SSC SEC Services Corp. (SECUF)

[Belek]

Fundamental Research Corp Updated coverage on Input Capital....

Week of January 5, 2015
Strong Start for Canola Exports to China

In a previous article, we had mentioned how strong canola demand from China would benefit the canola industry
and help canola pricing. In a recent trade mission to China, the agriculture minister signed a $1 billion dollar
agreement to export Canadian canola oil to China over the next 7 years. The Canadian Grain commission also
noted a significant increase in canola exports to China for the 2014/2015 growing season. There has also been a
push from the Canadian canola industry, to raise the awareness of canola in China with the Canadian Canola
Council introducing a Mandarin language information site. We feel the increasing demand from China will
benefit the Canola industry.

Canola is Canada’s number one agricultural export to China, valued at $2.83 billion in 2013 (Source: Canada
Canola Council). For the 2014-2015 harvest year, year to date exports to China are 1,389,000 tonnes, up 24.6%
over the 2013/2014 harvest year (Source: Grain Commission Canada). Last year, China accounted for 3.9
million of the 8.6 million canola tones exported (Source: Grain Commission Canada). Agri-Food Canada
estimates that canola exports for this year will be 9.2 million tonnes. China canola imports from Canada are
shown below

(not available)

We feel that the demand for canola from China will continue to help the canola industry. We feel in the longterm,
this will benefit Input Capital (TSX-V:INP) with our longer term estimate of canola at $475 per tonne.
Current prices for the Jan 15 futures market are currently trading at around $450 per tonne, up from $410 in
early December. We continue to maintain a positive long-term outlook on Input. As mentioned in our last
update, this quarter should produce record revenues for Input.

credit to FRC and
Daniel Iwata, BA, Dip. Fin. Mgmt.
Equity Research Associate
www.researchfrc.com