Linked In
News In
Linked In

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

Plant Impact sees signs of ag price recovery boosting profits hopes

Twitter Linkedin

Is the downturn for ag groups such as spray, seed and machinery manufacturers drawing to a close?

One of the sector's smaller members, Plant Impact, offered hope that the recovery in crop prices, which helped make many among of the top investments of 2016, was seeding improvement in prospects too for farm input groups.

"Recent improvements in the global soybean price," combined with stability in Brazil's currency, "provide an improving foundation" for the Plant Impact's fortunes in the 2016-17 Brazilian growing season, said the group, whose chief executive, John Brubaker, is speaking on June 15 at the Agrimoney Investment Forum in London.

The comment, while still somewhat reserved in its optimism, represents among the most sanguine yet for a sector badly hit by the dent to farm spending from the crop price weakness which prevailed until early this year.

Groups including industry giants such as Deere & Co, the maker of John Deere machinery, and seeds giant Monsanto have cut profits hopes - with some companies issuing multiple profits warnings.

Tricky market

Brazil has proven a particularly tough market, with the weakness of the real last year, in reducing the affordability of imports, being cited by the likes of agrichemicals groups FMC Corp and Syngenta for profits warnings.

However, Plant Impact - which said its comments followed "extensive market research" into prospects for 2016-17 – added that the brighter conditions had led it "to anticipate a significant promotional campaign" for its key Veritas product.

Veritas, being distributed in Brazil as an additive of a Bayer spray, aims to boost yields through encouraging flower retention.

Market reaction

However, Plant Impact, whose products are designed to boost farm productivity by enhancing crops' own capabilities, said its revenues for the February-to- April period had slipped to about $500,000, from some $600,000 a year before.

Sales were "adversely affected by the weak European agricultural market and reduced business from the Middle East," the group said.

Nonetheless, Plant Impact shares nudged 1.0% higher to 52p in London.

London broker Peel Hunt - retaining a "buy" rating on the stock, with a target price of 70p – said that the statement was "in line with expectations".

Plant Impact's deal with Bayer, and a distribution agreement with Aysta over a cocoa product, "provide the company with the opportunity to build material revenue streams in two global crops," said Peel Hunt analyst Charles Hall.

By Mike Verdin

Twitter Linkedin
Related Stories

Festive staff shortages 'likely' as British growers cut ties with UK supermarkets

Faced with mounting concerns over labour shortages and fears they may not be able to fulfil retailer contracts, some British growers have sought to cut ties with UK supermarkets in favour of companies elsewhere in Europe.

Hard Brexit to have 'catastrophic' effect on European meat industry; new report

A hard Brexit will have a ‘catastrophic impact’ on the European meat industry, according to a report published by Europe’s meat industry body, UECBV, as the UK and EU continue negotiations.

Manufacturers stockpile agrochemicals in bid to keep post-Brexit prices down for farmers

Manufacturers of crop protection products are stockpiling agrochemicals in warehouses in a bid to keep input costs down for farmers after Brexit, according to the chief executive of the Crop Protection Association, Sarah Mukherjee.

Dairy groups sidestep shockwaves from GDT price slump

Indeed, shares in the likes of A2 and Beston soar. Still, that does not mean there are no losers from the dairy price falls...
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© 2017 and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069