2011 Australian Blueberry Industry

By Jon Gleeson

Sales Manager, Driscolls Australia

Byron Bay

Coffs Habour

Tumbarumba

Victoria

South Australia Tasmania

Australian Growing Locations

S/E QLD

WA

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2007 2008 2009 2010 2011Planted Area (Ha) 545 600 625 650 700Volume (Tonnes) 1984 2330 2775 3615 3780Fresh Domestic 1090 1360 1640 2320 2410Fresh Export 450 320 270 320 320Process 360 450 550 450 450NZ Imports 84 200 315 525 600High Chill (%) 17% 25% 30% 33% 35%Low Chill (%) 83% 75% 70% 67% 65%Farm Gate ($/Kg)

Fresh 20.9 21.24 21.55 18.98 19.65Process 5.76 5.45 3.95 3.03 3.83

Australian Industry Snapshot 2007-11

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2012 2013 2014 2015 2016Productive Area (Ha) 1000 1050 1100 1150 1200Volume (Tonnes) 4200 4550 4900 5250 5550Fresh Domestic 2700 3000 3350 3700 4000Fresh Export 500 550 550 550 550Process 500 500 500 500 500NZ Imports 500 500 500 500 500High Chill (%) 0.35 0.35 0.35 0.35 0.35Low Chill (%) 0.65 0.65 0.65 0.65 0.65Farm Gate ($/Kg)

Fresh 19 18.75 18.5 18.25 18Process 4 4 4 4 4

5 Year Industry Forecast Snapshot 2012-16

Industry Statistics 2007 - 2011• Productive area – 545Ha to 900Ha (+65%)• Total Volume – 2000Tonnes to 3800T (+90%)• Fresh Domestic – 1100T to 2400T (+120%)• Export Fresh - 450T to 320T (-30%)• Process – decrease of 20% - transfer to fresh• Material increase in NZ Fresh Imports (600%)• Material increase of process imports (Chile)• Domestic consumption the big positive• Growth aided by successful Promo Strategy

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Varieties Av Yields

(T/Ha)

Sharp 4Star 6Misty 5Emerald 8Biloxi 5CX Private 10MBO Private 10Oz Private 8Brigitta 10Denise 7Blue Crop 8Duke newOzark Blue newLegacy 8Elliot 8

Rabbiteyes Various 8

General Variety Facts

Low Chill

High Chill

Marketing & Distribution Fresh Domestic

• Supermarkets main outlet “must have” product• One major … 300% growth over past 5 years• Central Wholesale markets (material growth)• Year on Year consumption growth estimated +25%• Overall quality improving (VIP & Post Harvest)• Small gourmet growers achieving niche sales• Packaging majority in clam shell – 125g• Larger pack sizes under review• Long local season (52 week by 2012)

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Marketing & Distribution Fresh Export

Markets• Japan was premier destination - 600T (8yr)• UK / Europe - opportunistic - price main barrier• South East Asia – minimal growth• China – back door via HK• Russia – Ist sales this year & very promising

China / India direct market access – opportunity

Australian Cost Production our “Achilles' heal”.

Market Opportunities KPI

- Premium Quality

- Strategic timing 8

Marketing & Distribution Processing

• In 1987 process fruit to U.S.- No sale in Aust

• Today Australia produces around 400/600T

• Value adding (nutritional) - +3000T market & growing

• Chile now a large supplier to Oz (direct to chains)

• Import replacement opportunity - +2500T

• Export opportunities limited to supply / price / freight

• High quality standards – price premium against imports

• Very strong global demand = higher commodity $$$• Material negative profit contribution against fresh

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Lyr Tyr +/- Lyr. Tyr Diff. % +/- Lyr Tyr Diff. % +/-Total Fruit 100% 99% 0% 44 40 -3 -8% 10 11 1 10%Total Berries 79% 80% 1% 8 8 0 -1% 40 43 3 8%

Total Blueberries 30% 29% -2% 4 4 0 -7% 29 27 -2 -8%Total Strawberries 76% 78% 2% 7 7 0 -2% 45 47 2 5%Total Blackberries 3% 3% 5% 2 2 0 -23% 12 14 2 18%Total Raspberries 30% 33% 10% 3 3 0 3% 30 36 5 18%

Penetration Average purchase occasionsAvg. Purchase Intervals 2 time + buyers

No. Days lapsed between purchase.Purchase Behaviour

Australian Berry Consumer

-Berry consumption is increasing -Buyers are now purchasing blueberries more regularly -There is still a great opportunity to expand market consumption- Need to spread season

Global Growth of BB 2008 Million Tonnes 2010 Million Tonnes

Fresh Process Total Fresh Process Total

North America 104100 84530 188580 137440 85410 222850

South America 41780 10450 52220 62170 7410 69580

Europe 24690 890 25580 31130 5670 36800

Med. & N. Africa 370 0 370 990 18 10120

Southern Africa 500 200 700 950 91 10430

Asia Pacific 5570 2150 7710 7390 2810 10210

World Acreage 176960 98210 275160 240090 101410 341500

Asia/Pacific & South America timing of BB

Early market opportunity for Oz production

World Production of BB

Asia Pacific Overview

Global Territory Overview

Global Perspective

Summary - Australia• Steep learning curve over past 25 years• Profitability underpinned by Quality, R&D,

Cool chain & consistency of supply• COP – labour ($24per hour) – major issue• At the forefront of varietal development• Premium quality recognition (Globally)• Planned volume growth - realistic• We believe profitability will be sustainable going forward as long

as we continue to re-invest in R&D & deliver to our customers good tasting berries on a consistent basis.

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