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    monsanto ea_investor_tour monsanto ea_investor_tour Presentation Transcript

    • EUROPEAN KEY INVESTOR TOUR November 3-7, 2008
    • Forward-Looking Statements Certain 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 Company 2
    • 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 – 2006-2017 Strong Demand Environment FACTORS: 110 70 ► INCREASING PROTEIN Corn Total Trade Soybean Total Trade Soybeans – million metric tons DEMAND 60 105 Corn – million metric tons Wealth drives meat 50 100 consumption – changing feed 40 demand 95 ► ASCENSION OF CHINA 30 China’s growth is driving 90 20 huge changes in global oilseeds and grain trade 85 10 ► ESTABLISHMENT OF BIOFUELS 80 0 Assuming only base-case adoption of biofuels, more corn and soy needed in next decade USDA 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: ~70M 4 Source: USDA Agricultural Projections to 2017, available at: http://www.ers.usda.gov/Publications/OCE081/
    • STRATEGIC OUTLOOK Global Corn Production Per Acre Is Sub-Optimized Today, Creating an Opportunity for Innovation GLOBAL CORN PRODUCTION1: YIELD CORE PRODUCTIVITY MEASURES AND EVALUATION Boosting yield-per- acre can make a meaningful CANADA difference in EU 27 3M ACRES supply-demand 136 BU/AC 500M BUSHELS 27M ACRES 90% HYBRID environment U.S. 99 BU/AC CHINA 2B BUSHELS • If India, Mexico 90M ACRES 151 BU/AC 67M ACRES MEXICO 13B BUSHELS 83 BU/AC and Brazil moved 6B BUSHELS 18M ACRES 25% HYBRID to 100 bushel per INDIA 48 BU/AC BRAZIL 900M BUSHELS acre yields, they 20M ACRES 36M ACRES 45% HYBRID 75% HYBRID 32 BU/AC could produce 58 BU/AC 700M BUSHELS 2B BUSHELS nearly 4 billion additional ARGENTINA bushels of corn 10M ACRES 111 BU/AC 900M BUSHELS annually – equal to total world Optimization of yield per acre corn exports in 2007 Poor/Subsistence Sub-Optimized Optimized 5 1. Source is USDA FAS and internal estimates.
    • STRATEGIC OUTLOOK Monsanto’s 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 EXAMPLE U.S. BASELINE CROP 2000 BASELINE1 325 137 bu/ac Corn: 300 37 bu/ac Soybeans: 275 Historical Yield 632 lbs/ac 250 Cotton: U.S. Yield Per Acre (bu/ac) 30-Year Trend 225 STRATEGIC RATIONALE Molecular Breeding Advances 200 Biotech Advances Helping meet global demand 175 150 Furthering competitive lead 125 Creating new value for 100 farmers that creates 75 sustainable growth 50 opportunities 25 0 1970 1980 1990 2000 2010 2020 2030 2030 U.S. YIELD U.S. YIELD TARGET ~300 bu/ac 151 bu/ac 2030: 2007: 1. Average U.S. yield by crop, USDA NASS 6
    • STRATEGIC OUTLOOK Monsanto’s Growth Opportunity Lies at the Intersection of Demand, Innovation and Execution Monsanto’s Simple Philosophy on Opportunity: YIELD More demand requires more INNOVATION More yield requires more GROWTH More innovation delivers more 7
    • FINANCIAL OUTLOOK Yield and Innovation Create the Runway of Growth to 2012 for Seeds & Traits and for Monsanto as a Whole 2012 GROSS PROFIT TARGET GROSS PROFIT COMMITMENT: RELATIVE TO 2007 BASELINE 2007-2012F $9.5 - Total Gross Profit $9.75B $10,000 $9.5- BUSINESS DETAIL $8.6-9.1B $9.75B Roundup and Other $8,000 ~$1.9B Glyphosate-Based $8-8.5B >2X ~2.25X Herbicides GP (in millions) ~2X 2007 2007 BASELINE ~$300M All Other Ag $6,000 BASELINE 2007 Productivity BASELINE $7.3- Seeds & Genomics $4,000 $7.5B $4,230 2.6-2.7x Corn Seed & $2,000 Traits ~2x Soybean Seed & $0 Traits ORIGINAL MID-YEAR CURRENT BASELINE TARGET UPDATE GUIDANCE ~2x Cotton Seed & 2007 2012F Traits >2.5x •INCREASED •BETTER Vegetable Seeds ROUNDUP GROWTH IN GP TARGET SEEDS & TO $1.8B TRAITS •2008 ACQUISITIONS •ROUNDUP GP TARGET OF $1.9B 8
    • FINANCIAL OUTLOOK Near Term, 2009 Again Projects Double-Digit Earnings Growth and Strong Cash Generation 2008 2009F EARNINGS $4.20-$4.40 $3.64 ONGOING EARNINGS PER SHARE ~15-20% GROWTH >80% GROWTH FROM 2007 FROM 2008 Seeds & Genomics Gross Profit $3.9B $4.5-$4.6B Corn Seed & Traits Gross Profit $2.2B ~$2.8B Soybean Seed & Traits Gross Profit $725M ~$700M Cotton Seed & Traits Gross Profit $313M ~$300M Vegetable Seeds Gross Profit $394M ~$500M All Other Seed & Traits Gross Profit $251M ~$200M Roundup And All Other Glyphosate-based $2.0B $2.3-2.4B Herbicides Gross Profit All Other Ag Productivity Gross Profit $344M ~$400M CASH MANAGEMENT AND SPENDING FREE CASH FLOW $772M ~$1.8B Operating Cash $2.8B >$3B Capital Expenditures $918M ~$1B SG&A as a Percent of Sales 20% 19% Range R&D as a Percent of Sales 9% 9.5%-10% Range 9
    • USES OF CASH Over 70% of the $2.8 Billion of Operating Cash Generated Invested in Acquisitions, Technology and Capital in FY08 USES OF CASH PERCENT OF $2.8B OPERATING CASH USED BY CATEGORY: FY2008 2% Cash Generation 13% $772M FY2008 Free Cash Flow: 37% FY2009 Free Cash ~$1.8B Flow Forecast1: 15% CASH PRIORITIES • Bolster direct returns to shareowners • Support commercial growth through capital spending • Invest in future growth through 33% technology collaborations Acquisitions and • Expand the core through strategic Technology Collaborations acquisitions Capital Spending Dividends Share Repurchase 1. Estimate does not contemplate strategic acquisitions. Other 10
    • STRATEGIC OUTLOOK Seed Platforms Are Business Foundation, Establish Footprint for Traits, and Create Diversified Crop Portfolio Globally U.S. 2012 2008 SHARE TARGETS EU27 25.5% 30-34% 2008 SHARE 2012 TARGETS DEKALB 10.5% ~15% 12% 16-20% ASI CORN 20% 24-28% Asgrow 9% 10-12% ASI INDIA 2008 SHARE 2012 TARGETS 41% ~50% Deltapine 36% 40-44% CORN 5% 12% COTTON LA - NORTH 2008 SHARE 2012 TARGETS 62-66% 58% CORN BRAZIL 2008 SHARE 2012 TARGETS 40% 44-48% CORN ARGENTINA 2008 SHARE 2012 TARGETS 21% 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
    • STRATEGIC OUTLOOK Significant Growth Opportunity in Expansion of Existing and Near Term Commercial Biotech Traits Globally SOYBEANS COTTON CORN INTERNATIONAL MARKET OPPORTUNITY ROUNDUP ROUNDUP BOLLGARD ROUNDUP YIELDGARD MARKET OPPORTUNITY FOR BIOTECH TRAITS THROUGH 20101 ROUNDUP YIELDGARD READY READY AND READY CORN SMARTSTAX READY ROOTWORM BOLLGARD II CORN 2 BORER 2 YIELD (FLEX) U.S. 65-75M 45-55M 10-12M 6-8M 80M 60-70M 45-55M 60-65M 2008 Penetration 97% 0% 63-75% 74-98% 86% 64-75% 55-67% 0% 45-50M2 Brazil 50-60M 3M 2M 15-20M 15-20M 5M 15-20M Argentina 40M - - - 9M 7M 5M 5-7M India - - 15-20M 18-20M 6M 6M - 5-6M Europe (EU27) 1M - - - 24M 8M 5M 15-20M South Africa 0.2M - .15M .15M 6M 4M - 4M 0.5M- Australia - - 0.5M-0.8M - - - - 0.8M OPPORTUNITY: 91-101M 45-50M 19-24M 21-23M 60-65M 40-45M 15M 44-57M Total Intl. Markets 2008 Penetration 77-86%1 66-74% 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
    • FINANCIAL OUTLOOK Increased 2009 and 2012 Targets for Roundup Reflect Sustainability Even As Supply-Demand Comes Into Balance ROUNDUP AND OTHER GLYPHOSATE-BASED HERBICIDES: Roundup and Other BRANDED AND NON-BRANDED TRENDS – 2004-2008 Glyphosate-Based Herbicides 300 Branded 2009 Forecast Non-Branded GROSS PROFIT TARGET: $2.3-$2.4B 250 Global Volume (in gallons) Above BRANDED PRICE BAND (PER GALLON): $16-$18 200 2012 Forecast GROSS PROFIT TARGET: $1.9B 150 BRANDED PRICE BAND $16-$18 (PER GALLON): 100 50 0 2004 2005 2006 2007 2008 GLOBAL VOLUME 209M 215M 235M 252M 257M (GALLONS): BRANDED PRICE BAND $11-$13 $11-$13 $11-$13 >$11-$13 ~$20 (PER GALLON): TOTAL ROUNDUP AND OTHER GLYPHOSATE-BASED $703M $637M $648M $854M $2.0B HERBICIDES GROSS PROFIT: 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 2010 2011 2012 TO MID-DECADE Roundup Drought- Nitrogen- SmartStax Ready 2 Yield Tolerant Corn Utilization Soybeans Family1 Corn 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 and refuge reduction • On track for 2009 release SUPERIOR, NE - FIELD TRIALS – 2007 FARM PROGRESS SHOW – 2007 WITH GENE CONTROL HYBRID FARM PROGRESS SHOW – 2007 (94 BU/AC) (76 BU/AC) 1. Part of the Monsanto-BASF Yield and Stress R&D Collaboration 14
    • R&D PIPELINE Monsanto’s Yield Leadership Widens With Each New Game- Changing Technology Launched DuPont Syngenta 2009 Option to License  2011 2nd‐Gen  Roundup Ready 2  Roundup  Soybean Trait Optimum®GAT®³ Yield⁶ Ready 2 Yield¹ 2012 All‐in‐One  2010 No Specified  Corn Trait  Optimum  Platform⁷ SmartStax Platform  AcreMax™ Plus⁴ Biotech  Drought  2012+² 2014+⁵ Post‐2014⁸ Tolerance  Corn 6. Press Release: “Monsanto and Syngenta  1. Controlled commercial release of 1‐2M  3. Optimum® and GAT® are registered  Reach Royalty‐Bearing Licensing  acres; Large‐scale launch of 5‐6M in 2010 trademarks of Pioneer Hi‐Bred; Date as  Agreement on Roundup Ready 2 Yield stated in DuPont press release 07‐17‐08 2. First trait in the Drought‐tolerant corn  Soybean Technology,” 05‐23‐08 family, currently Phase III 4. AcreMax™  is a trademark of Pioneer Hi‐ 7. No specified platform indicated via Corn  Bred; Date as stated by William S. Niebur,  Technology Pipeline, Syngenta Half Year  Ph.D., Merrill Lynch Agricultural Chemicals  Results Presentation, 07‐24‐08, Slide 22.   Conference, 06‐05‐08, Slide 14 Relevant component traits: VIP/Broad lep:  5. Ibid, Slide 23 2009 and RW dual mode of action: 2012 8. Ibid. 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 – 2006-2017 Strong Demand Environment FACTORS: 110 70 ► INCREASING PROTEIN Corn Total Trade Soybean Total Trade Soybeans – million metric tons DEMAND 60 105 Corn – million metric tons Wealth drives meat 50 100 consumption – changing feed 40 demand 95 ► ASCENSION OF CHINA 30 China’s growth is driving 90 20 huge changes in global oilseeds and grain trade 85 10 ► ESTABLISHMENT OF BIOFUELS 80 0 Assuming only base-case adoption of biofuels, more corn and soy needed in next decade USDA 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: ~70M 17 Source: USDA Agricultural Projections to 2017, available at: http://www.ers.usda.gov/Publications/OCE081/
    • STRATEGIC OUTLOOK Global Corn Production Per Acre Is Sub-Optimized Today, Creating an Opportunity for Innovation GLOBAL CORN PRODUCTION1: YIELD CORE PRODUCTIVITY MEASURES AND EVALUATION Boosting yield-per- acre can make a meaningful CANADA difference in EU 27 3M ACRES supply-demand 136 BU/AC 500M BUSHELS 27M ACRES 90% HYBRID environment U.S. 99 BU/AC CHINA 2B BUSHELS • If India, Mexico 90M ACRES 151 BU/AC 67M ACRES MEXICO 13B BUSHELS 83 BU/AC and Brazil moved 6B BUSHELS 18M ACRES 25% HYBRID to 100 bushel per INDIA 48 BU/AC BRAZIL 900M BUSHELS acre yields, they 20M ACRES 36M ACRES 45% HYBRID 75% HYBRID 32 BU/AC could produce 58 BU/AC 700M BUSHELS 2B BUSHELS nearly 4 billion additional ARGENTINA bushels of corn 10M ACRES 111 BU/AC 900M BUSHELS annually – equal to total world Optimization of yield per acre corn exports in 2007 Poor/Subsistence Sub-Optimized Optimized 18 1. Source is USDA FAS and internal estimates.
    • STRATEGIC OUTLOOK Monsanto’s Growth Opportunity Lies at the Intersection of Demand, Innovation and Execution Monsanto’s Simple Philosophy on Opportunity: YIELD More demand requires more INNOVATION More yield requires more GROWTH More innovation delivers more 19
    • STRATEGIC OUTLOOK Monsanto’s 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 EXAMPLE U.S. BASELINE CROP 2000 BASELINE1 325 137 bu/ac Corn: 300 37 bu/ac Soybeans: 275 Historical Yield 632 lbs/ac 250 Cotton: U.S. Yield Per Acre (bu/ac) 30-Year Trend 225 STRATEGIC RATIONALE Molecular Breeding Advances 200 Biotech Advances Helping meet global demand 175 150 Furthering competitive lead 125 Creating new value for 100 farmers that creates 75 sustainable growth 50 opportunities 25 0 1970 1980 1990 2000 2010 2020 2030 2030 U.S. YIELD U.S. YIELD TARGET ~300 bu/ac 151 bu/ac 2030: 2007: 1. Average U.S. yield by crop, USDA NASS 20
    • FINANCIAL OUTLOOK Yield and Innovation Create the Runway of Growth to 2012 for Seeds & Traits and for Monsanto as a Whole 2012 GROSS PROFIT TARGET GROSS PROFIT COMMITMENT: RELATIVE TO 2007 BASELINE 2007-2012F $9.5 - Total Gross Profit $9.75B $10,000 $9.5- BUSINESS DETAIL $8.6-9.1B $9.75B Roundup and Other $8,000 ~$1.9B Glyphosate-Based $8-8.5B >2X ~2.25X Herbicides GP (in millions) ~2X 2007 2007 BASELINE ~$300M All Other Ag $6,000 BASELINE 2007 Productivity BASELINE $7.3- Seeds & Genomics $4,000 $7.5B $4,230 2.6-2.7x Corn Seed & $2,000 Traits ~2x Soybean Seed & $0 Traits ORIGINAL MID-YEAR CURRENT BASELINE TARGET UPDATE GUIDANCE ~2x Cotton Seed & 2007 2012F Traits >2.5x •INCREASED •BETTER Vegetable Seeds ROUNDUP GROWTH IN GP TARGET SEEDS & TO $1.8B TRAITS •2008 ACQUISITIONS •ROUNDUP GP TARGET OF $1.9B 21
    • FINANCIAL OUTLOOK Near Term, 2009 Again Projects Double-Digit Earnings Growth and Strong Cash Generation 2008 2009F EARNINGS $4.20-$4.40 $3.64 ONGOING EARNINGS PER SHARE ~15-20% GROWTH >80% GROWTH FROM 2007 FROM 2008 Seeds & Genomics Gross Profit $3.9B $4.5-$4.6B Corn Seed & Traits Gross Profit $2.2B ~$2.8B Soybean Seed & Traits Gross Profit $725M ~$700M Cotton Seed & Traits Gross Profit $313M ~$300M Vegetable Seeds Gross Profit $394M ~$500M All Other Seed & Traits Gross Profit $251M ~$200M Roundup And All Other Glyphosate-based $2.0B $2.3-2.4B Herbicides Gross Profit All Other Ag Productivity Gross Profit $344M ~$400M CASH MANAGEMENT AND SPENDING FREE CASH FLOW $772M ~$1.8B Operating Cash $2.8B >$3B Capital Expenditures $918M ~$1B SG&A as a Percent of Sales 20% 19% Range R&D as a Percent of Sales 9% 9.5%-10% Range 22
    • USES OF CASH Over 70% of the $2.8 Billion of Operating Cash Generated Invested in Acquisitions, Technology and Capital in FY08 USES OF CASH PERCENT OF $2.8B OPERATING CASH USED BY CATEGORY: FY2008 2% Cash Generation 13% $772M FY2008 Free Cash Flow: 37% FY2009 Free Cash ~$1.8B Flow Forecast1: 15% CASH PRIORITIES • Bolster direct returns to shareowners • Support commercial growth through capital spending • Invest in future growth through 33% technology collaborations Acquisitions and • Expand the core through strategic Technology Collaborations acquisitions Capital Spending Dividends Share Repurchase 1. Estimate does not contemplate strategic acquisitions. Other 23
    • FINANCIAL OUTLOOK On Track in 2008, Growth Drivers Continue to Set Stage for Growth Through 2012 GROSS PROFIT OUTLOOK BY SEGMENT 2007-2012F $10,000 TOTAL GROSS All Other Agricultural Productivity PROFIT GROWS TO >2.25X Roundup and Other Glyphosate-based Herbicides $8,000 2007 BASELINE Seeds & Genomics $6,000 $4,000 2008 SEEDS & GENOMICS $2,000 GENERATES $3.9B OF GROSS PROFIT $0 2007 2008 2009F 2010F 2011F 2012F U.S. Corn Int’l Corn Cotton Vegetables R&D Pipeline Soybeans • Expand seed • Establish and • Prepare for • Accelerate U.S. • Reinvigorate • Largest-ever footprint expand seed commercial traits and margins R&D field footprint launch of breeding effort • Drive trait • DeRuiter Roundup • Drive trait • Drive int’l traits penetration integration Ready 2 Yield penetration SmartStax Accelerated trait Roundup Ready Globalized $1B Vegetable Game-Changing Platform platform 2 Yield Platform Cotton Platform Platform Launches
    • OVERVIEW Gross Profit Growth Comes From Two-Step Strategy: Establish Seed Footprint, Then Layer on Biotech Traits BREEDING BIOTECH TRAIT 3 R&D TRAIT 2 SEED ENGINE TRAIT 1 SEED Establish Seed Footprint Add Biotech Traits • Seed provides a core gross-profit • Higher margins than seed with contribution minimal incremental cost of goods STRATEGIC VALUE • Seed footprint speeds penetration • Opportunity to stack multiple traits rate of biotech traits per acre • Access to global germplasm • Proven, commercial-driven R&D pools combined with most program backed by industry’s DIFFERENTIATORS advanced breeding technology largest seed-and-trait R&D spend creates seed that outperforms • Collaborator of choice competitors • New trait introductions MEASURES OF SUCCESS • Seed share growth • Trait upgrade and trait platform opportunity Corn: U.S., Argentina, Brazil, Europe, Central America Corn: U.S., Argentina, Brazil KEY CROPS & GEOGRAPHIES Soybeans: U.S. Soybeans: U.S., Brazil Cotton: U.S., India Cotton: U.S., India, Australia Vegetables: Global 25
    • STRATEGIC OUTLOOK Significant Growth Opportunity in Expansion of Existing and Near Term Commercial Biotech Traits Globally SOYBEANS COTTON CORN INTERNATIONAL MARKET OPPORTUNITY ROUNDUP ROUNDUP BOLLGARD ROUNDUP YIELDGARD MARKET OPPORTUNITY FOR BIOTECH TRAITS THROUGH 20101 ROUNDUP YIELDGARD READY READY AND READY CORN SMARTSTAX READY ROOTWORM BOLLGARD II CORN 2 BORER 2 YIELD (FLEX) U.S. 65-75M 45-55M 10-12M 6-8M 80M 60-70M 45-55M 60-65M 2008 Penetration 97% 0% 63-75% 74-98% 86% 64-75% 55-67% 0% 45-50M2 Brazil 50-60M 3M 2M 15-20M 15-20M 5M 15-20M Argentina 40M - - - 9M 7M 5M 5-7M India - - 15-20M 18-20M 6M 6M - 5-6M Europe (EU27) 1M - - - 24M 8M 5M 15-20M South Africa 0.2M - .15M .15M 6M 4M - 4M 0.5M- Australia - - 0.5M-0.8M - - - - 0.8M OPPORTUNITY: 91-101M 45-50M 19-24M 21-23M 60-65M 40-45M 15M 44-57M Total Intl. Markets 2008 Penetration 77-86%1 66-74% 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. 26
    • 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 Sales For 2009, Corn Seeds & $3,500 >$3.5B Traits 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 $2,000 share, increasing trait penetration and increasing 56% $1,721 $1,500 prices $1,000 Margin increases by $1,019 54% $825 increasing mix toward traits $500 2009 DRIVERS $0 52% 2005 2006 2007 2008 Increasing triple-stack penetration in U.S. combined Net Sales Gross Profit Gross Profit as Percent of Sales with stronger trait pricing Launch of new traits in Argentina and Brazil 28
    • FINANCIAL OUTLOOK Yield-Enhancing Technology Creates Value – Returning $1.50-$3 For Every Dollar Spent By Farmers in Corn U.S. FARMER RETURN ON INVESTMENT: 1983-2008F 170 160 150 32 140 130 Bu/ac 120 FARMER RETURN OF bu/ac 1.5X – 3X 110 PER DOLLAR SPENT 100 ON YIELD-CREATING TECHNOLOGY @ COMMODITY PRICE RANGE OF $2-$4/BU 90 80 PRE-BIOTECH: 1983-1996 POST-BIOTECH: 1996-2008F AVERAGE YIELD DURING AVERAGE YIELD DURING 115.6 bu/ac 138.3 bu/ac PERIOD: PERIOD: 1.7 bu/ac 2.6 bu/ac ANNUAL YIELD GAIN: ANNUAL YIELD GAIN: YIELD-RELATED PRODUCTION Seed/ Chem/ $27.07/ac $43.24/ac Equip/ Labor COSTS SCARCITY-RELATED $19.33/ac $52.02/ac Land Rent $6.23/ac $94.90/ac Fertilizer 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 Estimate 29
    • CORN SEED & TRAITS U.S. DEKALB Share Consistently Ahead of Expectations; Growth Trend Continues in 2009 DEKALB U.S. CORN SHARE EVOLUTION: CORN 2001-2009F FINANCIAL OUTLOOK 30% Three years of growth since 2005 have outpaced projected 28% growth each year GROW 26% 2%+ 2009: Trend continues with 25.5% 24% early commitment for accelerated growth in 23% 22% DEKALB and ASI 20% 2009 DRIVERS TARGET 19% 18% 2+ U.S. DEKALB Share 2005 PROJECTED 16% +1 AVERAGE GROWTH 16% U.S. ASI Share TREND 14% TRAIT TARGETS 14% 13% 12% U.S. Triple-Stack 10% 12% 34-35M Penetration 10% 2001 2002 2003 2004 2005 2006 2007 2008 2009F 1.4 1.5 1.7 1.9 2.2 >2.4 ~2.5 DEKALB Trait Penetration Trend: 2003-2009F Average Number of Traits Per Acre in DEKALB Seed1 1. Trait intensity reflects the average number of traits per acre with at least one trait 30
    • CORN SEED & TRAITS Seed Platforms Are Business Foundation, Establish Footprint for Traits, and Create Diversified Crop Portfolio Globally EU27 2008 SHARE 2012 TARGETS 12% 16-20% CORN U.S. 2012 2008 SHARE TARGETS 25.5% 30-34% DEKALB 10.5% ~15% ASI INDIA 2008 SHARE 2012 TARGETS 36% 40-44% CORN LA - NORTH 2008 SHARE 2012 TARGETS 62-66% 58% CORN BRAZIL 2008 SHARE 2012 TARGETS 40% 44-48% CORN ARGENTINA 2008 SHARE 2012 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
    • CORN SEED & TRAITS Triple Stack Penetration Accelerates, Creating Added Growth and Setting Stage for SmartStax Launch U.S. CORN TRAIT OPPORTUNITY: 2005-2010F 70 220 200 U.S. TRIPLE-STACK ACRES 60 180 U.S. TRAIT ACRES (IN MILLIONS) 160 50 (IN MILLIONS) 140 40 120 100 30 80 20 60 40 10 20 0 0 2007 2008 2009F 2005 2006 2007 2008F 2009F 2010F 2010 • Opportunity Q3UPDATE Rootworm Control NA 50-65M 20.8M 30.1M Corn Borer Control NA 60-70M 42.4M 45M Glyphosate Tolerance NA 80M 57.9M 68.8M Triple Stack/SmartStax 17.6M 29.1M 34-35M 50-65M Opportunity widens in 2010 with launch of SmartStax Trait acres reflect the total acres planted with each individual trait. In the case of stacked traits, each absolute acre will be reflected by two or more trait acres. 32
    • CORN SEED & TRAITS Monsanto’s 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, SMARTSTAX how likely would you be to switch seed brands to obtain this new technology? Would you say: “Very likely” or “Somewhat likely” COMMERCIAL OPPORTUNITY YIELDGARD CORN 74% BORER USERS WHO LAUNCH TARGET: 2010 TREAT FOR ROOTWORM TARGET ACRE 60-65M OPPORTUNITY: 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% VALUE PROPOSITION PERCENT OF FARMERS 2008 trials evaluating SmartStax in elite HERCULEX® I CORN 65% BORER USERS WHO germplasm, quantifying sources of TREAT FOR ROOTWORM 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 reduced REDUCTION Reduced refuge 3-6% STRATEGY: refuge in Southern geographies • Bollgard II natural refuge in cotton 5-10% • On track for 2010 • COMMERCIAL All components have U.S. approvals TRACK: • Final regulatory package with 5% refuge request submitted in June 2008 33
    • CORN SEED & TRAITS Larger Seed Footprints in South America Enable Larger Launches and Faster Ramp Up Than Competition LATIN AMERICAN CORN LATIN AMERICA NORTH OUTLOOK: CURRENT 5-YEAR OUTLOOK #1 position in all key SEED & TRAIT TRENDS THROUGH 2012 SEED SHARE: countries 7-8M MEXICO HYBRID ACRES: In approval stage BIOTECH STATUS: HONDURAS GUATEMALA • Integration of Cristiani; Expand seed footprint for FY2009 PRIORITIES: EL SALVADOR pending trait introductions COLOMBIA BRAZIL CURRENT 5-YEAR OUTLOOK 40% (#1 position) SEED SHARE: BRAZIL PERU 25-27M HYBRID ACRES: 1st commercial trait in BIOTECH FY2009 STATUS: • Targeted share gain: 1-2 points FY2009 • 1-2M acre launch of YieldGard Corn Borer; sold- PRIORITIES: out in Q1 ARGENTINA ARGENTINA CURRENT 5-YEAR OUTLOOK 46% (#1 position) SEED SHARE: 8-10M HYBRID ACRES: Commercial planting BIOTECH STATUS: • Targeted share gain: 1-2 points FY2009 PRIORITIES: • 1-2M acre launch of YieldGard Corn Borer with Roundup Ready Corn 2 stack; sold-out in Q1 34
    • CORN SEED & TRAITS Monsanto’s Pricing Model Aimed at Total Value Created; Shared with Farmer YieldGard VT Triple Improved Yield PRICING TO VALUE EXAMPLE: 2009 UPDATE: Yield-advantage value at 3 year Improved Yield1 average 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: $4.00 Indirect Benefits $60-$80 Quantified benefits, such as convenience and Indirect Benefits2 peace of mind INDIRECT BENEFITS: $5 • Value shared with farmers Incremental Value Created $65-$85 (+) Replacement Value Factors costs farmers would have incurred for substitute insect and weed control • 100% of replacement value is captured PRICING APPROACH UPDATE: Per-Acre Trait Cost3: $29-$54 UPDATE: Replacement PRICING APPROACH ($11-$19) Value4 Percentage of incremental value shared Incremental Farmer Cost: $18-$35 ultimately 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 and peace 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 package 35
    • SOYBEAN SEED & TRAITS Soybean Seeds and Traits Poised for Renaissance Driven By Roundup 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 >$1.1B For 2009, Soybean Seeds & $1,200 60% Traits gross profit is forecast to be flat with 2008 $1,000 50% Performance more subject to $800 40% planted acres because of $M significant trait penetration $725M $667 $600 30% $613 In 2009, lower acres and $588 higher production cost for $400 20% seed still prominent $200 10% Beyond 2009, Roundup Ready 2 Yield creates new margin $0 0% opportunity as acres expand 2005 2006 2007 2008 2009 DRIVERS Net Sales Gross Profit Gross Profit as Percent of Sales Focus on 1-2M acre controlled commercial release of Roundup Ready 2 Yield 37
    • SOYBEAN SEED & TRAITS Roundup 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 OPPORTUNITY U.S. SOYBEANS Near-Isoline Comparisons: 2007 U.S. AVERAGE Roundup Ready 2 Yield vs. Roundup Ready 41.6 bu YIELD PER ACRE: % Yield Increase over Roundup Ready 12% ROUNDUP READY 2 YIELD TARGETED YIELD 11% 7-11% 10% IMPROVEMENT: 9% 9% 8% VALUE PROPOSITION 7% 7% 6% YIELD IMPROVEMENT ON 3-5 bu/ac AVERAGE YIELDS: 4% INCREMENTAL YIELD VALUE TO $27-$45/acre FARMER (VERSUS ROUNDUP READY): 2% PRICING SEAMLESS PRICE 0% $69-$72 FOR ROUNDUP 4 YEAR READY 2 YIELD 2004 2005 2006 2007 SEED (PER ACRE)1: AVERAGE SEAMLESS PRICE FOR FIRST- Roundup Ready 2 Yield soybeans yield 7 to 11 percent GENERATION $49-$52 ROUNDUP READY higher than Roundup Ready soybeans based on 73 SEED (PER ACRE)1: Monsanto field trials from 2004-2007 1. Reflects seamless pricing to farmer, including trait value, germplasm value and value provided by seed treatment 38
    • COTTON SEED & TRAITS Seed Platforms Are Business Foundation, Establish Footprint for Traits, and Create Diversified Crop Portfolio Globally U.S. 2012 2008 SHARE TARGETS 41% ~50% Deltapine INDIA 2008 SHARE 2012 TARGETS 5% 12% COTTON BRAZIL 2008 SHARE 2012 TARGETS 21% 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
    • COTTON SEED & TRAITS Cotton Platform Segregating Into Value- and Volume-Focused Opportunities To Reflect Changing Global Production CHANGING GLOBAL COTTON LANDSCAPE 2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008 16 16 Monsanto insect-protected 17.2 Monsanto insect-protected trait acres trait acres 14.6 12 12 Acres (M) Acres (M) 8 8 8.7 8.6 7.8 7.8 6.6 5.9 5.7 4 4 1.3 3.1 0.2 0 0 13.5M 13.7M 14.2M 15.2M 10.8M 9.4M INDIA PLANTED 3X PLANTED ACRES UNITED STATES MORE BOLLGARD AND BOLLGARD II THAN U.S. IN 2008 VOLUME VALUE Expanding cotton market with U.S. acres likely to continue to be small, but growing demand for technology, among highest value but assumes local pricing risk • Technology adoption still needed to improve • Second-generation farmer profitability conversion continues to move ahead • Deltapine brand continues to provide access to world’s largest cotton germplasm pool 41
    • COTTON SEED & TRAITS Regardless of Where Cotton Is Grown Geographically, Trait Intensity Is Key Opportunity for Monsanto GLOBAL COTTON SEED AND TRAITS GROSS PROFIT COTTON INDEX=2007 FINANCIAL OUTLOOK 2012F 2007 With Delta & Pine Land acquisition, lower-margin seed is greater portion of product mix – softening margins Corn and soybeans have displaced cotton in Deltapine brand’s core U.S. geographies ~2X 2009 DRIVERS Re-establish U.S. share OVER 2007 INDEX growth, promote second-gen U.S Cotton Seeds & Traits Gross Profit penetration in U.S. and India International Cotton Seeds & Traits Gross Profit 42
    • VEGETABLE SEEDS Vegetable Core Platforms Are Established, Focusing on Execution and Growth To Become $1B Business by 2012 VEGETABLES $1,400 $1.2B $1,200 FINANCIAL OUTLOOK >$1B $1,000 $M $800 By 2012, Vegetable business $725M roughly equates to today’s $600 >$650M soybean business – currently $400 Monsanto’s second-largest seed-and-trait segment $200 Sales growth continues in $0 NET GROSS NET GROSS mid-single digits; Margin SALES PROFIT SALES PROFIT grows through pricing, new Vegetable Platform: Soybean Platform: products and increase of 2012F 2008 protected-culture business RANK ORDER GROSS PROFIT GENERATORS: 2012F 2009 DRIVERS Corn Seeds & Traits Focus on operation and execution of 3-channel Soybean Seeds & Traits approach: Seminis open-field, Vegetable Seeds DeRuiter protected-culture, and ISG regional brands Cotton Seeds & Traits All Other Seeds & Traits 44
    • VEGETABLE SEEDS De Ruiter Seeds Is Perfect Complement to Seminis, Setting Pace for Growth Through 2012 FY07 Annual net Sales = $145M FY08 Annual Net Sales = $744M Portfolio Composition: Percent of Sales1 Portfolio Composition: Percent of Sales1 10% 13% Open-Field Protected-Culture 87% 90% Pairing Seminis with De Ruiter Seeds brings together the leading positions in open-field and protected-culture segments • Both divisions benefit from the coordinated 1. Size of pies not to scale with revenue molecular breeding infrastructure generated by Seminis or De Ruiter Seeds 45
    • ROUNDUP Increased 2009 and 2012 Targets for Roundup Reflect Sustainability Even As Supply-Demand Comes Into Balance ROUNDUP AND OTHER GLYPHOSATE-BASED HERBICIDES: Roundup and Other BRANDED AND NON-BRANDED TRENDS – 2004-2008 Glyphosate-Based Herbicides 300 Branded 2009 Forecast Non-Branded GROSS PROFIT TARGET: $2.3-$2.4B 250 Global Volume (in gallons) Above BRANDED PRICE BAND (PER GALLON): $16-$18 200 2012 Forecast GROSS PROFIT TARGET: $1.9B 150 BRANDED PRICE BAND $16-$18 (PER GALLON): 100 50 0 2004 2005 2006 2007 2008 GLOBAL VOLUME 209M 215M 235M 252M 257M (GALLONS): BRANDED PRICE BAND $11-$13 $11-$13 $11-$13 >$11-$13 ~$20 (PER GALLON): TOTAL ROUNDUP AND OTHER GLYPHOSATE-BASED $703M $637M $648M $854M $2.0B HERBICIDES GROSS PROFIT: 47
    • R&D PIPELINE Phase Advancements For Key Projects Reflect Progress and Strength Throughout Monsanto’s Industry-Leading Pipeline BIOTECH TRAIT PIPELINE: JANUARY 2008 UPDATE PHASE PHASE PHASE PHASE D 1 3 2 4 PHASE PHASE PHASE PHASE D 1 3 2 4 AGRONOMIC TRAITS YIELD AND STRESS PIPELINE ROUNDUP READY 2 YIELD SOYBEANS DROUGHT-TOLERANT CORN FAMILY YIELDGARD VT PRO 2ND-GEN YIELDGARD CORN BORER DROUGHT-TOLERANT CORN SMARTSTAX CORN 2ND-GEN DROUGHT-TOLERANT CORN DICAMBA-TOLERANT SOYBEANS NITROGEN-UTILIZATION CORN FAMILY INSECT-PROTECTED + ROUNDUP READY 2 YIELD SOYBEANS NITROGEN-UTILIZATION CORN BOLLGARD III BROAD-ACRE HIGHER-YIELDING CORN FAMILY SOYBEAN NEMATODE- RESISTANCE HIGHER-YIELDING CORN SOYBEAN DISEASE BROAD-ACRE HIGHER-YIELDING SOYBEAN FAMILY DICAMBA-TOLERANT COTTON HIGHER-YIELDING SOYBEANS COTTON LYGUS CONTROL 2ND-GEN HIGHER-YIELDING SOYBEANS YIELDGARD ROOTWORM III DROUGHT-TOLERANT COTTON VALUE-ADDED TRAITS FAMILY DROUGHT-TOLERANT COTTON EXTRAX™ CORN PROCESSING SYSTEM + MAVERA HIGH-VALUE BROAD-ACRE HIGHER-YIELDING CORN WITH LYSINE2 CANOLA FAMILY HIGH-OIL SOYBEANS HIGHER-YIELDING + ROUNDUP READY 2 YIELD CANOLA1 2ND-GEN HIGH-OIL SOYBEANS High Impact Technologies (HIT) project OMEGA-3 ENRICHED SOYBEANS Jan. 3, 2008 Advancements/Additions VISTIVE III SOYBEANS The colored bar associated with each project indicates which phase that project is in. It is not 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-yielding trait is incorporated into the Yield and Stress collaboration with BASF HIGH-OIL CORN 2. Value of licensing the EXTRAX™ technology is shared with Cargill as a part of Renessen 49 joint venture
    • 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 2010 2011 2012 TO MID-DECADE Roundup Drought- Nitrogen- SmartStax Ready 2 Yield Tolerant Corn Utilization Soybeans Family1 Corn 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 and refuge reduction • On track for 2009 release SUPERIOR, NE - FIELD TRIALS – 2007 FARM PROGRESS SHOW – 2007 WITH GENE CONTROL HYBRID FARM PROGRESS SHOW – 2007 (94 BU/AC) (76 BU/AC) 1. Part of the Monsanto-BASF Yield and Stress R&D Collaboration 50
    • OVERVIEW Monsanto’s Yield Leadership Widens With Each New Game- Changing Technology Launched DuPont Syngenta 2009 Option to License  2011 2nd‐Gen  Roundup Ready 2  Roundup  Soybean Trait Optimum®GAT®³ Yield⁶ Ready 2 Yield¹ 2012 All‐in‐One  2010 No Specified  Corn Trait  Optimum  Platform⁷ SmartStax Platform  AcreMax™ Plus⁴ Biotech  Drought  2012+² 2014+⁵ Post‐2014⁸ Tolerance  Corn 6. Press Release: “Monsanto and Syngenta  1. Controlled commercial release of 1‐2M  3. Optimum® and GAT® are registered  Reach Royalty‐Bearing Licensing  acres; Large‐scale launch of 5‐6M in 2010 trademarks of Pioneer Hi‐Bred; Date as  Agreement on Roundup Ready 2 Yield stated in DuPont press release 07‐17‐08 2. First trait in the Drought‐tolerant corn  Soybean Technology,” 05‐23‐08 family, currently Phase III 4. AcreMax™  is a trademark of Pioneer Hi‐ 7. No specified platform indicated via Corn  Bred; Date as stated by William S. Niebur,  Technology Pipeline, Syngenta Half Year  Ph.D., Merrill Lynch Agricultural Chemicals  Results Presentation, 07‐24‐08, Slide 22.   Conference, 06‐05‐08, Slide 14 Relevant component traits: VIP/Broad lep:  5. Ibid, Slide 23 2009 and RW dual mode of action: 2012 8. Ibid. 51
    • R&D PIPELINE Insect-Protected Soybeans Are First-Ever Monsanto Trait Developed Exclusively for Non-U.S. Opportunity 2007 FIELD TESTING SHOWS VISUAL R&D Pipeline PROOF 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-$300M CONTROL WITH GENE VALUE2: (NO INSECTICIDE) (NO INSECTICIDE) SOURCES OF VALUE: Insecticide substitution Insect-protected soybeans with Roundup Ready 2 Yield 1 Based on 2 current sprays technology demonstrated significant protection from key costing almost $6/acre total lepidopteran pests, including soybean looper, in 2007 tests Improved yield 2 4+% increase over chemical 1. Acre opportunity reflects acres where trait could have technological fit. Opportunity does not reflect acres that may be insecticides planted 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 2020 52
    • R&D PIPELINE Higher-Yielding Soybeans Continue to Demonstrate Improved Yield Over Conventional Controls 2007/08 HIGHER-YIELDING SOYBEAN NEW: 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 2 STATUS: (bu/a increase over control) Average Yield Advantage PROJECT CONCEPT: 6.0 PRODUCT Higher-yielding soybeans aimed at CONCEPT boosting intrinsic yield potential of TARGET 4.0 RANGE soybeans through insertion of key genes VALUE: 2.0 LAUNCH-COUNTRY 45M ACRES1: 0.0 2020 VALUE2: $300-$500M Event 1 Event 2 Event 3 Event 4 Event 5 SOURCES OF VALUE: Season 1: 2007 U.S. Field Trials (18 locations) Season 2: 2007/08 LA Field Trials (12 locations) Improved yield 16 top-performing events advanced to Latin America trials. 1 Targeting yield improvement of 6-10% Lead events showing strong yield advantages over conventional controls in both trials. Higher-yielding trait will be stacked on top of Roundup Ready 2 Yield and other soybean-pipeline traits. 1. Acre opportunity reflects acres where technology fits at Monsanto's 2007 market share in respective crops 2. 2020 value reflects gross sales opportunity in launch country in year 2020 53 PART OF THE MONSANTO BASF YIELD AND STRESS R&D COLLABORATION
    • R&D PIPELINE 2007 Dryland Field Tests of Lead Drought Event Offers Visual Evidence of Increased Yield In Stressed Conditions 2007 FIELD TESTING SHOWS VISUAL R&D Pipeline PROOF OF YIELD IMPROVEMENT Drought-Tolerant Corn Family: SUPERIOR, NE - FIELD TRIALS – 2007 Lead Project HIT Project Phase 3 PROJECT CONCEPT: Drought-tolerance family aimed at providing consistent yield and buffering against effects of water limitations VALUE: LAUNCH-COUNTRY 55M ACRES1: 2020 VALUE2: $300-$500M SOURCES OF VALUE: Improved yield Targeting 6-10% yield 1 CONTROL HYBRID WITH 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 development Monsanto's 2007 market share in respective crops can have significant effect on corn yield; Monsanto’s lead 2. 2020 value reflects gross sales opportunity in launch country drought-tolerance trait shows a significant yield advantage in year 2020 compared with controls under drought stress 54 PART OF THE MONSANTO BASF YIELD AND STRESS R&D COLLABORATION
    • R&D PIPELINE Second-Generation Drought-Tolerant Corn Targeted to Expand Reach Drought Efficacy for Second-Gen Events 16 R&D Pipeline Yield Difference Over Controls (%) 14 Drought-Tolerant Corn Family: 12 Second-Generation Project 10 PRODUCT CONCEPT Phase 2 8 STATUS: KEY RESULTS TARGET RANGE 6 PROJECT CONCEPT: 4 Drought-tolerance family aimed at 2 providing consistent yield and 0 EVENT 1EVENT 2 EVENT 3 EVENT 1EVENT 2 EVENT 3 buffering against effects of water HIGHER-YIELDING ENVIRONMENT LOWER-YIELDING ENVIRONMENT limitations AVERAGE YIELD: 166 BU/AC AVERAGE YIELD: 53 BU/AC VALUE: 2007 2006 LAUNCH-COUNTRY 55M (All three events significant @ p≤0.10); Statistical significance determined by ANOVA (2006) or nonparametric test (2007) ACRES1: 2020 VALUE2: $300-$500M SOURCES OF VALUE: SEGMENTED VALUE OPPORTUNITY ACROSS MARKETS Improved yield Second generation KEY OPPORTUINITY IRRIGATED Targeting 6-10% yield demonstrates 1 8-12M Acres improvement in water-stress performance over environments WESTERN broad range of stress DRYLAND conditions in both low Water substitution 10-12M Acres and high-yielding 2 Variable costs in pumped environments irrigation of >$100/ acre STABILITY Potential for a broad 60-70M Acres Low annual High annual 1. Acre opportunity reflects acres where technology fits at acreage fit across all precipitation Monsanto'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 University in year 2020 55 PART OF THE MONSANTO BASF YIELD AND STRESS R&D COLLABORATION
    • R&D PIPELINE In Continued Field Testing, Nitrogen-Utilization Lead Shows Yield Improvement Under Normal Nitrogen LEAD PERFORMANCE UNDER NORMAL R&D Pipeline NITROGEN CONDITIONS Nitrogen-Utilization Corn Family: Lead Project Yield Increase (bu/Ac) 12 * ** Phase 1 10 *** STATUS: * 8 PROJECT CONCEPT: 6 4 Targets ways to use nitrogen more 2 efficiently, exploring potential to 0 boost yield under normal nitrogen -2 conditions or stabilize it in low TRIALS IN MULTIPLE TRIALS IN MULTIPLE nitrogen environments HYBRID BACKGROUNDS HYBRID BACKGROUNDS VALUE: (15 LOC) (16 LOC) LAUNCH-COUNTRY 2005 55M 2006 YIELD TRIALS: ACRES1: 2007 YIELD TRIALS: YIELD SUFFICIENT N LEVELS SUFFICIENT N LEVELS TRIALS: 2020 VALUE2: (37 LOC TOTAL) $300-$500M (20 LOC TOTAL) (23 LOC TOTAL) SOURCES OF VALUE: 2005 2006 2007 Improved yield * Statistically significant @ p≤0.10 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 over Monsanto's 2007 market share in respective crops multiple years 2. 2020 value reflects gross sales opportunity in launch country in year 2020 56 PART OF THE MONSANTO BASF YIELD AND STRESS R&D COLLABORATION
    • R&D PIPELINE Strong Pipeline Reflects Growing Innovation and Value of Emerging Yield and Stress Traits DISCOVERY PHASE 1 PHASE 2 PHASE 3 PHASE 4 Drought- HIGH Tolerant FAMILY TRAITS► Family CORN: COLLABORATION YIELD & STRESS Nitrogen- BROAD-ACRE HIGH Utilization FAMILY TRAITS► YIELD Family Broad-Acre, MEGA Higher-Yielding FAMILY TRAITS► Family SOYBEANS: Broad-Acre, BROAD-ACRE HIGH Higher-Yielding FAMILY TRAITS► YIELD Family 2020 VALUE RANGES: Omega-3 Roundup Bollgard III soybeans Ready 2 Yield soybeans MEGA HIGH Roundup Insect-protected $300M-$500M >$1BM Ready 2 Roundup Ready 2 Yield canola YieldGard Yield soybeans VT PRO Dicamba- corn MID LOW tolerant soybeans <$150M $150M-$300M Vistive III Improved- protein High-oil Corn Soybeans Cotton Canola soybeans soybeans Note: 2020 value ranges reflects expected annual gross sales in launch country in 2020. 57
    • CREDIT With Different Core Structure, Credit Access For Farmers Remains Solid As Purchase-Season Approaches U.S. FARM BUSINESS DEBT: U.S. Farm Credit SHARE BY CATEGORY, 2000-2006 LENDING SYSTEM 45 • One-third of farmers get financing from the Farm 42.4% 40 Credit System – Percentage of Market government-backed lending 35 earmarked for agriculture 32.6% 30 • Around 40 percent of farmers tap into regional 25 and community banks 17.2% 20 • Rely on core deposits for funding 15 • Continue to hold interest rates steady and lines of credit open 10 5.3% • 15-20 percent use credit 5 lines provided by 2.6% agricultural suppliers 0 2000 2001 2002 2003 2004 2005 2006 Commercial Banks Farm Credit System Individuals & Others Life Insurance Companies USDA FSA Source: USDA Economic Research Service Year-end 2006 preliminary estimates shown 59
    • CREDIT With the Season Well Under Way, Credit Access For Farmers in Brazil and Argentina Is Holding ARGENTINA FARM BUSINESS DEBT: Argentina and Brazil Farm SHARE BY CATEGORY, 2000-2006 Credit MONSANTO SALES 100 • In fiscal year 2008, 90 approximately 55% of our 80 sales in Brazil were for cash Percentage of Market 65% or grain, or for terms 70 securitized with grain and 60 land. 50 • In Argentina in fiscal year 2008, approximately 75% of 40 our sales were for cash or 27% 30 were collateralized with grain contracts. 20 8% 10 0 2000 2001 2002 2003 2004 2005 2006 Commercial Banks AgChem & Seed Suppliers Individuals & Others Note: Decline in credit from banks and Agchem and Seed dealers in 2002 in Argentina was due to significant currency de-valuation. 60
    • Reconciliation of Non-GAAP Financial Measures Reconciliation of Free Cash Flow Fiscal Year 2009 Fiscal Year Fiscal Year $ Millions Forecast 2008 2007 Net Cash Provided (Required) by Operations $3,000 $2,799 $1,854 Net Cash Provided (Required) by Investing Activities (1,200) (2,027) (1,911) Free Cash Flow $1,800 $772 ($57) Net Cash Provided (Required) by Financing Activities N/A (102) (583) Effect of Exchange Rate Changes on Cash and Cash Equivalents N/A 77 46 Net Increase (Decrease) in Cash and Cash Equivalents N/A $747 ($594) Reconciliation of Non-GAAP EPS Fiscal Year Fourth Fourth 2009 Fiscal Year Fiscal Year $ per share Forecast 2008 2007 Quarter 2008 Quarter 2007 $4.20-$4.40 $3.62 $1.79 ($0.31) ($0.39) Diluted Earnings (Loss) per Share Solutia Claim Settlement -- ($0.23) -- -- -- Loss (Income) on Discontinued Operations -- ($0.04) ($0.15) ($0.01) ($0.13) In-Process R & D Write-Off Related to the De Ruiter -- $0.29 -- $0.29 -- Acquisition In-Process R & D Write-Off Related to the Delta & Pine Land -- -- $0.34 -- $0.34 (D&PL) Acquisition Diluted Earnings (Loss) per Share from Ongoing Business $4.20-$4.40 $3.64 $1.98 ($0.03) ($0.18) 62