Global Cocoa prices Kakao Konek – 6 Dec 2017 Simon Bakker Kennemer Foods

Key Determinants of Global Prices Annual production Weather and climate New hectarage Geopolitical issues Supply Demand Consumption in US / Europe Emerging markets Rise in per capita income

Developments over last year Prices decreased last year

Developments over last year Prices decreased last year Current prices still depressed

Developments over last year Prices decreased last year Current prices still depressed Main causes: Unexpected big harvest in Ivory Coast Weaker demand in emerging markets Russia and Brazil

Developments over last year Prices decreased last year Current prices still depressed Main causes: Unexpected big harvest in Ivory Coast Weaker demand in emerging markets Russia and Brazil Where do we go from here?

Developments over last year Prices decreased last year Current prices still depressed Main causes: Unexpected big harvest in Ivory Coast Weaker demand in emerging markets Russia and Brazil Where do we go from here?

INDUSTRY Outlook – DEMAND SIDE

Trends: Demand Outlook Demand resurgence in traditional markets

Resurgence in Traditional Markets Source: CCS Cocoa, 2017

Trends: Demand Outlook Demand resurgence in traditional markets Consumption picking up significantly in emerging markets Russia Turkey Brazil China and India

Significant pick up in Emerging Markets Source: CCS Cocoa, 2017

Chocolate Sales Outlook (Growth 2014-2022) Source: Euromonitor, 2017

Trends: Demand Outlook Demand resurgence in traditional markets Consumption picking up significantly in emerging markets Russia Turkey Brazil China and India Overall positive outlook

INDUSTRY outlook – SUPPLY SIDE

Trends: Supply Outlook Ivory Coast – expected revert to “normal” production Ghana – production steady

Trends: Supply Outlook Ivory Coast – expected revert to “normal” production Ghana – production steady Indonesia– continuous dramatic decline

Indonesia in dramatic decline Indonesia Main Crop Trend Source: CCS Cocoa, 2017

Trends: Supply Outlook Ivory Coast – expected revert to “normal” production Ghana – production steady Indonesia– continuous dramatic decline Minor Origins Ecuador: bright spot Not replicated in other minor origins

Minor Origins Ecuador Cocoa Production Brazil Cocoa Production Nigeria Cocoa Production Cameroon Cocoa Production Source: CCS Cocoa, 2017

Trends: Supply Outlook Ivory Coast – expected revert to “normal” production Ghana – production steady Indonesia– continuous dramatic decline Minor Origins Ecuador: bright spot Not replicated in other minor origins Lower prices reducing new planting

Conclusion Much brighter prospects in medium to long term Philippines Building cacao industry resilience Short term volatility Increasing yield is key Raising Philippine brand as high quality origin

15,000 Our cacao farmers….. and counting….. ©2017 Kennemer Foods International Inc. All rights reserved.