Duxton Farms Q4 FY2024 Activities Report - Strong Performance Amidst Weather Challenges
DUXTON FARMS LTD (DBF) Share Update July 2024 Wednesday 31st
Duxton Farms Reports Positive Crop and Livestock Performance Despite Weather Challenges
Duxton Farms Limited (ASX:DBF) has released its Q4 FY2024 activities report, highlighting robust crop and livestock performance despite facing weather-related challenges. The report covers the company's diversified agricultural operations across New South Wales, Victoria, and the Northern Territory.
Instant Summary:
- 198mm of rainfall recorded in Forbes, NSW, above the historical mean.
- Winter crops growing well, with promising yields.
- Livestock markets recovering with quality livestock selling well.
- Completion of cotton picking with yields above budget.
- No shares bought back this quarter; buyback program restarted.
Weather and Crop Update
The Central West of New South Wales, particularly Forbes, experienced 198mm of rainfall over the quarter, significantly above the historical mean of 136mm. This has positively impacted the growth of winter crops, with additional fertilizer applied in June. However, wetter-than-average conditions delayed cotton picking and the sowing of irrigated wheat in some areas.
Despite these delays, most of the cotton pick has been completed, with yields looking promising and above budget. Early ginning results have supported these positive yield expectations.
Livestock and Irrigation
Livestock markets have shown recovery, with quality livestock selling well. Although pasture growth has slowed due to several frosts, fodder reserves remain adequate, supported by cotton seed from ginning.
The Wyangala dam has been utilized throughout the quarter and remains mostly full, with a high chance of a reset. This ensures a stable water supply for irrigation needs.
Property and Financial Updates
At Piambie, 548 hectares of irrigated wheat have been planted and are growing well under favorable conditions. The redevelopment of land and the planting of Stage Two pistachio trees are ongoing, with irrigation systems now operational.
Mountain Valley Station saw mustering activities, with cattle in good condition following a wet season. Infrastructure improvements, including road repairs and enhanced communication systems, have been completed.
Market Insights
Wheat prices at Port Kembla ended the quarter at $334 per tonne, up 5% from the previous quarter but down 18% from the same time last year. International wheat prices experienced volatility due to varying crop expectations globally.
Cotton prices continued to decline, finishing the quarter 14% lower than the previous quarter, influenced by global production estimates and increased ending stocks.
Livestock prices showed mixed results, with the Beef Eastern Young Cattle Indicator up 4% for the quarter, while the Lamb Eastern Trade Indicator remained flat. Wool prices saw minimal movement, with a slight increase over the year.
The positive performance in crop yields and livestock recovery is likely to bolster investor confidence in Duxton Farms. Despite weather-related challenges, the company's effective management and operational strategies have resulted in promising outcomes. The continuation of the share buyback program may also positively influence stock prices.
Investor Reaction:
Analysts are likely to view Duxton Farms' performance favorably, given the strong crop yields and livestock recovery. The company's ability to navigate weather challenges and maintain robust operations will be seen as a positive indicator of its resilience and strategic planning.
Conclusion:
Investors should keep an eye on Duxton Farms' ongoing operational performance and strategic initiatives. The company's ability to manage weather-related challenges and deliver strong results highlights its potential for sustainable growth. The resumption of the share buyback program is also a positive signal for shareholders.