Signs of life?

By Frank Buhagiar on Monday 10 July 2023

Signs of life?
Image source: Signs of life?
CommentaryFoodTech Investment

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

Week ended 7 July 2023 - fourth one in a row in which share price fallers have outnumbered risers in FFF’s listed FoodTech space.  Why then the relatively positive title for this latest installment of Food on the Move?  Delve deeper and grounds for believing that things could be looking up for the sector can be found.  For starters, the deficit between fallers and risers continues to shrink.  Currently, it stands at just five after there were 26 fallers, 21 risers and one non-mover during the week ended 7 July 2023.  The week before, the gap was nine - 28 fallers, 19 risers (one non-mover).  The week before that? 16 - 31 fallers, 15 risers (two non-movers). Trend or just plain old coincidence?  Time will tell.

Shrinking deficits, not the only signs of life in the sector.  The week also saw some big moves among the constituents of FFF’s FoodTech space.   Look no further than Cibus (CBUS), a Food on the Move regular since its tie-up with Calyxt and subsequent reverse stock split. Was only last week when Food on the Move reported “…shares closed at US$10.5 having been as high as US$26.95 immediately after the split in late May.” A week a long time in FoodTech it seems.  Fast forward seven days and the shares were up a vertigo-inducing 74.3% to US$18.3. The trigger?

The title of CBUS’ only announcement of the week offers a clue: “Cibus Welcomes European Commission Proposal on Regulation of Plants Obtained from New Genomic Techniques”. The three bullet points at the top of the press release offer some more:

  • Proposal aims to adapt EU legislation to scientific and technological progress, enabling the products of New Genomic Techniques (NGTs) to contribute to more sustainable agriculture, climate resilience, and food security
  • Proposed regulation identifies a ‘Conventional-like’ category of NGT products that would be regulated as conventional varieties, bringing EU policy closer to that of trading partners in North and South America, Australia, and Japan
  • Under the proposal, products from Cibus’ gene editing platform such as canola and oilseed rape resistant to disease or with reduced seed losses would be considered ‘Conventional-like'

Cibus’ Tony Moran had this to say: “The long-awaited legislative change would create a very welcome stimulus for plant science innovation, especially in academia and small and medium-size enterprises (SMEs), which in turn would boost the contribution of NGTs to a sustainable EU agri-food system.”

CBUS, not the only stock to see its share price rise by more than half. Urban-gro (UGRO) shot up by 61% to end the week at US$1.9.  No news out from the indoor ag specialist, but the shares were recently given a boost after independent research and brokerage outfit First Berlin slapped a Buy recommendation and US$7 price target on the stock.  That was end of June.  A look at UGRO’s share price graph reveals the gains were made on 6 and 7 July.  Word only just getting out of First Berlin’s recommendation? Or something else afoot?  One to watch.

There’s more.  Burcon Nutrascience (BU) tacked on 23.5% to finish the week at CAD0.21. Company announced it’s partnering with “…HPS Food and Ingredients to Launch World’s First Soluble Hempseed Protein Isolate”.  The partnership will “…explore the commercialization of Burcon’s first-of-its-kind high purity, soluble hempseed protein isolate.  This collaboration aims to capitalize on the thriving hempseed protein market trend and deliver exceptional plant-based protein solutions to customers worldwide.”

Comment from Burcon CEO Kip Underwood: “This collaboration marks an important milestone in our commitment to monetize our intellectual property, connect directly with customers, and exert more influence over the production of our innovative plant-based protein solutions.  By joining forces with HPS, a premier leader in hempseed and plant-based ingredient solutions, we have an excellent partner with the resources to quickly get to market and meet the growing demand for sustainable, hempseed-based protein ingredients.” Definite signs of life there.

Finally, any other week and Desert Control’s (DSRT) 28.1% rise would have likely got top billing. Triple helping of announcements from the AgTech.  Firstly, “Desert Control enters strategic agreement for the Kingdom of Saudi Arabia”.  The press release goes on to explain that DSRT “…has entered into an agreement with Holistic Earth Advanced Regeneration Technologies SA (H-EART) to become a licensed operator for production, sales, distribution, and implementation of Liquid Natural Clay (LNC) in the Kingdom of Saudi Arabia (KSA). The agreement marks a significant milestone in Desert Control's transition to a royalty-based licensed operator structure for the Middle East. The change in business model unlocks cash, reduces operating costs, and allows Desert Control to leverage the capacity and reach of local partners while dedicating additional resources to core business activities and accelerating development in the United States and other markets.”

Next press release, “Desert Control Announces Finalization of Strategic Review Process for the Middle East”, a tidier-upper effectively bookending the launch of the company’s strategic review back in May – see Food on the Move’s “NOT ANOTHER STRATEGIC REVIEW…”.  Final announcement, “Purchase of shares by CEO”: “On 7 July 2023, Ole Kristian Sivertsen, has through OKS Consulting AS purchased 5000 shares in the Company at an average price of NOK 10.00. Following the transaction, OKS Consulting AS holds a total of 930 000 shares in the Company.”  The CEO seeing signs of life in the DSRT