Global Dairy Overview & Outlook April 3, 2012

2 Hoogwegt Groep BV Founded in 1965, based in Arnhem, The Netherlands International marketers of dairy ingredients & commodities Largest private dairy trading company with global network of 13 distinct business units

3 Worldwide network Hoogwegt International Hoogwegt Milk Havero Hoogwegt Hoogwegt Cheese Apollo Milk Rumi Rumi Algeria Hoogwegt Poland Hoogwegt U.S., Inc. Good Home Foods LLC Hoogwegt Purchases Hoogwegt Australia Pacific Dairy Ingredients

4 A True Global View Hoogwegt - A True Global View Active in all major producing and consuming markets Export to over 110 countries worldwide Network provides Hoogwegt with critical market access and market information Rich history of trading skills and volatility management

5 Outline International trade landscape Implications for U.S. dairy industry U.S. is at a crossroads

6 Milk Production Sources: EuroStat, USDA, DCANZ, DairyAustralia, Argentine Secretary of Agriculture, GTIS. EU and Argentina are milk deliveries.

7 Milk Production – Major Exporters Source: EuroStat, USDA, DCANZ, DairyAustralia, Argentine Secretary of Agriculture. EU and Argentina are milk deliveries.

8 Dairy Product Production – Major Exporters Source: USDA

9 Dairy Product Production – Major Exporters Source: USDA

10 Dairy Product Production – Major Exporters Source: USDA

11 Whole Milk Powder Exports Source: GTIS

12 Whole Milk Powder Imports Source: GTIS; Algeria and Venezuela extrapolated from partial-year numbers.

13 Skim Milk Powder Exports Source: GTIS

14 Skim Milk Powder Imports Source: GTIS. Algeria extrapolated from 11-month numbers.

15 Cheese Exports Source: GTIS

16 Cheese Imports Source: GTIS

17 Butterfat Exports Source: GTIS

18 Butterfat Imports Source: GTIS. Iran data unavailable for

19 Whey Products Exports Source: GTIS

20 Whey Products Imports Source: GTIS; Indonesia extrapolated from partial-year numbers.

21 Aggregate Imports Includes WMP, SMP, cheese, butterfat and whey products. Source: GTIS. Algeria extrapolated from 11-month numbers.

22 Aggregate Imports Includes WMP, SMP, cheese and butterfat. Source: FAPRI. SE Asia includes Indonesia, Malaysia, Philippines, Thailand and Vietnam. ME/NA includes Algeria, Egypt and Saudi Arabia.

23 Benchmark Prices Source: USDA’s “Dairy Market News.” WMP, SMP, cheese and butter are Oceania. Whey is EU.

24 Benchmark Prices Source: USDA’s “Dairy Market News.” WMP, SMP, cheese and butter are Oceania. Whey is EU.

25 Global Marketplace: Current Situation

26 Implications for the United States Source: USDA, USDA’s “Dairy Market News.”

27 Volatility

28 In truth, it’s tough playing in the global market

29 Why is U.S. behind EU and Oceania in the global market? Export vs. customer? Policy – support & CCC? Federal order pricing – discourages investment? Large internal market – exportable volumes? Last in, first out

30 Opportunities Source: U.S. Dairy Export Council/National Milk Producers Federation

31 Need international customers if we want to grow

32 Fast-food chain growth In emerging markets Non-U.S. stores (2010) Change from 2009 McDonald’s18, KFC11, Subway10,109+1,067 Pizza Hut5, Starbucks5, Burger King4, Domino’s4, Dunkin’ Donuts3, Dairy Queen

33 Conclusions … we are at a crossroads

34 Embrace and Adapt …

35 Change…

36 Policy must promote innovation, investment and growth

37 Thank you. Global Dairy Overview and Outlook Dairy Policy Annual Conference Dalyn Dye President and CEO, Hoogwegt U.S., Inc. April 3, 2012