SOUTH AUSTRALIANPOTATO INDUSTRY

2

• South Australia is located at the centre of Australia’s road, rail andair logistics networks; with time and cost advantages for air and seafreight transport to key Asian markets.

• South Australian labour costs are 9% below the Australian averageand below all mainland capital cities.

• South Australia is competitive in terms of property prices andconstruction costs for commercial and industrial properties.

• Adelaide, the capital of South Australia has been voted the 5th mostliveable city in the world making it an ideal location for attracting asustainable workforce.

• A Coordinator-General has recently been appointed to helpstimulate private sector investment for projects with a constructionvalue in excess of $3 million. A Case Manager is appointed for eachproject to help streamline and support the approval process.

Minerals & Energy

Agriculture Renewable Energy

Advanced Manufacturing Defence

Source: ABS 6302, EIU: A Summary of Liveability Ranking and Overview August 2012

ICT & Electronics Health

State populationAdelaide population

1.6 million1.2 million

THE STATE OF SOUTH AUSTRALIA

2

Key Location for Sustainable Business

Diverse Industry Base

3

PREMIUM FOOD & WINE FROM OUR CLEAN ENVIRONMENT

Agriculture is South Australia’s most significant industry worth over $17 billion annually, supplyingPremium Food & Wine to the world.

20% of Australia’s grain produce 7 million tonne average grain production per year with 80% exported to China, Asia and Middle East

62% of Australia’s wine exports Premium wine growing regions with exports to UK, North America and emerging markets in China and Asia

Premium livestock producer Beef, lamb, dairy, pigs, poultry, wool – exports to Japan, China, US, UK, Europe, other Asia

Australia’s premium seafoodTuna, rock lobster, abalone, prawns and kingfish from the

pristine Southern Ocean exporting to Japan, Hong Kong and other Asia.

Leading horticulture production Potatoes, tomatoes, capsicums, mushrooms, almonds, citrus–including world leading greenhouse and water technologies

Australia’s first commercial forestry 200,000 hectares of softwood and hardwood plantations –exports to Japan and others

World leading R&D and education University of Adelaide/Waite Institute, South Australian Research & Development Institute, Australian Wine Research Institute

4

THE SOUTH AUSTRALIAN ADVANTAGE

A Government Open for BusinessThe South Australian Government welcomes investment with its support for business including:

• Direct access to key government decision-makers.

• A dedicated investment team and renowned case management service to streamline investors’ establishment and approvals processes.

• A private sector Co-ordinator General has been appointed to help fast track investments over $3 million dollars in value by assisting proponents in navigating the states planning and development processes.

Low Cost Australian Business Location• Labour Costs – South Australia’s full time labour costs are 9% below the

Australian average and below all mainland capital cities. .

• Property Prices – Adelaide’s residential, commercial and industrial property prices are amongst the lowest of Australia’s mainland capital cities.

• Construction Price – Adelaide is competitive in terms of construction costs for the development of new multi-residential, commercial and industrial properties.

LiveabilityAdelaide has been ranked

• The 5th most liveable city in the world by the Economist Intelligence Unit.

• The most liveable city in Australia by the Property Council of Australia.

• The cheapest of the Australian mainland capital cities according to Mercer’s Cost of Living Survey.

• The safest city in Australia by Suncorp Bank’s Family Friendly City Index.

Major Events

Source: ABS 6416, AECOM: The Blue Book 2012, KPMG: Competitive Alternatives 2012, EIU: A Summary of Liveability Ranking and Overview August 2012, Property Council of Australia: Australian City Liveability Index 2011, Mercer: Worldwide Cost of Living Survey 2012, Suncorp Bank: Family Friendly City Report.

$1,200

$1,300

$1,400

$1,500

$1,600

$1,700

SA Vic. NSW QLD WA Aust.

Average Weekly Ordinary Time Earnings, Full Time Adults by State

5

POTATO INDUSTRY ADVANTAGE IN SOUTH AUSTRALIA

The South Australian Potato Industry offers a number of advantages

Fresh quality potatoes supplied year roundThe highest quality potatoes supplied fresh year round

Established processing industry Established potato (crisping and chipping) and food processing industry

Natural AdvantagesExceptional growing conditions and climate for potato production

Recognised food safety, research and developmentEstablished food safety, biosecurity and links to leading R&D

organisations

Source:

Australia’s largest potato producing StateSouth Australia is the largest potato producing State in Australia

Major production regionsFive regions in close proximity to the Adelaide market and processors

Source: Agricultural Commodities Australia 2012-13, PIRSA Scorecard 2013/146

SOUTH AUSTRALIA IS THE NATION’S LEADING POTATO PRODUCER

Australian potato production by state (2012-13)

0.00

2,000.00

4,000.00

6,000.00

8,000.00

10,000.00

SouthAustralia

Victoria Tasmania New SouthWales

Queensland WesternAustralia

Potato Area Planted 2012-13 (Hectares)

South Australia is Australia’s largest potato producing State. The Potato Industry adds morethan $443 million in food revenue to the State’s economy.

South Australia

29%

Tasmania27%

Victoria20%

Western Australia

6%

Queensland

9%

New South Wales

9%

Australia1,273 Kt

French Fry Processing120kt

Crisp Processing 40kt

Fresh Product220kt

South Australian potato usage (2013-14)

South Australian producers supply premium quality potatoes to the

fresh, French fry and crisping

sectors nationally and

internationally

South Australia produces 80% of Australia’s fresh

washed potatoes.

Source: Potatoes South Australia 7

SIGNIFICANT POTATO PRODUCTION REGIONS

Northern Adelaide Plans

The region is on the northern outskirts of Adelaide:

• 10% of the State’s potato production• Supplies crisping and fresh sectors• Principle production area for the fresh sector• Location of major fresh potato produces• Close proximity to major food retailers and markets• All year round supply of fresh potatoes• Supply for the crisping industry

Murraylands & Riverland / Mallee

The region follows the Murray River from Waikerie to the Murray Mouth and the Mallee:

• 45% of the State’s potato production• Supplies crisping and fresh sectors• Major production area for the fresh sector nationally• Premium seed production area• All year round supply of fresh potatoes• Supply for the crisping industry

Kangaroo Island

The region is an island south west of Adelaide:

• 1/3 of the State’s seed potato production• Quarantined seed production area• No commercial production permitted

South East Region

The region extends from Bordertown down to south of Mt Gambier:

• 44% of the State’s potato production• Supplies 14,000 tonnes to the crisping industry• Largest supplier to McCain Foods Ballarat, Victoria• Premium seed production area

Source: Potatoes South Australia8

YEAR ROUND FRESH POTATO SUPPLY ACROSS REGIONS

Realise the advantages of year round production and supply of fresh potatoes from SouthAustralian producers.

Establish in close proximity to producers:

Close proximity to potato producers offers advantages in logistics costs, cold store requirements/costs, field monitoring and establishing and maintaining close working relationships

Supply to French Fry industry:

The French Fry industry stores significant tonnes of product, normally harvested from mid-March until end-April when optimum tonnage and quality occurs. This storage is in bulk stores.

Supply to crisping industry:

The existing crisping industry enjoys access to fresh or ground-stored product for twelve months of the year. No shed storage is required.

Wide coverage of production areas:

South Australia has an extensive range of established potato production regions. Varying climate within each region allows for production over an extended period.

South Australia’s unique advantage to produce all

year round compared with the other States of Australia.

DISTRICT REGION DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV

Adelaide Hil lsWoodside, Mt Barker

Lake Alexandrina Langhorne Creek

Adelaide PlainsVirginia, Angle Vale

Lower South EastMt Gambier, Penola

Upper South East & Mallee

Pinnaroo, Lameroo, Bordertown

Port Pirie Port Pirie

Lower Murray Murray Bridge

Upper Murray Waikerie, Loxton

SUMMER AUTUMN WINTER SPRING

South Australia’s potato producing regions offer access to numerous natural advantages toproducers. These advantages promote production of high quality, high yielding potatoes in largevolumes.

South Australia’s has natural advantages in coverage, varieties, irrigation, environment.

Coverage

With a wide coverage of established production

across five main growing regions provides access to large tracts of fresh farming

land, wide producing windows and risk mitigation.

South Australian producers grow many potato varieties

for processing and fresh markets including leading

European and North American varieties.

Established irrigation network sourcing water from

sustainable underground aquifers linked to efficient on farm irrigation systems and water management

practices.

Varieties Irrigation

The South Australia potato regions have excellent

climatic conditions including suitable sandy soils, low

disease pressures.

Environment

NATURAL ADVANTAGES GENERATING PREMIUM QUALITY PRODUCE

Source: ABARES Agricultural Commodity Statistics9

ESTABLISHED POTATO PROCESSING INDUSTRY

10

Work with an established industry capable of meeting your short and long term producerequirements

Source: Potatoes SA

Established Potato Industry

Experienced, efficient and established producers focused on premium quality

Numerous producers meeting the needs of existing fresh, processing and seed sectors

Extensive range of fresh and processing varieties currently produced

Sophisticated variety improvement and propagation facilities

Accredited mini tuber facility (Solan Pty Ltd) providing premium, early stage generation plant material

The Smiths Snackfoods Company (Subsidiary PepsiCo Inc) has an existing crisping operation in Adelaide

Established supply chain in the South East of the State with producers supplying McCain Foods Ballarat operations

Some of the largest producers in the southern hemisphere

See

dP

rodu

ctio

nP

roce

ssin

g

ViCSPA seed certification

ESTABLISHED FOOD PROCESSING INDUSTRY

11

Operate from within an established food processing industry.

Source: PIRSA Scorecard 2013/14, South Australian Government economic priorities

South Australia’s Growing Finished Food Industry

4,200

4,700

5,200

5,700

6,200

2009/10 2010/11 2011/12 2012/13 2013/14

South Australian Finished Food Value ($M)

Horticulture24%

Field Crops18%Livestock

43%

Seafood8%

Dairy7%

Total$5.86 Billion

South Australian Finished Food Values 2013/14

The food and wine industry currently generates $17.1 billion in revenue, employs one in five working South Australians and accounts for over 40 per cent of the state’s merchandise exports.

Agriculture, forestry and fishing are the fastest growing segments in the South Australian economy.

Food and Wine an Economic Priority

Economic Priority 2:“Premium food and wine produced in our clean environment and exported to the world” – South Australian Government

Source: PIRSA12

SOUTH AUSTRALIA’S BIOSECURITY AND SAFETY ADVANTAGES

South Australia has established biosecurity, pest, pesticide and agricultural chemicals controlsensuring the State’s safe and healthy status remains an advantage.

Biosecurity SA aims to protect and improve

South Australian industry by

managing the risk of pest and

disease incursion.

Biosecurity SA plays a role in

maintaining food safety and supporting

responsible rural chemical use.

Biosecurity NetworkAustralia has a strong biosecurity network consisting ofBiosecurity Australia (Federal Government) who manage andfocus on point of import / export accreditation and BiosecuritySA (South Australian Government) who manage SouthAustralia’s biosecurity needs.

Together this network provides the frontline in protecting SouthAustralia’s horticultural industry.

Continued Vigilance to protect the potato industry from pest and diseases. Actions include• Biosecurity planning• Biosecurity programs• Prevention, detection and eradication measures• Regulatory arrangements• Trapping grids• Border controls• Community awareness

ViCSPAViCSPA is an independent provider of a leading range ofprofessional Seed Potato Certification and other services to theAustralian Potato Industry. It is the certification authority for SA,Victoria and Northern NSW seed potatoes.

http://www.vicspa.org.au/

ACCESS TO WORLD LEADING AGRICULTURAL RESEARCH & DEVELOPMENT CENTRES Our research delivers outcomes that have direct significance to agribusiness across the globe

SUPPORTED BY THE STATE’S LEADING UNIVERSITIES

13

RESEARCH AND DEVELOPMENT

WAITE RESEARCH INSTITUTESoil & Water SciencePlant ScienceWine ScienceFood & Human NutritionValue Chains

WAITE RESEARCH INSTITUTEFOODplus Research Centre

SOUTH AUSTRALIAN RESEARCH & DEVELOPMENT INSTITUTEAquatic SciencesInnovative Food & PlantsLivestock & Farming SystemsSustainable Systems

COMMONWEALTH SCIENTIFIC INDUSTRIAL RESEARCH ORGANISATIONFood & Nutritional SciencesPlant IndustryLand & Water

RESEARCH AND DEVELOPMENT

14

The South Australian Research and Development Institute (SARDI) delivers robust scientificsolutions to support sustainable and internationally competitive primary industries.

Potato Research and DevelopmentThe South Australian Research and Development Institute (SARDI), a division of Primary Industries and Regions SA, has expertise in a range of disciplines pertaining to the protection, production and postharvest handling of temperate fruit and vegetable crops.

World wide research relevant to potatoes includes:

• Horticultural pests, entomological projects and disease diagnosis;

• Horticulture pathology research on all aspects of disease management focusing on fungal pathogens. Previous research has investigated management options for seed and soil-borne diseases including:

• Bacterial breakdown in washed potatoes• Black dot• Potato early dying• Potato pink rot• Rhizoctonia• PCN

• SARDI has developed a new DNA-based test (called PreDicta Pt) that can quickly and accurately measure major soil-borne disease-causing agents. The diagnostic tests research into potato diseases was conducted under the Australian Potato Research Program (APRP 1&2: a 5 year collaboration with international research institutions).

Food InnovationBusinesses have access to SARDI’s food technology service to facilitate innovation and solve technical issues in: food processing; packaging innovation; food composition (chemical and microbiological evaluation and support) and new product development.

Relevant programs include

Food Innovation :

• New product development• Sensory and consumer acceptability evaluation• Process improvement• Packaging solution• Shelf life assessment• Lean manufacturing• Quality control

Microbiology and Molecular Biology Services:

• Shelf life testing• Chemical residue testing• Advice on testing protocols• Risk management practices

Risk Assessment Services:

• Risk assessment analysis covering microbial, chemical and physical hazards from production to consumption.

Food Statistical service

15

Industry Support

South Australian potato organisations and members actively support and develop the industry in South Australia. Foreign investment is welcomed as a key mechanism to support industry growth.

Key industry organisations:• Potatoes South Australia• Horticulture Coalition South

Australia• Horticulture Innovation

Australia (HIA)

State Government Support Low Costs Infrastructure

Adelaide and South Australia are at the centre of Australia’s air, road and rail transport links.

Strategic proximity to Asia supported with a number of ports, including Port Adelaide.

Food Safety Standards and Export Regulations

Food Safety Standards

South Australia is recognised internationally for the quality of food safety standards and processes, ensuring strong differentiation in international markets.

Producers and processors in South Australia adhere to the national guidelines under Food Standards Australia & New Zealand.

Export Regulations

Exporting licenses for horticultural products is provided for under the Horticulture Marketing and Research Development Services Act 2000. Permits for export are negotiated through the Federal Department of Agriculture and the importing country upon market access based on agreed phytosanitary protocols.

South Australia has a range of initiatives and advantages to support new investment into theState including low costs and existing infrastructure.

SUPPORT TO INVEST IN SOUTH AUSTRALIAN POTATOES

A Coordinator-General has recently been appointed to help stimulate private sector investment for projects with a construction value in excess of $3 million. A Case Manager is appointed for each project to help streamline and support the approvals processes.

State Government agencies involved include:• Primary Industries and

Regions South Australia• Department of State

Development

Ranked one of the lowest cost states in Australia for business and living.

Adelaide the 5th most liveable city in the world and Adelaide has the lowest cost of living of all capital cities.

Average wages are 9% below the Australian average and below all mainland capital cities.

CONTACT DETAILS

Investment Attraction AgencySouth AustraliaThe ConservatoryLevel 9, 131-139 Grenfell StreetAdelaide 5000South AustraliaT: +61 8 8303 2419E: investinsa@sa.gov.auwww.invest.sa.gov.au

Primary Industries and Regions South AustraliaGrenfell CentreLevel 14, 25 Grenfell StreetAdelaide 5000South AustraliaT: +61 8 8226 0900www.pir.sa.gov.au

Potatoes South Australia IncLevel 1, 145 South Terrace Adelaide SA 5000South AustraliaT: +61 8 7221 1962www.potatoessa.com.au

Published November 2015

The information contained in this presentation has been compiled by the Department for State Development (DSD) andPrimary Industries & Regions South Australia (PIRSA) and originates from a variety of sources. Although all reasonablecare has been taken in the preparation and compilation of the information, it has been provided in good faith for generalinformation only and does not purport to be professional advice. No warranty, express or implied, is given as to thecompleteness, correctness, accuracy, reliability or currency of the materials. Facts, illustrations and information shouldnot be relied upon and readers should seek their own professional advice and due diligence prior to making anyinvestment decision.

DSD, PIRSA and the Crown in the right of the State of South Australia does not accept responsibility for and will not beheld liable to any recipient of the information for any loss or damage however caused (including negligence) which maybe directly or indirectly suffered as a consequence of use of these materials. DSD and PIRSA reserves the right toupdate, amend or supplement the information from time to time at its discretion.

This document has been prepared with the assistance of Potatoes South Australia.

Brad KaranicolouInvestment Attraction AgencyFood and AgribusinessTelephone +61 8 8303 2182Email: brad.karanicolou@invest.sa.gov.au

Hamish GordonHorticulture Account ManagerAgriculture, Food and WinePrimary Industries and Regions SATelephone +61 8 8429 0441Email: hamish.gordon@sa.gov.au

Robbie DavisChief Executive OfficerPotatoes South Australia IncTelephone +61 8 7221 1962Email: robbiedavis@potatoessa.com.au

AGINSIGHT – SOUTH AUSTRALIAAgInsight South Australia is an interactive website that gives users comprehensive agricultural and economic data. The system will help local and international investors identify business opportunities and commodity options in South Australia.http://www.aginsight.sa.gov.au/