monsanto 11-10-05b

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monsanto 11-10-05b

  1. 1. ROBB FRALEY CHIEF TECHNOLOGY OFFICER MONSANTO BIENNIAL U.S. INVESTOR DAY Nov. 10, 2005 1
  2. 2. OVERVIEW Breeding and Biotech Provide Parallel R&D Paths to Commercial Products BREEDING and BIOTECHNOLOGY form two R&D pathways Separate, but parallel, the BREEDING and BIOTECHNOLOGY pathways are linked by shared tools. DISCOVERY PHASE I PHASE II R&D PHASE: PHASE III PHASE IV LAUNCH BREEDING COMMERCIAL IT PLATFORM GERMPLASM G ANALYTICS MARKERS GENOMICS SEED ELITE Germplasm SOLD TO FARMERS R BIOTECHNOLOGY 2
  3. 3. OVERVIEW Monsanto Is Partner of Choice for Technology Innovators DISCOVERY PHASE I Gene/Trait Identification Proof of Concept STRUCTURE FUNCTION APPLICATION MONSANTO MENDEL MENDEL MENDEL Gene libraries Transcription factor hits Hit optimization Drought, cold, nitrogen, disease CERES ICORIA Gene libraries Gene screening CERES CERES Gene screening Gene screening DEVGEN Insect control DIVERGENCE Nematode control MONSANTO Corn & soybean trait testing MODULAR GENETICS Protein Optimization U of Nebraska TRAIT MONSANTO CAPABILITIES KSU COLLABORATIONS TGI, Inc. PARTNER CONTRIBUTION Arcadia MONSANTO Advanced lead testing in crops >20K GENE/ PROMOTER GENES TESTED: >2K GENE/ PROMOTER COMBOS IN CROPS COMBOS 3
  4. 4. OVERVIEW Trait DISCOVERY PHASE I PHASE II PHASE III PHASE IV Proof Of Concept Early Development Advanced Pre-launch Gene/Trait Pipeline Development Identification Roundup Ready Flex Cotton Tolerance Herbicide Roundup RReady2Yield Soybeans Roundup RReady2Yield Canola Dicamba-tolerant Soybeans 2nd-Gen YieldGard Rootworm Control 2nd-Gen YieldGard Corn Borer Pest FARMER BENEFITS YieldGard Rootworm II Soybean nematode-resistance Drought-tolerant Corn Higher-yielding Canola Drought-tolerant Soybeans Yield Drought-tolerant Cotton Higher-yielding Corn Nitrogen Utilization Corn Cold-tolerant Corn Higher-yielding Soybeans Mavera™ high-value corn with lysine Enhancements PROCESSOR Mavera™ I high-value soybeans Protein Mavera™ II high-value soybeans 2nd-Gen high-value corn with lysine Feed corn with balanced proteins L High oil soybeans for processing P Improved-protein soybeans CONSUMER Vistive II Low Lin – Mid Oleic soybeans Lipids Vistive III Low Lin – Mid Oleic – Low Sat soybeans B Omega-3 Soybeans Discovery Platform Abbreviations: 4 L P B Lipid Enhancements Protein Enhancements Bioactive Compounds
  5. 5. OVERVIEW Corn Germplasm Improvements Are Tightly Linked to Market Share Gains U.S. CORN MARKET SHARE 2004 CORN YIELD (BU/A) 220 HOLDENS/CORN STATES LICENSEES MONSANTO BRANDED 210 AMERICAN SEEDS, INC. BRANDS COMPETITORS 60% 200 DEKALB AND ASGROW BRANDS 50% 190 2004 40% 180 30% 170 20% 160 150 10% 95 100 105 110 0% RELATIVE MATURITIES (DAYS) 2001 2002 2003 2004 2005 2005 CORN YIELD (BU/A) BREEDING ADVANCES AND ADVANTAGES 200 Strong yield in 2004 translated into 190 a 2-point share gain in 2005 180 2004 In 2005, preliminary data indicates 170 continued yield advantage versus 160 best-in-class competitors 150 95 100 105 110 115 RELATIVE MATURITIES (DAYS) 5
  6. 6. PIPELINE UPDATE Cotton States Will Launch New Source of Cotton Seed KEY MARKET AREAS U.S. TARGET MARKET 7M-8M Cotton States CREATING VALUE PERCENT PENETRATED 0% • Licensing fee Germplasm licensed from third parties and developed through molecular reflects value of top breeding by Monsanto quality germplasm, separate from value Taking preliminary orders from licensees; Enough seed for approximately of trait 1 million acres available for licensing in 2006 • Cotton seed All varieties offered in 2006 will be on a second-generation trait platform currently sells for average of $20 per 2005 UNIVERSITY COTTON VARIETY TESTS acre retail 1,300 UP NEXT LBS LINT/ACRE 1,200 • 4+ licensees will sell seed sourced from Cotton States 1,100 in 2006, located broadly throughout Cotton Belt 1,000 COTTON STATES COMPETITIVE VARIETIES VARIETIES DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 6
  7. 7. OVERVIEW Seminis DISCOVERY PHASE II PHASE III PHASE PHASE I LAUNCH IV Proof Of Pipeline Gene/Trait Early Advanced Concept Identification Development Development Pre-launch BREED ING SE LECTIO N VEGETABLE BREEDING FAMILIES SOLANACEOUS QUALITY TARGETS 2005 Tomato Vencedor Hot Pepper Pepper 2006/7 Eggplant TYLCV Tomato CUCURBITS 2005 Grower Melon Watermelon MVR Squash Cucumber Squash Performance PX03913198 Melon Gourd 2006/7 High-Quality Watermelon Horticultural LARGE SEED 2005 Quality Beans Okra Devotion Sweet Corn Peas Sweet Corn 2006/7 Disease Sweeter Peas BRASSICA Resistance 2005 DOZENS DOZENS DOZENS <10 Broccoli Ironman Broccoli Cauliflower 2006/7 Cabbage Shelf Life Curd Yield & Quality Brussels Sprouts Cauliflower ROOT & BULB Consumer 2005 Onion Beet Fahrenheit Leek Traits Leek Carrot Invicta Carrot 2006/7 Low-Pungency onion Seed LEAFY 2005 Producibility Lettuce Boomerang Lettuce Spinach 2006/7 Celery Processing Butterhead Improved Mechanically Harvested-Spinach 7
  8. 8. PIPELINE UPDATE Conversion from Open-Pollinated to Hybrid Offers Opportunity in Mexican Market KEY CROP PENETRATION MARKET (Acres) SQUASH Mexican OP Conversion 100K 5% CREATING VALUE CARROTS 67K 10% ONIONS 2005 FIELD REPORT 76K 40% HOT PEPPERS 298K 40% Mexican OP Conversion MULTI-STAGE: PHASE II THROUGH LAUNCH NEW MARKET OPPORTUNITY $70 CURRENT MARKET Not as well as Better than As expected $60 expected expected POTENTIAL MARKET $50 $ MILLIONS Quality $40 $30 Horticultural Performance $20 $10 New Hybrids $0 HOT SQUASH ONION CARROT OBSERVATIONS PEPPER • Able to achieve increased uniformity, earlier maturity, higher produce quality • Higher market yield and profitability • Better disease resistance • Value of hybrids already being recognized in the market DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 8
  9. 9. PIPELINE UPDATE Molecular Breeding Helps Target Novel Approaches to Disease Resistance EUROPE N. KEY MARKET AREAS JAPAN -AFRICA AMERICA Geminivirus (Ty) AVAILABLE MARKET 57K 88K 3K Resistance in Tomato CREATING VALUE PERCENT PENETRATED 31% 1% 0% OPPORTUNITY: NOVEL DISEASE 2005 FIELD REPORT RESISTANCE, MARKERS & IP OPEN MARKET ACCESS Ty Resistance Stacked with Nematode Resistance in High Flavor Pink Tomatoes (Japan) PROVEN SUCCESS IN EUROPE-AFRICA PHASE II 15 60 Early Development $ (m illio n s ) # OF CULTIVARS 10 40 Not as well as Better than As expected expected expected 5 20 CHROMOSOME 6 0 0 Shelf Life 99 00 01 02 03 04 Fruit Quality Horticultural Performance MARKER Ty-1 ENABLED OBSERVATIONS • Demonstrating excellent disease resistance; Patents are pending for traits FUTURE IN JAPAN; TY-MI + • Leads show promise for high-flavor pink tomatoes, high- HIGH FLAVOR TOMATOES value commercial opportunities DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 9
  10. 10. PIPELINE UPDATE Herbicide-Tolerance Focus Has Shifted to Second- and Third- Generation Traits in Larger Product Family CREATING VALUE FARMER BENEFITS Roundup Ready Flex for cotton is first-ever second- DISCOVERY PLATFORM: HERBICIDE TOLERANCE generation trait in weed PHASE PHASE PHASE PHASE D PLATFORM I II III IV control HERBICIDE TOLERANCE Second-generation traits for ROUNDUP READY FLEX COTTON soybeans and canola are in ROUNDUP mid-phases of pipeline RREADY2YIELD SOYBEANS Third-generation product ROUNDUP RREADY2YIELD already in Phase II for CANOLA soybeans, stacks two modes DICAMBA-TOLERANT SOYBEANS of action DICAMBA-TOLERANT COTTON 10
  11. 11. PIPELINE UPDATE Roundup RReady2Yield Soybeans Expand Weed Control Window KEY MARKET ACRES U.S. BRAZIL ARGENTINA Roundup RReady2Yield 50M 35M 70M AVAILABLE MARKET Soybeans CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT IMPLEMENTATION OF MARKER ASSISTED SELECTION IN TRAIT INTEGRATION Roundup RReady2Yield Soybeans PHASE III Advanced Development Not as well as As Better than expected expected expected Trait Performance Agronomic Performance LEAD GENE: COMPLETED Lead Selection LEAD EVENT: COMPLETED OBSERVATIONS • Lead event confirmed in April of 2005 • Trait integration efforts started • Implementation of marker assisted selection DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 11
  12. 12. PIPELINE UPDATE Third-Generation of Soy Weed Control Gives Farmers Two Unique Modes of Action KEY MARKET ACRES U.S. BRAZIL ARGENTINA Dicamba-Tolerant 80M 50M 35M AVAILABLE MARKET Soybeans CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT FIELD TESTING VALIDATING TOLERANCE Dicamba-Tolerant Soybeans DICAMBA TOLERANT PHASE II Early Development Not as well as Better than As expected expected expected Trait Performance Agronomic Performance NON TRANSGENIC LEAD GENE: COMPLETED Lead Selection LEAD EVENT: IN PROGRESS OBSERVATIONS • Tolerance demonstrated at both pre-emergence and post- emergence application timing Dicamba Resistant Soybean • No visual crop injury at rates of 1.5lb/acre, 3X labeled use Post Emergent Application of 1.5 lb/a rate DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 12
  13. 13. PIPELINE UPDATE Roundup RReady2Yield Canola Is Newest Addition to Herbicide-Tolerance Family KEY MARKET ACRES U.S. EUROPE CANADA Roundup RReady2Yield TBD TBD TBD AVAILABLE MARKET Canola CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT NEW BENEFIT TO CANOLA FARMERS Roundup RReady2Yield Canola Enhanced crop tolerance will allow greater application flexibility PHASE II Early Development CURRENT EVENT Not as well as Better than As expected expected expected Trait Performance Agronomic Performance LEAD GENE: COMPLETED Lead Selection LEAD EVENT: IN PROGRESS OBSERVATIONS NEW EVENT • Field performance shows enhanced tolerance to Roundup herbicide • Stacked with yield genes to deliver enhanced yield from Tolerance at rates representing 8x standard nitrogen use efficiency and enhanced seed yield use rate DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 13
  14. 14. PIPELINE UPDATE Insect Control Discovery Program Approaching Second- Generation Commercialization CREATING VALUE FARMER BENEFITS Second-generation YieldGard corn borer builds on triple- DISCOVERY PLATFORM: PEST CONTROL stack corn platform and PHASE PHASE PHASE PHASE D PLATFORM I II III IV expands potential for new PEST CONTROL acreage penetration SECOND-GENERATION YIELDGARD CORN YieldGard corn rootworm ROOTWORM next-generation discovery SECOND-GENERATION YIELDGARD CORN improves production of BORER stacked traits while YIELDGARD ROOTWORM CORN II enhancing performance SOYBEAN NEMATODE- RESISTANCE 14
  15. 15. PIPELINE UPDATE Second-Generation YieldGard Corn Borer Expands Insect Spectrum and Acreage Potential KEY MARKET ACRES U.S. BRAZIL ARGENTINA Second-Generation 50M 15M 4M AVAILABLE MARKET YieldGard Corn Borer CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT NEW BENEFIT TO CORN FARMERS Second-Generation YieldGard Corn Borer Second-generation YieldGard Corn Borer offers PHASE III unparalleled combination of insect control and Advanced Development resistance management Not as well as Better than As expected expected expected FALL ARMYWORM Trait Performance Agronomic Performance LEAD GENE: COMPLETED Lead Selection LEAD EVENT: COMPLETED OBSERVATIONS • Excellent control of targeted pests – raises bar for corn earworm and fall armyworm control • Outstanding yields, including stacks for rootworm control 2ND GEN YGCB CONVENTIONAL • Insect resistance management benefit unique to market • Lead event selected for regulatory submissions DISCOVERY PHASE I PHASE II PHASE IV LAUNCH PHASE III Proof of Concept Early Development Pre-Launch Adv. Development 15
  16. 16. PIPELINE UPDATE Second-Generation YieldGard Corn Rootworm Reinvents Stacked Corn Platform KEY MARKET ACRES U.S. BRAZIL ARGENTINA Second-Generation 25M 1M AVAILABLE MARKET 5M YieldGard Rootworm CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT CRW INFESTATION CONTINUES TO EXPAND Second-Generation YieldGard Rootworm PHASE IV Pre-Launch Not as well as Better than As expected expected expected Trait Performance Agronomic Performance LEAD GENE: COMPLETED Lead Selection LEAD EVENT: COMPLETED OBSERVATIONS Percent Acres Treated and/or Planted • Vector-stack delivered outstanding performance for Corn Acres - not treated corn rootworm control and Roundup Ready crop safety 0.1 - 25 % treated • Monsanto to launch 2nd generation CRW stacked-traits 25.1 - 50 % treated while competitors introduce 1st generation singles >50% treated • Will introduce to seed licensees in 2006 with commercial sales expected in 2007 or 2008 DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 16
  17. 17. PIPELINE UPDATE Yield Platform Has Expanded Most Dramatically of All Families in Past Year CREATING VALUE FARMER BENEFITS Drought traits have been applied to new crops, DISCOVERY PLATFORM: YIELD expanded in corn PHASE PHASE PHASE PHASE PLATFORM D I II III IV Next-generation leads are DROUGHT-TOLERANT being developed CORN simultaneously with SOYBEANS advancement of first- COTTON INTRINSIC YIELD generation products CORN SOYBEANS CANOLA NITROGEN UTILIZATION CORN COLD-TOLERANT CORN 17
  18. 18. PIPELINE UPDATE Drought-Tolerant Corn Is Lead Crop of Yield Family of Traits KEY MARKET ACRES U.S. BRAZIL ARGENTINA 80M 30M 6M AVAILABLE MARKET Drought-Tolerant Corn CREATING VALUE 0% 0% 0% PERCENT PENETRATED CONSISTENT RESULTS FROM EARLY 2005 FIELD REPORT LEADS AND MORE LEADS EMERGING FROM PIPELINE Drought-Tolerant Corn PHASE II WITH TRAIT WITHOUT TRAIT WITH TRAIT WITHOUT TRAIT Early Development Not as well as Better than As expected expected expected Trait Performance Agronomic Performance o C 32 34 40 LEAD GENE: COMPLETED Lead Selection LEAD EVENT: IN PROGRESS OBSERVATIONS • Lead genes show consistent drought stress performance across years • Mid-season drought performance results in more, bigger ears • Up Next: Advance into early development WITHOUT TRAIT WITH TRAIT DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 18
  19. 19. PIPELINE UPDATE Drought-Tolerant Cotton Performance Encouraging in Early Field Evaluation KEY MARKET ACRES U.S. AUSTRALIA Drought-Tolerant Cotton AVAILABLE MARKET 7M 0.5M CREATING VALUE 0% 0% PERCENT PENETRATED 2005 FIELD REPORT FROM GREENHOUSE Drought-Tolerant Cotton TESTING TO…. PHASE I Proof of Concept …FIRST DROUGHT- YEAR FIELD Not as well as Better than CONTROL As expected TOLERANT TRIALS expected expected Trait Performance Agronomic Performance LEAD GENE: IN PROGRESS Lead Selection LEAD EVENT: N/A OBSERVATIONS • Drought leads are working across crops • First leads into cotton are showing promise • Next up: Continued evaluation to assess drought DROUGHT- CONTROL performance TOLERANT DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 19
  20. 20. PIPELINE UPDATE Nitrogen Utilization Corn Moved From Greenhouse to Field Work in 2005 KEY MARKET ACRES U.S. BRAZIL ARGENTINA Nitrogen Utilization Corn 80M 30M 6M AVAILABLE MARKET CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT FROM GREEN- Nitrogen Utilization Corn HOUSE PHASE I TESTING Proof of Concept TO… Not as well as Better than …FIRST As expected expected expected YEAR GENE H Control FIELD Trait Performance TRIALS CONTROL GENE F Agronomic Performance LEAD GENE: IN PROGRESS Lead Selection LEAD EVENT: N/A G en e OBSERVATIONS s • Enhanced nitrogen utilization is challenging trait • Industrial scale genomics effort is generating leads • Up Next: Optimization to improve trait performance and continued screening HIGH N MED N LOW N DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 20
  21. 21. PIPELINE UPDATE Processor Benefits Projects Represent New Approach to Market Not Traditionally Served by Seed Innovations CREATING VALUE PROCESSOR BENEFITS Mavera High-Value Corn with lysine represents first biotech PHASE PHASE PHASE PHASE product from our Renessen D PLATFORM I II III IV collaboration PROTEIN AND/ OR ENHANCEMENTS Like Vistive, Mavera MAVERA HIGH-VALUE CORN WITH LYSINE represents a family of MAVERA I HIGH-VALUE products SOYBEANS MAVERA II HIGH- Renessen joint venture VALUE SOYBEANS includes both biotech and HIGH OIL SOYBEANS FOR PROCESSING breeding approaches to SECOND-GENERATION adding value in the feed HIGH-VALUE CORN WITH LYSINE industry FEED CORN WITH BALANCED PROTEINS 21
  22. 22. PIPELINE UPDATE First-Generation High-Value Corn with Lysine in Final Phases of Regulatory Reviews KEY MARKET ACRES U.S. BRAZIL ARGENTINA Mavera High-Value Corn 5M 2M 1M AVAILABLE MARKET with Lysine CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT FIELD DATA VALIDATES LYSINE TARGETS Mavera High-Value Corn with Lysine PHASE IV 5000 Pre-Launch 4000 Not as well as Better than As expected expected expected 3000 Trait Performance 1ST GENERATION 2000 Agronomic Performance MINIMUM 1000 LEAD GENE: COMPLETED Competitive Comparison TARGET LEAD EVENT: COMPLETED 0 SOUTH U.S. RESULT CONTROL OBSERVATIONS AMERICA (2004) RESULT • Final year of field trial work confirms lysine targets in (2005) commercial-quality germplasm • Completed FDA Consultation; USDA comment period underway • Final approvals anticipated for 2007 launch DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 22
  23. 23. PIPELINE UPDATE Vistive Family of Traits Continues To Offer Additive Value as New Consumer Products Advance CREATING VALUE CONSUMER BENEFITS Monsanto and Solae recently announced an agreement for our improved-protein PHASE PHASE PHASE PHASE D PLATFORM I II III IV soybeans PROTEIN ENHANCEMENTS Vistive II and III build on the IMPROVED-PROTEIN low-linolenic platform SOYBEANS FOR FOOD launched in 2005 with LIPID ENHANCEMENTS additional qualities that VISTIVE II LOW LIN – MID OLEIC SOYBEANS improve the oil profile VISTIVE III LOW LIN – MID OLEIC – LOW SAT SOYBEANS BIOACTIVE COMPOUNDS OMEGA-3 SOYBEANS 23
  24. 24. PIPELINE UPDATE Improved-Protein Soybeans for Food Poised for Commercial Track Following Solae Announcement KEY MARKET ACRES U.S. BRAZIL ARGENTINA Improved-Protein <1M TBD TBD AVAILABLE MARKET Soybeans for Food CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT Improved-Protein Soybeans for Food PHASE III Advanced Development Not as well as Better than As expected expected expected IMPROVED SOLUBILITY PROFILE Trait Performance VINTON 81 Agronomic Performance COMMODITY Lead Selection MON HBC COMPLETED OBSERVATIONS CASEIN • Completed alliance with Solae 0 2 4 6 8 10 12 MEDIAN PARTICLE DIAMETER (MICRONS) • Early food formulation work very promising High beta-conglycinin presence • Strong yield and agronomic performance translates to mouth-feel more comparable to conventional dairy products DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 24
  25. 25. PIPELINE UPDATE Vistive Family of Improved Oils Meets Multiple Needs in Food Industry TARGET: LOW LINOLENIC TARGET: LOW LINOLENIC TARGET: LOW SAT VISTIVE SOYBEANS VISTIVE RAPESEED +INCREASED OLEIC + LOW LINOLENIC 2005 LAUNCH 2005 LAUNCH 500K ACRES IN US 40K ACRES IN EUROPE VISTIVE III LOW LIN – MID OLEIC – LOW SAT TARGET: INCREASED OLEIC SOYBEANS + LOW LINOLENIC VISTIVE PHASE II FAMILY VISTIVE II LOW LIN – MID OLEIC SOYBEANS CONSUMER PHASE III MARKET OIL FOR FRYING AND IMPROVED SOYBEAN SPRAYING QUALITY FOR LIQUID OILS Crackers Snack chips 25
  26. 26. PIPELINE UPDATE Vistive II Adds Improved Oleic Content to Current Vistive Low Lin Product KEY MARKET ACRES U.S. BRAZIL ARGENTINA Vistive II Low Lin – 30M TBD TBD AVAILABLE MARKET Mid-Oleic Soybeans CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT Vistive II Low Lin – Mid-Oleic Soybeans PHASE III Advanced Development Not as well as Better than As expected 50% of the oil expected expected of Vistive II is Trait Performance mid-oleic, improving Agronomic Performance overall oil profile Lead Selection COMPLETED Mid Oleic OBSERVATIONS Linolenic Linoleic Sats 18:1 STANDARD • Achieved commercial targets of 50% oleic and 3% SOY linolenic composition in field testing MID-OLEIC • Molecular marker selection was implemented enabling SOY plant selections with compositions for line advancements DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 26
  27. 27. PIPELINE UPDATE Omega-3 Oil Production in Soybeans: Initial Taste, Smell and Oil Stability Results Promising KEY MARKET ACRES U.S. EU ROW TBD TBD TBD AVAILABLE MARKET Omega-3 Soybeans CREATING VALUE 0% 0% 0% PERCENT PENETRATED 2005 FIELD REPORT SDA OIL TASTES RESULTS 2005 Omega-3 Soybeans PHASE II 10 Early Development 5 Not as well as Better than As expected expected expected 0 Trait Performance Soy Oil SDA Oil Fish Oil (INCLUDES OIL TASTE, SMELL AND STABILITY) Taste Rating 0-15 Scale Agronomic Performance Score of zero indicates no taste LEAD GENES: COMPLETED Lead Selection LEAD EVENT: COMPLETED In taste-testing, stearidonic acid (SDA) oil compares favorably versus fish oil and OBSERVATIONS commodity soy oil • 2004 U.S. and 2005 Argentine field trials continue to confirm expression of SDA levels at concept targets • Initial sensory data superior to fish oil • SDA oil stability results are promising DISCOVERY PHASE I PHASE III PHASE II PHASE IV LAUNCH Proof of Concept Adv. Development Early Development Pre-Launch 27
  28. 28. SUMMARY New Traits, Trait Upgrades and New Stacked Combinations Are Creating New Platforms for Farmers CORN 2005 2010F 2015F Preferred Trait Preferred Trait Preferred Trait Trait Offerings Trait Offerings Trait Offerings Combinations Combinations Combinations ROUNDUP READY ROUNDUP READY ROUNDUP READY STACKED – STACKED – STACKED – CORN 2 CORN 2 CORN 2 DOUBLE: TRIPLE: TRIPLE + YIELD YIELDGARD PLUS YIELDGARD YIELDGARD YIELDGARD TRAITS: YGCB + RR YGRW+YGCB+RR ROOTWORM ROOTWORM ROOTWORM YGRW + RR YIELDGARD CORN 2nd GENERATION 2nd GENERATION 2nd GEN YGCB + STACKED – STACKED – BORER YGRW YGRW 2nd GEN YGRW + 2nd GEN TRIPLE: TRIPLE: RR YIELDGARD CORN YIELDGARD CORN + DROUGHT BORER BORER 2nd GEN YGCB + YGRW+YGCB+RR + INTRINSIC 2nd GEN YGRW + YIELDGARD CORN YIELDGARD CORN + NITROGEN RR BORER BORER HIGH-VALUE HIGH-VALUE STACKED – TRIPLE STACKED – TRIPLE CORN W/ LYSINE CORN W/ LYSINE + FEED TRAITS + + FEED TRAITS: YIELD TRAITS: 2nd GEN HIGH- VALUE CORN W/ HIGH-VALUE LYSINE 2nd GEN HIGH- CORN W/ LYSINE + FEED CORN WITH VALUE CORN W/ YGRW + YGCB + BALANCED LYSINE + YGRW + RR PROTEINS YGCB + RR FARMER BENEFITS YIELD: DROUGHT PROCESSOR BENEFITS CONSUMER BENEFITS YIELD: INTRINSIC YIELD: NITROGEN 28

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