Director Gunnar DalenBusiness & Trade Policy

Meatco and Nortura – a beautiful partnership

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Nortura SA at a glance Key figures 2012

• Annual turnover USD BN 3

• Been in business for 80 years

• Invested NOK BN 5 since 06

• Production : 218 000 tons fresh meat 39 000 tons of eggs

• Market share: 70% on carcass level 50% on processed products

• Industries in 32 municipalities in 14 counties

• Approx. 5 500 man years - 63% men - 37% women - 70 nationalities - 48% specialist qualifications

• Organised as a co-operative, owned by 18 500 farmersHeadquarter

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145 districts 145 districts

6 regionsEach led by a Working Committee

6 regionsEach led by a Working Committee

Annual Meeting 110 delegates

Annual Meeting 110 delegates

Group Board9 member elected 5 employee elected

Group Board9 member elected 5 employee elected

Value Chain Committee5 sub-committees

Value Chain Committee5 sub-committees

Control Committee3 members

Control Committee3 members

Group Council

14 + 12 + 5 members

Group Council

14 + 12 + 5 members

18 500 owners18 500 owners

AdministrationAdministration

Working committees 5+2 members

(poultry, egg, sheep,pigs, poultry meat)

Working committees 5+2 members

(poultry, egg, sheep,pigs, poultry meat)

Cooperative member organisation

Election Committee 6 members

Election Committee 6 members

Every 8th (13%) beef steak/filet in Norway comes from Namibia/ Botswana/Swaziland

Key beef import facts:• SACU total quota 3700 t: = 65% of the Norwegian tarif free quotas = 6% of Norwegian total beef consumption = 13% of Norwegian steak/filet consumption

• Namibia’s quota: 1600 t • Botswana’s quota: 1600 t• Swaziland’s quota: 500 t

• Annual export value Namibia: 200 MN NAD, calculated with the prices Nortura offers

• Cattle farming and beef industry in Namibia is therefore of great interest for Norway and vice versa

Nortura’s strategic objectives in Southern Africa:

• Develop long term relations with the meat industry in order to:– Develop a market based and profitable meat import from SACU– Play a predictable role as a major channel of the import of meat

• Create values both in SACU and in Norway– Offer prices which reflect the Norway price level, in harmony with

Nortura’s fair pricing policy and to avoid domestic price disturbance – Introduce added value to the imported meat, step by step– Optimize the market harmony (in Norway) between the domestic and

the imported flow of meat – Work together with Governments, Meat Industry and Farmers in N/Bw

• Contribute to transparent and predictable conditions for exporters, importers and consumers

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Nortura’s contribution to the income increase on SACU beef export since 2009*

• 2009: Nortura decided to begin as direct importer from SACU. Import volume: 99 tons (3 % of total quota 3700

tons)• 2010: The ambitious plan to lift the import prices close to Norway

level depended on achieving a big share of the import quickly. But all doors to the exporters were locked (old bonds?). Nortura had to buy it’s way into the trade (30% of the shares in Witvlei). Import volume 287 tons (8% of total quota 3700 tons)

• 2011: After the big price lifts our share of import increased. Nortura worked now in close cooperation with all players in

Namibia and Botswana. Nortura’s import volume: 2108 tons (56%) • 2012: Nortura stabilized import prizes at 85 - 90% of Norwegian prices,

and achieved an import volume of 1866 tons (50,4%)• 2012: The price lifts have increased the annual export value of

the SACU beef export with MN 150 – 200 NAD since 2008

* Meatco in the same period changed it’s export strategy successfully

Documented, big price lift on exported beef, after Nortura started to import (2008) till date *

Prices in € / kg 2008 ** 2013 *** Difference

Tenderloin 22,29 28 + 25%

Striploin 11,91 22 + 85%

Ribeye 9,22 18 + 95%

Topside 6,53 13 + 99%

Knuckles 4,84 10 + 107%

4% chuck & blade 5,07 10 + 97%

14% chuck & blade 3,07 7 + 128%

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The price lift has increased the annual export value of the SACU beef export with MN 150 – 200 NAD / yr. * In this period Meatco also changed the export strategy successfully (Meatco UK) ** Actual prices offered by Norwegian import companies in 2008*** Nortura’s average prices in early 2013

A very brief market update

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Beef and veal market 1990 - 2014

Consumption

Production

Beef wholesale prices 2006 – 2013 in NOK

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(1 NOK = 1,6 NAD)

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Future : Concerns and hopes

Meatco and Nortura are sister organizations,

• Similar owner interests (cattle farmers in our hearts)• Both are leading players in domestic meat industry• Similar high focus on food safety and food quality• Mutual interest in a lean and efficient export organization

with competitive and transparent margins (Meatco UK)

• Mutual interests in highest possible prices on exported beef to Norway (Nortura is the only Norwegian importer with an self-interest to pay well)

• Meatco has the beef. Nortura has industrial capacity and access to all market channels in Norway

- M and N have a mutual interest in developing a long turn business relation, and cooperate on technological and

organizational topics (Quoting MOU from 8. Oct 2013)

My concerns and hopes (I have other too)

Concerns: • Decrease in beef production in Namibia (and Norway)• Drought and bush encroachment • Challenges with the EU- approval on the export to N/EU

Hopes:• Increased business relation with Meatco (now only 30%)• A successful transformation of Meatco• Develop the visible presence of your beef in our shops• By help of Nortura open doors to the Norwegian Govt.

on relevant development projects and other topics• Good rain for you!! (and not too cold winter for us)

Thank you!

Dalen farm November 2012