Supply Chain AND THE PURECIRCLE ADVANTAGE APRIL 13, 2016

Transcription

1 Supply Chain AND THE PURECIRCLE ADVANTAGE APRIL 13, 2016

2 Long term supply chain model Market: Global Sweeteners $50bn a year: 1. Sugar $40bn, HFCS (Corn) $7bn, High Intensity sweetener$3bn 2. Sugar 160 million tonnes a year; total 3. Only Sugar, Corn and Stevia can be Mass Volume NATURAL Sweeteners Mass volume success requires: 1. Great Taste 2. Scalable Supply 3. Sustainable Supply 4. Commodity Pricing Goal: PCL is looking at long term market opportunity: ,000 tonnes of high purity stevia

3 Supply context of sweet in India Production: sugar mills under distress, total production Est million tons Sugar production is expected to be 23.5 to 24.5 million tons 1. Harvest for is expected to be lower because of water stress in Maharashtra and rest of India, leading to inventory reduction 3. Yields are flat over last 10 years 4. Farmer incomes are flat 39,000 to 55,000 per year/acre Consumption 1. Sugar expected to be 24.5 million tons 2. Production is expected to be less than Supply leading to price volatility Sustainability impacts 1. Water reservoir tables at a 10 year low 2. Farmers walking away from sugar cane planting in

4 PureCircle s Supply Chain Control: From Seedling to Sweetener Plant Breeding & Agronomy Program Harvesting Extraction & Purification Application Great products Ensuring quality through vertical integration TASTE CONSISTENCY SCALE CAPACITY TRACEABILITY TESTING

5 PureCircle at the forefront of leaf supply diversification, outside of China Beyond current agricultural operations in Kenya and Paraguay, actively pursuing stevia plantation development with local partners in: ON-GOING TESTS AND ACTUAL PLANTATIONS OTHER REGIONS AFRICA Burundi CAR Malawi Mozambique Rwanda Swaziland Tanzania Uganda Zambia LATIN AMERICA Ecuador Guatemala Mexico Nicaragua OTHER REGIONS India* Macedonia Romania Turkey USA PureCircle 2020 Plans: 50% of our leaf supply outside of China India is important to our diversification plans

6 We combine our science and passion for understanding stevia to produce the best tasting steviol glycosides Our Our suite PureCircle of technical Stevia services Agronomy designed Program to was created reduce to fully development understand time the and performance of the stevia improve leaf and in-market provide success commercial scale. Our Commitments SCIENCE & RESEARCH SCALING NATURALLY FARMERS Stevia Expertise From Seed to Leaf Sustainable Expansion for Commercial Viability Livelihood + Community Enhancement 6 The science of naturally developing new stevia leaf varieties with more of the best tasting steviol glycosides. Growing and scaling the best stevia varieties to support food and beverage needs. The commitment to grow highquality stevia leaf while contributing positively to the farming communities.

7 Agronomy Program: Science & Research PLANT RESEARCH NEW VARIETIES NURSERY RESEARCH COUNTRY RESEARCH Understanding how all the parts of the stevia plant contribute to taste and performance attributes. Using traditional, crossbreeding methods to create the healthiest and best tasting stevia plants. On-the-ground research to learn how best to grow the different stevia varieties. Learning how to work with the changing growing conditions from country to county. 7

8 Agronomy Program: Scaling Naturally LEAF EXPANSION LEAF DIVERSIFICATION WORLDWIDE FARMER RECRUITMENT Expanding PureCircle leaf growing regions around the world. Planting a diverse supply of stevia leaf to service all food and beverage needs. Continuous recruitment of farmers, small and large, to further develop the natural stevia leaf supply. 8

9 Agronomy Program: Farmers EDUCATION & TRAINING RELIABLE PAYMENTS ACCESS TO FUNDING & TOOLS COMMUNITY LEADERSHIP PROGRAMS Providing PureCircle farmers with stevia education and training to successfully grow the crop sustainably. Contract with farmers for a known, fixed price for their PureCircle stevia leaf product. Providing farmers with microfinancing options, seedlings and other tools to help them advance their stevia business. Supporting local programs that help develop leaders within the PureCircle farming communities. 9

10 Farmers are improving lives of their families and communities by adopting stevia as a crop. Three case studies across three regions: Esther Chepkwony Mama Lucy - Kenya PureCircle provided seedlings and arranged micro-financing Planted 0.3 acres in 2010 on her small farm in Kericho Paid back her loan early and expanded her farm Able to pay for her 3 grandchildren (Gideon, Collins, and Miriam) to attend school with her stevia income Francisca Vera- Paraguay Owns a small farm in San Pedro in which the family also grows tomatoes, corn, and wheat plus has 5 cows Francisca credits stevia for keeping the family together through earning more money than before and enough to send her children to school Mr. Li- China Has expanded his stevia cultivation from 5 hectares in 2010 to 35 hectares today Greatly raised his standard of living by switching from low income crops to stevia Yearly net income of about RMB50k- thus his big smile

11 Extraction & Purification WE ARE THE WORLD S LEADING PRODUCER OF HIGH-PURITY STEVIA INGREDIENTS Leading production and capacity in the industry State-of-the-art facilities to refine extract into various high purity ingredients Unmatched consistency and scale to deliver consistent taste for any and all products Proven track record with 80%+ market share of the world s Reb A Safety verified by independent labs through testing against the highest specification standards

12 All rights reserved September 2015 PureCircle operates the worlds largest stevia extraction and purification plants Extraction PCJX extraction plant in Ganzhou, China Established in 2002 Land area of 20 hectares Headcount +/- 370 Flexible production that includes: Continuous R&D to improve efficiencies and quality of extract Agriculture breeding R&D Waste water treatment system Recycling and treatment of biomass ISO9000, GMP, HACCP, Kosher, Halal, FSSC22000 Capacity expansion targets Latest expansion completed in Q Awarded by Government: National key Leading Enterprise in Agriculture Industrialization Poverty alleviation leading enterprises in Jiangxi Province Purification PCSB in Enstek, Malaysia Established in 2003 Land area of 2 hectares Headcount +/- 350 Flexible production that includes: R&D and QC labs Pilot plant and flexible workshops Waste water treatment system ISO9000, GMP, HACCP, Kosher, Halal, FSSC22000 Major capacity expansion financed and underway Target completion FY17 Capacity expansion targets

13 With industry leading safety, consistency and traceability practices Testing Consistency Traceability

14 Vertical Integration leads to benefits that go beyond risk avoidance Risk Avoidance Competitive Advantage 竞争优势 Availability Consistency Safety Innovation Long Term Economics Sustainability/ Communications

15 #1: Innovation across all aspects- from leaf to process leading to best tasting stevia products Reb A Family SG95 Family Alpha Family Delta Family Zeta Family NSF groups

16 #2: Vertical Integration provides long term economical benefits Plant Breeding Cultivation Extraction Purification Application Proprietary Varieties Matching Leaf to Location Enhanced yield per hectare Capacity Utilization Production localization Capacity Utilization Production localization Ingredient synergies PureCircle 2012

17 #3: Sustainability Carbon footprint as much as 72% lower than sugar Water footprint as low as much as 96% lower than sugar

18 Founded on Sustainability FARMING EXTRACTION PURIFICATION Supporting 25,000 farmers while using less land Large-scale recycling and treatment plant Convert bio waste to fertilizer A leader in the industry on sustainable practices to benefit communities, environments, and public health OUR SUSTAINABILITY VISION FOR 2020 Reduce I million metric tons of carbon Reduce 2 trillion liters of water Reduce 13 trillion calories 18

19 Vertical integration allows us to take sustainability to the next level HOW WE GROW IT LOWEST CARBON FOOTPRINT 30-80% Less carbon than the next stevia sweetener or other natural sweeteners LOWEST WATER FOOTPRINT At least 92% Less water than other natural sweeteners LOWEST LAND FOOTPRINT uses 1/5 the land of cane sugar Size of Sikkim = Amount of stevia needed to replace 20% of today s sugar consumption 19 KgCo2-e/kg SE* Comparative Carbon Footprints Liters/Kg SE* Comparative Water Footprints Source: PureCircle lifecycle assessment FY2011

20 First to set industry standards on sustainability: Our 2020 Goals WE PROMISED WE DELIVERED TO REDUCE 1 MILLION CARBON METRIC TONS OF CARBON EMISSIONS REDUCED OUR CARBON FOOTPRINT BY 98,000 METRIC TONS 10% OF GOAL/ON TARGET TO REDUCE 2 TRILLION LITERS OF WATER WATER REDUCED 200 BILLION LITERS OF WATER 10% OF GOAL/ON TARGET TO REDUCE 13 TRILLION CALORIES FROM THE GLOBAL DIET CALORIES REDUCED 1.3 CALORIES TRILLION 10% OF GOAL/ON TARGET 20

21 We can partner with you to tell YOUR story a story you can be proud of A stevia sweetener system is estimated to be about 10 Metric Tons for a brand. When compared to the same amount of sweetness in sugar, stevia can: PUBLIC HEALTH CARBON WATER INDEPENDENT FARMER SUSTAINABLE AGRI PRACTICES LAND USE 2 BILLION calories eliminated 2000 MT of estimated GHG reduced 4.5 Billion Liters reduced 2000 farmer family members supported Supported in Kenya, Paraguay and China Land usage 1/5 WASTE REDUCTION Supported bio waste conversion in farms and manufacturing to organic fertilizer *compared to added sugars

22 Our plans are expected to greatly benefit Indian farming sector Average Farmer land owning= 1 Ha Yield / Ha= 3 MT/Ha/Annum PureCircle price (as on date)= $2/kg Average Farmer Income/Ha= $6,000/Ha/year PureCircle Goal- 5,000 Ha Annual India Sourcing=$30 Million or INR 195 Cr 22

23 Meet Fermin 23

24 Committed To India Long-Term PureCircle Plans: Investing $200 million in India over the next 5 years Establishing The Market Focusing On Scale-Up Securing Future Production Capabilities Testing stevia leaf growing potential Forming PureCircle India offices Scaling stevia leaf plantations to include thousands of farmers Providing local applications formulation capabilities Building a stevia processing plant 24

25 With your support and our goals, we can support thousands of Fermin s in the next few years Thank you! 25