CEO of Nutreco looks into the future for the feed company Nutreco and the salmon feed business in general. Is there a new competitive climate within the salmon feed business?

1. Knut Nesse – CEO
Nordea Salmon Summit
Oslo| 28 November 2013

3. Doubling food
production
Halving the pressure on
the planet
Feeding 9 billion people
in 2050
3

4. The essential link
Raw material
markets
Struggling supplies
Animal nutrition
& fish feed
producers
Farmers
Surging Demand
4

5. Nutreco’s two divisions
• Revenue in 2012 of €5.2 billion
• Over 100 production and processing plants in 30 countries
• Multinational workforce of approximately 10,000 employees
Animal Nutrition
Fish Feed
Revenue
€3.3 billion
€1.9 billion
EBITA*
€149 million
€142 million
* Before exceptional items from continuing operations and excluding corporate costs
5

6. Unique knowledge – Skretting’s passion for fish
Process technology
Nutrition
Raw materials
Our competence in research and application in daily feed production gives us a
competitive advantage
Goals
Fish health
Fish
performance
Feed quality
Food safety
Sustainability
6

7. Skretting – a global aquafeed company
3,400
employees
1.7 million MT
of feed
Production in 16
countries
Sales in more than
40 countries
Feeds for more than
60 species of fish &
shrimp
5 global R&D units
3,400 employees | Production: 1.7 million tonnes (2012) | Sales in >40 countries |
Production in 16 countries | No. 1 in salmon feed
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8. World fish and shrimp feed market 2012*
Annual
growth
volume**
Europe
America
Asia***
Africa
Sum species
Estimated volume (million tonnes)
Salmonid
5%
Shrimp
5%
White fish
>5%
Sum
geography
>5%
1.9 MT
Turnover
1.5 MT
0.1 MT
3.5 MT
€3.9 B
0.7 MT
3.2 MT
3.9 MT
€3.9 B
0.8 MT
0.6 MT
9.2 MT
2.0 MT
12.6 MT
€6.2 B
2.7 MT
2.8 MT
12.5 MT
2.0 MT
20.0 MT
€14.0 B
Note: * Defined in addressable market turnover, (€ billions) and volumes (million metric tonnes) ex. carp. Fresh water trout are included in white fish
** Annual long-term growth rate
Source: Skretting
*** Australia has been included in Asia
8

9. Value chain – fish feed industry
Raw materials
Feed
R&D
Breeding
Hatchery
Fish
Processing
Sale
Transportation
9

10. Steady growth of global salmon farming industry
kTonnes
2,500
2,000
1,500
Other
Faroes
Canada
CAGR 9%
1,000
UK
Chile
Norway
500
0
1992
2000
2005
2010
2015e
Sources: Kontali, ABG Sundal Collier, companies
10

11. The potential of Norwegian aquaculture
Salmonid value chain
2050
2030
2010
1999
Economic value
€1.5 billion
10%
CAGR
Economic value
€4.3 billion
6.5%
CAGR
Economic value
€15 billion
3.5%
CAGR
Economic value
€30 billion
Volume
0.5 mill. tonnes
6.5%
CAGR
Volume
1 mill. tonnes
5.6%
CAGR
Volume
3 mill. tonnes
2.6%
CAGR
Volume
5 mill. tonnes
Source: Value created from productive oceans in 2050, SINTEF, 2012
11

12. Growth of salmonid feed supply in Norway
kTonnes
2500
CAGR 2014-2020 = 5% est.
~100kTonnes/year
2000
1500
CAGR 1996-2013 = 7.8%
1000
500
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
0
12

13. World’s largest and most modern fish feed factory - Averøy
Upgrade fully completed in 2013
Nutreco’s largest ever capex
project
Total investment of approx.
€ 80 million
Additional capacity of 150,000
MT
Total capacity now 450,000 MT
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14. A new competitive climate for fish feed?
?
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15. Innovation in fish feed is key to meet future demand
• To meet growing demand for aquaculture (by 2030), supply should grow
by 5.6% per year. However, expected growth based on recent trends is
only 3.5%...
• Meeting this gap between future demand/supply for aquaculture will
depend on the availability of quality and affordable feeds, additional
production locations and sufficient water supply
• We need to invest in innovation in fish feed to support growth in
aquaculture:
• Continued emphasis on alternatives to fishmeal and fish oil
• Sustainable supply of plant feed ingredients
• Improving feed formulation and production
Sources: 2007-2030, Arni Mattheson, FAO, AquaVision 2012 presentation;
The State of World Fisheries and Aquaculture 2012 - FAO
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16. Conclusion
• Strong forecasts for global aquaculture growth
• Future demand for food from aquaculture will largely depend on the
availability of quality feeds
• Innovation in fish feed is key to meet future demand
• Nutreco’s key driver is to support our customers through innovative
sustainable feed solutions that contribute to their productivity and
profitability
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17. THANK YOU