- 1. EUROPEAN KEY INVESTOR TOUR November 3-7, 2008
2. Forward-Looking StatementsCertain statements contained in
this presentation are quot;forward-looking statements,quot; such as
statements concerning the company's anticipated financial results,
current and future product performance, regulatory approvals,
business and financial plans and other non-historical facts. These
statements are based on current expectations and currently
available information. However, since these statements are based on
factors that involve risks and uncertainties, the company's actual
performance and results may differ materially from those described
or implied by such forward-looking statements. Factors that could
cause or contribute to such differences include, among others:
continued competition in seeds, traits and agricultural chemicals;
the company's exposure to various contingencies, including those
related to intellectual property protection, regulatory compliance
and the speed with which approvals are received, and public
acceptance of biotechnology products; the success of the company's
research and development activities; the outcomes of major
lawsuits; developments related to foreign currencies and economies;
successful operation of recent acquisitions; fluctuations in
commodity prices; compliance with regulations affecting our
manufacturing; the accuracy of the company's estimates related to
distribution inventory levels; the company's ability to fund its
short-term financing needs and to obtain payment for the products
that it sells; the effect of weather conditions, natural disasters
and accidents on the agriculture business or the company's
facilities; and other risks and factors detailed in the company's
most recent reports on forms 10-Q and 10-K. Undue reliance should
not be placed on these forward- looking statements, which are
current only as of the date of this presentation. The company
disclaims any current intention or obligation to update any
forward-looking statements or any of the factors that may affect
actual results.Trademarks Trademarks owned by Monsanto Company and
its wholly-owned subsidiaries are italicized in this presentation.
All other trademarks are the property of their respective owners.
2008 Monsanto Company2 3. STRATEGIC OUTLOOK While Metrics and
Projections Vary, Fundamentals of Demand-Driven Environment for
Grain Remain Strong USDA LONG-TERM PROJECTIONS:STATE OF
AGRICULTURE:CORN AND SOYBEAN TOTAL TRADE 2006-2017Strong Demand
Environment FACTORS:11070 INCREASING PROTEINCorn Total Trade
Soybean Total TradeSoybeans million metric tons DEMAND 60105 Corn
million metric tons Wealth drives meat 50100consumption changing
feed 40demand95 ASCENSION OF CHINA 30 Chinas growth is driving90
20huge changes in global oilseeds and grain trade85 10
ESTABLISHMENT OF BIOFUELS80 0 Assuming only base-case adoption of
biofuels, more corn and soy needed in next decadeUSDA Demand
Outlook Global corn trade expected to grow 15 percent by 2017
Imports by China and Mexico help spur demand USDA assumption on
U.S. planted corn acres: ~90M Global soybean trade grows 40 percent
by 2017 80 percent of growth is driven by China USDA assumption on
U.S. planted soybean acres: ~70M4 Source: USDA Agricultural
Projections to 2017, available at:
http://www.ers.usda.gov/Publications/OCE081/ 4. STRATEGIC
OUTLOOKGlobal Corn Production Per Acre Is Sub-Optimized Today,
Creating an Opportunity for Innovation GLOBAL CORN PRODUCTION1:
YIELDCORE PRODUCTIVITY MEASURES AND EVALUATION Boosting yield-per-
acre can make a meaningfulCANADA difference inEU 273M ACRES
supply-demand136 BU/AC500M BUSHELS27M ACRES90% HYBRID
environmentU.S.99 BU/AC CHINA2B BUSHELS If India, Mexico90M
ACRES151 BU/AC 67M ACRESMEXICO13B BUSHELS 83 BU/AC and Brazil
moved6B BUSHELS 18M ACRES25% HYBRID to 100 bushel perINDIA 48
BU/ACBRAZIL900M BUSHELS acre yields, they20M ACRES36M ACRES45%
HYBRID75% HYBRID32 BU/AC could produce58 BU/AC 700M BUSHELS2B
BUSHELS nearly 4 billion additionalARGENTINA bushels of corn10M
ACRES111 BU/AC900M BUSHELS annually equal to total world
Optimization of yield per acre corn exports in 2007
Poor/SubsistenceSub-Optimized Optimized51. Source is USDA FAS and
internal estimates. 5. STRATEGIC OUTLOOK Monsantos Innovation
Targeted at Doubling Yield by 2030,Extending Competitive Lead and
Creating New Value DOUBLING YIELD WITH TECHNOLOGY:DOUBLING YIELD BY
2030 U.S. CORN EXAMPLEU.S. BASELINECROP 2000 BASELINE1325137 bu/ac
Corn:300 37 bu/acSoybeans:275 Historical Yield632
lbs/ac250Cotton:U.S. Yield Per Acre (bu/ac) 30-Year Trend225
STRATEGIC RATIONALE Molecular Breeding Advances200Biotech
AdvancesHelping meet global demand175150Furthering competitive
lead125 Creating new value for100 farmers that creates 75
sustainable growth 50opportunities 2501970 1980 1990
20002010202020302030 U.S. YIELD U.S. YIELD TARGET ~300 bu/ac 151
bu/ac2030: 2007:1. Average U.S. yield by crop, USDA NASS6 6.
STRATEGIC OUTLOOK Monsantos Growth Opportunity Lies at the
Intersection of Demand, Innovation and ExecutionMonsantos Simple
Philosophy on Opportunity:YIELDMore demand requires
moreINNOVATIONMore yield requires more GROWTHMore innovation
delivers more 7 7. FINANCIAL OUTLOOKYield and Innovation Create the
Runway of Growth to 2012 for Seeds & Traits and for Monsanto as
a Whole 2012 GROSS PROFIT TARGETGROSS PROFIT COMMITMENT: RELATIVE
TO 2007 BASELINE2007-2012F$9.5 -Total Gross Profit$9.75B$10,000
$9.5-BUSINESS DETAIL $8.6-9.1B $9.75BRoundup and Other $8,000
~$1.9BGlyphosate-Based$8-8.5B>2X ~2.25XHerbicides GP (in
millions)~2X20072007 BASELINE~$300MAll Other Ag $6,000
BASELINE2007ProductivityBASELINE$7.3-Seeds & Genomics $4,000
$7.5B $4,230 2.6-2.7x Corn Seed & $2,000 Traits~2x Soybean Seed
&$0Traits ORIGINALMID-YEARCURRENTBASELINETARGETUPDATE GUIDANCE
~2x Cotton Seed & 20072012F Traits>2.5x INCREASED
BETTERVegetable SeedsROUNDUPGROWTH INGP TARGETSEEDS &TO $1.8B
TRAITS2008 ACQUISITIONSROUNDUP GP TARGET OF $1.9B8 8. FINANCIAL
OUTLOOKNear Term, 2009 Again Projects Double-Digit Earnings Growth
and Strong Cash Generation2008 2009FEARNINGS$4.20-$4.40
$3.64ONGOING EARNINGS PER SHARE ~15-20% GROWTH >80% GROWTH FROM
2007 FROM 2008 Seeds & Genomics Gross Profit$3.9B$4.5-$4.6BCorn
Seed & Traits Gross Profit $2.2B~$2.8B Soybean Seed &
Traits Gross Profit $725M~$700MCotton Seed & Traits Gross
Profit $313M~$300MVegetable Seeds Gross Profit$394M~$500MAll Other
Seed & Traits Gross Profit$251M~$200MRoundup And All Other
Glyphosate-based$2.0B $2.3-2.4B Herbicides Gross ProfitAll Other Ag
Productivity Gross Profit $344M~$400MCASH MANAGEMENT AND SPENDING
FREE CASH FLOW$772M~$1.8BOperating Cash$2.8B >$3BCapital
Expenditures $918M~$1B SG&A as a Percent of Sales 20%19%
RangeR&D as a Percent of Sales9%9.5%-10% Range9 9. USES OF
CASHOver 70% of the $2.8 Billion of Operating Cash Generated
Invested in Acquisitions, Technology and Capital in FY08 USES OF
CASHPERCENT OF $2.8B OPERATING CASH USED BY CATEGORY: FY2008 2%Cash
Generation13% $772M FY2008 Free Cash Flow:37%FY2009 Free Cash
~$1.8B Flow Forecast1:15%CASH PRIORITIES Bolster direct returns
toshareowners Support commercial growththrough capital spending
Invest in future growth through 33%technology collaborations
Acquisitions and Expand the core through strategic Technology
Collaborationsacquisitions Capital SpendingDividendsShare
Repurchase1. Estimate does not contemplate strategic
acquisitions.Other 10 10. STRATEGIC OUTLOOKSeed Platforms Are
Business Foundation, Establish Footprint for Traits, and Create
Diversified Crop Portfolio GloballyU.S.2012 2008 SHARETARGETSEU27
25.5%30-34%2008 SHARE 2012 TARGETSDEKALB 10.5%~15% 12% 16-20%ASI
CORN20% 24-28%Asgrow 9% 10-12%ASIINDIA 2008 SHARE 2012 TARGETS 41%
~50%Deltapine 36% 40-44%CORN 5% 12%COTTON LA - NORTH2008 SHARE 2012
TARGETS 62-66%58% CORNBRAZIL2008 SHARE2012 TARGETS 40%44-48%CORN
ARGENTINA 2008 SHARE 2012 TARGETS21% 31%COTTON 46%50-54% CORN Share
for row crops provided reflects sales volume for Monsanto brands
divided by total planted acres in respective geography. Corn
represents hybrid corn share in each respective market. Source for
Deltapine share in the U.S. is dmrkynetic 2008 new certified seed
share estimates.11 11. STRATEGIC OUTLOOKSignificant Growth
Opportunity in Expansion of Existing and Near Term Commercial
Biotech Traits Globally SOYBEANS COTTON CORN INTERNATIONAL MARKET
OPPORTUNITY ROUNDUPROUNDUPBOLLGARDROUNDUP YIELDGARDMARKET
OPPORTUNITY FOR BIOTECH TRAITS THROUGH 20101 ROUNDUP YIELDGARDREADY
READYAND READY CORN SMARTSTAXREADYROOTWORMBOLLGARD IICORN 2BORER2
YIELD (FLEX)U.S.65-75M45-55M 10-12M 6-8M 80M60-70M45-55M 60-65M2008
Penetration97%0%63-75% 74-98% 86%64-75%55-67% 0%
45-50M2Brazil50-60M3M2M15-20M15-20M5M 15-20M Argentina40M-- -
9M7M5M5-7M India - - 15-20M 18-20M6M6M -5-6MEurope (EU27)1M--
-24M8M5M 15-20M South Africa 0.2M - .15M .15M6M4M - 4M0.5M-
Australia - -0.5M-0.8M----0.8MOPPORTUNITY:91-101M45-50M 19-24M
21-23M60-65M40-45M 15M 44-57M Total Intl. Markets 2008
Penetration77-86%166-74% 0%3-4% 3%20-23%0% 0%of Intl. Markets Note:
Market Opportunity reflects total acres where technology is
applicable, not necessarily acres projected for penetration by
2010. 1.Primarily Bollgard I penetration; opportunity to expand to
second generation technology. Roundup Ready 2 Yield is planned to
be launched in Brazil as a stack with Insect-Protected soybeans. 2.
12 12. FINANCIAL OUTLOOK Increased 2009 and 2012 Targets for
Roundup ReflectSustainability Even As Supply-Demand Comes Into
BalanceROUNDUP AND OTHER GLYPHOSATE-BASED HERBICIDES: Roundup and
OtherBRANDED AND NON-BRANDED TRENDS 2004-2008
Glyphosate-BasedHerbicides300Branded 2009 Forecast Non-Branded
GROSS PROFIT TARGET: $2.3-$2.4B250 Global Volume (in
gallons)AboveBRANDED PRICE BAND(PER GALLON):$16-$18200 2012
Forecast GROSS PROFIT TARGET: $1.9B150BRANDED PRICE BAND
$16-$18(PER GALLON):10050 020042005 200620072008 GLOBAL VOLUME209M
215M235M252M257M (GALLONS):BRANDED PRICE BAND $11-$13$11-$13
$11-$13 >$11-$13 ~$20(PER GALLON): TOTAL ROUNDUP ANDOTHER
GLYPHOSATE-BASED $703M$637M $648M$854M $2.0BHERBICIDES GROSS
PROFIT:13 13. R&D PIPELINE R&D Engine Is Poised to Launch
Average of One Game-Changing Technology Every Other Year Through
Mid-Decade R&D PIPELINE: ADVANCED GAME-CHANGING TECHNOLOGIES
2008 2009 201020112012 TO MID-DECADERoundupDrought- Nitrogen-
SmartStaxReady 2 YieldTolerant CornUtilizationSoybeans Family1Corn
Family1 Second-gen soybean All-in-one corn trait Value likely in
improved Targets ways to use trait platform platform yield under
stress and nitrogen more efficiently potential for water China
import approval On track for 2010 launch replacement received
September Submitted for 2008 regulatory review andrefuge reduction
On track for 2009 releaseSUPERIOR, NE - FIELD TRIALS 2007FARM
PROGRESS SHOW 2007 WITH GENECONTROL HYBRID FARM PROGRESS SHOW 2007
(94 BU/AC) (76 BU/AC) 1. Part of the Monsanto-BASF Yield and Stress
R&D Collaboration 14 14. R&D PIPELINEMonsantos Yield
Leadership Widens With Each New Game- Changing Technology Launched
DuPont Syngenta 2009 OptiontoLicense 2011 2ndGen RoundupReady2
RoundupSoybeanTraitOptimumGAT Yield Ready2Yield2012 AllinOne
2010NoSpecified CornTraitOptimumPlatformSmartStaxPlatformAcreMax
Plus BiotechDrought2012+2014+ Post2014 ToleranceCorn6.
PressRelease:MonsantoandSyngenta 1.
Controlledcommercialreleaseof12M3. OptimumandGATareregistered
ReachRoyaltyBearingLicensingacres;Largescalelaunchof56Min2010trademarksofPioneerHiBred;Dateas
AgreementonRoundupReady2Yield statedinDuPontpressrelease071708 2.
FirsttraitintheDroughttolerantcornSoybeanTechnology,052308family,currentlyPhaseIII
4. AcreMaxisatrademarkofPioneerHi7.
NospecifiedplatformindicatedviaCorn
Bred;DateasstatedbyWilliamS.Niebur,
TechnologyPipeline,SyngentaHalfYear
Ph.D.,MerrillLynchAgriculturalChemicals
ResultsPresentation,072408,Slide22. Conference,060508,Slide14
Relevantcomponenttraits:VIP/Broadlep:5.
Ibid,Slide232009andRWdualmodeofaction:20128. Ibid.15 15. STRATEGIC
OUTLOOK While Metrics and Projections Vary, Fundamentals of
Demand-Driven Environment for Grain Remain Strong USDA LONG-TERM
PROJECTIONS:STATE OF AGRICULTURE:CORN AND SOYBEAN TOTAL TRADE
2006-2017Strong Demand Environment FACTORS:11070 INCREASING
PROTEINCorn Total Trade Soybean Total TradeSoybeans million metric
tons DEMAND 60105 Corn million metric tons Wealth drives meat
50100consumption changing feed 40demand95 ASCENSION OF CHINA 30
Chinas growth is driving90 20huge changes in global oilseeds and
grain trade85 10 ESTABLISHMENT OF BIOFUELS80 0 Assuming only
base-case adoption of biofuels, more corn and soy needed in next
decadeUSDA Demand Outlook Global corn trade expected to grow 15
percent by 2017 Imports by China and Mexico help spur demand USDA
assumption on U.S. planted corn acres: ~90M Global soybean trade
grows 40 percent by 2017 80 percent of growth is driven by China
USDA assumption on U.S. planted soybean acres: ~70M17 Source: USDA
Agricultural Projections to 2017, available at:
http://www.ers.usda.gov/Publications/OCE081/ 16. STRATEGIC
OUTLOOKGlobal Corn Production Per Acre Is Sub-Optimized Today,
Creating an Opportunity for Innovation GLOBAL CORN PRODUCTION1:
YIELDCORE PRODUCTIVITY MEASURES AND EVALUATION Boosting yield-per-
acre can make a meaningfulCANADA difference inEU 273M ACRES
supply-demand136 BU/AC500M BUSHELS27M ACRES90% HYBRID
environmentU.S.99 BU/AC CHINA2B BUSHELS If India, Mexico90M
ACRES151 BU/AC 67M ACRESMEXICO13B BUSHELS 83 BU/AC and Brazil
moved6B BUSHELS 18M ACRES25% HYBRID to 100 bushel perINDIA 48
BU/ACBRAZIL900M BUSHELS acre yields, they20M ACRES36M ACRES45%
HYBRID75% HYBRID32 BU/AC could produce58 BU/AC 700M BUSHELS2B
BUSHELS nearly 4 billion additionalARGENTINA bushels of corn10M
ACRES111 BU/AC900M BUSHELS annually equal to total world
Optimization of yield per acre corn exports in 2007
Poor/SubsistenceSub-Optimized Optimized181. Source is USDA FAS and
internal estimates. 17. STRATEGIC OUTLOOK Monsantos Growth
Opportunity Lies at the Intersection of Demand, Innovation and
ExecutionMonsantos Simple Philosophy on Opportunity:YIELDMore
demand requires moreINNOVATIONMore yield requires more GROWTHMore
innovation delivers more 19 18. STRATEGIC OUTLOOK Monsantos
Innovation Targeted at Doubling Yield by 2030,Extending Competitive
Lead and Creating New Value DOUBLING YIELD WITH TECHNOLOGY:DOUBLING
YIELD BY 2030 U.S. CORN EXAMPLEU.S. BASELINECROP 2000
BASELINE1325137 bu/ac Corn:300 37 bu/acSoybeans:275 Historical
Yield632 lbs/ac250Cotton:U.S. Yield Per Acre (bu/ac) 30-Year
Trend225 STRATEGIC RATIONALE Molecular Breeding Advances200Biotech
AdvancesHelping meet global demand175150Furthering competitive
lead125 Creating new value for100 farmers that creates 75
sustainable growth 50opportunities 2501970 1980 1990
20002010202020302030 U.S. YIELD U.S. YIELD TARGET ~300 bu/ac 151
bu/ac2030: 2007:1. Average U.S. yield by crop, USDA NASS20 19.
FINANCIAL OUTLOOKYield and Innovation Create the Runway of Growth
to 2012 for Seeds & Traits and for Monsanto as a Whole 2012
GROSS PROFIT TARGETGROSS PROFIT COMMITMENT: RELATIVE TO 2007
BASELINE2007-2012F$9.5 -Total Gross Profit$9.75B$10,000
$9.5-BUSINESS DETAIL $8.6-9.1B $9.75BRoundup and Other $8,000
~$1.9BGlyphosate-Based$8-8.5B>2X ~2.25XHerbicides GP (in
millions)~2X20072007 BASELINE~$300MAll Other Ag $6,000
BASELINE2007ProductivityBASELINE$7.3-Seeds & Genomics $4,000
$7.5B $4,230 2.6-2.7x Corn Seed & $2,000 Traits~2x Soybean Seed
&$0Traits ORIGINALMID-YEARCURRENTBASELINETARGETUPDATE GUIDANCE
~2x Cotton Seed & 20072012F Traits>2.5x INCREASED
BETTERVegetable SeedsROUNDUPGROWTH INGP TARGETSEEDS &TO $1.8B
TRAITS2008 ACQUISITIONSROUNDUP GP TARGET OF $1.9B21 20. FINANCIAL
OUTLOOKNear Term, 2009 Again Projects Double-Digit Earnings Growth
and Strong Cash Generation2008 2009FEARNINGS$4.20-$4.40
$3.64ONGOING EARNINGS PER SHARE ~15-20% GROWTH >80% GROWTH FROM
2007 FROM 2008 Seeds & Genomics Gross Profit$3.9B$4.5-$4.6BCorn
Seed & Traits Gross Profit $2.2B~$2.8B Soybean Seed &
Traits Gross Profit $725M~$700MCotton Seed & Traits Gross
Profit $313M~$300MVegetable Seeds Gross Profit$394M~$500MAll Other
Seed & Traits Gross Profit$251M~$200MRoundup And All Other
Glyphosate-based$2.0B $2.3-2.4B Herbicides Gross ProfitAll Other Ag
Productivity Gross Profit $344M~$400MCASH MANAGEMENT AND SPENDING
FREE CASH FLOW$772M~$1.8BOperating Cash$2.8B >$3BCapital
Expenditures $918M~$1B SG&A as a Percent of Sales 20%19%
RangeR&D as a Percent of Sales9%9.5%-10% Range22 21. USES OF
CASHOver 70% of the $2.8 Billion of Operating Cash Generated
Invested in Acquisitions, Technology and Capital in FY08 USES OF
CASHPERCENT OF $2.8B OPERATING CASH USED BY CATEGORY: FY2008 2%Cash
Generation13% $772M FY2008 Free Cash Flow:37%FY2009 Free Cash
~$1.8B Flow Forecast1:15%CASH PRIORITIES Bolster direct returns
toshareowners Support commercial growththrough capital spending
Invest in future growth through 33%technology collaborations
Acquisitions and Expand the core through strategic Technology
Collaborationsacquisitions Capital SpendingDividendsShare
Repurchase1. Estimate does not contemplate strategic
acquisitions.Other 23 22. FINANCIAL OUTLOOKOn Track in 2008, Growth
Drivers Continue to Set Stage for Growth Through 2012GROSS PROFIT
OUTLOOK BY SEGMENT 2007-2012F $10,000 TOTAL GROSS All Other
Agricultural ProductivityPROFIT GROWS TO >2.25X Roundup and
Other Glyphosate-based Herbicides $8,000 2007 BASELINE Seeds &
Genomics$6,000 $4,0002008 SEEDS & GENOMICS $2,000GENERATES
$3.9B OF GROSS PROFIT $0 20072008 2009F2010F 2011F2012FU.S. Corn
Intl Corn Cotton VegetablesR&D Pipeline Soybeans Expand seed
Establish and Prepare for Accelerate U.S. Reinvigorate Largest-ever
footprint expand seedcommercialtraits and margins R&D field
footprintlaunch of breeding effort Drive trait DeRuiterRoundup
Drive trait Drive intl traits penetration integrationReady 2 Yield
penetration SmartStaxAccelerated traitRoundup ReadyGlobalized$1B
VegetableGame-ChangingPlatform platform2 Yield Platform Cotton
Platform Platform Launches 23. OVERVIEW Gross Profit Growth Comes
From Two-Step Strategy: Establish Seed Footprint, Then Layer on
Biotech TraitsBREEDING BIOTECHTRAIT 3R&DTRAIT 2 SEED
ENGINETRAIT 1 SEED Establish Seed FootprintAdd Biotech Traits Seed
provides a core gross-profit Higher margins than seed
withcontribution minimal incremental cost of goods STRATEGIC VALUE
Seed footprint speeds penetration Opportunity to stack multiple
traitsrate of biotech traits per acre Access to global germplasm
Proven, commercial-driven R&Dpools combined with most program
backed by industrys DIFFERENTIATORSadvanced breeding technology
largest seed-and-trait R&D spendcreates seed that outperforms
Collaborator of choicecompetitors New trait introductions MEASURES
OF SUCCESS Seed share growth Trait upgrade and trait platform
opportunityCorn: U.S., Argentina, Brazil,Europe, Central
AmericaCorn: U.S., Argentina, BrazilKEY CROPS &
GEOGRAPHIESSoybeans: U.S. Soybeans: U.S., BrazilCotton: U.S.,
IndiaCotton: U.S., India, AustraliaVegetables: Global 25 24.
STRATEGIC OUTLOOKSignificant Growth Opportunity in Expansion of
Existing and Near Term Commercial Biotech Traits Globally SOYBEANS
COTTON CORN INTERNATIONAL MARKET OPPORTUNITY
ROUNDUPROUNDUPBOLLGARDROUNDUP YIELDGARDMARKET OPPORTUNITY FOR
BIOTECH TRAITS THROUGH 20101 ROUNDUP YIELDGARDREADY READYAND READY
CORN SMARTSTAXREADYROOTWORMBOLLGARD IICORN 2BORER2 YIELD
(FLEX)U.S.65-75M45-55M 10-12M 6-8M 80M60-70M45-55M 60-65M2008
Penetration97%0%63-75% 74-98% 86%64-75%55-67% 0%
45-50M2Brazil50-60M3M2M15-20M15-20M5M 15-20M Argentina40M-- -
9M7M5M5-7M India - - 15-20M 18-20M6M6M -5-6MEurope (EU27)1M--
-24M8M5M 15-20M South Africa 0.2M - .15M .15M6M4M - 4M0.5M-
Australia - -0.5M-0.8M----0.8MOPPORTUNITY:91-101M45-50M 19-24M
21-23M60-65M40-45M 15M 44-57M Total Intl. Markets 2008
Penetration77-86%166-74% 0%3-4% 3%20-23%0% 0%of Intl MarketsNote:
Market Opportunity reflects total acres where technology is
applicable, not necessarily acres projected for penetration by
2010. 1.Primarily Bollgard I penetration; opportunity to expand to
second generation technology. Roundup Ready 2 Yield is planned to
be launched in Brazil as a stack with Insect-Protected soybeans. 2.
26 25. CORN SEED & TRAITS Corn Gross Profit to Expand 25-30% in
2009, Reflecting Continuing Momentum in Seed Share and Trait
Penetration CORN SEEDS AND TRAITS: KEY FINANCIAL METRICS AND
DRIVERS 2005-2008F CORN FINANCIAL OUTLOOK 62%$4,000 Gross Profit as
Percent of SalesFor 2009, Corn Seeds &$3,500 >$3.5BTraits
gross profit is forecast 60%to be up 25-30%$3,000 Absolute gross
profit is$2,500 58%increased by growing seed
$M>$2.1B$2,000share, increasing traitpenetration and increasing
56% $1,721$1,500prices$1,000Margin increases by $1,01954%
$825increasing mix toward traits $500 2009 DRIVERS $052%
200520062007 2008Increasing triple-stackpenetration in U.S.
combined Net Sales Gross ProfitGross Profit as Percent of Saleswith
stronger trait pricingLaunch of new traits inArgentina and Brazil28
26. FINANCIAL OUTLOOKYield-Enhancing Technology Creates Value
Returning $1.50-$3 For Every Dollar Spent By Farmers in Corn U.S.
FARMER RETURN ON INVESTMENT: 1983-2008F 17016015032 140130 Bu/ac
120 FARMER RETURN OFbu/ac1.5X 3X 110PER DOLLAR SPENT 100 ON
YIELD-CREATING TECHNOLOGY@ COMMODITY PRICE RANGE OF $2-$4/BU 9080
PRE-BIOTECH: 1983-1996POST-BIOTECH: 1996-2008FAVERAGE YIELD DURING
AVERAGE YIELD DURING 115.6 bu/ac138.3 bu/acPERIOD:PERIOD: 1.7
bu/ac2.6 bu/ac ANNUAL YIELD GAIN: ANNUAL YIELD
GAIN:YIELD-RELATEDPRODUCTION Seed/ Chem/$27.07/ac $43.24/ac Equip/
LaborCOSTS SCARCITY-RELATED $19.33/ac $52.02/ac Land
Rent$6.23/ac$94.90/acFertilizer Source: USDA, Land Rent Averaged
using Corn & Soybean, Doane Ag, dmrkynetec data, Yield is
calculated using a 3 year rolling average, (32 Yield is 2.6
bu/ac/yr *12 years). 2008F Yield is April 08 Doane Ag. Return
Monsanto Estimate29 27. CORN SEED & TRAITS U.S. DEKALB Share
Consistently Ahead of Expectations; Growth Trend Continues in 2009
DEKALB U.S. CORN SHARE EVOLUTION: CORN2001-2009F FINANCIAL
OUTLOOK30% Three years of growth since 2005 have outpaced projected
28% growth each yearGROW 26%2%+2009: Trend continues with25.5% 24%
early commitment for accelerated growth in 23% 22% DEKALB and ASI
20%2009 DRIVERSTARGET 19% 18% 2+U.S. DEKALB Share 2005 PROJECTED
16% +1 AVERAGE GROWTH 16%U.S. ASI Share TREND 14%TRAIT TARGETS14%
13% 12%U.S. Triple-Stack10%12% 34-35M Penetration 10%2001 20022003
2004 200520062007 20082009F1.4 1.5 1.71.92.2>2.4~2.5 DEKALB
Trait Penetration Trend: 2003-2009FAverage Number of Traits Per
Acre in DEKALB Seed11. Trait intensity reflects the average number
of traits per acre with at least one trait30 28. CORN SEED &
TRAITSSeed Platforms Are Business Foundation, Establish Footprint
for Traits, and Create Diversified Crop Portfolio GloballyEU272008
SHARE 2012 TARGETS12% 16-20%CORNU.S. 2012 2008 SHARETARGETS 25.5%
30-34%DEKALB 10.5% ~15%ASI INDIA2008 SHARE 2012 TARGETS36%
40-44%CORNLA - NORTH2008 SHARE 2012 TARGETS 62-66%58%
CORNBRAZIL2008 SHARE2012 TARGETS 40%44-48%CORN ARGENTINA 2008
SHARE2012 TARGETS 46% 50-54% CORN Share for row crops provided
reflects sales volume for Monsanto brands divided by total planted
acres in respective geography. Corn represents hybrid corn share in
each respective market.31 29. CORN SEED & TRAITSTriple Stack
Penetration Accelerates, Creating Added Growth and Setting Stage
for SmartStax LaunchU.S. CORN TRAIT OPPORTUNITY: 2005-2010F70220200
U.S. TRIPLE-STACK ACRES60180 U.S. TRAIT ACRES (IN MILLIONS)160 50
(IN MILLIONS)14040120 100308020604010200 02007 20082009F 2005 2006
20072008F2009F 2010F2010Opportunity Q3UPDATERootworm ControlNA
50-65M 20.8M 30.1MCorn Borer Control NA 60-70M 42.4M45M Glyphosate
ToleranceNA80M 57.9M 68.8MTriple Stack/SmartStax 17.6M 29.1M 34-35M
50-65MOpportunity widens in 2010 with launch of SmartStaxTrait
acres reflect the total acres planted with each individual trait.
In the case of stacked traits, each absoluteacre will be reflected
by two or more trait acres.32 30. CORN SEED & TRAITSMonsantos
Leadership Continues With Next Game- Changer in Corn; SmartStax
Resets Trait Platform in 2010 LIKELIHOOD OF SWITCHING BRANDS FOR
SmartStax If your current seed brand did not offer this new
Monsanto Insect Protection Technology,SMARTSTAXhow likely would you
be to switch seed brands to obtain this new technology? Would you
say:Very likely or Somewhat likelyCOMMERCIAL OPPORTUNITY YIELDGARD
CORN 74%BORER USERS WHO LAUNCH TARGET:2010TREAT FORROOTWORMTARGET
ACRE60-65M OPPORTUNITY:0% 10% 20% 30% 40% 50% 60%70% 80% 90% 100%
VALUE PROPOSITIONPERCENT OF FARMERS2008 trials evaluating SmartStax
in eliteHERCULEX I CORN 65%BORER USERS WHO germplasm, quantifying
sources of TREAT FORROOTWORM potential on-farm yield advantages: 0%
10% 20% 30% 40% 50% 60%70% 80% 90% 100% Improved 1-2% consistency:
SmartStax STATUS Primary pests Improved Precedent established with
U.S. EPA on consistency:1-2%dual-mode-of-action traits: Secondary
pests REFUGE YieldGard VT PRO received reducedREDUCTION Reduced
refuge3-6% STRATEGY:refuge in Southern geographies Bollgard II
natural refuge in cotton5-10% On track for 2010 COMMERCIAL All
components have U.S. approvals TRACK: Final regulatory package with
5% refugerequest submitted in June 200833 31. CORN SEED &
TRAITSLarger Seed Footprints in South America Enable Larger
Launches and Faster Ramp Up Than CompetitionLATIN AMERICAN CORN
LATIN AMERICA NORTH OUTLOOK:CURRENT5-YEAR OUTLOOK#1 position in all
key SEED & TRAIT TRENDS THROUGH 2012SEED SHARE: countries 7-8M
MEXICOHYBRID ACRES:In approval stage BIOTECH STATUS: HONDURAS
GUATEMALA Integration of Cristiani; Expand seed footprint forFY2009
PRIORITIES: EL SALVADOR pending trait introductionsCOLOMBIA
BRAZILCURRENT5-YEAR OUTLOOK40% (#1 position)SEED SHARE:
BRAZILPERU25-27M HYBRID ACRES: 1st commercial trait in
BIOTECHFY2009 STATUS: Targeted share gain: 1-2 points FY2009 1-2M
acre launch of YieldGard Corn Borer; sold- PRIORITIES: out in
Q1ARGENTINA ARGENTINA CURRENT 5-YEAR OUTLOOK 46% (#1 position)SEED
SHARE:8-10M HYBRID ACRES: Commercial planting BIOTECH STATUS:
Targeted share gain: 1-2 pointsFY2009 PRIORITIES: 1-2M acre launch
of YieldGard Corn Borer with Roundup Ready Corn 2 stack; sold-out
in Q1 34 32. CORN SEED & TRAITS Monsantos Pricing Model Aimed
at Total Value Created;Shared with FarmerYieldGard VT Triple
Improved YieldPRICING TO VALUE EXAMPLE: 2009UPDATE: Yield-advantage
value at 3 year Improved Yield1average commodity price IMPROVED
YIELD One year back, current year and forward year 15-20(BU/AC):
Value shared with farmers UPDATE: 3 YEAR COMMODITY PRICE:
$4.00Indirect Benefits $60-$80Quantified benefits, such as
convenience and Indirect Benefits2peace of mindINDIRECT BENEFITS:
$5 Value shared with farmersIncremental Value Created $65-$85(+)
Replacement ValueFactors costs farmers would have incurred
forsubstitute insect and weed control 100% of replacement value is
capturedPRICING APPROACH UPDATE: Per-Acre Trait Cost3: $29-$54
UPDATE: ReplacementPRICING APPROACH($11-$19) Value4Percentage of
incremental value sharedIncremental Farmer Cost: $18-$35ultimately
determined by market research,pricing simulations and focus groups
to assess: Incremental Value Shared: 60-70% Market Share
Implications 1. Monsanto estimates, based on better insect and weed
control over conventional options Trait Penetration Effect 2.
Monsanto estimates, based on farmer surveys quantifying benefits
such as convenience andpeace of mind Competitive Reaction 3. Retail
price range for YieldGard VT Triple in 2009, at seeding rate of 2.7
acres per unit 4. Subtracts costs farmers would have spent had they
not used a trait package35 33. SOYBEAN SEED & TRAITS Soybean
Seeds and Traits Poised for Renaissance Driven ByRoundup Ready 2
Yield Opportunity SOYBEAN SEEDS AND TRAITS:KEY FINANCIAL METRICS
AND DRIVERS 2005-2008F SOYBEANS FINANCIAL OUTLOOK$1,400 70% Gross
Profit as Percent of Sales >$1.1BFor 2009, Soybean Seeds
&$1,200 60%Traits gross profit is forecastto be flat with
2008$1,000 50%Performance more subject to $80040%planted acres
because of $Msignificant trait penetration$725M $667 $60030% $613In
2009, lower acres and$588 higher production cost for $40020%seed
still prominent $20010%Beyond 2009, Roundup Ready2 Yield creates
new margin $00%opportunity as acres expand 20052006 2007 20082009
DRIVERS Net Sales Gross Profit Gross Profit as Percent of Sales
Focus on 1-2M acre controlledcommercial release ofRoundup Ready 2
Yield37 34. SOYBEAN SEED & TRAITSRoundup Ready 2 Yield Soybeans
Is One Of the Most- Anticipated Launches Because of Step-Change In
Yield ROUNDUP READY 2 YIELD SOYBEANS: SECOND-GENERATION WEED
CONTROL OPPORTUNITYU.S. SOYBEANSNear-Isoline Comparisons: 2007 U.S.
AVERAGERoundup Ready 2 Yield vs. Roundup Ready 41.6 bu YIELD PER
ACRE:% Yield Increase over Roundup Ready12% ROUNDUP READY 2 YIELD
TARGETED YIELD 11% 7-11%10% IMPROVEMENT: 9% 9%8% VALUE PROPOSITION
7% 7%6% YIELDIMPROVEMENT ON 3-5 bu/ac AVERAGE
YIELDS:4%INCREMENTALYIELD VALUE TO$27-$45/acre FARMER
(VERSUSROUNDUP READY):2% PRICING SEAMLESS PRICE0% $69-$72 FOR
ROUNDUP4 YEAR READY 2 YIELD 2004 200520062007SEED (PER ACRE)1:
AVERAGE SEAMLESS PRICE FOR FIRST-Roundup Ready 2 Yield soybeans
yield 7 to 11 percentGENERATION $49-$52 ROUNDUP READYhigher than
Roundup Ready soybeans based on 73SEED (PER ACRE)1:Monsanto field
trials from 2004-20071. Reflects seamless pricing to farmer,
including trait value, germplasm value and value provided by seed
treatment38 35. COTTON SEED & TRAITS Seed Platforms Are
Business Foundation, Establish Footprintfor Traits, and Create
Diversified Crop Portfolio GloballyU.S.2012 2008 SHARE TARGETS
41%~50%Deltapine INDIA 2008 SHARE 2012 TARGETS 5% 12%COTTONBRAZIL
2008 SHARE 2012 TARGETS21% 31%COTTON Share for row crops provided
reflects sales volume for Monsanto brands divided by total planted
acres in respective geography. Source for Deltapine share in the
U.S. is dmrkynetic 2008 new certified seed share estimates.40 36.
COTTON SEED & TRAITSCotton Platform Segregating Into Value- and
Volume-Focused Opportunities To Reflect Changing Global Production
CHANGING GLOBAL COTTON LANDSCAPE 20032004 2005 2006 200720082003
2004 200520062007 2008 1616Monsanto insect-protected 17.2 Monsanto
insect-protected trait acrestrait acres 14.6 1212 Acres (M) Acres
(M) 8 88.78.67.87.8 6.6 5.95.7 4 41.33.1 0.2 0 013.5M 13.7M
14.2M15.2M10.8M9.4MINDIA PLANTED3XPLANTED ACRESUNITED STATES MORE
BOLLGARDAND BOLLGARD IITHAN U.S. IN 2008 VOLUME VALUEExpanding
cotton market with U.S. acres likely to continue to be small,
butgrowing demand for technology, among highest valuebut assumes
local pricing risk Technology adoption still needed to improve
Second-generationfarmer profitability conversion continues to move
ahead Deltapine brand continues to provide accessto worlds largest
cotton germplasm pool41 37. COTTON SEED & TRAITSRegardless of
Where Cotton Is Grown Geographically, Trait Intensity Is Key
Opportunity for MonsantoGLOBAL COTTON SEED AND TRAITS GROSS
PROFITCOTTON INDEX=2007 FINANCIAL OUTLOOK 2012F 2007 With Delta
& Pine Landacquisition, lower-marginseed is greater portion
ofproduct mix softeningmarginsCorn and soybeans havedisplaced
cotton in Deltapinebrands core U.S. geographies ~2X 2009 DRIVERS
Re-establish U.S. shareOVER 2007 INDEXgrowth, promote second-genU.S
Cotton Seeds & TraitsGross Profitpenetration in U.S. and
IndiaInternational Cotton Seeds& Traits Gross Profit42 38.
VEGETABLE SEEDS Vegetable Core Platforms Are Established, Focusing
onExecution and Growth To Become $1B Business by 2012
VEGETABLES$1,400 $1.2B$1,200 FINANCIAL OUTLOOK>$1B$1,000 $M
$800By 2012, Vegetable business $725Mroughly equates to todays
$600>$650Msoybean business currently $400Monsantos
second-largestseed-and-trait segment $200 Sales growth continues in
$0NETGROSSNETGROSSmid-single digits; Margin SALES PROFITSALES
PROFITgrows through pricing, new Vegetable Platform: Soybean
Platform:products and increase of 2012F 2008 protected-culture
business RANK ORDER GROSS PROFITGENERATORS: 2012F 2009 DRIVERS Corn
Seeds & TraitsFocus on operation andexecution of 3-channel
Soybean Seeds & Traitsapproach: Seminis open-field, Vegetable
SeedsDeRuiter protected-culture,and ISG regional brands Cotton
Seeds & TraitsAll Other Seeds & Traits44 39. VEGETABLE
SEEDSDe Ruiter Seeds Is Perfect Complement to Seminis, Setting Pace
for Growth Through 2012 FY07 Annual net Sales = $145M FY08 Annual
Net Sales = $744MPortfolio Composition: Percent of Sales1Portfolio
Composition: Percent of Sales110%13% Open-Field
Protected-Culture87% 90% Pairing Seminis with De Ruiter Seeds
brings together the leading positions in open-field and
protected-culturesegments Both divisions benefit from the
coordinated 1. Size of pies not to scale with revenuemolecular
breeding infrastructuregenerated by Seminis or De Ruiter Seeds45
40. ROUNDUP Increased 2009 and 2012 Targets for Roundup
ReflectSustainability Even As Supply-Demand Comes Into
BalanceROUNDUP AND OTHER GLYPHOSATE-BASED HERBICIDES: Roundup and
OtherBRANDED AND NON-BRANDED TRENDS 2004-2008
Glyphosate-BasedHerbicides300Branded 2009 Forecast Non-Branded
GROSS PROFIT TARGET: $2.3-$2.4B250 Global Volume (in
gallons)AboveBRANDED PRICE BAND(PER GALLON):$16-$18200 2012
Forecast GROSS PROFIT TARGET: $1.9B150BRANDED PRICE BAND
$16-$18(PER GALLON):10050 020042005 200620072008 GLOBAL VOLUME209M
215M235M252M257M (GALLONS):BRANDED PRICE BAND $11-$13$11-$13
$11-$13 >$11-$13 ~$20(PER GALLON): TOTAL ROUNDUP ANDOTHER
GLYPHOSATE-BASED $703M$637M $648M$854M $2.0BHERBICIDES GROSS
PROFIT:47 41. R&D PIPELINEPhase Advancements For Key Projects
Reflect Progress and Strength Throughout Monsantos Industry-Leading
Pipeline BIOTECH TRAIT PIPELINE: JANUARY 2008 UPDATEPHASE PHASE
PHASE PHASED1 3 2 4 PHASE PHASE PHASE PHASE D 13 24 AGRONOMIC
TRAITS YIELD AND STRESS PIPELINEROUNDUP READY 2 YIELDSOYBEANS
DROUGHT-TOLERANT CORN FAMILY YIELDGARD VT PRO 2ND-GEN YIELDGARD
CORN BORERDROUGHT-TOLERANT CORN SMARTSTAX CORN2ND-GEN
DROUGHT-TOLERANT CORN DICAMBA-TOLERANT SOYBEANS
NITROGEN-UTILIZATION CORN FAMILYINSECT-PROTECTED + ROUNDUP READY 2
YIELD SOYBEANSNITROGEN-UTILIZATION CORN BOLLGARD III BROAD-ACRE
HIGHER-YIELDING CORN FAMILY SOYBEAN NEMATODE-RESISTANCE
HIGHER-YIELDING CORNSOYBEAN DISEASE BROAD-ACRE HIGHER-YIELDING
SOYBEAN FAMILY DICAMBA-TOLERANT COTTONHIGHER-YIELDING SOYBEANS
COTTON LYGUS CONTROL 2ND-GEN HIGHER-YIELDING SOYBEANSYIELDGARD
ROOTWORM IIIDROUGHT-TOLERANT COTTON VALUE-ADDED TRAITS FAMILY
DROUGHT-TOLERANT COTTONEXTRAX CORN PROCESSINGSYSTEM + MAVERA
HIGH-VALUE BROAD-ACRE HIGHER-YIELDING CORN WITH LYSINE2 CANOLA
FAMILYHIGH-OIL SOYBEANS HIGHER-YIELDING + ROUNDUP READY 2 YIELD
CANOLA12ND-GEN HIGH-OIL SOYBEANS High Impact Technologies (HIT)
projectOMEGA-3 ENRICHED SOYBEANS Jan. 3, 2008
Advancements/AdditionsVISTIVE III SOYBEANSThe colored bar
associated with each project indicates which phase that project is
in. It isnot intended to represent the relative status of the
project within a particular stage.HIGH-STEARATE SOYBEANS(VIA
BIOTECH) 1. For higher-yielding + Roundup Ready 2 Yield canola,
only the value of the higher-yieldingtrait is incorporated into the
Yield and Stress collaboration with BASFHIGH-OIL CORN 2. Value of
licensing the EXTRAX technology is shared with Cargill as a part of
Renessen49joint venture 42. R&D PIPELINE R&D Engine Is
Poised to Launch Average of One Game-Changing Technology Every
Other Year Through Mid-Decade R&D PIPELINE: ADVANCED
GAME-CHANGING TECHNOLOGIES 2008 2009 201020112012 TO
MID-DECADERoundupDrought- Nitrogen- SmartStaxReady 2 YieldTolerant
CornUtilizationSoybeans Family1Corn Family1 Second-gen soybean
All-in-one corn trait Value likely in improved Targets ways to use
trait platform platform yield under stress and nitrogen more
efficiently potential for water China import approval On track for
2010 launch replacement received in September Submitted for 2008
regulatory review andrefuge reduction On track for 2009
releaseSUPERIOR, NE - FIELD TRIALS 2007FARM PROGRESS SHOW 2007 WITH
GENECONTROL HYBRID FARM PROGRESS SHOW 2007 (94 BU/AC) (76 BU/AC) 1.
Part of the Monsanto-BASF Yield and Stress R&D Collaboration 50
43. OVERVIEWMonsantos Yield Leadership Widens With Each New Game-
Changing Technology LaunchedDuPont Syngenta2009 OptiontoLicense2011
2ndGenRoundupReady2RoundupSoybeanTrait OptimumGAT YieldReady2Yield
2012AllinOne2010NoSpecifiedCornTraitOptimumPlatform SmartStax
PlatformAcreMax Plus BiotechDrought 2012+2014+ Post2014
ToleranceCorn 6. PressRelease:MonsantoandSyngenta1.
Controlledcommercialreleaseof12M3.
OptimumandGATareregisteredReachRoyaltyBearingLicensing
acres;Largescalelaunchof56Min2010trademarksofPioneerHiBred;DateasAgreementonRoundupReady2YieldstatedinDuPontpressrelease0717082.
FirsttraitintheDroughttolerantcornSoybeanTechnology,052308
family,currentlyPhaseIII 4. AcreMaxisatrademarkofPioneerHi 7.
NospecifiedplatformindicatedviaCornBred;DateasstatedbyWilliamS.Niebur,TechnologyPipeline,SyngentaHalfYearPh.D.,MerrillLynchAgriculturalChemicalsResultsPresentation,072408,Slide22.Conference,060508,Slide14Relevantcomponenttraits:VIP/Broadlep:
5. Ibid,Slide232009andRWdualmodeofaction:2012 8. Ibid. 51 44.
R&D PIPELINE Insect-Protected Soybeans Are First-Ever Monsanto
Trait Developed Exclusively for Non-U.S. Opportunity2007 FIELD
TESTING SHOWS VISUALR&D PipelinePROOF OF CONTROL
Insect-Protected Soybeans with Roundup Ready 2 Yield TIPTON, GA -
FIELD EFFICACY TRIAL 2007 Phase 3 STATUS:PROJECT
CONCEPT:Insect-protected soybeans use Bt technology widely adopted
in corn and cotton to control insect pests, especially economically
important pests for Brazilian farmers. The Bt trait is combined
with Roundup Ready 2 Yield VALUE: LAUNCH-COUNTRY:Brazil
LAUNCH-COUNTRY 50M ACRE OPPORTUNITY1: 2020
COMMERCIAL$150-$300MCONTROLWITH GENEVALUE2: (NO INSECTICIDE)(NO
INSECTICIDE) SOURCES OF VALUE: Insecticide
substitutionInsect-protected soybeans with Roundup Ready 2 Yield
1Based on 2 current sprays technology demonstrated significant
protection from keycosting almost $6/acre total lepidopteran pests,
including soybean looper, in 2007 testsImproved yield 24+% increase
over chemical 1. Acre opportunity reflects acres where trait could
have technological fit. Opportunity does not reflect acres that may
beinsecticidesplanted to a competitive trait or acres required for
insect-resistance management (IRM) set-aside refuges 2. 2020 value
reflects gross sales opportunity in launch country in year 202052
45. R&D PIPELINE Higher-Yielding Soybeans Continue to
Demonstrate Improved Yield Over Conventional Controls2007/08
HIGHER-YIELDING SOYBEANNEW:AGRONOMIC TESTING VERSUS CONTROLS
R&D Pipeline Higher-Yielding Soybeans Family: Percentage yield
difference vs. control: Lead Project 8.0 6.2% 10.2%7.1% 6.0% 4.6%
10.5%2.2% 10.3% 5.4% 8.8%Phase 2STATUS: (bu/a increase over
control)Average Yield Advantage PROJECT CONCEPT: 6.0PRODUCT
Higher-yielding soybeans aimed atCONCEPT boosting intrinsic yield
potential ofTARGET4.0 RANGE soybeans through insertion of key genes
VALUE: 2.0 LAUNCH-COUNTRY45M ACRES1:0.02020 VALUE2: $300-$500MEvent
1 Event 2Event 3Event 4Event 5 SOURCES OF VALUE:Season 1: 2007 U.S.
Field Trials (18 locations)Season 2: 2007/08 LA Field Trials (12
locations) Improved yield16 top-performing events advanced to Latin
America trials. 1 Targeting yield improvement of 6-10%Lead events
showing strong yield advantages overconventional controls in both
trials.Higher-yielding trait will be stacked on top of RoundupReady
2 Yield and other soybean-pipeline traits. 1. Acre opportunity
reflects acres where technologyfits at Monsanto's 2007 market share
in respectivecrops 2. 2020 value reflects gross sales opportunity
inlaunch country in year 2020 53 PART OF THE MONSANTO BASF YIELD
AND STRESS R&D COLLABORATION 46. R&D PIPELINE 2007 Dryland
Field Tests of Lead Drought Event Offers Visual Evidence of
Increased Yield In Stressed Conditions2007 FIELD TESTING SHOWS
VISUAL R&D PipelinePROOF OF YIELD IMPROVEMENTDrought-Tolerant
Corn Family: SUPERIOR, NE - FIELD TRIALS 2007Lead Project HIT
Project Phase 3PROJECT CONCEPT:Drought-tolerance family aimed
atproviding consistent yield andbuffering against effects of
waterlimitationsVALUE: LAUNCH-COUNTRY55M ACRES1:2020
VALUE2:$300-$500MSOURCES OF VALUE:Improved yield Targeting 6-10%
yield 1CONTROL HYBRIDWITH GENE improvement in water-stress
environments (76 BU/AC)(94 BU/AC)1. Acre opportunity reflects acres
where technology fits at Water stress exposure during different
stages of developmentMonsanto's 2007 market share in respective
crops can have significant effect on corn yield; Monsantos lead 2.
2020 value reflects gross sales opportunity in launch country
drought-tolerance trait shows a significant yield advantagein year
2020compared with controls under drought stress54 PART OF THE
MONSANTO BASF YIELD AND STRESS R&D COLLABORATION 47. R&D
PIPELINESecond-Generation Drought-Tolerant Corn Targeted to Expand
ReachDrought Efficacy for Second-Gen Events 16R&D PipelineYield
Difference Over Controls (%) 14Drought-Tolerant Corn Family:
12Second-Generation Project 10PRODUCT CONCEPT Phase 28STATUS:KEY
RESULTS TARGET RANGE6PROJECT CONCEPT:4Drought-tolerance family
aimed at2providing consistent yield and0 EVENT 1EVENT 2 EVENT 3
EVENT 1EVENT 2 EVENT 3buffering against effects of water
HIGHER-YIELDING ENVIRONMENT LOWER-YIELDING ENVIRONMENTlimitations
AVERAGE YIELD: 166 BU/AC AVERAGE YIELD: 53 BU/ACVALUE: 2007
2006LAUNCH-COUNTRY 55M (All three events significant @ p0.10);
Statistical significance determined by ANOVA (2006) or
nonparametric test (2007)ACRES1: 2020 VALUE2:$300-$500MSOURCES OF
VALUE:SEGMENTED VALUE OPPORTUNITY ACROSS MARKETS Improved yield
Second generationKEY OPPORTUINITY IRRIGATEDTargeting 6-10%
yielddemonstrates 1 8-12M Acresimprovement in
water-stressperformance overenvironments WESTERN broad range of
stress DRYLAND conditions in both lowWater substitution 10-12M
Acresand high-yielding 2Variable costs in pumped
environmentsirrigation of >$100/ acreSTABILITY Potential for a
broad 60-70M AcresLow annual High annual 1. Acre opportunity
reflects acres where technology fits at acreage fit across all
precipitationMonsanto's 2007 market share in respective crops
precipitation acres planted 2. 2020 value reflects gross sales
opportunity in launch country Source: Spatial Climate Analysis
Service, Oregon State Universityin year 2020 55 PART OF THE
MONSANTO BASF YIELD AND STRESS R&D COLLABORATION 48. R&D
PIPELINE In Continued Field Testing, Nitrogen-Utilization Lead
Shows Yield Improvement Under Normal NitrogenLEAD PERFORMANCE UNDER
NORMAL R&D PipelineNITROGEN CONDITIONSNitrogen-Utilization Corn
Family:Lead ProjectYield Increase (bu/Ac) 12 ***Phase 110 ***
STATUS: * 8PROJECT CONCEPT: 6 4Targets ways to use nitrogen more
2efficiently, exploring potential to 0boost yield under normal
nitrogen-2conditions or stabilize it in lowTRIALS IN MULTIPLE
TRIALS IN MULTIPLEnitrogen environmentsHYBRID BACKGROUNDS HYBRID
BACKGROUNDSVALUE: (15 LOC)(16 LOC) LAUNCH-COUNTRY 200555M 2006
YIELD TRIALS: ACRES1: 2007 YIELD TRIALS: YIELD SUFFICIENT N
LEVELSSUFFICIENT N LEVELSTRIALS: 2020 VALUE2: (37 LOC
TOTAL)$300-$500M (20 LOC TOTAL)(23 LOCTOTAL)SOURCES OF VALUE: 2005
20062007 Improved yield * Statistically significant @ p0.10 Yield
improvement in normal 1 nitrogen environments Bar color correlates
with the specific hybrid background tested. Same bar color in
different tests and different years indicates same hybrid was used.
Nitrogen reduction All trials conducted under sufficient nitrogen
application levels. 2 Improving yield in low nitrogen environments
Under normal nitrogen conditions, Nitrogen-Utilization lead has 1.
Acre opportunity reflects acres where technology fits at
demonstrated yield advantages in multiple backgrounds
overMonsanto's 2007 market share in respective crops multiple years
2. 2020 value reflects gross sales opportunity in launch countryin
year 202056 PART OF THE MONSANTO BASF YIELD AND STRESS R&D
COLLABORATION 49. R&D PIPELINE Strong Pipeline Reflects Growing
Innovation and Value ofEmerging Yield and Stress Traits DISCOVERY
PHASE 1PHASE 2PHASE 3PHASE 4Drought-HIGH Tolerant FAMILY TRAITS
Family CORN:COLLABORATIONYIELD & STRESSNitrogen- BROAD-ACREHIGH
Utilization FAMILY TRAITS YIELDFamily Broad-Acre,MEGA
Higher-Yielding FAMILY TRAITS FamilySOYBEANS:Broad-Acre,
BROAD-ACREHIGH Higher-YieldingFAMILY TRAITSYIELDFamily2020 VALUE
RANGES:Omega-3 RoundupBollgard IIIsoybeansReady 2
YieldsoybeansMEGAHIGH
RoundupInsect-protected$300M-$500M>$1BMReady 2Roundup Ready 2
Yield canola YieldGardYield soybeansVT PRODicamba-cornMID LOW
tolerantsoybeans
