Ewan Colquhoun Ridge partners 2 Aug 2016 Marketing Levy Update Ewan Colquhoun Ridge partners 2 Aug 2016

APFA MARKETING strategy 2021 1. Educate Chain Partners about Farming 2. Educate Governments and Regulators 3. Collect and release Market Intelligence 4. PROMOTE AUSTRALIAN PRAWNS APFA MARKETING strategy 2021 APFA WILL INVEST TO: Support and monitor “Love Australian Prawn’ campaign Leverage promotion by partnering with other Australian aqua products Undertake joint promotions with Australian beverage sector

APFA will do what Farmers can not do alone Prawn Farms APFA Least Influence Most Influence Switch Consumers to Farmed Prawns APFA can directly influence prawn awareness and demand through generic (e.g. LAP) or category marketing and promotion. APFA R&D can also lower costs through the supply chain (RD&E). But, APFA has limited influence on farm profitability and ROI. Increase Prawn Demand Increase Prawn Sales Farms can directly control their own ROI and profit through cost control and product quality (e.g. RD&E levy). But, farms have limited influence on prawn demand, or their chain partners due to lack of critical mass and lack of market power Increase Prawn Price Increase Farm Sector Revenue Increase Farm Profitability Increase Farm ROI Most Influence Least Influence

APFA Marketing Strategy Levy Business Plan Levy Management Plan 3 Steps to marketing investment APFA Board - approval of concept FRDC 2014.16 - Project 2015 APFA Conference update Delay due to - Marketing Strategy 2021 – now completed Funding required - ~$150k for LAP + APFA Programs Review Progress

APFA Marketing Strategy Levy Business Plan Levy Management Plan 3 Steps to marketing investment APFA Board - approval of concept FRDC 2014.16 - Project 2015 APFA Conference update Delay due to - Marketing Strategy 2021 – now completed Funding required - ~$150k for LAP + APFA Programs Review Progress Levy Design Consult farms, stakeholders, FRDC, DAWR - next 2 months Assess Voluntary V Compulsory (Domestic ONLY) Levy metrics – who pays, cap, frequency, rate, point, timing, etc Piggyback on existing RD&E levy (lower costs), but no matching DAWR / Minister Approval if compulsory Authority to spend, accountability for spend, APFA governance Levy Equity Determine equitable levy rate + payment cap for large farms Majority of farms + big 4 (Seafarm, PacReef, GCMA, Aussie Prawns) must approve

APFA Marketing Strategy Levy Business Plan Levy Management Plan 3 Steps to marketing investment APFA Board - approval of concept FRDC 2014.16 - Project 2015 APFA Conference update How will we invest - Marketing Strategy 2021 completed Funding required - ~$150k for LAP + APFA Programs Review Progress Levy Design Consult farms, stakeholders, FRDC, DAWR - next 2 months Assess Voluntary V Compulsory (Domestic ONLY) Levy metrics – who pays, cap, frequency, rate, point, timing, etc Piggyback on existing RD&E levy (lower costs), but no matching DAWR / Minister Approval if compulsory Authority to spend, accountability for spend, APFA governance Levy Equity Determine equitable levy rate + payment cap for large farms Majority of farms + big 4 (Seafarm, PacReef, GCMA, Aussie Prawns) must approve Confirm resources at APFA / LAP to manage the Marketing program Mandatory 5 year review of Plan/Levy Managing and spending the money Output: Levy Business Plan to APFA/FRDC Levy Submission to APFA/FRDC and DAWR (if compulsory)

Aug-Sept Oct-Nov Dec-Jan Feb Next 6 months Confirm farm consultation program – farms, contacts, data, Draft Levy Development Plan – consult APFA/FRDC/DAWR Release media advice/adverts re proposed levy Consult on site with all farms re levy options & preferences Document all issues and options, positive and negative Identify APFA / proponent capability to manage a levy Aug-Sept Document matters related to the DAWR 12 Principles: intent of the levy; how funds will be used; unique caps, etc. forecast returns/ROI, beneficiaries, management of funds why alternate collection options are not attractive. positive and negative responses from license holders if/how design will address each concern, etc Market failure and how levy is best way to resolve Oct-Nov Document when/how levy will be monitored Document when/how levy reviewed every 5-10 years Finalise Levy proposal - design, collection, and use of funds Submit draft levy Business Plan to APFA / FRDC & DAWR Prepare for Poll/Vote to approve if required Dec-Jan Conduct Poll / Vote APFA / FRDC approval for compulsory or voluntary levy Submission to DAWR Minister if for compulsory levy Approval and levy begins July 2017 Feb