MOJI MOGARI

OVERVIEW

OVER OF AFGRI

COLLATERAL MANAGEMENTCOLLATERAL MANAGEMENT

GENERAL AGRICULTURAL ISSUES OF CONCERN

GLOBAL CHALLENGES

OPPORTUNITIES IN SOUTHERN AFRICA

AFGRI’S APPROACH TO VALUE CHAINS

GENERAL AGRICULTURAL ISSUES OF CONCERN

OPPORTUNITIES IN SOUTHERN AFRICA

AFGRI’S APPROACH TO VALUE CHAINS

1. OVERVIEW OF AFGRI

• 65 Silo complexes ± 4,0m tons (incl. Zambia)

• Debtors book of ± R5.6bn of which 50% are individual

farmers

• 1000 000 tons of Animal Feed

(including Natal-Agri)

• Largest John Deere dealer in Southern Hemisphere

OVERVIEW OF AFGRI Cont1

4,0m tons (incl. Zambia)

R5.6bn of which 50% are individual

Largest John Deere dealer in Southern Hemisphere

Total Agriculture SolutionProcure Direct (Farmers)

Procure Indirect (Mills)

Market Product (SAFEX)

Animal Feeds

Market

InfrastructureStorage

Logistics

Risk Management

alternatives

Total Agriculture Solution

Finance

Insurance Start Up Insurance

Inputs Equipment

Fertilizer

Seed

Chemicals

BUSINESS MODEL

SERVICESAGRI-

SERVICES

AFGRI

FOODSAFGRI

FOODS

AFGRI is a leading SoAfrican services busin

offering a wide rang

physical and intellec

inputs to farmprocessors and user

agricultural produ

AGRI SERVICES

AGRI-FIN

SERVICES

FOODS

NEW SEGMENTAL STRUCTURE

Operational activities

Capital Broking

Logistics Services

Capital:CreditTreasuryInsurancebroking

Financial solutions

for agriculture

Logistics:•Grain handling & storage• 65 silo complexes• Five bunkers• 4 million ton capacity

Trading:• Grain & commodity trading

Broking:•Price risk and hedging solutions for producers and consumers of agricultural products•No proprietary trading

Logistics Trading

Tailor made financial solutions to farmers, processors and consumers of agricultural products

trading•No proprietary trading

Value-add products and services supplied to a wide variety of customers, especially famers to support and grow their farming operations

NEW SEGMENTAL STRUCTURE

Operational activities

Producer Services

Animal Protein Oil & Prote

Retail:• 60 retail outlets• FarmCity• John Deere agency & workshop

Primary Inputs:•Direct supply of diesel, fertiliser and seed.• Agri-chemical

Animal Feeds:•Animal feed technology, formulation and production•Scientific services and equipment retail

Broilers:•Poultry production

Oil & Protein:• Bulk supplier oedible oils and fasoya and cotton protein for animafeed and texturissoya protein for human consump

Retail Primary

Inputs

add products and services supplied to a wide variety of customers, especially famers to support and grow their farming

• Agri-chemical distribution•Advisory services

•Poultry production from hatching to abattoir in the Daybreak Group

Expanding into the agricultural processing and food production sectors and comprises Animal feeDaybreak farms & Nedan oil businunits

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Capital

Capital:

• Credit

• Treasury

• Insurance broking

Financial solutions for agricultureFinancial solutions for agriculture

Tailor made financial solutions to farmers, processors and consumers of agricultural products

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Broking

Broking:

•Price risk and hedging solutions for

producers and consumers of

agricultural products

•No proprietary trading

Tailor made financial solutions to farmers, processors and consumers of agricultural products

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Logistics Services

Logistics:• Grain handling & storage

• 65 silo complexes

• Five bunkers

• 4 million ton capacity

Trading:

Logistics Trading

Trading:

• Grain & commodity trading

• No proprietary trading

Value-add products and services supplied to a wide variety of customers, especially famers to support and grow their farming

operations

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Producer Services

Retail:• 60 retail outlets

• FarmCity

• John Deere agency & workshop

Primary Inputs:•Direct supply of diesel, fertiliser and

Retail Primary Inputs

add products and services supplied to a wide variety of customers, especially famers to support and grow their farming

operations

•Direct supply of diesel, fertiliser and

seed.

• Agri-chemical distribution

•Advisory services

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Animal Protein

Animal Feeds:• Animal feed technology, formulation

and production

• Scientific services and equipment

retail

Broilers:Broilers:• Poultry production from hatching to

abattoir in the Daybreak Group

Expanding into the agricultural processing and food production sectors and comprises Animal feeds, Daybreak farms & Nedan oil

business units

NEW SEGMENTAL STRUCTURE (cont.)

Operational activities

Oil & Protein

Oil & Protein:• Bulk supplier of edible oils and fats,

soya and cotton protein for animal

feed and texturised soya protein for

human consumption

Expanding into the agricultural processing and food production sectors and comprises Animal feeds, Daybreak farms & Nedan oil

business units

Infrastructure: Logistics

3 Network Architecture

On-site

Transactional

Grading PC

On-site ART PC

Transactional

Server

On-site

Transactional

Grading PC

Grading PC

Grading PC

On-site

Transactional

Grading PC

On-site ART PC

ART Server

Grading PC

On-site

Transactional

Grading PC

On-site ART PC

Acorn Inventory Measurerement & Survey ‘AIMS’

. General Agricultural Issues of

Concern

Constrained competitiveness and profitabilityConstrained competitiveness and profitability

Lack of confidence and growth in the sector

Lack of investment in the sector and private sector

Global financial crisis (exports and credit risk)

Competing claims for resources Competing claims for resources

Implementation of Strategic Plan for SA Agriculture, including equitable participation

Food security risk: globally, continentally, regionally, nationally, and last but not least, at household level.

General Agricultural Issues of

Constrained competitiveness and profitabilityConstrained competitiveness and profitability

Lack of confidence and growth in the sector

Lack of investment in the sector – both from public

Global financial crisis (exports and credit risk)

Competing claims for resources Competing claims for resources

Implementation of Strategic Plan for SA Agriculture, including equitable participation

Food security risk: globally, continentally, regionally, nationally, and last but not least, at household level.

FOOD PRODUCTION CAPACITY ENHANCEMENT

5. OPPORTUNITIES IN SOUTHERN AFRICA

INVESTMENT IN FOOD INFRASTRUCTURE

UNDER UTILIZED ARABLE LAND , WITH AVAILABLE

WATER RESOURCE

GREATER LOCAL NEED FOR SUSTAINABLE FOOD

PRODUCTION

FOOD PRODUCTION CAPACITY ENHANCEMENT

5. OPPORTUNITIES IN SOUTHERN AFRICA

INVESTMENT IN FOOD INFRASTRUCTURE

UNDER UTILIZED ARABLE LAND , WITH AVAILABLE

GREATER LOCAL NEED FOR SUSTAINABLE FOOD

6 VALUE CHAINDIRECT

SUPPLIERS

PRODUCER

SERVICES

RETAILPRIMARY

INPUTSLOGISTICS

DAY 30 DAY 200

Direct

ManufacturingGrowth period

PLANT HARVESTPLANT HARVEST

FINANCIAL SERVICES

CAPITAL

LOGISTICS FOODS RE

LOGISTICS TRADINGANIMAL

PROTEIN

OIL &

PROTEIN

DAY 300 DAY 350

Storage ProcessingEn

Cust

TRADE SALETRADE SALE

FINANCIAL SERVICES

BROKING

VALUE CHAIN (cont)

5. GROWER

GRAIN

4. AFGRI ZIM OR EQUIVALENT:

MANAGES THE SEASONAL FACILITY ON

BEHALF OF THE MILLERS

5. PRODUCTION

SUPPLY

CONTRACTS

GRAIN

PRODUCERS

CREDIT FACILITY

ADVANCED BY AFGRI ZIM

ON THE BASIS OF

PURCHASE ORDER, AND

THE MILLER

GUARUNTEEING THE

FACILITY

MILLERS BUY THE MILLERS AND

OTHER BULK

3. AFGRI ZIM

REGISTERES BOND

ON PHYSICAL

ASSETS OF THE

MILLERS

GRAIN AT SAFEX

LINKED / MARKET

PRICE, AND THE

PRODUCER

CREDIT LINES ARE

SETTLED IN FULL

CONTRACTS

OTHER BULK

BUYERS

6.

PURCHASE ORDER

ISSUED TO THE

PRODUCERS.

1. GENERAL/BUYING

FACILITY RAIZED TO

ENABLE THE MILLERS

TO BUY FROM

PRODUCERS.

2. THEN AFGRI ZIM

ENTERS INTO AN

AGENCY

AGREEMENT AT A

FEE TO ARRANGE

AND MANAGE

ADVANCES TO THE

PRODUCERS , AND

RISK MANAGEMENT

AFGRI

THANKS YOU

AFGRI

THANKS YOU