Pistachio Presentation January 20, 2013 Presented by: Mia Cohen, Setton Pistachio of Terra Bella, Inc.
Pistachio Presentation Overview Objectives for Presentation US Pistachio Supply Global Pistachio Supply US Pistachio Shipment History, Domestic vs. Export US Pistachio Major Export Markets 2012 Highlights Outlook Key Factors impacting Pistachios In Summary, 3 Key Points Questions 1
US Open Inshell Pistachio Supply supply is steadily increasing (in millions of lbs.) New Crop Carryover from Prior Year Total Saleable Supply Carryover into Next Year Total Shipments 800 700 600 500 400 300 200 100 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2 Inventory adjustments and End of Crop Year Adjustments are included in New Crop. Source: ACP & APG
Global Pistachio Supply CA supply is growing (in millions of lbs.) 3 1400 1200 1000 800 600 400 200 419 13% 48% 871 12% 53% 35% 545 11% 67% 862 14% 46% 40% 765 10% 53% 37% US Iran Turkey 761 22% 46% 31% 1,175 38% 22% 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Total Crop reflected. Source: ACP & APG 8% 56% 35% 628 31% 25% 44% 840 13% 45% 42% 1,219 20% 37% 43% 882 14% 35% 51% 1,133 22% 29% 49%
US Open Inshell Shipments exports play an important role (in millions of lbs.) Domestic Export 500 450 400 350 300 250 200 150 100 50 110 30% 70% 155 31% 69% 153 36% 64% 162 165 39% 32% 61% 68% 202 48% 52% 169 49% 51% 185 53% 47% 285 59% 41% 268 68% 32% 307 63% 37% 296 59% 41% 354 57% 43% 432 62% 38% 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 4 Source: ACP & APG
US Pistachio Major Export Markets reflects international expansion (in millions of lbs.) Western Europe Eastern Europe China & Hong Kong Canada Central & South America Japan India Australia Middle East Korea Israel 300 250 200 150 100 50 5 0 Open Inshell reflected. Source: ACP & APG 2007 2008 2009 2010 2011 2012
2012 Highlights 2012 Crop On crop totaling 555,412,410 million pounds, record crop Harvest started late and its duration was longer than usual Strong grower prices resulted in many 2 nd and 3 rd shakes Average nut size is good, average size Non-splits are much lower than average, less closed shell available Insect damage is higher this year US supply continues to increase, demand continues to grow, current demand is greater than supply Opening price has been consistent for the last few years Large volumes were sold earlier than usual this year Current availability very limited, prices are up The US is the top producer of pistachios in the world Iran continues to become less of a factor in prices and sales Healthy messaging is fueling the increased demand 6
Outlook 2013 Q1 2013 Q2 2013 Q3 2013 Crop Supplies tight Supplies tight Supplies tight Expect an off crop of approx. 500 mil. lbs. Prices firm Prices firm Prices increasing Expect opening price consistent with 2012 crop Pre-sales for 2013 crop begins, expect fewer than last year Supplies will be tight, prices may increase quickly 7 Long Term Outlook 2014 Crop On crop estimated at 675 million lbs. 2015 Crop Off crop estimated at 575 million lbs. 2016 Crop On crop estimated at 800 million lbs.
Key Factors for Future Large crops are on the horizon, how will this impact prices? Nutrition studies are the backbone of healthy messaging, what will they teach us about what we already know and what we don t currently know? Healthy messaging will continue to educate consumers about the powerful health benefits of pistachios, what impact will it have on sales? With an increase in supply being committed to retail brands and retail programs, how will this affect industrial supply? How large a role will emerging markets play vs. established markets? What about China? Iran s diminishing crops, how will this impact prices? 8 Global economy, currency implications, how will this impact pistachios?
Pistachio Summary 3 key points: 1. Supply increasing, demand growing, current demand is greater than supply 2. Opening price consistency, current high price level is because of limited availability 3. Pistachios are powerful, healthy messaging will continue to fuel demand 9
10 Questions?