2 Source: USDA, Eurostat EU imports 44% of its gas from Russia Russia and Ukraine account for 28% of global wheat export Ukraine accounts for 17% of global corn export Russia exports account for 8% of the global oil supply Russia and Ukraine are significant players in the in the world trade of gas, oil, wheat, and corn EU imports almost half of its gas from Russia Source: Eurostat 3 43.9% 19.9% Russia 5.0% Norway 11.9% United Kingdom 5.5% Algeria United States 13.8% Others EU imports of natural gas Share of trade in value (2020) 2011 2020 121,738 152,649 +25.4% In recent years, the EU has increased its imports of gas from Russia Imports of gas from Russia accounted for 44% in 2020 - latest published figures. For now, gas flows freely, but uncertainty about future deliveries has increased gas prices by up to 800% Change in EU imports of natural gas from Russia Million cubic metres Russia and Ukraine account for a significant amount of the world grain export Russia and Ukraine holds 28% of world export of wheat Ukraine holds 17% of world export of corn – Russia only 2.3 % EU is a net exporter of wheat , but import a substantial volume of corn 50-100 ships are ready to be loaded with grain, oil seed, and soya from harbors in the Black Sea . However, the harbors are closed with the employees being home, on the run, or at war The trade with grain has stopped as the buyer and seller are too far with nobody knowing what the price should be. In the short and medium long run, we must be prepared for very high prices (+50 DKK per 100 kg. for grain) Source: USDA 4 18.0% EU Argentina Russia 11.5% Canada 7.2% USA Ukraine 16.8% 15.6% 10.8% 7.0% 0.7% Brazil 12.5% Australia Others Russia 2.5% EU 17.2% Ukraine 2.3% 21.5% 31.5% USA Argentina 16.4% 8.5% Brazil Others Estimated world wheat export 21/22 Estimated world corn export 21/22 The crisis has led to sharply increasing agricultural commodity prices Call for action 5 Wheat prices CBOT TTF Gas prices Corn prices CBOT Fertilizers and nitrogen compounds European Union is self-sufficient in wheat but a net importer of corn and prices are expected to increase Wheat and Corn (1.000 t) Call for action 6 Wheat Corn 123.124 138.799 126.930 138.900 106.300 107.250 104.750 107.650 2018/19 2019/20 2020/21 2021/22 +16.824 +31.549 +22.180 +31.250 Production Consuption 64.351 66.742 67.092 69.960 85.000 79.000 77.600 79.900 2020/21 2018/19 2019/20 2021/22 -20.649 -12.258 -10.508 -9.940 Production Consuption • EU is self sufficient in wheat production • But prices will be expected to increase significantly • EU is a net Importer of Corn ( ≈ 10 mil. Ton) • On corn we can expect even higher price pressure in the European market 8 9 10 11 12 13 14 15 16 The German pig quotation has increased significantly in the last 4 weeks and has passed the Danish quotation 7 October 2017 FY 17/18 Pig Quote correction 2*,DKK/kg Covid-19, EU lock-down October 2021 FY 21/22 ASF Germany 10.02 10.25 9.90 Week 9, 2022 -0.35 Week 9, 2021 10.56 9.88 11.11 Week 9, 2020 14.67 13.99 15.63 *19/20 & 20/21 Applying 1,35 DKK/kg as level of supplementary payment October 2019 FY 19/20 DK EU DE October 2018 FY 18/19 October 2020 FY 20/21 Week 9, 2019 10.09 9.95 10.21 (Week 8) Week 9, 2019 10.63 10.16 11.07 4,00 9,00 14,00 19,00 24,00 29,00 34,00 39,00 The US quotation has passed the Chinese, and both are far ahead of the EU quotation 8 January 2018 Pig Quote, DKK/kg Covid-19, EU lock-down ASF Germany 13.84 13.95 10.02 Week 8, 2022 -0.11 January 2020 CN EU US January 2019 January 2021 Week 8, 2020 13.61 7.56 37.0 January 2022 Week 8, 2021 10.31 10.01 28.2 Week 8, 2019 10.03 6.93 12.5 Week 8, 2018 10.33 8.36 13.42 Prices on pork well below cost of production 9 10 11 12 13 14 Call for action 9 Owners, cost of production Danish Crown Pig Quote, correction 2 Q1 2021/22 DKK pr kg Q2 Q3 Q4 Q1 2020/21 Source: Danish Crown and Danish Agricultural Council We need to push our sales prices up Call for action 10 Farmers / livestock Transport Production Transport Transport Retailer Consumer Energy prices Feed costs Fertilizer prices Energy prices Packaging materials 1. We need to push our sales prices up... 2. ... so that retailers push up their prices towards the consumers 3.. So we can pay a better price to our owners From a low but stable price level to an unpredictable bull market Call for action 11 5 10 15 20 Denmark The Netherlands Germany France Spain 16,87 14,17 Jul- 23 Jul- 22 Apr- 22 16,04 Feb- 23 European prices on a steep journey, March 2021 DKK/kg US futures (Lean hog quotaton) DKK/kg Q4 Q3 Q2 Q1 High economic growth, rising inflation and a long period of declining pig production. High prices on futures until the summer of 2023 Longer period with prices significantly below break- even cost. We expect lower production and increasing imports in 2022 Turbulence based on ASF and fluctuating production are to be expected Increasing production in the first quarters of 2021. In many countries production has been declining for the last 2 quarters of 2021. An accelerated declining production is expected in the coming month. This will stimulate the market with price increases in addition to the usual seasonal increases. Q1 Global food prices are rising - but meat is lagging behind Call for action 12 113 145 111 60 80 100 120 140 160 2020 Dairy 2017 Food Price Index 2022 2019 2018 2021 Meat Cereals Sugar 141 Source: FAO Priceindex Priceindex: 2014-2016=100