Stock market value of HZPC falls for the second time in a row

The certificate price of seed potato trading house HZPC has fallen for the second time in a row. This brings the value of the certificate to €162 and decreases again by the maximum value of 10%. For Gerard Backx, the CEO of HZPC, this is no cause for concern.

The market value of HZPC Holding amounts to €127 million due to the fall in price, where it stood at a record level of €157 million last year. Backx reports that 4.000 certificates have been traded, which is less than 0,5% of the total number of certificates. "Nevertheless, this has a major impact."

'More supply than demand'
"After a long period of maximum price increases, the price has fallen over the last 2 price days. The supply has been higher than the demand, which offers purchase options for certificate holders. At the beginning of March we announced that the profit for the 2018/2019 season will be higher than last year. Now our expectation is that the profit will be significantly higher than last year," reports Backx. The CEO is not concerned about the price drop. "If you look at the big picture, this is only a correction. If this decline continues for several years, it is worrisome."

Backx, on the other hand, does not expect the decrease to be due to the fact that growers have less confidence in HZPC. "It also concerns some arable farmers who were allowed to keep their certificates when they stopped their business. Those farmers are now old and will want to cash in the certificates. In addition, a bit of emotion may play a role: at a certain point it is expected that the price will going down."

'No problems expected'
Backx sees no clear reason for the fall in the price. "The lower harvests in 2018 did cause some concerns, but on average this turned out well. We therefore do not expect any problems from a structural and strategic point of view," says Backx. 

The next trading day is Friday, November 1, but the dividend will first be paid to the members in October. This one came in at €4 last year. "As 66% of the realized net profit is paid out as dividend, it will be significantly higher this year."

Anne-Jan Doorn

Anne Jan Doorn is an arable expert at Boerenbusiness. He writes about the various arable farming markets and also focuses on the land and energy market.

aj.doorn@boerenbusiness. Nl

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