1. Food Bites Everyday Cheese Annual Market Quantification June 2011

2. 2010 Category Shares 2

3. Annual Growth Rates 3

4. Mozzarella replaces gouda at no. 2 4 Cheddar cheese remains the most important cheese type in terms of both value and volume, with a 39.1% contribution to the former in 2010. Gouda cheese lost significant volume and share in 2010, to lose its second place position and become the third most popular cheese type in South Africa after cheddar and mozzarella. Strategic decisions to focus on other business units by key players in this sector are the major contributing factor to volume losses seen in the gouda cheese market. Mozzarella cheese performed exceptionally well in 2010 with 11.0% growth seen in this market, reflecting the highest growth rate across all cheese types. Growth in this market is driven by the foodservices sector, which consumes close to half of mozzarella cheese produced. Soft cheese as well as other everyday cheese remain niche product offerings within this market with a combined contribution of 9.2%.

5. Mozzarella replaces gouda at no. 2 (Cont.) 5 There is a growing trend towards production of goat and sheep milk cheese particularly amongst the smaller regional cheeseries as consumers are becoming more aware of the inherent qualities of these non-cow milk based cheese. Cheddar cheese is by far the most popular cheese type across cow, sheep and goat milk cheese. The majority of players interviewed were optimistic about the future of everyday cheese, although smaller cheeseries cited that they were failing to compete against imported cheeses as these are priced more competitively than their handmade cheeses, given the weaker dollar. Fat free cheese; feta in particular; is gaining popularity as the healthy eating trend continues to expand. Closely tied to the health trend is the growing organic food trend which manufacturers mentioned as a key area of growth going forward. Some consumers are also interested in knowing if the animals providing milk are well cared for, and such endorsements on the product’s packaging are taking root in this market.

6. Food Bites Everyday Cheese For more information, contact: Jan Wegelin Research Manager Tel: (011) 615 7000 Mobile: 082 938 0744 www.bmi.co.za