International Consulting Opportunities Interest in the Agriculture Space Gary Thien AFM, ARA Thien Farm Management, Inc. 101 East Graham Ave. Council Bluffs, Iowa 51503

2 Thesis of Investment Community Amount of Arable Land per person continues to decline each year Population growth continues to increase food demand Urbanization and family income levels –Creates more protein demand –More protein demand means increased feed usage for livestock

3 The Investors Sovereign Wealth Hedge Fund Companies Public and Private Pension Funds Family Offices

4 Investment Strategies Spreading Risks –Weather –Political –Currency Types of Markets -Developed Countries United States Canada Australia –Developing Countries Brazil Argentina Eastern Europe –Frontier Countries FSU (Former Soviet Union) Africa

5 Land or Operation Land Play -- Own and Lease to Others –Expect Lower Returns without Operational Risk Operational Play -- Own and Operate –Expect Higher Returns with more Risk Mix of Land and Operational Agriculture Infrastructure –Processing –Rail –Storage

6 Decision Making on Agricultural Assets How much to invest - % of total portfolio in ag. How much risk to take - How to spread or mitigate the risk Investment horizon Exit Strategies

7 Investment Offices Large Staffs of investment analysts Responsible for other people’s money Global Knowledge Extensive Financial Models Issues Investment Committee turn-around time –Exclusivity may be granted –When working with farm sellers-time is of the essence

8 Scope of Investments Generally substantial investments in terms of money –$10 to $100 mm into a land fund or single asset –5,000 to 200,000 hectares Sole Investor Partner Investor – Stack in the Existing Operation Targeting Specific Enterprises

9 Challenges in Global Investment Land is a limited Resource Management is an extremely limited Resource Expats Logistics Political and Currency Risks Commodity Markets Multiple and integrated enterprises

10 Investor Needs Appraisal –US and Globally Management –US and Globally Direct Management Employee Searches Financial Accounting Consulting –US and Globally Reviewing “pitch” material

11 Investor Needs-Agriculture Specific Understanding –Soils –Weather –Crops to be grown –Yields –Fertility and Chemical needs –Direct and Indirect Costs –Machinery inventory and capabilities –Storage –Employees and capabilities –Systems and controls –Capital Improvement needs –Organic and outside growth –Budgeting

12 Hazards of International Work Language Barrier Working in foreign currencies & weights/meas. Logistics Time Visas

13 …. Utilize a minimum and no till crop production system

14 …Modern and efficient grain storage and conditioning

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16 …Modern Seeding Equipment

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25 Questions? What is the current attitude for agricultural investment?