Alliance Grain Traders From Producer to the World Australian Grain Industry Conference 2008

Transcription

1 Alliance Grain Traders From Producer to the World Australian Grain Industry Conference 2008 July 2008

2 Alliance Grain Traders Overview Company Overview Saskatchewan based leader in pulse processing and distribution, with valueadded plants in Canada, U.S. and Australia and a global customer base Share Performance- Last 12 Months Corporate Profile $ Listing AGT.UN (TSX-Venture) $18.00 $16.00 $ Headquarters Regina, Saskatchewan USA- Bismarck and Williston North Dakota Share Price (C$) $12.00 $10.00 $8.00 $6.00 $ Volume (000's) Australia Horsham and Adelaide $2.00 $ Jun Jul-07 -Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun-08

3 A Global Leader in Pulses Saskcan Pulse Founded in 2001 January 2003, shipped first load of red split lentils July 2003: acquired Saskcan Rosetown August 2006: acquired Saskcan Horizon August 2007: TSX-V deal to form Alliance 225 full-time staff Exports to 85 countries Forecast revenue of $375 million in 2008 Largest lentil exporter in the world Continued focus on expansion globally July 2008: new public offering finalized for $15 million

4 Alliance Grain Traders - Facilities Value-added facilities in diversified regions Largest value-added splitter of pulses in the world Global production capacity of over 5500K metric tonnes in Canada, U.S. and Australia: eight production plants Proprietary technology and process lead to superior margins & efficiencies Saskcan Pulse Trading - Main Plant Regina SK Australia Milling Group Horsham, Australia

5 Alliance Grain Traders - Facilities Value-added facilities in diversified regions 6 Saskatchewan production facilities (Regina, Rosetown (2), Milestone, Aberdeen) 13 production lines for cleaning, sizing, splitting, colour sorting & packaging 500,000 metric tonnes capacity North Dakota splitting facility 100,000 metric tonnes capacity Australia splitting facility with planned upgrades for ,000 metric tonnes capacity Saskcan Pulse Trading Rosetown, SK Saskcan Horizon Aberdeen, SK

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7 Rural Renaissance a future in which agriculture provides societal solutions to energy supplies, health promotion and climate change. whatever producers and processors do, they must be done in innovative ways that resonate with their customers.

8 What Is a Pulse? Derived from latin puls, pultis meaning thick soup Seeds of legumes Pea, bean, lentil, chickpea and faba bean crops High quality protein source Important nutrition for developing countries Additional benefits of pulse crops Valuable component of crop rotation Help reduce nitrogen costs

9 Pulse Crop Industry Factors affecting resurgence of acres: Competitive crop prices Marketing factors: demand, price and world supply Costs of inputs - Fertilizer Rotation Cashflow control

10 Pulse Crop Industry The Four Fs FOOD FUEL FIBRE FEED High protein, low glycemic ingredient Biodiesel and ethanol alternative energy Nutritional and industrial use Safe feed for livestock industry

11 Global Pulse Market Increasing Global Demand Gap for Pulses 90% of global pulse consumption comes from developing countries Demand expected to continue at ~6% year due to steady population growth Low per-acre aceyeds yields in developing eop nations ato sceat creating goppotu opportunities tesfor developed nations Advanced farming practices and significant research in new crop varieties allow Canada to become a major player in global trade of pulses Global pulse trade averages ~7.4M tonnes annually Canada accounted for 38% of world pulse exports in 2006/2007 Global Peas Market Global Lentils Market Consumption Production Consumption Production Other 38% India 37% Other 33% Canada 27% Other 38% India 21% UAE 13% Syria 5% Other 22% India 28% Pakistan 2% Bangladesh 5% Spain 8% China 10% India 8% France 10% China 11% Russia 11% Bangladesh 7% Pakistan 10% Algeria 11% U.S.A 7% Turkey 18% Canada 20%

12 Who Will Supply the World? Comprehensive R&D program. Must maintain position as the low cost producer so research needed to improve yields. Chart below illustrates that Developed country yields outpacing developing countries / Hectare. Tonnes / 2,500 2,000 1,500 1, Developed Countries Developing Countries

13 More Land Needed The world needs another 84 million acres under continuous crop by the year 2016 to meet biofuel needs. Pulses and other crops can t keep pace with demand unless yields rise.

14 World Acreage Outlook (million hectares)

15 Australian Pulse Production by State ('000 ha) WA Vic SA NSW Qld Lupins Field Peas Chickpeas Faba Beans Lentils

16 Australian Pulse Production ( ) 3000 Pro oductio on ('000 0t) Lupins $150/t Lentils $420/t Faba beans $260/t Chickpeas $350/t Field peas $220/t

17 Red Lentils

18 Australian Desi Chickpeas

19 Australian Dunn Peas

20 20 World Pulse Markets Indian- Sub Bangladesh, Sri Lanka, India, Pakistan Pulses are food staple and main source of protein

21 World Pulse Markets Middle East Egypt is third largest importer in the world Iran, Saudi Arabia, Dubai/UAE, Iraq, Turkey High pulse consumption. Main staple of diet 21

22 22 World Pulse Markets - Europe Spain, France, Greece, Italy, Germany, U.K. Regular consumers in Czech, Bulgaria, Romania High ethnic populations as well

23 23 World Pulse Markets - Africa North Africa Algeria, Morocco, Egypt Central Africa Sudan, Ethiopia Large recipient of pulses as food aid

24 24 World Pulse Markets South America Mexico, Latin America Colombia, Mexico, Peru are all big consumers of green lentils and peas Brazil: Canary Seeds

25 25 World Pulse Markets China and Asia Not traditional consumer of pulses but emerging g Pea starch used in vermicelli noodle production poducto

26 World Pulse Markets North America Limited domestic consumption but growing g with ethnic populations p Highest consumptions correspond with ethnic populations NY, NJ, CA, IL, MI in the U.S. Toronto, Montreal, Vancouver in Canada Food Uses??? 26

27 Future Direction Future pulse production in Australia will be dependent on many factors 1) improvements in productivity it cultivars, management options 2) changes in management and production costs role in whole farm management, and input costs 3) changes in the environment climate change, salinisation, i i pathogen, exotic incursions 4) world prices and the relative price of pulses compared to other crop options world production and demand

28 General Observations Decision needs to be made: Is Australia a commodity producer in pulses or a food producer? Farmer Dressed vs. Value Added Development of an on-farm storage and handling system Freight advantage of Australia needs to be exploited Origin based value ad creates economic growth Development of a broad range of food markets globally including canning, packing, split and food and ingredients Creation of an Australian Brand known for quality and reliability

29 Food Industry Trends Processed food globally $3.2 trillion(3/4 of total world food sales) US, EU and Japan = over 60% of retail processed food sales. Growth highest in developing countries like China and E. Europe

30 Market Opportunities Global sales of health and wellness ess products exceed US$420 billion. Emerging markets such as Brazil, Russia, India, China and Mexico show large growth in the health and wellness category.

31 Pulse Product Releases By Country (top 10) 19,063 pulse products released since % of all % food launches

32 Pulse Product Releases by Company (worldwide)

33 From Selling Commodities to Marketing Health & Wellness Expanding pulse markets and adding value

34 Future Directions Traditional commodity markets will be a key destination for Global pulses for the foreseeable future However, we can diversify our market base and add value Increased focus on nutrition, health and processing technologies Foods that kids want to eat and Mom s want to buy.

35 Future Directions Focus on the food sector Encourage use of pulses as ingredients by food processors, food service Leverage nutrition & health, environment attributes t (pulses meet consumer demands for nutritious foods, sustainability) Target affluent markets (e.g. N. America, Europe) where consumption is low; food processing sector is sophisticated Foster Research: Improve our knowledge of nutrition & health potential of pulses Provide solutions to food processors, food service, to enable incorporation of pulses

36 Market Pull Nutrition & Health Pulse Attributes High Fibre High Protein (Alternative to soy or wheat) High Starch (High Resistant Starch) Non-digestible Carbohydrates Low Fat Low Glycemic Index Satiating Market Demands Prebiotics and Gut Health High Fibre, Low Fat Diabetes Obesity Weight loss Healthy Snack Foods Low Allergenicity Gluten Free

37 Pulse ingredients in food products Whole Bean Food Ready to Eat Increased Ingredient Food Product Consumption

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39 Research/Market Development Identify and characterize functional components in pulses to fully unravel the goodness of pulses Understand the effects of processing Consider nutrient enrichment to bolster current processed pulses products Develop evidence-based health messages Support break-through research

40 OBJECTIVES: More products with pulses on grocery store shelves Increased consumption of pulse food products

41 Pulse Canada Pulse Innovation Project

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43 Environmental Pulls Peers

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46 Food With a Message Climate Neutral from cow to cone Raises awareness of climate change Promotes Climate Change College that Ben & Jerry helped establish Sun Chips Small Steps Sweepstakes Sun Chips plant in Modesto, CA, uses a field of solar concentrators for heat Frito Lay purchases renewable energy credits to offset 100% of electricity used in its U.S. facilities

47 Closing Messages Global Demand for Safe Food Renewable Energy: Biofuels and Politics Access to new markets. Build existing ones. Access to adequate capital Transportation Demand for Quality Development for Food and Ingredients

48 Thanks to all of Sources for this Presentation Pulse Canada and The Pulse Innovation Project Canadian Special Crops Association (CSCA) Pulse Breeding Australia Stat Publishing: TSXV: AGT.un com