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India Maize Summit New Delhi 20 th March 2014

India Maize Summit New Delhi 20 th March 2014. A Little about Noble + Global Corn Trade and its likely impact on India By Major Rajiv Yadav. What do we do?. Founded in 1987 Operates from over 140 locations and 35 countries Three Business divisions (percentage of revenue) Energy (68%)

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India Maize Summit New Delhi 20 th March 2014

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  1. India Maize SummitNew Delhi20th March 2014

  2. A Little about Noble + Global Corn Trade and its likely impact on India By Major Rajiv Yadav

  3. What do we do? • Founded in 1987 • Operates from over 140 locations and 35 countries • Three Business divisions (percentage of revenue) • Energy (68%) • Agriculture (16%) • Metals, Minerals and Ores (16%) • Owns assets and participates along the supply chain • Focuses on low cost sourcing to high growth markets • Noble is listed in Singapore , with headquarters in Hong Kong. • We are ranked number 76 in the 2013 Fortune 500

  4. Size & Growth • Strong growth in all divisions • Revenue was USD 94b in 2012 • Tonnage has increased nearly 60 per cent to 224 million tonnes per annum in the last five years Total Revenue (US$ billion) * Our Former Logistics segment results are, from Q1 2011, consolidated into the Physical commodity divisions, reflecting the nature of our business we provide logistic/chartering services to support the underlying physical commodity segments.

  5. Agri business • Focus on Grains, Oilseeds, Sugar, Cotton, Coffee and Cocoa • The Agri business unit traded over 44 metric tonnes in 2012 – almost triple the flow in 2006 Assets • New oilseed crushing facilities in Brazil, Argentina, Ukraine and South Africa, together with the existing four plants in China, produce a global throughput of 10 million tonnes per year • Cluster of strategically located port facilities in Argentina and Brazil • A complex of four state-of-the-art sugar and ethanol mills in Brazil • A 1400 tns per day edible oil refinery at Kandla(India)

  6. INDEX • Production estimates – 2013/14 • SND Snapshot • India • Exports • Growth • Destination markets • Price behavior • World Corn Yields Vs Indian Corn Yields • Future challenges

  7. India Maize Production

  8. SND Snapshot - India

  9. Current Scenario – Indian Corn • Increase in Kharif crop production by almost 1.1 MMT vs. last year (Maharashtra and Karnataka). • Non-competitive Indian corn prices vs. other origins kept Indian corn exports miniscule in first quarter, however with Ukraine crisis (and thus steep rise in world corn prices), Indian corn could find its way into export market. • Ending stocks to revive from last year exceptionally low levels with higher output + limited exports in Q1. • Alternate usages of corn increasing in starch/distillery/biofuel. • Poultry growth has been stagnant…… • Still catching up with last year export volumes look unachievable till now….unless something major change happens across globe.

  10. Exports – Sudden growth after slow start No surprise if we catch up with last year export volumes.

  11. India Corn FOB prices(Jan-Mar)

  12. Destination markets SEA is the traditional market for Indian corn. Advantages for buyers : Shorter voyage period. Buyers can monitor quality at load port. Px advantage to SA Corn.

  13. CNF Px Comparison We are still competitive in prices at destination markets.

  14. Price behavior – Indian market vs. CBOT Reducing price spread between NDCEX – CBOT is opening ways for Indian corn in export market

  15. Corn Yield/Production Comparison – Major Growing Countries *Source: USDA

  16. Future Challenges • STAGNATING PRODUCTION • GMO still not allowed • Competing crops • Global warming leading to inconsistent weather. • LACK OF QUALITY CONSISTENCY • High on aflatoxin & mycotoxins • Not deemed fit for human consumption in developed nations. • Lack of mechanization for harvesting • LOGISTICAL ISSUES • Higher wastages during transit • Rail/road transport always a limiting factor for speedy movement • Frequent Port Congestions • LACK OF QUALITY WAREHOUSING • Inadequate and poor quality warehousing facilities. • Long term storage always remains a concern.

  17. Factors to watched in near future ? • BLACK SEA CRISIS • Impact of US/Europe sanctions on Russia. • Logistics constraints emerging out • No other substitute to globally cheapest feed wheat & corn • US DRY WEATHER CONCERNS • Beginning has not been great . • More clarity to come in April. • FALL OUT OF INDIAN ELECTIONS • Rupee will strengthen in case new Government comes with clear majority. • Strong dollar could make exports all the more difficult. • LIKELY DELAYED MONSOON THIS YEAR. • Good for Bihar corn exports. • Next year crop sowing could have adverse impact.

  18. Thank You

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