abalone markets Laura Mattiazzi NAB Agribusiness April 2015 - PowerPoint PPT Presentation

Future Economic health of our major abalone markets Laura Mattiazzi NAB Agribusiness April 2015

Overview 1.Asia Desk Introduction 2.World abalone supply 3.Our observations of the world abalone markets: • China • Japan • Singapore • Hong Kong 4. Future challenges 2 2

NAB Agribusiness – Asia Desk Roger Gaudion Our mandate Head of PMO & Asia Desk Our strategy is to grow the T: 0427 709 408| E: Roger.Gaudion@nab.com.au business, through supporting our Roger’s responsibilities are twofold: Oversight with PMO of larger customers with outbound trade corporate agribusiness exposures along with driving the “Australia in Asia” flows (exports ) and capturing & strategy with the Asia Desk. monetising inbound investment Roger has extensive experience in the banking industry, having performed flows of an agribusiness nature front line and leadership roles across NAB Business, Corporate Banking and Credit; and in the last 9 years senior roles within NAB Agribusiness. “Agri Asia Desk” builds on the leading market share (30.5% ) and Laura Mattiazzi positioning in the market place – Senior Agribusiness Manager, Asia Desk “right bankers, right places” . We T: 0477 734 802 | E: Laura.h.mattiazzi@nab.com.au are well placed to capture and Laura joined the Agri team 18 months ago after having spent 14 years in grow our Asia related business NAB Business. By utilising solid commercial banking experience along with given our local market presence fluent Mandarin and Cantonese language skills, Laura has assisted the Agri team in expanding its service offerings to promote trade and inbound Enterprise (Internal ) collaboration investments into Agri sector. is a central pillar of our success both domestically and in Asia for Mike Mosel NAB. Senior Agribusiness Manager, Asia Desk Growing our market share T: 0457 518 382| E: Mike.mosel@nab.com.au through new business Before joining Agribusiness, Mike led a team of business bankers and a opportunities, & supporting portfolio of corporate banking clients in Darwin. His career at NAB covered a range of roles in Risk Management and Business Banking. Mike was born existing customers is enhanced in Australia but raised in Indonesia so he speaks fluent Indonesian. He is through developing and leveraging currently completing the Asialink Leaders program through the University key external influencers ,that have of Melbourne. an alignment to Asia region 3 3

NAB is Dedicated to Australian Agriculture • More than 154 years agribusiness experience • Banking 1 in every 4 Australian agribusinesses • Market Leading Share: 30.5% by total lending volumes 1 • Over 600 Agribusiness Bankers , financial planners and product specialists • Across 110 regional Australian locations • Dedicated Corporate Agribusiness teams in Brisbane, Sydney & Melbourne NAB Agribusiness Branch Location 1 APRA/NAB Market Analysis Sept 2013 4 4

NAB Agribusiness – Global Connectivity NAB Agribusiness has global reach through NAB Group’s network operating in 10 countries across 4 continents, serving 8 million banking customers & 140,000 agricultural customers Glasgow Beijing Tokyo & Osaka Shanghai Hong Kong Mumbai Singapore Jakarta 5 5

World abalone supply *All figures below are in metric tons Note. Adapted from Cook, (2014), [PDF document], Retrieved from http://dx.doi.org/10.4236/me.2014.513110  Farm grown abalone 14 times the amount of wild caught  China accounted for 87.5% of the world’s total farm abalone production last year  Increased production in China to meet demand  Greater availability of illegally abalone products also floods supply  Against expectations, Chinese farm production has not increased in the current trend 6 6

China  China’s demand for high -quality Country snapshot  World’s second largest agriculture and food products is economy growing rapidly. It predicted that China  Australia’s largest trading will account for 43 per cent of global partner, total trade 151bil growth in agricultural demand by 2050   Under the ChAFTA, the 10-14% tariff on 32.6kg per capita seafood consumption per year abalone will be eliminated within 4  “New norm” for the years  China’s seafood imports from NZ future of stable moderate GDP growth, around 7% quadrupled (to $338 million) since the year on year China-NZ FTA   Korea is now pushing hard for abalone Rising middle class with a distinctive consumer sales in China  Australia is recognised by local trend  Economic shift towards consumers as having a clean and green domestically driven environment with good quality consumption products and brands 7 7

Japan Country snapshot  Japan is world famous for its  World’s third largest fish-eating culture, although economy younger generation showing  Australia’s second largest preference for fast food trading partner, total trade  Japanese government 71bil eliminated all tariffs on  53.7 kg per capita seafood abalone last year consumption per year  Australia enjoys a  Currently facing economic competitive advantage in troubles, GDP growth rate supplying fresh, raw seafood target 1.5% to Japan  Quantitative easing in place,  Demand for Australian wild addition QE likely abalone stable, farmed may see continued growth 8 8

Singapore Country snapshot  8 th highest GDP per capita in the world  Australia’s fifth largest trading partner, total trade 27bil  22 kg per capita seafood consumption per year  Highly dependent on imports with strong demand for seafood  Over 10% year on year increase for seafood imports in 2011  Note. Adapted from Hoshino, (2013), [PDF document], Retrieved from Significant increase of www.aares.org.au/aares/documents/2013AC/Presentations/Hoshino.pdf consumption in frozen seafood in recent years 9 9

Hong Kong Country snapshot  Biggest exporter target for wild Australian abalone  71 kg per capita seafood consumption per year  Sustainable seafood is becoming more popular  Hong Kong was the second largest export market for Australian fish and crustaceans and largest for prepared or preserved seafood Note. Adapted from Hoshino, (2013), [PDF document], Retrieved from www.aares.org.au/aares/documents/2013AC/Presentations/Hoshino.pdf 10 10

Future Challenges  Increasing price competition from China and Chile for farmed abalone  Illegal fishing of abalone endangers future supply and depresses current prices with excess supply  Korean live abalone is becoming increasingly competitive due to good quality and survivability from shorter distance boat travel  Low product and customer diversification leads to low adaptability to survive in difficult market conditions like the recent GFC  Overall global abalone demand dipped, unlikely to increase again until Chinese and Japanese economics improve  Asian economic trends will significantly affect demand and prices, but the trends are difficult to accurately predict  Fisheries exploited/over-fished 11 11

Contact for Asia Desk Agribusiness, NAB Laura Mattiazzi ( 刘天惠 ) Senior Agribusiness Manager, Asia Desk National Australia Bank Address: Level 28, 500 Bourke Street, Melbourne Phone number: +61 477 734 802