Slide1: Skretting North America Tribal Fisheries Meeting Olympia WA 9th November 2006 Dr. Chris Beattie Product Manager


Outline: Outline Skretting update Main markets Raw material trends Bio-Oregon range Questions


Skretting Worldwide: Skretting Worldwide Skretting is the world leader in the production and supply of feed for salmon and trout, meeting 40% of global demand and having approximately 1300 employees. Total annual production is over 1 million tonnes


Skretting Research & Development: Skretting Research & Development Research activities centrally controlled through Skretting Aquaculture Research Centre. Vital resource for knowledge base & fish nutrition trials All Skretting formulations audited by ARC scientists to ensure compliance to formulation standards. Maintains links with local research institutes around the world Coordinates extensive RM and feed testing program


Slide5: North America– East & West Coast Services highly consolidated salmon grower market Specialty US & Canadian enhancement market Services highly consolidated salmon grower market Plant closed for two months each Spring (low sea temps.)


Slide6: Commercial Salmon Market Vancouver Island Atlantic & Chinook Fast growth / low FCR Harvest Quality Highly consolidated Starter to 12mm Harvest ca. 5kg Highly automated


Slide7: West Coast Enhancement Market Requires developed logistics Markets AK,WA,OR,ID,MT,CA Huge area (1.2M square miles) Multiple Species Diverse needs Technically demanding Complex market


Slide8: Marine Species US developing offshore farming Small number of candidate species Increasing interest in Cobia Central American region Fast growth rate – 10 months to harvest Yellowtail & flounder in Mexico Aquaculture is growing fast across the world and this obviously has effects in the feed supply business….. Moi - Polydactylus sexfilis Amberjack - Seriola rivoliana


Estimates of global aquafeed production according to two sources: Estimates of global aquafeed production according to two sources Tacon, 2004


Estimated proportion of fishmeal destined for use in different sectors for 2002 and 2012: Estimated proportion of fishmeal destined for use in different sectors for 2002 and 2012 2002 6.2 million tonnes 2012 6.0 million tonnes Pike, 2005


Estimated proportion of fish oil destined for use in different sectors for 2002 and 2012: Estimated proportion of fish oil destined for use in different sectors for 2002 and 2012 2002 0.98 million tonnes 2012 1.1 million tonnes Pike, 2005


Annual global production of fishmeal and oil not increasing over 10-year period: Annual global production of fishmeal and oil not increasing over 10-year period 10 year average = 6.4 million tons 10 year average = 1.2 million tons


Slide13: Fish meal price trend 1995 to 2006 year to date. Prices way above last El Nino level in 1998


Slide14: Raw material – checklist Price is acceptable  Security of supply  Low contaminant level  Good fatty acid profile  Good amino acid profile  Low saturates  Good processing profile  Is it sustainable ? What about by-catch ?


Slide15: Raw material testing Amino acid profile Pesticides Antibiotic residue PCBs BHA Myco-toxins Dioxins Minerals Ethoxyquin Heavy metals (As, Cd,Hg,Pb) Fatty acid profile T.V.N Peroxide


Changing Times: Changing Times Highly consolidated commercial markets Extreme pressure on marine raw materials Environmental pressures on formulation Legislative pressures on contamination Increased burden of analytical testing


Changing times……: Changing times…… Moore-Clark Merger 1969


Slide18: A Brief History of Skretting……..


Slide19: Sometimes change is good !


Slide20: Skretting acquired Bio-Oregon product line in July 2006 Maintained 4 main diet lines – discontinued moist line BioVita, BioDry 3000, BioDiet Grower, BioDry 1000LP Well received in markets New customers & additional business New products for the Skretting line (BioDiet Grower & 1000LP) Skretting & Bio-Oregon


Slide21: Increased workload for plant increase # diets Reduction in plant efficiency More complex packaging requirements Similar diets with similar profiles Customer confusion over diet choice Confusing product literature Needed to review and optimize product range Every action has a reaction


Slide22: Planning the new range “Skretting views Bio-Oregon acquisition as part of a continuing evolution of our business in the U.S.A. In acquiring the name and product line of Bio-Oregon, Skretting is reaffirming its commitment to provide the most efficient products and services to our fisheries enhancement customers in the Pacific Northwest & Alaska.” Enhancement – led Meeting the diverse needs of the enhancement market Rationalized - clear differences between products Bringing the best of Skretting and Bio-Oregon together in one range Clear choice between conservative & replacement diets Highly palatable & suitable for a range of species All backed up by Skretting logistics and Global R&D


Slide23: Lifestage Diets for Fish®


Slide24: Lifestage Diets for Fish® Highly palatable More prime fishmeal in starters New 2.5mm sizing - smoother pellet transition Clear choice between conservative (BioVita), replacement (BioClarks) and performance (Bio-Olympic) New semi-moist diet New low phosphorus diet Plus the best of Skretting specialty feeds Transfer diets & Vitalis


Slide26: Clear labeling - if it’s in the feed it’s on the label Pdt#: A2960 Lot#: 32188 Pdn Date: Oct 31, 2006 BioVita Starter #1 COMPLETE FEED FOR SALMON & TROUT GUARANTEED ANALYSIS Crude Protein (min) 52% Crude Fiber (max) 1.0% Crude Fat (min) 20% Phosphorus (min) 1.7% INGREDIENTS:Fish Meal, Wheat Flour, Fish Oil, Krill Meal, Gelatin, Brewer’s Yeast, Betaine, Astaxanthin, Ethoxyquin (Antioxidant), Vitamin/Mineral Premix Containing Vitamin A, Vitamin D3, Ascorbyl Polyphosphate (C), Vitamin E, Inositol, Zinc Sulphate, Nicotinic Acid, Calcium D Pantothenate, Manganese Sulphate, Riboflavin, Pyridoxine Hydrochloride (B6), Thiamine Mononitrate, Vitamin K, Copper Sulphate, Folic Acid, Calcium Iodate, D-Biotin, Sodium Selenite and Vitamin B12. Manufactured for: Bio-Oregon 1935 NW Warrenton Drive, Warrenton OR 97146 800-962-2001 Phone 503-861-3701 Fax Net Wt. 20kg / 44lb Product name & size Production date Proximate composition Ingredients in descending order Lot #


Slide27: Starter Feeds


Slide28: BioVita Starter A Premium Starter Feed for enhancement hatcheries Loaded with natural palatability enhancers for excellent first feeding Prime fish meals and all fish oil formula for excellent growth High levels of vitamins, beta-glucans and nucleotides for healthy fish BioVita is equivalent to Nutra Plus Starter


Slide29: BioClark’s Starter A Sustainable Starter Feed for Enhancement Applications Replacement technology allows price stability and RM sustainability Natural palatability enhancers are included to stimulate feeding High levels of vitamins, beta-glucans and nucleotides for healthy fish BioClark’s Starter is equivalent to Apollo Starter


Slide30: Fry Feeds


Slide31: BioVita Fry A Premium Fry Feed for Enhancement Operations All fish meal / fish oil formulation Natural palatability enhancers are included to stimulate feeding High levels of vitamins, beta-glucans and nucleotides for healthy fish BioVita Fry is equivalent to BioVita pellets


Slide32: Bio-Olympic Fry Rapid growth based on Nutritional Excellence Advanced formulation delivers outstanding growth rates Palatability enhancers ensure active feeding High quality fishmeal and fish oil content promoting rapid growth Bio-Olympic is equivalent to Nutra Fry


Slide33: BioClark’s Fry A Sustainable Fry Feed for Enhancement Applications Select use of alternative raw materials provides improved raw material and price stability Natural palatability enhancers promote feed intake and growth Prime fish meal and fish oil increase digestibility and minimize water quality impact BioClark’s Fry is equivalent to: Clark’s Fry, Bio-Dry 3000 & Apollo Fry


Slide34: BioTrout High Performance Feed for Trout and Steelhead High energy for excellent growth rates Amino-balanced for better protein utilization Select use of alternative raw materials provides improved raw material and price stability BioTrout is equivalent to: Orient


Slide35: Specialty Feeds


Slide36: BioDiet Grower Soft texture and palatability enhancers promote feeding Highly stable moist product which does not require freezing High quality fishmeal and fish oil content promoting growth BioDiet Grower is new to Skretting A Second-Generation Semi-Moist Enhancement Diet


Slide37: BioDry 1000LP Low phos. (<1%) diet for hatcheries with tight effluent restrictions Higher moisture (12%) soft textured pellet Stabilized and requires no refrigerated transport or storage BioDry 1000LP is new to Skretting An Advanced Low-Phosphorus Diet for Salmon & Trout


Slide38: BioTransfer Palatability enhancers ensure active feeding Added dietary salt stimulates seawater osmoregulation Betaine aids osmoregulatory development and reduces mortality Beta-glucans and enhanced vitamin levels counteract stress Extra nucleotides provide building blocks for rapid growth BioTransfer is equivalent to Nutra Transfer Best Possible Preparation for a Life in Seawater


Slide39: Vitalis SA The benefits deriving from the use of a specially formulated broodstock feed include: Healthier broodstock, Improved fecundity High egg quality and survival Improved survival Better initial performance of first-feeders once established onto feed. For Optimum Salmon Brood Health, Egg and Fry Quality Vitalis Trout Low Fat Trout Brood Feed for Optimal Egg and Fry Quality Brood Feeds


Slide40: Strategies – Starter & Fry Traditional Performance Economy / Sustainability BioVita Starter >>>>>BioVita Fry BioVita Starter >>>>>Bio-Olympic BioClarks Starter >>>>>BioClark’s Fry


Slide41: Strategies – Specialty Soft feed & Controlled growth Low Pollution Preparation for Transfer BioDiet Grower BioDry1000LP BioTransfer


New Warehouse Facility – Longview Washington: New Warehouse Facility – Longview Washington


New Warehouse Facility – Longview Washington: New Warehouse Facility – Longview Washington Ideal location for feed pick-up US Strategic feed store (2000t+) Logistic & order flexibility Medicated feed inventory Dedicated Bio-Oregon inside sales line


Slide45: Acknowledged the importance of the enhancement business Listened to our customers needs (e.g. importance of first-feeding success) Made specific changes to our diets to fulfill these needs Put together a clearly defined and clearly labeled range to avoid customer confusion Ensured that we continue to fulfill the needs of the enhancement industry. Summary: In the designing the new Bio-Oregon range we have All backed by Skretting’s R&D, manufacturing skills, logistics and sales support


Slide46: Thanks