KRAFT Europe

DelibProcessSCP Closing Conference Brussels, Blegium Commitment to Sustainability Sabine Peters-Halfbrodt EU Corporate & Public Affairs December 8th, 2009 1

Who is Kraft Foods? •  One of the leading food companies in the world •  $ 41.9 billion in revenue •  98.000 employees and 168 plants worldwide •  Wide product portfolio including snacks, chocolate & coffee North America Kraft Foods Europe Asia Pacific Region Latin America Region Central & Eastern Europe, Middle East & Africa Region 2

An amazing brand portfolio. 9 Brands with more than $1 billion in revenue 50+ Brands with more than $100 million in revenue 40+ Brands over 100 years old

Why is Kraft Foods committed to sustainability? Forecast  Population growth  Average standard of living improves Consequences  Growing demand on limited natural resources  Increase of emissions and pollution 4

Ambitious goals and status quo. We are on track to meet or to exceed all our goals and to date have delivered roughly $150MM in productivity Down 14% (actuals thru 2008) 116MM pounds out (actuals thru 2008) Down 14% (actuals thru 2008) Down 21% (actuals thru 2008) Down 12% (actuals thru 2008) Base Year: 2005 All goals to be achieved by year end 2011

Today‘s focus: Agricultural Commodities.

Coffee and Cocoa. Pioneer in sustainable coffee Major collaboration with Rainforest Alliance Significant brand & customer linkage Expanding Rainforest Alliance programme to cocoa Global programme to combat child labour in West Africa Broader strategy includes energy, emissions, waste

Coffee and Cocoa. •  Since the early 1990s: coffee and cocoa have been crisis-ridden commodities •  Some 50 to 100 million people worldwide depend on coffee and cocoa •  For more than 15 years, Kraft Foods has focused on working to improve agricultural production conditions in developing countries in Africa, Latin America and South Asia, focusing on commodities such as coffee and cocoa 8

Collaborating with the Rainforest Alliance Good reasons for… •  The Rainforest Alliance •  applies to all types and sizes of farms •  beneficial for farmers, workers and their families •  protecting water, soil and wildlife •  promotes biodiversity and helps to conserve eco-systems •  leads to better farm management with intended farm health improvements and yield increases, better crop quality and reliable harvest volumes •  The Rainforest Alliance Certified™ program matches highest standards towards sustainable agriculture and proved itself to be market-capable and competitive in the origins (supply and demand pricing model) •  The 1st rigorous sustainability standard of the tropics •  Means more than 20 years of experience on international level (FSC co-author) 9

Coffee. Purchasing of raw coffee from Rainforest Alliance Certified™ farms 10

UK / Kenco example: Continuous improvements in coffee. Complete power brand 2010 roll-out (Retail & AFH) 100% RAC Freeze-dried roll-out (Retail & 2009 AFH) 100% RAC 2008 Freeze-dried roll-out (Retail & AFH) 75% RAC Kenco Pure launch (Retail) 2007 100% RAC Kenco Sustainable Development launch (Retail & AFH) 2006 100% RAC 11

Building sustainability into every aspect of Kenco. Raw Transport & Genesis Conversion Packaging Sales Materials Warehousing Connecting 100% sourced Coffee grounds Eco-Refill pack Project Mocha – FSC consumers with from Rainforest burnt for energy Project Cheshire new ambient (Sustainable) the farm Alliance Certified >30% Reduction new formats warehouse outer packs Education farms by 2010 in energy used and POS programme since 2000 AFH cup recycling Dedication to great sustainable coffee 13

Cocoa. Purchasing of raw cocoa from Rainforest Alliance Certified™ farms 14

Sustainably farmed cocoa: Pioneering PPP initiative sets new standards. •  In 2005, we embarked on a 3-y development project in Côte d’Ivoire •  Partnering with internationally respected partners: •  the Rainforest Alliance •  leading development organizations such as GTZ and USAID •  cocoa trader Armajaro •  End of 2008: 2,000 farmers were awarded Rainforest Alliance Certified™ •  Harvest 2007/2008: premium generated additional 280,000 USD for all •  Yields improved, productivity increased significantly, sometimes 50% plus •  Incidents of “black pod” disease decreased up to one third 15

First chocolate products containing cocoa from Rainforest Alliance Certified™ farms. Beginning in France and Belgium with 70% plus cocoa premium dark chocolates, Côte d’Or now contains at least 30% cocoa from Rainforest Alliance Certified™ farms By end of 2012, the company will use only cocoa from Rainforest Alliance Certified™ farms in two major chocolate brands in Europe: •  Côte d’Or •  Marabou This equates to approx. 30,000 tons of cocoa beans on an annual basis 16

Other initiatives. •  Bill & Melinda Gates Foundation •  World Cocoa Foundation (WCF) •  Sustainable Tree Crops Program (STCP) •  Empowering Cocoa Households with Opportunities and Education Solutions (ECHOES)

Fundamental co-operations in agricultural development. In addition to and jointly with the Rainforest Alliance: •  United States Agency for International Development (USAID) •  Global Environment Facility (GEF) •  United Nations Development Program (UNDP) •  Deutsche Gesellschaft fuer Technische Zusammenarbeit (GTZ) 18

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