1. By Elizabeth Hund November 7, 2005
Name of presentation...
International Opportunities
By Elizabeth Hund November 7, 2005
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2. Coöperatieve Centrale Raiffeisen-Boerenleenbank
Rabobank International

3. Rabobank 2005 ● Only AAA rated non-government bank
● years of agricultural/community banking experience
● 57,000 employees in 35 countries
Rabobank International

4. Rabobank International Network
London
Dublin
Antwerp
Frankfurt
Paris
Madrid
Milan
Singapore
Mumbai
New Delhi
Jakarta
Bangkok
Taipei
Hong Kong
Beijing
Shanghai
Tokyo
Toronto
New York
Chicago
Atlanta
Dallas
San Francisco
Washington D.C.
Warsaw
Poznan
Moscow
Istanbul
Mexico City
Curaçao
São Paulo
Santiago
Buenos Aires
Sydney
Melbourne
Brisbane
Perth
Auckland
Rabobank International

5. The global FAR team has 74 members in 12 different countries
Utrecht (Global HQ)
Beijing
Tokyo
New York
Shanghai
New Delhi
Mexico City
Hong Kong
Mumbai
Bangkok
Jakarta
Singapore
Sydney
São Paulo
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6. Rabobank Locations in the United States
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Rabobank Locations in the United States
Corporate Bank
Rabobank NA
Rabo AgriFinance
Rabo AgServices
Rabobank International
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7. Rabobank International
“The financial link in the global food chain”®
Rabobank International

8. Contents Section 1: Consumer Progression Section 2: Production Trends
International Opportunities
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9. Section I Consumer Progression
Setting the stage
Section I Consumer Progression

10. Key Drivers Behind Global Food Demand – Income and Total Population
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Key Drivers Behind Global Food Demand
– Income and Total Population
AUSTRALIA
CANADA
JAPAN US
CHINA
INDIA
EUROPE-25
EAST ASIA
MIDDLE EAST
& NORTH AFRICA
SUBSAHARAN
AFRICA
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
-0.2%
0.2%
0.6%
1.0%
1.4%
1.8%
2.2%
2.6%
Population growth 2002 (annual %)
GDP growth 2002 (annual %)
SOUTH
ASIA 0%
In developing countries income is the major driver of food demand while in developed countries variations in income do not affect food demand so significantly.
The global economy is expected to improve its growth rate during the current and next year from 3.9% in 2003 to an average of 4.5% with most of the growth coming from developing countries.
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11. Asia is Key to Future Consumer Demand
China and India
most populated countries
highest annual GDP growth
Low income levels of those countries show enormous markets that are emerging.
Source: Rabobank analysis based on UN data
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12. China Economic Superpower?
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China Economic Superpower?
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Source: United Nations, Rabobank
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13. Demographics We are getting older!
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Demographics We are getting older! %
Higher interest in functional foods
Require different serving sizes & packaging
In the western hemisphere, health becomes progressively more important.
Source: Rabobank analysis based on UN data
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14. Industry Consolidation
USD 604bn
USD 130bn
USD 473bn
USD 106bn
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15. Globalization Major players have become huge global companies
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Globalization Major players have become huge global companies
Top Ten 2001 Ranked by total sales (in USD billion)
Retailers
1. Wal-Mart Stores 218
2. Carrefour (France) 62
3. Ahold (Dutch) 60
4. Kroger 50
5. Metro AG(Germany) 44
6. Albertson’s 38
7. Safeway (US) 34
8. Leclerc* (France) 34
9. Auchan * (France) 33
10. Intermarché*(France) 31
*2000
Total above USD 605
Food Service
1. McDonald’s
2. Tricon
3. Compass (England) 13
4. Burger King 11
5. Sodexho Alliance(Fr.) 11
6. Wendy’s 8
7. Aramark 8
8. Accor (France) 7
9. Six Contintents (UK) 6
10. Whitbread (UK) 4
Total above USD 131
The major buyers of dairy products include food retailers, wholesalers, the foodservice industry and food processors. The major companies in these sectors are consolidating on a global basis and tend to be significantly larger than the players in the dairy industry.
Food manufacturers - customers (Nestle, Phillip Morris, Unilever) are also players in the dairy industry
Retailers - tend to be predominantly European demonstrating their ability to globalise
Food service - tend to be predominantly US companies - reflects the fact that the % of money spent out of the home in the US is hi’er than in any other country.
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16. Section II Production Trends
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Section II Production Trends
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17. Name of presentation...
World Beef Production
South America is poised to take over North America
as the world’s largest beef producing region
Source: FAO
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18. World Pork Production China accounts for almost
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World Pork Production
China accounts for almost
half of world pork production
Source: FAO
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19. World Poultry Production
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World Poultry Production
Poultry production has shifted from
North America & Europe to South America & Asia
Source: FAO
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20. World Dairy Production
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World Dairy Production
World production is increasing at around 1% per annum but different regions are growing at different rates. There are some regions where not much significant shift has taken place over times such as in NAFTA, Central America + Caribbean, Other Africa, North East Asia and South East Asia.
Western Europe’s share is declining over time – In 1984, it held 31% share, which fell to 23% in 2001 and is forecasted to further decline to 21% by 2010.
On the hand, South Asia’s position in global production has grown from a 11% share in 1984 to a 19% share in 2001 and predicted to further increase to 23% by This rise is due to the growing demand for dairy products in its domestic markets.
It is also interesting to note the increasing role of South America as a global dairy producer, as its share grew from 5% in 1984 to 8% in 2001.
Oceania has demonstrated a 1-2% increase in share between 1984 and the forecasted level for 2010.
Developing regions are becoming more
important for dairy production
Source : CFCE / FAO/Rabobank
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21. China continues to be the world leader in cotton production
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World Cotton Production
World production is increasing at around 1% per annum but different regions are growing at different rates. There are some regions where not much significant shift has taken place over times such as in NAFTA, Central America + Caribbean, Other Africa, North East Asia and South East Asia.
Western Europe’s share is declining over time – In 1984, it held 31% share, which fell to 23% in 2001 and is forecasted to further decline to 21% by 2010.
On the hand, South Asia’s position in global production has grown from a 11% share in 1984 to a 19% share in 2001 and predicted to further increase to 23% by This rise is due to the growing demand for dairy products in its domestic markets.
It is also interesting to note the increasing role of South America as a global dairy producer, as its share grew from 5% in 1984 to 8% in 2001.
Oceania has demonstrated a 1-2% increase in share between 1984 and the forecasted level for 2010.
China continues to be the world leader in cotton production
Source : CFCE / FAO/Rabobank
Rabobank International
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22. Consolidation of U.S. Farmers
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Consolidation of U.S. Farmers
Consolidation has been driven by:
Cost
Product sales advantages
Regulatory and policy considerations
In California
Total farm number reduced from to between 1997 and 2002
Average farm size increased by 5.8% from 327 acres to 346 acres
On average California has smaller farms but higher income per farm reflecting that high value dairies and fruit and vegetables dairies are important in California Ag
Rabobank analysis based on US Census data
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23. Farmers are Moving! Access to labor Environmental regulations
Water availability
Shift in focus of crops
Market access and non tariff barriers
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24. Use and potential of selected agricultural areas
Beware Brazil!
Use and potential of selected agricultural areas 50
100
150
200
250
Indiana, Iowa and
Illinois
Cerrado
Argentina
Million Acres
In use
Potential
$2000/acre
$1100/acre
$1250/acre
Agricultural frontier land in Brazil can be purchased for less than USD 350 per acre
There are 220 M acres of potential area in the “Cerrado”
Indiana, Iowa and Illinois have a total area of 96 M acres
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25. Section III International Opportunities

26. Top 5 Exporters % World Market Share in 2002 United States 15.50%
Netherlands %
France %
Germany %
Canada %
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27. Top 5 Growth Exporters Top 10 Exporters (2002)
The next 5 exporters are gaining
U.S. is still the largest exporter but is consistently losing market share:
1990 = 18.2% of the world exports
2002 = 15.5% of the world exports
Australia and Argentina have been growing rapidly.
United States
Netherlands
France
Germany
Canada
Belgium
Spain
Brazil
Italy
China
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28. Exports What are they exporting?
Source: Rabobank analysis based on UN data
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29. U.S. Export Trends
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30. Don’t Forget Exchange Rates
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Don’t Forget Exchange Rates
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31. Tools of the Trade Political risk Rule of law Local financing
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32. Joint Ventures If you can’t beat ‘em, join ‘em
Difficult but not impossible
Loads of opportunities
Key success factors are:
Partner selection
Careful structuring of the deal
Cost control
Attracting and retaining local talen
Branding
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33. Summary Consumer Progression Income Demographics Trends
Production Trends
Consolidation
Globalization
New Major Players
Expansion of international trade
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