SALES COMMUNIQUÉ UNPASTEURIZED SYRUP - July 2018 Date of sale: July 9, 2018 Terms for release of maple syrup from inventory from the current ...

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CONTINUER À LIRE
S A L E S C O M M U N I Q U É UN PASTEURIZED SYRUP
                                           J u l y 20 18

                                             Date of sale:
                                             July 9, 2018

                              Terms for release of maple syrup from inventory
                                         from the current harvest,
held by the Fédération des producteurs acéricoles du Québec [Federation of Quebec Maple Syrup Producers]
CONTENTS

1   BACKGROUND .................................................................................................................................... 3
2   OBJECTIVES ....................................................................................................................................... 3
3   TERMS FOR RELEASE OF MAPLE SYRUP FROM INVENTORY ................................................................... 3
      3.1         Tier 1 regular lot, unpasteurized, 2018 harvest ..................................................................................................5
      3.2         Tier 2 regular lot, unpasteurized, 2018 harvest ..................................................................................................6
      3.3         Tier 3 organic lot, unpasteurized, 2018 harvest .................................................................................................7
      3.4         Tier 4 organic lot, unpasteurized, 2018 harvest .................................................................................................8
      3.5         Tier 5 regular lot, unpasteurized VR1 & VR4, 2018 harvest ................................................................................9
      3.6         Special terms and conditions ...........................................................................................................................10
4   ACCESS AND DELIVERY POLICY ......................................................................................................... 11
      4.1         Background .....................................................................................................................................................11
      4.2         Terms of sale ..................................................................................................................................................11
      4.3         Barrels ............................................................................................................................................................12
      4.4         Quality audit, related costs and contributions to the CIE ...................................................................................13
      4.5         Syrup eligibility conditions ...............................................................................................................................14
      4.6         Payment conditions and maple syrup delivery..................................................................................................14
5   ADDITIONAL INFORMATION ............................................................................................................... 15
1          BACKGROUND

In accordance with the provisions of article 10.03 of the Convention de mise en marché du sirop d’érable pour les années de
commercialisation 2017 et 2018 [Marketing Agreement for Maple Syrup for the 2017 and 2018 Marketing Years] (the “Agreement”)
approved by the Régie des marchés agricoles et alimentaires du Québec [Board for Agricultural and Food Markets of Quebec] (the
“RMAAQ”), and having previously obtained the approval of the Conseil de l’industrie de l’érable (CIE) [Maple Industry Council], the
Federation is releasing maple syrup from its inventory subject to special conditions of sale.

This special sales communiqué explains the special terms of sale (price and conditions) for maple syrup from the Federation’s
inventory. In accordance with the provisions of article 10 of the Agreement approved and negotiated by the RMAAQ, the Federation
must announce the sales price of the maple syrup in its inventory during the marketing year, which includes the syrup for the
present year.

2          OBJECTIVES

The Federation's objectives that determined the conditions set out in this sales communiqué can be summarized as follows:
    1. Offer unpasteurized maple syrup from the current harvest year at competitive prices;
    2. Build loyalty among authorized buyers who help grow sales of Quebec maple syrup.

3          TERMS FOR RELEASE OF MAPLE SYRUP FROM INVENTORY

For the period from July 9 to September 30, 2018, the Federation is selling certain amounts of unpasteurized maple syrup from
the 2018 harvest according to the lots described briefly in the following table:

 Sales Communiqué – July 2018                                                                                       Page 3 of 16
Colour Classes             Types of Defect           Pounds
                                                                                                  VR1 and VR5 and           Volume
 #                              Lot Type                        GO       AM        DA      VD
                                                                                                    VR4       PG           Available
 1    Unpasteurized regular lot – 2018 harvest                 10 %      47 %     27 %     4%      12 %       0%           2,100,000
 2    Unpasteurized regular lot – 2018 harvest                 16 %      42 %     25 %     5%       12 %        0%         3,200,000
 3    Unpasteurized organic lot – 2018 harvest                  0%       0%       65 %     0%       35 %        0%           500,000
 4    Unpasteurized organic lot – 2018 harvest                 13 %      40 %      9%      0%       38 %        0%           800,000
 5    Unpasteurized VR1 & VR4 lot – 2018 harvest                0%       0%        0%      0%        0%       100 %          400,000

Applicable "Agreement" growth discount
For all lots offered in this communiqué, a growth discount of $0.10/pound applies in accordance with the terms of Article 4.01 d) of
the 2017-2018 Marketing Agreement for Maple Syrup. According to the article, this discount will be granted to the authorized buyer
and applied on the portion (maximum 10% in volume) of syrup purchased in 2018 that exceeds their purchases of the previous year
(2017). This price reduction will be applied by the Federation at the end of the marketing year, February 28, 2019. This discount is
only available to authorized buyers who have a minimum-purchase history of three (3) years with the Sales Agency.

Special payment terms available
For eligible authorized buyers, the payment terms for volumes purchased in the 1st round will be similar to yearly syrup payment
plus a handling and storage fee of $0.08 per pound.

For detailed terms, please refer to section 4 of this sales communiqué.

 Sales Communiqué – July 2018                                                                                         Page 4 of 16
3.1               Tier 1 regular lot, unpasteurized, 2018 harvest

The volume available for this lot is 2,100,000 lb.

No regrading is allowed for this lot.

The maple syrup is available in a lot of 11 barrels or more (about 6,700 pounds).

                                                                                           Grille 1 Lot régulier non-pasteurisé #1 - récolte 2018
                                                                                                                            Frais de
                                                                            Prix de la       Frais de       Contributions                   Prix de
                                         Pondération Transmission                      1                2          3
                                                                                                                            mise en                                            Prix de vente approximatif pondéré 7
               Catégorie                                                      grille       classement           CIE                   4
                                                                                                                                             vente
                                            du lot   de la lumière                                                          marché
                                                                                                             $CAN/livre                                $CAN/livre $CAN/gallon imp. $CAN/gallons US                 $CAN/litre       $CAN / baril 8
DO - Doré, goût délicat                      10%           75% à 100%     2,9500              0,0075            0,0050       0,0800         3,0425
AM - Ambré, goût riche                       47%          50% à 74,9 %    2,9400              0,0075            0,0050       0,0800         3,0325
FO - Foncé, goût robuste                     27%          25 % à 49,9 %   2,8500              0,0075            0,0050       0,0800         2,9425          2,9485               39,07                 32,54              8,59            1 253
TF - Très foncé, goût prononcé                4%           0% à 24,9 %    2,5500              0,0075            0,0050       0,0800         2,6425
Défauts VR1-VR4                              12%           0% à 100 % Selon catégorie         0,0075            0,0050       0,0800         2,6600
                                             100%                                                                                                                         Tous les prix sont F.O.B. (Ex Works) - entrepôt de Laurierville (Québec)
1
    Prix de base du sirop servant à établir le paiement aux producteurs
2
    Frais de classement et de vérification de la qualité. Représente la moitié des frais totaux, l'autre partie étant payés par les producteurs
3
    Contributions payable au Conseil de l'industrie de l'érable (CIE) qui représente les acheteurs autorisés de sirop d'érable en vrac au Québec
4
    Frais incluant les coûts de manutention, d'entreposage de 0,08$/ lb au 1er tour et de 0,14$/lb au 2e tour
5
    Le crédit s'établit à 0,10$ pour les défauts de type VR1 et 0,15$ pour les défauts de type VR4
7
    Le prix de vente moyen est approximatif. Il varie selon la répartition réelle des catégories de sirop du lot vendu ainsi que la répartition des sirops avec défauts de saveurs (VR1 et VR4).
    Pour les fins de calcul, nous avons assumé que la totalité des sirop avec défauts de saveur étaient répartis également dans les catégories C - ambré et D - foncé avec 50 % de défauts de type VR1 et 50 % de défaut de type VR4
8
    Le prix de vente par barils est basé sur un baril contenant 425 lb de sirop.

For other terms and conditions of sale related to the purchase of inventory syrup, please refer to section 4 of this sales
communiqué.

    Sales Communiqué – July 2018                                                                                                                                                                                         Page 5 of 16
3.2               Tier 2 regular lot, unpasteurized, 2018 harvest

The volume available for this lot is 3,200,000 lb.

No regrading is allowed for this lot.

The maple syrup is available in a lot of 11 barrels or more (about 6,700 pounds).

                                                                                           Grille 2 Lot régulier non-pasteurisé #2 - récolte 2018
                                                                                                                            Frais de
                                                                            Prix de la       Frais de       Contributions                   Prix de
                                         Pondération Transmission                      1                2          3
                                                                                                                            mise en                                            Prix de vente approximatif pondéré 7
               Catégorie                                                      grille       classement           CIE                   4
                                                                                                                                             vente
                                            du lot   de la lumière                                                          marché
                                                                                                             $CAN/livre                                $CAN/livre $CAN/gallon imp. $CAN/gallons US                 $CAN/litre       $CAN / baril 8
DO - Doré, goût délicat                      16%           75% à 100%     2,9500              0,0075            0,0050       0,0800         3,0425
AM - Ambré, goût riche                       42%          50% à 74,9 %    2,9400              0,0075            0,0050       0,0800         3,0325
FO - Foncé, goût robuste                     25%          25 % à 49,9 %   2,8500              0,0075            0,0050       0,0800         2,9425          2,9493               39,08                 32,55              8,60            1 253
TF - Très foncé, goût prononcé                5%           0% à 24,9 %    2,5500              0,0075            0,0050       0,0800         2,6425
Défauts VR1-VR4                              12%           0% à 100 % Selon catégorie         0,0075            0,0050       0,0800         2,6600
                                             100%                                                                                                                         Tous les prix sont F.O.B. (Ex Works) - entrepôt de Laurierville (Québec)
1
    Prix de base du sirop servant à établir le paiement aux producteurs
2
    Frais de classement et de vérification de la qualité. Représente la moitié des frais totaux, l'autre partie étant payés par les producteurs
3
    Contributions payable au Conseil de l'industrie de l'érable (CIE) qui représente les acheteurs autorisés de sirop d'érable en vrac au Québec
4
    Frais incluant les coûts de manutention, d'entreposage de 0,08$/ lb au 1er tour et de 0,14$/lb au 2e tour
5
    Le crédit s'établit à 0,10$ pour les défauts de type VR1 et 0,15$ pour les défauts de type VR4
7
    Le prix de vente moyen est approximatif. Il varie selon la répartition réelle des catégories de sirop du lot vendu ainsi que la répartition des sirops avec défauts de saveurs (VR1 et VR4).
    Pour les fins de calcul, nous avons assumé que la totalité des sirop avec défauts de saveur étaient répartis également dans les catégories C - ambré et D - foncé avec 50 % de défauts de type VR1 et 50 % de défaut de type VR4
8
    Le prix de vente par barils est basé sur un baril contenant 425 lb de sirop.

For other terms and conditions of sale related to the purchase of inventory syrup, please refer to section 4 of this sales
communiqué.

    Sales Communiqué – July 2018                                                                                                                                                                                         Page 6 of 16
3.3                Tier 3 organic lot, unpasteurized, 2018 harvest

The volume available for this lot is 500,000 lb.

No regrading is allowed for this lot.

The maple syrup is available in a lot of 11 barrels or more (about 6,700 pounds).

                                                                                           Grille 3 Lot biologique non-pasteurisé #1 - récolte 2018
                                                                                                                               Frais de
                                                                            Prix de la          Frais de       Contributions                  Prime          Prix de
                                        Pondération Transmission                       1                   2          3
                                                                                                                               mise en                                                         Prix de vente approximatif pondéré 7
               Catégorie                                                      grille          classement           CIE                      biologique        vente
                                           du lot   de la lumière                                                              marché4
                                                                                                                      $CAN/livre                                         $CAN/livre $CAN/gallon imp. $CAN/gallons US $CAN/litre $CAN / baril 8
DO - Doré, goût délicat                      0%          75% à 100%      2,9500                  0,0075            0,0050      0,0800             0,1800      3,2225
AM - Ambré, goût riche                       0%         50% à 74,9 %     2,9400                  0,0075            0,0050      0,0800             0,1800      3,2125
FO - Foncé, goût robuste                    65%         25 % à 49,9 %    2,8500                  0,0075            0,0050      0,0800             0,1800      3,1225          3,0219               40,04                 33,35          8,81            1 284
TF - Très foncé, goût prononcé               0%          0% à 24,9 %     2,5500                  0,0075            0,0050      0,0800             0,1800      2,8225
Défauts VR1-VR4                             35%          0% à 100 % Selon catégorie              0,0075            0,0050      0,0800             0,1800      2,8350
                                            100%                                                                                                                                  Tous les prix sont F.O.B. (Ex Works) - entrepôt de Laurierville (Québec)
1
    Prix de base du sirop servant à établir le paiement aux producteurs
2
    Frais de classement et de vérification de la qualité. Représente la moitié des frais totaux, l'autre partie étant payés par les producteurs
3
    Contributions payable au Conseil de l'industrie de l'érable (CIE) qui représente les acheteurs autorisés de sirop d'érable en vrac au Québec
4
    Frais incluant les coûts de manutention, d'entreposage de 0,08$/ lb au 1er tour et de 0,14$/lb au 2e tour
5
    Le crédit s'établit à 0,10$ pour les défauts de type VR1 et 0,15$ pour les défauts de type VR4
7
    Le prix de vente moyen est approximatif. Il varie selon la répartition réelle des catégories de sirop du lot vendu ainsi que la répartition des sirops avec défauts de saveurs (VR1 et VR4).
    Pour les fins de calcul, nous avons assumé que la totalité des sirop avec défauts de saveur étaient répartis également dans les catégories FO - foncé et TF - très foncé avec 50 % de défauts de type VR1 et 50 % de défaut de type VR4
8
    Le prix de vente par barils est basé sur un baril contenant 425 lb de sirop.

For other terms and conditions of sale related to the purchase of inventory syrup, please refer to section 4 of this sales
communiqué.

    Sales Communiqué – July 2018                                                                                                                                                                                                 Page 7 of 16
3.4               Tier 4 organic lot, unpasteurized, 2018 harvest

The volume available for this lot is 800,000 lb.

No regrading is allowed for this lot.

The maple syrup is available in a lot of 11 barrels or more (about 6,700 pounds).

                                                                                          Grille 4 Lot biologique non-pasteurisé #2 - récolte 2018
                                                                                                                              Frais de
                                                                           Prix de la          Frais de       Contributions                  Prime           Prix de
                                        Pondération Transmission                      1                   2          3
                                                                                                                              mise en                                                          Prix de vente approximatif pondéré 7
               Catégorie                                                     grille          classement           CIE                  4
                                                                                                                                           biologique         vente
                                           du lot   de la lumière                                                             marché
                                                                                                                     $CAN/livre                                          $CAN/livre $CAN/gallon imp. $CAN/gallons US $CAN/litre $CAN / baril 8
DO - Doré, goût délicat                      13%         75% à 100%      2,9500                0,0075             0,0050      0,0800              0,1800     3,2225
AM - Ambré, goût riche                       40%        50% à 74,9 %     2,9400                0,0075             0,0050      0,0800              0,1800     3,2125
FO - Foncé, goût robuste                      9%        25 % à 49,9 %    2,8500                0,0075             0,0050      0,0800              0,1800     3,1225          3,0441                40,33                 33,60          8,87            1 294
TF - Très foncé, goût prononcé                0%         0% à 24,9 %     2,5500                0,0075             0,0050      0,0800              0,1800     2,8225
Défauts VR1-VR4                              38%         0% à 100 % Selon catégorie            0,0075             0,0050      0,0800              0,1800     2,8350
                                             99%                                                                                                                                  Tous les prix sont F.O.B. (Ex Works) - entrepôt de Laurierville (Québec)
1
    Prix de base du sirop servant à établir le paiement aux producteurs
2
    Frais de classement et de vérification de la qualité. Représente la moitié des frais totaux, l'autre partie étant payés par les producteurs
3
    Contributions payable au Conseil de l'industrie de l'érable (CIE) qui représente les acheteurs autorisés de sirop d'érable en vrac au Québec
4
    Frais incluant les coûts de manutention, d'entreposage de 0,08$/ lb au 1er tour et de 0,14$/lb au 2e tour
5
    Le crédit s'établit à 0,10$ pour les défauts de type VR1 et 0,15$ pour les défauts de type VR4
7
    Le prix de vente moyen est approximatif. Il varie selon la répartition réelle des catégories de sirop du lot vendu ainsi que la répartition des sirops avec défauts de saveurs (VR1 et VR4).
    Pour les fins de calcul, nous avons assumé que la totalité des sirop avec défauts de saveur étaient répartis également dans les catégories FO - foncé et TF - très foncé avec 50 % de défauts de type VR1 et 50 % de défaut de type VR4
8
    Le prix de vente par barils est basé sur un baril contenant 425 lb de sirop.

For other terms and conditions of sale related to the purchase of inventory syrup, please refer to section 4 of this sales
communiqué.

    Sales Communiqué – July 2018                                                                                                                                                                                                 Page 8 of 16
3.5               Tier 5 regular lot, unpasteurized VR1 & VR4, 2018 harvest

The volume available for this lot is 400,000 lb.

No regrading is allowed for this lot.

The maple syrup is available in a lot of 11 barrels or more (about 6,700 pounds).
                                                                                           Grille 5 Lot VR1&VR4 non-pasteurisé - récolte 2018
                                                                                                                            Frais de
                                                                            Prix de la      Frais de       Contributions                    Prix de
                                         Pondération Transmission                      1               2          3
                                                                                                                            mise en                                            Prix de vente approximatif pondéré 7
               Catégorie                                                      grille       classement          CIE                    4
                                                                                                                                             vente
                                            du lot   de la lumière                                                          marché
                                                                                                            $CAN/livre                                 $CAN/livre $CAN/gallon imp. $CAN/gallons US                 $CAN/litre       $CAN / baril 8
DO - Doré, goût délicat                       0%           75% à 100%     2,9500             0,0075            0,0050        0,0800         3,0425
AM - Ambré, goût riche                        0%          50% à 74,9 %    2,9400             0,0075            0,0050        0,0800         3,0325
FO - Foncé, goût robuste                      0%          25 % à 49,9 %   2,8500             0,0075            0,0050        0,0800         2,9425          2,6600               35,25                 29,36              7,75            1 131
TF - Très foncé, goût prononcé                0%           0% à 24,9 %    2,5500             0,0075            0,0050        0,0800         2,6425
Défauts VR1-VR4                              100%          0% à 100 % Selon catégorie        0,0075            0,0050        0,0800         2,6600
                                             100%                                                                                                                         Tous les prix sont F.O.B. (Ex Works) - entrepôt de Laurierville (Québec)
1
    Prix de base du sirop servant à établir le paiement aux producteurs
2
    Frais de classement et de vérification de la qualité. Représente la moitié des frais totaux, l'autre partie étant payés par les producteurs
3
    Contributions payable au Conseil de l'industrie de l'érable (CIE) qui représente les acheteurs autorisés de sirop d'érable en vrac au Québec
4
    Frais incluant les coûts de manutention, d'entreposage de 0,08$/ lb au 1er tour et de 0,14$/lb au 2e tour
5
    Le crédit s'établit à 0,10$ pour les défauts de type VR1 et 0,15$ pour les défauts de type VR4
7
    Le prix de vente moyen est approximatif. Il varie selon la répartition réelle des catégories de sirop du lot vendu ainsi que la répartition des sirops avec défauts de saveurs (VR1 et VR4).
    Pour les fins de calcul, nous avons assumé que la totalité des sirop avec défauts de saveur étaient répartis également dans les catégories C - ambré et D - foncé avec 50 % de défauts de type VR1 et 50 % de défaut de type VR4
8
    Le prix de vente par barils est basé sur un baril contenant 425 lb de sirop.

    Sales Communiqué – July 2018                                                                                                                                                                                         Page 9 of 16
3.6        Special terms and conditions

       Buyers must take possession of unpasteurized barrels before September 30, 2018;

       Once your possession dates are set and have been communicated to the Sales Agency, it is important to respect the dates
        you have committed to because preparing the quantities ordered requires considerable time and logistics.

       The lots available mirror the current grading. They include syrups with BRIX levels that are sometimes below 66.0 degrees.
        As per the Agreement, the price of these barrels will be reduced according to the conditions set out in Article 9.12. If you
        only want syrup with a density of 66.0 BRIX and over, please inform us and we will adjust the lots appropriately. Here is the
        breakdown:
            o Between 65.0 and 65.9: 9% of regular lots and 2% of organic lots
            o BRIX lower than 65.0: 2% of regular lots

       Sometimes the barrels we receive from producers are not completely full. For this reason, some of your order may contain
        barrels that are not full. However, to preserve syrup quality as much as possible, we will never include barrels that are less
        than 80% of the weight of a full barrel.

       Given the high volume of barrel returns that needs to be managed in a very short time span at our warehouses (Laurierville
        and Plessisville), we strongly urge you to return unwashed barrels to the locations where you took possession of the syrup.
        We can wash them for you for a fee of $5.49 a barrel. We believe proceeding in this way will accelerate the return of empty
        barrels.

       Barrels should be returned according to the following schedule:
            o 30% of barrels must be returned on November 1, 2018.
            o A further 50% must be returned on December 1, 2018 (cumulative total of 80%).
            o The remaining 20% must be returned on January 15, 2019 (cumulative total of 100%).

 Sales Communiqué – July 2018                                                                                            Page 10 of 16
4          ACCESS AND DELIVERY POLICY

The conditions stated in this communiqué will apply until November 30, 2018, inclusive.

4.1        Background

Please note that data concerning the inventory of maple syrup received and retained by the Federation may vary daily based on
syrup receipts for the current marketing year and confirmed purchase orders received.

A certain number of lots, including a list of specific barrel numbers, is assigned to the buyer when the purchase offer is signed. It is
expressly understood that, following regrading of syrup from different lots, some maple syrup of one grade may be regraded to a
superior or inferior grade, so that the percentages of maple syrup for grades within a given lot may vary. The Federation does not
assume any responsibility in this regard. The lot will then be sold according to its actual composition.

The Federation does not guarantee any order whatsoever beyond the specifically announced inventories or quantities.

Maple syrup for the current marketing year may be pasteurized or unpasteurized depending on availability.

Depending on availability, the maple syrup will be located in the Federation’s warehouses in Laurierville and Saint-Antoine-de-Tilly,
or in the Citadelle warehouses.

4.2        Terms of sale

Maple syrup will be available according to the following terms:

 Sales Communiqué – July 2018                                                                                           Page 11 of 16
First round
First, any authorized buyer, provided that they comply with the provisions of the Agreement, has from July 9, 2018 to 5:00 p.m. on
July 19, 2018, to offer to purchase, through a firm, irrevocable and unconditional offer, maple syrup from the inventory by email to
the following address: fpaq.acheteurs@upa.qc.ca or by fax to the following number: 450-679-1827.

As specified in article 10.01 d) of the Agreement, in cases where authorized buyers’ purchase offers for a grade of maple syrup from
the Federation's inventory are greater than the amount of syrup actually available in that grade, the syrup is distributed and sold
among all the authorized buyers who requested the purchase in proportion to the average volume of syrup purchased by each
buyer over the last three years, up to the quantity each requested to purchase.

Second round
Next, once the first round is complete, i.e. starting July 20, 2018, the Federation will sell the balance of the syrups offered during the
first round until September 30, 2018, to any buyer, whether authorized or not. Any such buyer, provided they honour the provisions
of the Agreement, may acquire lots from the Inventory, by submitting a firm, irrevocable and unconditional offer.

Nonetheless, in compliance with the provisions of article 10 of the Agreement, no unauthorized buyer may acquire a total greater
than 500,000 pounds of syrup, all grades combined, or a total greater than 1 million pounds if an authorized buyer. During the
second round, maple syrup will be sold on a "first come, first served" basis.

"Agreement" growth discount
For all lots offered in this communiqué, a growth discount of $0.10/pound applies in accordance with the terms of Article 4.01 d) of
the 2017-2018 Marketing Agreement for Maple Syrup. According to the article, this discount will be granted to the authorized buyer
and applied on the portion (maximum 10% in volume) of syrup purchased in 2018 that exceeds their purchases of the previous year
(2017). This price reduction will be applied by the Federation at the end of the marketing year, February 28, 2019. This discount is
only available to authorized buyers who have a minimum-purchase history of three (3) years with the Sales Agency.

4.3        Barrels

Pasteurized syrup will be contained in 45.76-gallon single-use food-grade barrels. For pasteurized syrup purchases, the prices set
out in this communiqué include full ownership of the barrels. These are single-use barrels and buyers must ensure that they will not

 Sales Communiqué – July 2018                                                                                            Page 12 of 16
at any time be reused to contain maple products again. To ensure this, when they dispose of these barrels, buyers must take the
necessary steps to alter these containers so that they can never again become reusable. By way of example, holes may be made in
the bottoms of these barrels, or they may be destroyed by a metal recycler, with evidence to prove it. Any buyer who does not
comply with this provision will be required to pay a fine of $50 per barrel if these barrels are rediscovered on the market.

The provisions of the Agreement apply to unpasteurized maple syrup barrels for the 2018 marketing year, if applicable. For
unpasteurized syrup purchases, the buyer must pay the Federation a refundable deposit of $150 per barrel, when taking receipt of a
maple syrup delivery, to cover the new replacement value of the barrels in case of breakage or heavy damage making them
unusable, with evidence to prove it. The deposit will be made through a wireless transfer deposited in the Federation's account or by
delivery of an irrevocable letter of credit to the Federation, valid until March 31, 2019, to the Federation's satisfaction.

The buyer must return these barrels to the warehouse from which they came, at the buyer's expense and in the state in which they
were received, no later than January 15, 2019, and these barrels must be clean and properly steam-washed according to good
professional practices. For any barrel that is not returned within the time frame and for any barrel seriously damaged by the buyer,
the buyer must pay the Federation the current replacement cost for a new barrel of the same kind and dimensions. The buyer must
also pay the Federation the current costs for any barrel not properly washed.

4.4        Quality audit, related costs and contributions to the CIE

Fees related to the initial quality audit of the syrup ($0.0075/pound), conducted by a specialized company, will be added to the
agreed upon price in order to defray the costs of this audit.

Contributions to the Conseil de l’industrie de l’érable (CIE), according to the “Règlement sur la contribution des acheteurs du produit
visé par le Plan conjoint des producteurs acéricoles du Québec au Conseil de l’industrie de l’érable”, currently corresponding to
$0.005/pound, will be added to the agreed upon price.

Finally, if the buyer so wishes, the Federation will undertake an additional quality audit of pasteurized maple syrup (not applicable
to this current communiqué). In this case, an additional fee of $0.0075/pound will be added to the agreed upon price. If no
additional audit is requested, the buyer must sign the "Resolution for the purchase of unpasteurized and pasteurized maple syrup

 Sales Communiqué – July 2018                                                                                          Page 13 of 16
for which there is no order for regrading," a copy of which is attached to this communiqué upon signing a maple syrup purchasing
agreement.

4.5        Syrup eligibility conditions

All buyers must comply with the provisions of the Agreement to take advantage of these terms. In addition, all buyers must sign a
maple syrup purchasing agreement to the Federation's satisfaction.

Maple syrup is available for any buyer who wants it with the exception of the following buyers:
a)     buyers who are currently under investigation by the Federation for non-compliance with applicable regulations and the
       Agreement;
b)     buyers who the Federation has reasonable grounds to believe are not complying with applicable regulations and the
       Agreement.

4.6        Payment conditions and maple syrup delivery

For maple syrup volumes bought in the first round, authorized buyers who have provided a letter of guarantee or joint guarantee in
their authorization request are eligible for similar payment terms to yearly syrup payment. Administratively, the Federation will regard
any unpasteurized syrup bought as a transfer between the relevant FPAQ warehouse and that of the authorized buyer. The syrup
will therefore be considered on consignment, with applicable fees.
Once the syrup has been transferred, the buyer must choose the barrels they wish to buy, a minimum of 30% of barrels
transferred, and these barrels will be invoiced by the Federation and are payable on the 15th day of the following month.
Transferred unpurchased barrels will remain on consignment and are payable upon use.

Any barrels still on consignment on October 15, 2018, must be bought and paid for in 25% increments or greater on November 15,
2018, December 15, 2018, January 15, 2019. and the remaining amount on February 15, 2019, if applicable. Note that the minimum
purchase volume (30%) of transferred barrels is in addition to the minimum purchase volume of the monthly grades, if applicable.

 Sales Communiqué – July 2018                                                                                           Page 14 of 16
The price of the maple syrup and costs related to the quality audit must be paid through a bank wire transfer into the Federation's
account before the buyer takes possession of the product. The buyer must guarantee reimbursement to the Federation of any
customs costs related to completing the purchasing transaction for direct sales for export. Any activity related to placement in tanks,
if applicable, must be carried out entirely by the buyer who requests it and who must bear the costs for it. The maple syrup must be
delivered at the buyer's expense to warehouses designated by the Federation during normal business hours and with at least 24
hours' notice, no later than July 19, 2018.

5          ADDITIONAL INFORMATION

For more information or any questions about these terms, please contact Ms. Chantal Fortin at 1-855-679-7021, ext. 8470, or Ms.
Isabelle Lapointe at 1-855-679-7021, ext. 8521.

Simon Trépanier, Executive Director
Fédération des producteurs acéricoles du Québec

 Sales Communiqué – July 2018                                                                                          Page 15 of 16
Maison de l’UPA
555, boulevard Roland-Therrien, office 525
   Longueuil (Québec) J4H 4G5 Canada
     450 679-7021 | 1 855-679-7021
                 fpaq.ca
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