in all respects. Production is hugely up, prices are rising fast, the cashew facility remains on time, and the upcoming high season looks as if prices will be well ahead of those used in Arden's forecasts:



"Dekel Agri-Vision Plc Executive Director Lincoln Moore said: "For the second consecutive month, we are reporting double-digit increases in CPO production, sales and prices compared to the equivalent period last year. Following material year on year improvements in the first half, we are increasingly confident that, with just one month to go, FY 2020 numbers will show a material improvement compared to FY2019 and at least hit market forecasts.

"With the global palm oil pricing environment currently highly supportive, we are looking forward to the start of the high season in Cote d'Ivoire, which typically runs from late January to May. Together with the commencement of high margin cashew processing operations at Tiebissou in Q2 2021, we expect the year ahead will result in a step-up in Dekel's financial performance and profile and I look forward to providing further updates on our progress."

[mr doughnut1] 08/12/2020 17:17

Here's hoping chadders

[chadders] 08/12/2020 15:39

That's the highest since I've been an investor. Brings back memories of £ multi million EBITDA and dividends.

Arden numbers will have to be revisited if this continues for another month.

[rivaldo] 08/12/2020 15:20

Wow - CPO up to $945 as of yesterday.....

[rivaldo] 08/12/2020 09:34

Arden retain their 8.1p target price/valuation in this morning's research note.

Importantly, they also state that their forecasts are based on an average palm oil price of €600/MT for the whole of 2021. The current price is US$925/MT (€763/MT).

That's almost 30% above Arden's forecast price - and since local prices lag international prices by 6-8 weeks, we can be pretty sure that at least Jan-Feb of the upcoming high season will achieve extremely good prices, much higher than are in the forecasts.

[chadders] 08/12/2020 07:56

Yes, another value accretive statement of intent.

[rivaldo] 08/12/2020 07:38

Good to see DKL increasing its stake in the cashew nut venture to 54% (with the option for another 16.7%):



Plus further confirmation that the build-out remains on course for first production in only 6 months' time - and there's a very nice estimate of the transformational nature of the project:

"Based on today's prices, the Board estimates the project has the potential to generate revenues in the region of EUR35-40 million per annum at a 30,000tpa processing capacity."

[chadders] 07/12/2020 15:28

harvey888, DKL have referred to it in their final results in the past. From memory it's based on Black-Scholes formula

[mr doughnut1] 06/12/2020 17:37

Have Thursday the 10th pencilled in on my calendar.

[mfhmfh] 04/12/2020 17:29

Hopefully we'll have the November production figures next week.

[harvey8888] 04/12/2020 17:04

Thanks cheddars. That's helpful. I agree on the lag but I'm preparing for the price to top out as one possibility. Second, I would be curious as to the formula for outgrowers. Should I check the LSE thread?

[chadders] 04/12/2020 15:59

harvey888, there is a fixed formula that results in shares of the CPO price going to both DKL and the growers. DKL do benefit greatly from the higher price.

The price DKl gets lags the market by 5 to 6 weeks so current prices will prevail at the start of the high season. Current industry view is that we'll see similar or higher prices still in H1 2021 due to increased demand and supply constraints in Malaysia and Indonesia. All is well documented on this and the lse thread.

[rightnellie] 04/12/2020 15:00

Yes patience is boring and on some other shares I am not at all patient!

[harvey8888] 04/12/2020 14:45

Agree that patience is a virtue but very boring. Two points we should take into account are: first, the CPO price is cyclical and has a habit of falling back sharply during the prime season. Second, given the percentage of outgrowers a good proportion of the price rise will be to theoir benefit andnot Dekel. Meanwhile, I remain optimistic long-term.

[rivaldo] 04/12/2020 14:33

Indeed rightnellie. The share price has rocketed somewhat over the last couple of months, so a pause for breath is natural.

But there's lots more to go for, both short-term given the very high CPO price and medium/long-term with the cashew nut facility opening, which is only 6 months away now.

[rightnellie] 04/12/2020 10:50

Once the main UK shares have finished their recovery to a more normal and realistically valued level and people have pocketed their substantial profits or recovered their huge losses then people will notice this undervalued minnow share. Patience is a virtue and I can manage to hang on for this year's results. Then Chadders and Rivaldo and I can pocket our large gains....or maybe not because this is worth holding onto for the medium term development potential too.

[rivaldo] 04/12/2020 08:36

The CPO price back up at over 6 year highs to $920 as of Wednesday:

[chadders] 27/11/2020 13:25

Good to see a tick up here. REA holdings flying at the moment as well.

[rivaldo] 27/11/2020 13:23

Another rise today. And after a brief dip, the CPO price has gone back up to $900 as of Wednesday.

And prices are expected to be high for at least H1 next year:



"Gapki Expects Tight Supply to Support Palm Oil Price Into 2021
BY :JAYANTY NADA SHOFA
NOVEMBER 27, 2020

Jakarta. The price of crude palm oil enjoys a significant rise thanks to the tight supply amid the Covid-19 pandemic, and the condition will persist well into the first half of 2021, according to the Indonesian Palm Oil Association, or Gapki.

Gapki's chairman Joko Supriyono, Indonesia's free-on-board CPO price surpassed $870 per ton this month, the highest level in three years, in line with the decline in production.

"As of September, the production in Indonesia is at a negative 5 percent compared to last year," Joko told the Jakarta Globe in an online media visit on Thursday.

etc"