Proteins: Plant-based Alternatives Presented by Kate Leavitt Board President, Soyfoods Association of North America Director of International Sales & Marketing, SunOpta

Overview Why plant-based protein alternatives are necessary Growing global demand for proteins and future growth List of plant-based alternatives and protein quality Environmental impact of meats and plant-based proteins Challenges in development

Why are Plant-Based Proteins Necessary? Global Protein Demand & Future Growth Consumer Attitudes Health Perceptions Limiting Animal Protein Consumption

Global Protein Demand & Future Growth As the demand for protein increases and water and land resources decrease, the environmental sustainability of protein sources, such as soyfoods, intensifies. Soy protein is valued for its unique position as the only widely available plant-based complete protein. Source: Beer 1989

Demand Drivers – Consumer Attitudes National Dietary Guidance stresses importance of plant-based diets. Health perceptions drive consumer usage of meat substitutes. Research links red meat with heart disease, a global health problem. Avoidance of meat has increased meat substitute consumption and led to innovation. Manufacturers highlight the healthy protein alternatives. 1/3 of US consumers claim site healthfulness for use of meat alternatives − higher than any other reason given. In the UK, half of consumers believe vegetarian foods are healthier than meat-based foods and 13% of consumers avoid red meat. Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013

Demand Drivers – Limiting Meat Consumption Some 41% of US consumers eat less meat than they did last year, while more than a quarter report that they limit or completely avoid meat altogether. Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013

Market overview: Innovation rises, as egg products gain Innovation increases global meat substitute and egg product selections, since 2009. Product development is equal among the two sub-categories, but egg products have grown more rapidly in recent years. Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013

Market overview: Europe shapes innovation trends Europe develops the most non-meat protein products, almost half of all product developed globally in 2012/2013. Europe’s share increased as both North America and Latin America declined. Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013

Market overview: Top five claims, by region Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013 Europe Asia Pacific Europe Organic has become an important selling point, but ethical claims are also popular, with ethical animal and eco-packaging in the top five. Asia Pacific Vegetarian claims are most common, while high protein is an attractive proposition to nutrient-seeking consumers. North America Latin America North America Brands are focusing on vegan claims, though no/low/ reduced fat is also more prominent than in other regions. Latin America Low allergen and gluten-free claims are driven by the Brazilian market, while cholesterol content is a concern. Top 5 Claims, Meat Substitutes and Egg & Egg Products % of new products, Apr 2012 – April 2013

Plant-based Protein Alternatives Soybeans Edible Beans Nuts Seeds Lentils Quinoa Seitan/Wheat Gluten Hemp Seeds Sea Vegetables Spirulina

High Protein Quality The Protein Digestibility Corrected Amino Acid Score (PDCAAS) determines protein quality. The PDCASS for isolated soy proteins is 1.0 on par with egg, whey and milk proteins. Soybean and beef have PDCASS score of just over 0.90. Source: FAO/WHO 1991 Soyfoods and soy proteins have been identified as high quality sources of complete proteins.

Environmental Impacts Land Use Demand for land is set to increase significantly, thereby inherently increasing the value placed upon food output on a per acre basis. Water Use As freshwater resources become strained and food production is impacted, one measure of food production efficiency will be the amount of protein produced for each unit of water. Energy Efficiencies Energy inputs are rising in cost because they are becoming more scarce.

Land Use Demand for land is set to increase significantly, thereby inherently increasing the value placed upon food output on a per acre basis. Soy delivers 941 pounds of protein per acre of U.S. land. Source: LMC International 2011

Land Use Livestock is the primary user of arable land accounting for 78% of agricultural land. As much as 33% of cropland is used to produce animal feed. Eighty-five percent of all global soybean production is crushed into soybean meal for animal feed. Some estimates suggest that in 2010 cattle will graze 24 million hectares of land that was forest in 2000. Land is a precious global resource and soybean based foods are proven to be an environmentally sustainable source of complete protein. The primary driver of world deforestation is feed for livestock production.

Water Use As freshwater resources shrink, one measure of food production efficiency will be the amount of protein produced for each unit of water. Rain-fed soybeans deliver about 106 grams of protein per cubic meter of water; whereas rice delivers just over 40 grams. Soybeans are one of the most water efficient protein sources based on production.

Energy Efficiencies This chart measures the amount of energy (calories) produced from specific crops and animals against the fossil energy inputs used to produce that crop or animal. Fossil energy includes: Fuel Pesticides Fertilizer Transportation Soy-based foods deliver the largest number of calories per the amount of fossil energy inputs.

Challenges in Development 34% of U.S. consumers cited that “they don’t taste good” as a reason why they do not eat meat alternatives. Obstacle Solution Lack of familiarity In-store demos, product placement, cooking shows. How to use Cooking shows, recipe cards, simple and familiar. Negative taste perceptions Additional R&D for target markets, samples, free coupons, events. Lack of convenience Educate on trade-off of cost, convenience and value, a range of options do exist. Cultural heritage Capitalize on growing ethnic popularity and appreciation for global cuisine. Cost Emphasize investing in health with food. 34% of U.S. consumers cited that “they don’t taste good” as a reason why they do not eat meat alternatives. Source: Mintel GNPD Category Insight: Soy, Meat Replacements and Non-meat Proteins, June 2013

Summary Population is projected to grow from 7.2 billion to 9.6 billion by 2050. The majority of all growth is in the least developed countries. There will continue to be a demand for protein that will strain the environment. Plant based alternatives are a necessary solution to providing enough protein to feed the world. Our industry has the opportunity and the obligation to meet this challenge.

For more information, please contact: kate.leavitt@sunopta.com, or +1.612.756.4512