Demand For Freight Transportation

State of the Industry

Strong Export Demand

Good Supply

Good Execution

Challenges

• High prices creating new production

• Lower food safety standards in some countries

• Pressure on food processors margins

So, where are we?

• Doing OK as a country

• High costs relative to some suppliers – Eastern Europe

– China

– Africa

• Strong standards for Environment, Health and Safety

• Middle of the pack, batting .500

• Yes, we are….

• 2011 season 81 : 81

• Playing in a tough division

• Doing lots of things right

• Team looks great

• Have not been able to make the playoffs

Blue Jays in 2012

• Need 90 wins to clinch a playoff spot

• Nine more wins than last year

• One more win every 18 games

• Have to capitalize on every opportunity

If we could have 9 wins:

1. Investment 2. Market Development 3. Execution 4. Efficient Labour 5. Control External Operating Costs 6. Property Taxes 7. Port Operation 8. Planning 9. A couple of Timely Rains

#1. Investment

#2. Market Development

• Which markets will pay for sustainable production?

• What are our competitors’ standards?

#3. Execution

• Soybean Meal: The seasonal harvest pressure from South America has so far failed to appear. Premiums in Brazil and Argentina have increased in the past few days by 11 – 16 US$/t as a result of the crop forecasts for Argentina and Brazil being more and more reduced to currently 42-45 mln t and 65- 67 mln t, respectively, and due to brisk worldwide

demand for soybeans. Shipments from South America are still significantly delayed as a result of the strikes and generally long waiting times in Brazilian ports. In Europe, larger intra-EU quantities and goods afloat have been traded recently at a premium to ensure a timely arrival and a sufficient supply. Almost no business is taking place for deferred positions.

#4. Efficient Labour

• Shipments from South America are still significantly delayed as a result of the strikes and generally long waiting times in Brazilian Ports .

#5. Control External Operating Costs

• Rail Rates

• Ancillary Charges

• Vessel Rates

• Container Rates

#6. Property Taxes

Comparative Property Taxes in Five Eastern Ports

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

Port #1 Port #2 Port #3 Port #4 Port #5

#7. Port Operation

• Some good, some not so good

• Lack of motivation to do something

• Volumes shrinking

• On the other hand,

• Aggressive Growth Strategies

• Involved management

• Cost effective management

#7. Port Operation

• Shipments from South America are still significantly delayed as a result of the strikes and generally long waiting times in Brazilian Ports .

#8. Planning

#8. Planning

Demand For Freight

Strong, if we can compete