Developments in the American Cashew Market Phone: (973) Morris Turnpike Summit, NJ The Richard Franco Agency, Inc. Food Brokers

Growing American Market Stable market allows for planning and promotion Reasonable prices Adequate supply – buyers are able to get what they need However – Global economic uncertainty – America is only 20% – 25% of global market – More competitive prices on tree nuts 2

Reasonable & Stable Prices 3 Cashew remain attractively priced Volatility since 2012 has been at an all-time low* * Based on available data beginning in 1970

USD Advantage “ Exchange is taking a deep dive. Combined with serious issues about the economy, we expect 2016 to be a difficult year… [as currency will] mean a 15% increase on shelf prices” – Large European buyer “To be honest… our currency took a dive so it just made everything prohibitive.” - Large Australian buyer USD gains vs. Major currencies over 18 months Australian $ Euro Yuan Rupee

Cashews vs Other Tree Nuts 5 January 2015 January 2016 Cashew demand benefitted from a relatively low price point However, that is no longer the case

Lag Time 6 String Contract February 2015 Shipment Mar - Dec 2015 Into Warehouse May 2015 – Feb 2016 Roast & Salt July 2015 – April 2016 On Shelf at Retail August 2015 – May 2016 Purchased & Consumed September 2015 – June 2016

Confectionary Use Cheap cashew pieces drove strong growth in confectionary usage Demand is now falling off due to higher prices and cheaper substitutes 7

Food Safety Food Safety Modernization Act Need high quality 3 rd party audits Increased documentation requirements FDA concern over salmonella contamination 8 Requirements and expectations are only going to increase; processors that proactively make improvements will benefit

Conclusions American cashew market is growing but challenges and uncertainty remains Buyers remain cautious given the global economic environment Cashews are attractively priced but are no longer the cheapest nut Food safety is a major priority 9