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Market Developments Domestic crude sunoil prices went up from $1,655 to $1,800 in the last 4 weeks partly due to short stocks but largely because of running out of 0% import duty licences. The demand has been very strong and most foreign traders found it difficult to understand why the domestic price went up so much at a time when sun complex was so weak. Currently, crude sunoil is trading around $1,800-1,810 ex-works with strong demand. Licence trade has come to an end in the last few weeks giving rise to %27 import duty in sunseeds gradually becoming effective. The last few weeks saw import crude sunoil calculating versus imported sunseeds, a rare situation mainly due to narrowing price differential between sunseed and crude sunoil. The top graph on the right shows the development of domestic crude sunoil price versus import crude price, between the last day of 2010 and today. The bottom graph on the right shows the development of CIF Marmara sunseeds price for the same period. The blue vertical line through the charts marks the date of issuance of 0% duty licences under the government tariff quota for 650,000 tons of sunseeds. Graph below shows development of domestic crude sunoil price in the last 5 months.

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As the duty free imports under government’s tariff quota will expire on 30th June, Turkey has already contracted all of its 650,000 tons of sunseeds. All of this will have arrived before the expiry of the tariff quotas. However, we predict Turkey will buy a minimum of a further 200,000 tons of sunseeds or equivalent (85,000 tons) of crude sunoil before the Turkish harvest goes into full swing. This year Turkish sunflower harvest will be delayed by at least 3 weeks.

Sunflower Crop The sowings of sunflowers was disrupted with constant rains during the month of May. In the south, big acreage shift took place towards cotton, with very good revenue last year, hence decreasing the sunflower plantings. This season we expect a much lower sunfower production in Çukurova region. In Thrace region, wheat took acreage from sunflower, again with good revenue last year. We expect total Turkish total sunflowerseed production this season to be stagnant at around 900,000 tons, if not lower.

Industry Consumer demand remained moderate but retail demand has been very strong in the last 4 weeks with hurried activity on the distributor side, in view of with rapidly rising domestic prices. Domestic refined edible oil market recovered with higher demand with several refiners increasing their wholesale prices. In front of the Ramadan, which will begin on 1st August, the months of June and July are the stock building period for the fats & oils chain, from the industry to the retail outlets. Overall, domestic crude sunoil consumption increased sharply in the last 4 weeks at around 75 to 80,000 tonnes/month rate, due to growing of the share of sunflower oil amongst liquid oils and apparent empty pipeline stocks of refiners and distributors.

Corn oil demand in Turkey is sharply down this season with higher price differential with sunoil landed cost. Market share lost by corn oil rapidly gained by sunflower oil where rapeoil sales diminished on supermarket shelves due to high cost and lack of availability. In the last 4-5 weeks, crude corn oil prices on CIF Turkey basis surged to $1,700/mt largely due to availability problems in the U.S.. China seems to be the only supplier of crude degummed and fully refined corn oil but demand from Turkey is weak with Tunisia (Libya) being the largest taker. There has been no concrete development on the GMO issue with corn, DDGs and some soybean imports still suffering.

2010-11 season saw a big shift to sunflower oil due to several factors. Lack of cottonseeds limited cotton oil usage in the south, GMO issue stopped illegal soybean oil commingling by mom-and-pop local bottlers and price issues limited the use of corn/rapeoil as liquid. Turkish domestic sunflower oil usage grew to around 900,000 tons a year, some 90% of the total domestic liquid oil consumption.

Refined sunoil exports to the Middle East died down lately with slowing of demand from Iraq.

International Market Developments

Russia The Russian government will decide within days whether the ban on grain exports is to be lifted July 1, Deputy Prime Minister Viktor Zubkov said with the Russia 24 television channel. Zubkov said there was "a large degree of probability" that the embargo would be lifted. He said the expected 85 million-90 million metric tons harvest this year and the remaining 17 million tons of grain from last year's harvest ensured there was sufficient amount of grain in the country, which made the export embargo unnecessary. Zubkov also said winter crops wintered well and were in good condition, and spring crops planting was also going well, faster than last year. Russia banned grain exports last summer after the worst drought in more than a century slashed the harvest by around a third, to 63 million metric tons. However, speculation has been building that the government may soon lift the embargo due to falling internal prices and hopes for a 90-million-ton harvest this year. Russian domestic grain prices continued to stabilize last week, reversing an earlier long-term trend of falling prices, according to data from the SovEcon agricultural markets analysis body. SovEcon attributes the stabilization to increasing demand from grain traders, who are accumulating wheat in the expectation that the government will soon lift the export ban.

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China Some South China areas is meeting the most serious draught since 1951, and no rain forcast in near future. Rice and rapeseed oil price started to be firm since last weekend. South China is main production area for rice and rapeseed, harvest for rapeseed mainly in Jun. Rapeseed 2011 crop output is estimated to be below 9 million tons, verusu 2010 crop of more than 11 million tons.

Ukraine The government has cancelled the grain export quotas, Agrarian Policy and Food Minister Mykola Prysiazhniuk has announced. According to him, grain exports should increase following the adoption of this document. The government has earlier prolonged the quotas for export of grain crops by Jul 1, 2011. The World Bank sharply criticized the government for prolongation of grain export, saying that the prolongation of quotas for export of grain is negative for foreign investors.

CME Group announced May 26 at Gafta annual meeting in Kiev, Ukraine, that it has signed separate agreements, one with the government of Ukraine and the National Bank of Ukraine and another with the commodities exchange Ukrainian Futures Exchange, to look for opportunities to further develop the financial and derivatives market in Ukraine for grain and non-agricultural products. In addition, the use of the electronic trading platform CME Globex will be explored. "These agreements with the government of Ukraine, its central bank and the UFE represents an important step by CME Group to establish its presence in Eastern Europe," said Leo Melamed, CME Group chairman emeritus, who led the Ukraine project. "Through these agreements, we will further extend CME Group's reach into the European marketplace and build on our position as the leading provider of commodity risk management tools," said CME Group Managing Director Agricultural Commodities Tim Andriesen. "As the world's demand for agricultural markets continues to grow, Ukraine plays a key role in grain production with nearly 30 million hectares of arable land. Through these agreements we hope to leverage our technology and expertise to better understand and help evaluate the financial risks in the region resulting from weather disruption, supply and demand changes and monetary policy decisions." Exchange is an important step for the economic development of region. Within the framework of the project, the CME Globex trading platform will provide the global access to manage risk in our important commodity markets. Now we are facing consistent and diligent work on our part, but the agreement with CME Group, the liquidity of their instruments and their technology leadership is exciting for the future development of this project," said Leonid Kozachenko, president of the Ukrainian Futures Exchange.

IGC Production of wheat in 2011-12 was forecast at 667 million tonnes in data issued May 26 by the International Grains Council. The forecast was down 5 million from its April 20 projections but would still be up 2.8% from 2010-11. Ending stocks of wheat in 2012 were projected at 185 million tonnes, down 1 million tonnes from the April forecast and down 1 million tonnes from the 2011 carryover. “The forecast of carryover stocks in the eight major exporters is unchanged from last month,” the IGC said. “Those in the U.S. are expected to decline, but stay at a comfortable level, while recoveries in inventories are projected in the E.U. and Russia.”

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Price Quotations (US$/TL 1.59) Price quotations as of Friday, 27th May 2011 are as follows: AgriPro Limited

Import: - Sunseeds (44 bss) - CIF Marmara - $ 675 - Rapeseeds (42 bss) - CIF Marmara - $ 735 - New Crop Rapeseeds (42 bss) - CIF Marmara - $ 705

- US Soybeans - CIF TR - $ 564 - S. America Soybeans - CIF TR - $ 548

- RBD Palm Oil - CIF TR $ 1,270 - RBD Palm Olein - CIF TR $ 1,280 - RBD Palm Stearin - CIF TR $ 1,190

- Black Sea origin Crude Sunoil - CIF Marmara/Mersin - $ 1.390/$ 1.400 - Argentina origin Crude Sunoil - CIF Mersin - $ 1.385 - S. America Crude Degummed Soyoil - CIF TR - $ 1.375 - USA Crude Degummed Corn Oil - CIF TR $ 1,700 - China origin Crude Degummed Corn Oil – CIF TR$ 1,640

- Black Sea 36 protein Sunmeal - CIF TR - $ 245

Domestic: - Crude Sunoil - ex-works Thrace - $1,800 - Crude Rape Oil - ex-works Aegean/Çukurova - $ 1,675 - Crude Soyoil - ex-works Aegean/Çukurova - $ 1,450 - Crude Corn Oil - ex-works - Southern Marmara - 3,075 TL - Semi-refined Cotton Oil - ex-works Çukurova - 2,550 TL - Crude Hazelnut Oil - ex-works Afyon - 2,750 TL

- 28 protein Sunmeal - ex-works Thrace/Agean/Çukurova - 340 TL/360 TL/380 TL

- Rapemeal - ex-works Thrace/Agean/Çukurova - $ 360 - Soya Küspesi - ex-works Agean/Çukurova - $ 530 - Cottonmeal - ex-works Çukurova - 485 TL

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