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Tapioca Industry Chain & Market Forum 2010Shanghai, CHINASeptember 9, 2010

Analysis to Thai Tapioca Market

Content

� Introduction to TTSA

� Introduction to Thailand Tapioca Industry�Starch industry and market

�Chip & Pellet industry and market

�Mealy bug outbreak and control update bullet

�Relationship between grain/chip import and chip prices

�Relationship among starch, chip and root prices

�Estimated Balance sheet of Thailand tapioca 2010/11

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Introduction of TTSA

�Found in 1976.�Key objective is to grow Thailand tapioca starch

industry. �Almost tapioca starch producers in Thailand are

members of TTSA by volunteer. �4 Honorable members – Tapioca experts, academics �76 Ordinary members – Tapioca starch processors�70 Associated members – Exporters, traders,

machinery/packaging/ equip & tool suppliers and surveyors.

�More info. from www.thaitapiocastarch.org

Introduction of Thailand Tapioca

�The world second largest producer of root after Nigeria. �Approx. 12% of world production.

�Approx. total acreage of 1.25 million hectares and 500,000 farmers

�The world largest exporter of tapioca products. �Export in 2009/10 will reach 2.6 million tons of starch

and 5.1 million tons of chip & pellet – the record high.

�Products are recognized by customers in more than 100 countries worldwide

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17 18

21

17

23

26 25

30

22 21

0

5

10

15

20

25

30

35Million Tons

Thailand Tapioca : Root Production

* 2009/10 and 2010/11 are estimated.

Tapioca Root

Chip/ Pellet

Domestic8%

Export32%

Tapioca Starch

Domestic19%

Export36%

Ethanol5%

Thailand Tapioca : Utilization of Root

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1.22 1.18 1.131.46

1.291.45

2.04

1.40

2.42

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50Baht/Kg.

Thailand Tapioca: Root Price

Yearly Average Monthly Average

Starch Industry Profile

Number of Starch Mills 78

Production Capacity 23,000 Tons Starch/Day

Domestic Consumption ~1.2 Million Tons Starch/Year

Export ~2.0-2.5 Million Tons Starch/Year

Root Consumption ~15 Million Tons Root/Year

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1.28 1.58 1.76 1.62 2.10 2.36 2.15 2.14

2.65 0.90

1.00 1.10 1.10 1.20

1.20 1.20 1.20

1.20

5.4

6.3 6.4 6.6 6.7 7.1 7.2 7.4 7.6

2.2 2.6

3.3

2.5

3.4 3.6 3.5 4.0

3.1

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

Million Tons

Thailand Tapioca Starch Capacity & Output & Consumption

Domestic Export Capacity Output

0.8 1.0 1.1 1.0

1.5 1.6 1.4 1.5

1.9 0.5 0.5

0.6 0.6

0.6 0.7

0.8 0.7

0.7

441

503551

611637

811

987

816

1,104

0

200

400

600

800

1,000

1,200

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Million USD.Million Tons

Export of Thai Tapioca Starch

Native Quantity Modified Quantity Total Value Native& Modified

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Top 10 Importers of Thai Tapioca Starch in 2009

Native StarchQuantity

(Tons)

Value

(Million Baht)

Modified

Starch

Quantity

(Tons)

Value

(Million Baht)

1 CHINA 500,943 4,613 JAPAN 249,894 4,245

2 TAIWAN 313,365 2,756 CHINA 108,940 1,998

3 INDONESIA 241,668 2,280 INDONESIA 67,054 1,226

4 MALAYSIA 188,351 1,674 KOREA,R 42,802 824

5 JAPAN 123,214 1,152 TAIWAN 28,620 487

6 PHILIPPINES 70,027 657 USA 20,710 570

7 SINGAPORE 50,644 468 MALAYSIA 18,727 399

8 BANGLADESH 37,275 317 SOUTH AFRICA 15,982 236

9 KOREA,R 36,893 342 NETHERLANDS 15,759 429

10 USA 31,715 375 INDIA 15,238 228

OTHERS 204,005 2,017 OTHERS 114,851 2,201

ALL COUNTRIES 1,798,100 16,651 ALL COUNTRIES 698,577 12,843

0.61

0.370.34

0.31

0.21

0.08 0.08 0.06 0.05 0.04

0

50

100

150

200

250

0.00

0.20

0.40

0.60

0.80

1.00

Million USDMillion Tons

Top 10 Importers of Thai Tapioca Starch in 2009 (Total Quantity : Native & Modified)

Quantity Value

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1.18 1.46 1.55

1.36 1.75

1.97 1.84 1.65

2.21 0.11

0.12 0.21

0.25

0.34 0.37

0.31 0.49

0.44

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Million Tons

Export of Thai Tapioca StarchCHINA VS. ROW

Export to ROW Export to China

Chip & Pellet Industry Profile

Numbers of Drying Yards 700

Numbers of Pelletizers 40

Domestic Consumption <1.0 Million Tons Chip & Pellet /Year

Export 3-5 Million Tons Chip & Pellet/Year

Root Consumption 10-12 Million Tons Root/Year

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Chip Quantity

(Tons)

Value

(Million Baht)Pellet

Quantity

(Tons)

Value

(Million Baht)

1 CHINA 4,024,048 18,962 CHINA 172,079 704

2 LAO REPUBLIC 179 0.785 KOREA,R 105,925 540

3 SINGAPORE 0.2 0.1 JAPAN 27,257 120

4 NETHERLANDS 17,000 57

5 NEW ZEALAND 8,550 36

6 TAIWAN 434 2.2

7 AUSTRALIA 100 0.4

ALL COUNTRIES 4,024,227 18,963 ALL COUNTRIES 331,345 1,459

Top Importers of Thai Chip & Pellet in 2009

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

Million Tons

Tapioca Chip : China Import VS Thailand Export

China Import Thailand Export

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1.752.16

3.19 3.36

4.44

5.46

1.93

4.73

6.05

1.301.61

2.62 2.63

3.51 3.39

1.23

2.80

4.99

0

1

2

3

4

5

6

7Million Tons

Tapioca Chip : China Import VS Thailand Export

China import Thailand Export

Mealy Bug Outbreak in Thailand

• First found in 2007.

• The important outbreak was reported in Q1’09 covering 50,000 tapioca hectares.

• Repeated outbreak in 2010 extended rapidly and severely affected the crop productivity in large scale.

• The government program in 2010 failed to control the extended outbreak. Most chemical treatments have showed poor results.

• 2009/10 crop reduced to 22 million tons vs. 28 million tons originally forecasted.

Symptom of Tapioca infested by Mealy bugs

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• Anagyrus Lopezi was originated in South America and has been introduced/used to control Mealy bug successfully in Africa.

• Thailand Dept. of Agr. introduced the parasitic wasp from Benin for the test by the end of Sep 09.

• Rearing technique was studied in parallel.

• The test showed promising result and was first released on July 17, 2010 after the environment safety assessment was completed.

• It was proven the most effective control measure and the method is practical, sustainable and cost-effective.

• Currently the government agencies and the private sector are accelerating the massive rearing of wasp for release nationwide.

• It is optimistic that 2011/12 crop should be almost back to normal.

Mealy Bug Control Update

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0.1

0.2

0.3

0.4

0.5

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0.9

1.0

0

50

100

150

200

250

300

350

400

Million TonsUSD/MT.

Price & Volume Relationship Price : Chinese Corn vs. Thai Chip

China's Tapioca Chip Import Thai Tapioca Chip Export Price Chinese Local Corn Price

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10

20

30

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50

60

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80

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100

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150

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350

400

450

500

550

600

650Percent (USD./MT)

Price Relationship : Starch, Chip & Root

Starch (F.O.B.) Starch RMC Chip (F.O.B) Root Starch content in root

Estimated Balance Sheet of Root 2010/2011

Menu2009/2010 2010/2011

Root Equiv. Scenerio1 Scenerio2.

Supply 31.7 24.9 21.9

Production 22.0 21.0 18.0

Import 0.6 1.0 1.0

Carry-in 9.1 2.9 2.9 Demand 28.8 23.7 21.0

Starch 15.8 13.5 12.3 Chip & Pellet 11.3 8.5 7.0 Ethanol 1.7 1.7 1.7

Carry-out 2.9 1.2 0.9 Unit : Million Tons.