On the up?

By Frank Buhagiar on Monday 31 July 2023

On the up?
Image source: On the up?
CommentaryFoodTech Investment

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

An ‘Up’ week for FFF’s listed FoodTech! Week ended 28 July 2023 saw 29 share price risers, 17 fallers and two non-movers.  Two ‘Up’ weeks in the last three now.  Are things finally looking up for listed FoodTech?  Certainly seem to be at the individual stock level…

Take Ocado (OCDO) – shares gained another 43% to close at 976p. Early June they were trading at 343p.  Talk about being on the up.  No shortage of news from the online grocer these past seven days – a rather technical director dealings announcement; another on Board changes, specifically the retirement of Luke Jensen as Executive Director and CEO of Ocado Solutions; and thirdly, the opening of a new facility in Kentucky by US retailer Kroger as part of its collaboration with OCDO.  Nothing there to warrant a 42% leap in the share price.  But there was one other announcement dated 24 July, “Ocado and AutoStore settle all Litigation”. Sound familiar?

That’s because the news was covered in last week’s Food on the Move “Counting Swallows”: OCDO “…put out a press release…on Saturday 22 July: ‘AutoStore and Ocado Settle All Patent Litigation’”. As Food on the Move pointed out “Saturday, a strange day to announce, especially as under the terms of the settlement ‘AutoStore will pay £200 million to Ocado in installments over 2 years.’ Surely, would have been a decent announcement to start the week with.  Begs the question: did word of the windfall get out, forcing OCDO to release early? Or was it a case of dates getting mixed up, wrong button pressed or some other admin error that led to the announcement going out on a Saturday?” Perhaps we have an answer.  Mysteriously the above link to the 22 July press release is no longer visible on the website.  Just the one dated 24 July.  Admin error/date mix-up? Looks that way.  No harm done if the share price is anything to go by.

As with OCDO, second consecutive Food on the Move appearance for Steakholder Foods (STKH).  In Counting Swallows it was a favourable write-up along with a $5 share price target from research outfit Zacks Equity Research that earned the cultivated meat specialist a mention.  This time round a triple-header of STKH news.  First up, “Steakholder Foods Signs First Ever Multi-Million-Dollar Agreement with GCC Governmental Body to Commercialize its 3D Bio-Printing Technology”.

GCC? “Gulf Cooperation Council (GCC), which represents the economic union between Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates”. Multi-Million-Dollar Agreement? “…a Memorandum of Agreement for Strategic Cooperation (MOA) with an accredited GCC-based governmental body as Steakholder Foods’ strategic partner, to advance food security efforts through the application of Steakholder Foods’ groundbreaking 3D printing technology. Commencing with an investment by the strategic partner in the construction of a pilot plant to produce printed hybrid-fish products, the MOA eventually aims to create a first-of-its-kind large-scale production facility in the Persian Gulf region. The agreement foresees a material initial down payment to Steakholder Foods for the procurement of its 3D-printer technologies, followed by a milestone-based sales and procurement plan for industrial-scale output.”

Shares jumped from $0.84 to $1.02 on the news.  Next day (25 July), the cultivated foodie issued another press release: “Steakholder Foods Announces US$6 Million Registered Direct Offering”. The offer price set at $1 a share.  A small discount to the share price at the start of the day.  By close of play that discount had widened considerably after the shares tacked on 12% to close at $1.12. Still a little way to go to get to the end of the week’s $1.17 mark.  Unlikely STKH’s third announcement “Steakholder Foods Receives Patent Allowance for Revolutionary Print Heads for Bioprinting of Edible 3D Structures at High Throughput” on its own enough to account for the extra five cents.  Does help keep up the momentum though.

Finally, Verde Agritech (NPK) shares reacted well to news that the potash fertiliser co. “…is in advanced negotiations to sell carbon credits to major international corporations that are established purchasers of permanent carbon offset.” Enough for a 31% share price rise?  Well, yes if the numbers are to be believed. As detailed in NPK’s press release Verde to Sell Carbon Credits: “Currently, carbon credits for permanent carbon offset similar to Verde’s are being sold at prices up to US$500 per tonne. The Company is able to generate up to 300,000 tonnes of carbon credit annually via its existing production facilities…”

Big numbers then.  But will it be a case of jam tomorrow?  According to the press release: “Verde’s silicate rock is rich in the mineral glauconite…, which once processed and applied to the soil removes carbon dioxide (CO2) from the air through a process called Enhanced Rock Weathering (ERW). ERW permanently locks CO2 into the new mineral structure. In 2022 the carbon credit markets totalled US$ 909 billion in transactions…Verde expects to close its first sales of carbon credit in Q3 2023.” Tomorrow not too far away perhaps.

OCDO awarded $200million and new facility opened by US collaboration partner; STKH signs multi-million-dollar agreement; NPK set for lucrative carbon credit revenue stream - things looking up for FFF’s listed FoodTech space…