Global Development Panel, Adelaide May 2017 PMA Hort Connections - - PDF document

PMA Hort Connections Conference – Global Development Panel, Adelaide May 2017

Overview of Costa

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Optimised portfolio of selected fresh produce categories:

• #1 market position in attractive core categories, backed by vertically integrated farming, packing and marketing
• perations
• Focus on IP and innovation for differentiation – own IP portfolio and network of global relationships
• Manage agricultural risk – eg. protected cropping , diverse portfolio, geographical dispersal
• 52 week production via geographic reach, varietal mix and agronomic expertise

Mushrooms Berries Tomatoes Citrus Produce Driscoll’s Australia JV (50%)² Genetics licensing Berry farming International African Blue (Morocco JV) (49%)²; China JV (70%)2 Avocados Logistics Bananas Costa Farms & Logistics (CF&L) Polar Fresh JV (50%) Farms

Business Model Business Divisions

Complementary wholesale marketing operation and cold- storage logistics platform Significant producer in Australia, supplying Cavendish and Lady Finger bananas

Our Australian locations

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#1 grape marketer in Australia and exports to over 20 countries. #1 grower in the domestic blueberry and raspberry market, and a world leader in blueberry genetics and breeding #1 marketer and ripener of avocados in Australia, sourced from growers across Australia and New Zealand. Building integrated operations #1 composter, grower and pre-packer of mushrooms in Australia #1 position in the domestic snacking tomato market, using state of the art glasshouse facilities

Costa operations Avocados Bananas Citrus Grapes Mushrooms Berries Tomatoes Costa Farms Logistics Business Support Center Polar Fresh

#1 citrus producer in Australia, growing oranges, mandarins, lemons, limes & tangelos. Exports to Japan, California, China, SE Asia and Middle East

Costa operations include c.3,500 planted hectares of farmland, 30 hectares of glasshouse and six mushroom facilities throughout Australia. Further 252ha of blueberries planted in Morocco, and initial establishment of farming in China

WA SA NT QLD NSW VIC TAS

International Expansion

• Grow our business by seeking opportunities beyond the domestic market.
• Utilise our well demonstrated world class IP, including blueberry genetics.
• Devote the necessary human resources, including agronomic skills to these projects.
• Leverage these valuable elements to build an international business which will become

a key profit and growth driver into the future.

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International Expansion

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Morocco

• African Blue Joint Venture formed in 2007.
• Backed by Costa blueberry varieties from Corindi (Aus).
• Customer supply flexibility – branded, private label, bulk
• At the end of FY2017 African Blue, plus third party growers,

will have +350 hectares of blueberries, under protective tunnels.

China

• Joint Venture formed with Driscoll’s in 2016.
• Established two farms so far, with blueberry and raspberry
• plantings. Aiming for 100 hectares over next 18 months.
• Management team mix of local and Australian staff.
• Market reception has been very positive on small initial

volumes.

Key market drivers

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• UK blueberry market grew by 28% in 2016.
• European demand is growing as consumer preferences

change.

• Season is six weeks ahead of main Spanish growing
• regions. Potential to expand season spread.
• Replacing plants in Morocco after 12 years instead of 8

years.

• Highest yield globally.
• In three years time (2020) will have +500 ha’s of

blueberries.

Morocco

Substrate plantings at Zauoia farm, Morocco Larache blueberry farm, Morocco

Morocco – the future

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• + 12/15 k Tonnes
• Spread Season (Jan – June)
• Customer Supply Flexibility
• Branded
• Private Label
• Bulk
• Frozen
• Europe is just waking up to blueberries!

Key market drivers

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• Demand fuelled by burgeoning

middle class, which now numbers 100m+.

• Projected demand growth for

blueberries to be in excess of 20% p.a.

• ‘Super fruits’ gaining market share

due to increasing income levels and recognition of nutritional value of berries

• Quarter of our sales by e-commerce

China

Initial berry farm at Shiping, Yunnan Province, China

China – the future

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• By 2023  + 1000Ha?
• 1.5bn people the opportunity
• And they love our BERRIES!

Discussion