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CropLogic moves a step closer to monetising hemp crop
2 minute read
Shares in AgTech group CropLogic Ltd (ASX:CLI) opened higher on Tuesday morning after management confirmed that the group had met another milestone in completing planting at its Hemp Trial Farm in Central Oregon.
This season, CropLogic’s wholly owned subsidiary LogicalCropping will crop 500 acres of CBD producing hemp at its Hemp Trial Farm in Central Oregon.
The completion of planning represents another box ticked by management, reinforcing its track record in terms of delivering on expectations.
Next steps include the installation and utilisation of CropLogic’s suite of agtech products such as CropLogic realTime and CropLogic Aerial Imagery, as well as implementation of a fertigation strategy.
Commenting on the critical nature of this development, CropLogic chief executive James Cooper-Jones said, "The first 3 days and then the first 3 weeks are critical times in any cropping operations as this is the time that determines whether plants will ‘take’.
‘’Considering this, it is also encouraging to see the first plantings are ‘taking’ well and showing good growth.”
More milestones on the horizon
The company could well receive further share price support over the coming months as news regarding growth and flowering emerges in August/September, followed by compliance testing and harvesting in September/October.
At the start of May FinFeed highlighted CropLogic’s impressive earnings outlook with this year’s crop expected to generate underlying earnings of approximately $40 million based on a healthy yield and mid-range costs of production and sales estimates.
Since then CropLogic’s shares have doubled, and no doubt as the company draws closer to realising its anticipated earnings its share price will respond accordingly.
Given the company’s market capitalisation of $22 million implies a substantial discount to other profitable agricultural producers, a rerating could be significant.