afoa october 2012
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AFOA October 2012. Oils New Paradigm David Dzisiak Dow AgroSciences. Anti-fat Sentiment Is Declining. Majority Seek Good Fat Consumption. 49% of Consumers Actively Consuming “Good Fats”. Limit Bad / Consume Good. 64% of Consumers Actively Consuming “Good Fats”. No Strong Effort. - PowerPoint PPT PresentationTRANSCRIPT
AFOA October 2012
Oils New Paradigm
David DzisiakDow AgroSciences
Anti-fat Sentiment Is Declining
Majority Seek Good Fat Consumption
Impact of Age on Strong Efforts to Consume/Limit Fat
40%
26%
17%
37%
59%65%
14%
37%
10% 11%
9% 8%5% 7%
0
10
20
30
40
50
60
70
18-34 Years 35-49 Years 50-64 Years 65+ Years
Impact of Age on Strong Efforts to Consume/Limit Fat
40%
26%
17%
37%
59%65%
14%
37%
10% 11%
9% 8%5% 7%
0
10
20
30
40
50
60
70
18-34 Years 35-49 Years 50-64 Years 65+ Years
Limit Bad / Consume Good
No Strong EffortLimit Bad ONLY
Consume Good ONLY
49% of Consumers Actively Consuming “Good Fats”
64% of Consumers Actively Consuming “Good Fats”
The 2010 Gallup Study of Healthy Fats & Oils Multi-sponsor Surveys, Inc.
US/capita Food Veg Oil Consumption
80/8
1 81
/82
82/8
3 83
/84
84/8
5 85
/86
86/8
7 87
/88
88/8
9 89
/90
90/9
1 91
/92
92/9
3 93
/94
94/9
5 95
/96
96/9
7 97
/98
98/9
9 99
/00
00/0
1 01
/02
02/0
3 03
/04
04/0
5 05
/06
06/0
7 07
/08
08/0
9 09
/10
10/1
1 11
/12
12/1
3
0
1
2
3
4
5
6
7
8
9
10
11
12
0
5
10
15
20
25
30
35
40
45
50
55
60
Vege
tabl
e O
ils o
ther
than
Soy
bean
Oil
(Pou
nds/
Pers
on)
Soyb
ean
Oil
(Pou
nds/
Pers
on)
Soybean Canola
Corn
Palm
Trans-fat labellingDecline of ph soy
N.A. Canola Production Expands
0
5
10
15
20
25
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013F
MM
Ac
& M
M m
t
Process Capacity Seed Output Actual Processed Acres HS Canola Processed
Omega-9 type canola oil is now a large part of NA production and processing
7 sites now processing high stability canola using about 35% of total capacity
approx 2.5B lbs high stability canola oil supply
New York Times Feb 9,2012 …….As controversy grew, many food manufacturers and restaurants gave in to pressure to remove trans fats — also known as partially hydrogenated oils — and began using alternatives like canola or sunflower oil.
• CDC National Health and Nutrition Examination Survey•Trans fat levels fell 58 percent by 2009• LDL “bad” cholesterol, fell ~10 units, to 119.2 mg/dl from 128.2 • HDL “good” cholesterol rose to 55.8 milligrams from an average of 49.6 milligrams.
Monounsaturates Are Healthful
“The potential of an effective cholesterol-lowering diet to reduce the risk of cardiovascular disease may be
significantly enhanced by inclusion of a moderate amount of monounsaturated fat”
Oils high in monounsaturated fat raise good (HDL) cholesterol levels and decrease bad (LDL) cholesterol
“Better-For-You” Products Driving Sales Growth At Leading CPG Companies*
*Source: H. Cardello, Hudson Institute Neilson: Food, Drug & Mass Merchandise Sales Tracking
CPG’s With Above Average “BFY” Product Sales Had Superior Margins*
*Source: H. Cardello, Hudson Institute Neilson Data and Company Annual Reports
Growers report yields by variety for Crop Insurance
Yields are competitive with elite industry varieties
2011 Grower Reported Yields
Year Risk Areas Variety/Hybrid Reported Acres Yield Units
2011 2-7, 9, 12 Invigor L-series 358844 29.9 bu/ac
2011 2-7, 9, 12 Nexera Hybrid RR Series 24509 28.5 bu/ac
2011 2-7, 9, 12 Invigor 5440 623906 28.5 bu/ac
2011 2-7, 9, 12 Pioneer 45H29 82491 28.3 bu/ac
2011 2-7, 9, 12 Dekalb 73 Series Hybrids 109892 27.6 bu/ac
Efficient Crop Production
Oilseed InnovationCrop / Oil Trait Market Drivers
1970’s Sunflower, Soy Rapeseed and Palm
Local\cheap vegetable oil
1980’s Hydrogenated oils Tropical fat alternatives
1990’sLow linolenic CanolaHigh oleic Sunflower
Low saturate oilsConsumer wellness trends
2000’s High Stability OilsNo Saturate Oils
DHA & Omega 3’sStructured TAG’s
Trans-fats and CVDObesity & Diabetes
Good FatsHealth and Vitality
New York NY