PRESS RELEASE PRODUCING WOOLWORTHS ROOIBOS TEA INVIGORATES A PREVIOUSLY DISADVANTAGED COMMUNITY 1 March 2010 Woolworths continues to demonstrate its commitment to socio-economic transformation and specifically Broad-based Black Economic Empowerment (BBBEE) in South Africa by supporting small, local, community-based enterprises. One of the latest projects to benefit is the Strandveld Tea Farmers Association, which is now growing premium fine rooibos tea for Woolworths. It¡¦s one of the projects that has grown out of the partnership between Woolworths and the Shell Foundation, a U.K.-based charity that tackles global development challenges by helping small businesses in poorer regions around the world, and resonates with Woolworths ¡¥Good business journey¡¦ goals of accelerating transformation and protecting the environment. As most South Africans know, Rooibos is traditionally grown along the west coast and in the Cederberg. Until nine years ago, that was virtually the only place in the world where rooibos grew. However, in 2001, when a serious drought affected production, entrepreneur Dawie de Villiers, managing director of Cape Natural Tea Products, went in search of an alternative source for rooibos. He believed he found what he was looking for near Elim, in the Strandveld area of the Overberg region near Cape Agulhas. Results of an initial, small-scale trial were encouraging, and were followed by extensive research into the viability of growing rooibos commercially in the area while preserving its wealth of indigenous flora. With The Better Trading Company, Shell Foundation¡¦s development partners, a study was commissioned that showed rooibos production would have less impact relative to other farming activities, it also suggested ways in which rooibos farming could restore biodiversity in areas already impacted by alien vegetation. The introduction of rooibos farming is also having a positive effect on the local community. Elim, which was established as a Moravian Mission Station in 1824, is still a small, picturesque country village where, until recently most economic activity revolved around subsistence farming and the thatching trade. That¡¦s now changing, as once De Villiers had proof that his plan could work, he began engaging with the local Elim farmers. Lionel October, a 31-year-old, third generation farmer, was one of the first to join him, and together they formed the Strandveld Tea Farmers Association. Today, the organisation, which is currently being registered as a co-op, has 10 members, all previously disadvantaged, small-scale farmers. They started small, planting only 10 hectares in 2006, expanding to 20 the following year, then doubling that again the year after. In just four years their hard work ¡V with assistance in terms of investment and technical expertise ¡V has paid off, as the project produces export-quality rooibos while creating job opportunities and generating revenue for the people of Elim. It¡¦s also benefiting the environment, as the farmers remove dense alien bush when planting rooibos. The rooibos inhibits re-growth of the aliens, but not the indigenous fynbos. In order to preserve the fynbos, planting, weeding and harvesting of the rooibos crop is done by hand. In addition to cultivating rooibos, local farmers have also found employment helping a nearby farmer harvest fynbos for export. It¡¦s a win-win situation, as Woolworths Food Divisional Director Julian Novak explains, ¡§We¡¦re very pleased to be able to support the Strandveld rooibos tea farmers by packaging and selling their tea in our stores. The project is an ideal fit with our Good business journey, not only because they are contributing to the creation of a strong, sustainable economy in their community, but also because this project is helping to protect the indigenous fynbos in this uniquely beautiful part of our country. We are looking forward to working with them for many years to come.¡¨ Strandveld rooibos tea has a deliciously robust flavour which is sure to please lovers of this uniquely South African tea. Like other Woolworths teas, the bags are made from unbleached filter paper which is kinder to the environment. The tea is available at most Woolworths stores countrywide. ENDS ______________________________________________________________________ NOTES FOR THE EDITOR „X Woolworths Good business journey Woolworths Good business journey is a comprehensive 5-year plan announced in April 2007 to help people and planet. It incorporates a series of challenging targets and commitments centred on four key priorities: accelerating transformation, driving social development, enhancing Woolworths¡¦ environmental focus and addressing climate change. „X Woolworths and transformation The transformation pillar of Woolworths Good business journey embraces the dti¡¦s broad-based black economic empowerment (BBBEE) scorecard framework. This includes equity ownership, management control, employment equity, skills development, preferential procurement, enterprise development and socio-economic development. Enterprise development projects are defined as small existing or start-up businesses, cooperatives or other enterprises. Woolworths contributes to their future sustainable growth by supporting, mentoring and procuring their products and services. „X Woolworths and the Shell Foundation Woolworths commitment to broad-based BEE in South Africa has resulted in partnerships being forged with quite a number of organisations with similar goals. Some of the initiatives have been identified through Woolworths association with the Shell Foundation. „X The Shell Foundation The Shell Foundation issued a grant of US$ 200 000 to the Strandveld Farmers to be used over a 4-year period; just over half has been deployed to date. The funding has been spent on inputs for the farmers and the transportation of the wet tea as well as to employ a highly skilled rooibos consultant who is sharing his extensive knowledge and transferring skills to the farmers – he has been vital to the success of the operation. The funding has also been used for a baseline study on the environmental issues including a trial to monitor how rooibos and indigenous fynbos grow in an area which has been cleared of alien vegetation with minimal disturbance to topsoil and preserving the latent fynbos seed bank. „X The Better Trading Company The Better Trading Company introduced the project to the Shell Foundation and manages the Foundation¡¦s interest in the project and works in partnership with Cape Natural Tea Products. They administer the bridging finance supplied by the Shell Foundation. With revenues from tea sales, farmers will co-invest in a tea court which will enable local processing, with farmers sharing ownership in the value add. They also scoped the form of the baseline study (environmental needs versus the potential to have a wide ranging social baseline study) and deployed an environmental specialist to carry out the study. „X Cape Natural Tea Products Established in 1996 as a partnership between farmers and marketers, Cape Natural Tea Products identified the potential of the Strandveld area over 6 years ago. They funded the early stage trials and identified and manage the consultant employed to assist the farmers. They also manage the raw tea through all the processing stages to delivery to the Blenders and disperse funds to the Strandveld Farmers. „X The Rooibos Tea Industry Rooibos is currently cultivated in narrow strip in the Western Cape stretching from Piketberg in the south to Nieuwoudtville in the north. This is the only area in the world that Rooibos tea is cultivated. It is planted on a dry land (non-irrigated) basis, so that yields are linked to annual rainfall and vary tremendously from region to region. This situation is an area of great concern to packer-branders of the product as raw material prices have shown a str

Woolworths continues to demonstrate its commitment to socio-economic transformation and specifically Broad-based Black Economic Empowerment (BBBEE) in South Africa by supporting small, local, community-based enterprises. One of the latest projects to benefit is the Strandveld Tea Farmers Association, which is now growing premium fine rooibos tea for Woolworths.