1. BANC OF AMERICA:
FIELD OF DREAMS
Transforming an Industry
Mark Leidy
EXECUTIVE VICE PRESIDENT,
GLOBAL MANUFACTURING
July 12, 2006
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2. The Basic Structure of a Corn Plant
CONCEPT 1
How is corn seed produced?
SEED PRODUCTION FIELD FARMERS’ PRODUCTION
CORN PLANT
(MONSANTO) FIELD (GRAIN PRODUCTION)
TASSEL
SILK
EAR
STALK
ROOTS
DEFINITION: HYBRID
DEFINITION: INBRED A TYPE OF CORN PRODUCED BY
BREEDING TWO INBREDS. HYBRIDS
AN INBRED, OR PARENT LINE, IS A
HAVE THE BENEFICIAL ATTRIBUTES
TYPE OF CORN USED TO PRODUCE
OF THE INBREDS, SUCH AS BETTER
HYBRID SEED
YIELD, DISEASE RESISTANCE OR
STALK STRENGTH.
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3. The Process of Creating Corn Hybrids in the Field
CONCEPT 1
How is corn seed produced?
STEP 2 STEP 3 STEP 5 STEP 6
STEP 4
STEP 1
GROW AND
IN FIELDS IN PLANT MALE REMOVE THE MALE REMOVE MALE
HARVEST
OTHER INBRED AT A TASSELS POLLINATES INBREDS FOR
MATURE
LOCATIONS, 1:4 RATIO FROM MALE THE FEMALE INCREASED
FEMALES
BULK UP INBRED TO INBRED TO FEMALE
FOR NEW
MALE AND CREATE CREATE GROWTH
HYBRIDS
FEMALE FEMALES HYBRID CORN
INBREDS SEED
3

4. Advanced Planning Can Help Improve Speed to Market,
Translate to Competitive Advantage
CONCEPT 1
How is seed corn produced?
SAMPLE TIMELINE
RESEARCH INBRED HYBRIDS
R&D HAND-OFF SEED PARENT PARENT SEED HYBRID FIELD HYBRID SEED FINISH AND
PARENT SEED PURITY INCREASE PRODUCTION HARVEST DELIVERY
12 / 2004 3 / 2005 2 / 2006 4 / 2006 9 / 2006 12 / 2006
20 EARS 2 UNITS 650 UNITS 50,000 UNITS 50,000 UNITS CUSTOMER
PARENT SEED EQUIVALENT EQUIVALENT CORN SEED CORN SEED FULFILLMENT
SCALE OF
PRODUCTION
COST-INFLECTION POINT:
PRODUCTION COST RISES CONSIDERABLY ONCE A
COST OF HYBRID, OR SKU, REACHES THE BULK-UP PHASE.
PRODUCTION
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5. Global Supply Chain Redesign and Disciplined
Manufacturing Management Improve Seed Production
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
Monsanto’s capital investments and
THEN NOW
best-in-class operational capabilities
have transformed seed production by One
10
improving… Company
Companies
72 Sites
138 Sites
Upgraded
Aged
Facilities
Facilities Cost
Management
Latest
Traditional
Technology
Technology
Portfolio
Use Six
Independent Management
Sigma®
Supply
Chains
Applied
Production
Quality
Conventional
Technology
Seed Farming
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Six Sigma® is a registered service mark and trademark of Motorola, Inc.

6. Like the Chemistry Business, Cost Management
Process in Seed Production Identifies Opportunities
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
THIS CYCLE, BORROWED FROM THE
Top Five Cost
CHEMISTRY BUSINESS, CAN
Opportunities are:
SYSTEMATICALLY IMPROVE SEED
Cost PRODUCTION
Management
Field Production Yield
TRACK
METRICS
Facility production yield
Portfolio
IMPROVE
FOCUS
Management
RESOURCES ON
Product advancement
OPPORTUNITIES
People productivity
Quality
Inventory and SKU
EXPENDITURES
EVALUATE FOR
MEASURED BY
management
OPPORTUNITY
DOLLARS
SCREEN
EXPENDITURES
FOR VALUE
CONTINUOUS
IMPROVEMENT
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7. Leveraging Technology to Move Seed Production Into
21st Century
CONCEPT 2
What has Monsanto done to increase our
NA SEED PRODUCTION competitive position in production?
IMPROVED DETASSELING EFFICIENCY
GROWER SELECTION PROCESS
Use technology to select seed growers Sterilize female inbreds’ tassles
Production
% Sterile
Cost
Management
Portfolio 2000 2001 2002 2003 2004 2005
Management
IMPROVED POLLEN EFFICIENCY FEMALE POPULATIONS INCREASED
Flaming to widen pollen duration Maximize the use of assets
Quality
NA Production Yield 1993 - 2005
160
1993 = 100%
% of Target
80
0
'04 '05
'93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03
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8. Six Sigma® and Other Continuous Improvement Have Improved Field
Performance and Reduced Cost in North America by More Than 30%
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
Increase Populations of female
parents/acre by reducing spacing
between rows
Reduced variability of seed planting
Cost
equipment using Six Sigma tools
Management
Assure pollen timing of the male
occurs when female silk is receptive
Portfolio
BEFORE SIX SIGMA
Management
Quality
THE RESULT OF ROW OPTIMIZATION IS SEEN ABOVE ON THE RIGHT.
ROW SPACING WAS SHIFTED FROM 30 INCHES TO 20-INCHES.
AFTER SIX SIGMA
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9. Six Sigma® and Other Continuous Improvement Have Improved Field
Performance and Reduced Cost in North America by More Than 30%
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
SEED SPACING AND ROW WIDTH IMPROVEMENTS
10-ACRE PLOTS (FIXED COSTS)
THEN:
Use of this model
in Monsanto corn
Cost
seed operations
Management
can benefit
Genetics
Portfolio
Management NOW: Steriles
Row Width
Seed Spacing
Quality
Uniformity
Grower Selection
USING FIELDS MORE EFFECTIVELY THROUGH CAREFUL PLANTING CAN Pollination Efficiency
RESULT IN APPROXIMATELY 30 PERCENT MORE PLANTS PER ACRE
WITH BETTER YIELD
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10. Carefully Managing Trait and Genetic Offerings
Reduces Portfolio Complexity
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
Corn shelf life is 3 to 5 years
Production planning and forecasting helps minimize
obsolescence and maximize portfolio “freshness”
Cost
200%
Management
3 TRAITS ON 1 HYBRID LINE
ADDS 7 NEW SKUs
Portfolio
SKU POTENTIAL
PERCENT OF TARGET
Management WITH TRAITS
100%
ACTUAL
Quality SKU RED ZONE REPRESENTS
COUNT THE GOAL IN PRODUCTION
AND SALES FORECAST
VARIABILITY, AND THE
IMPORTANCE OF ZONE
BASED PRICING
0%
2002 2003 2004 2005
VOLUME SOLD /
VOLUME PRODUCED
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11. As Portfolio Evolves Toward Stacked Traits, We Can
Produce Fewer Products on Seed Grower Acreage
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
S IN G L E S DOUBLES T R IP L E SKUs
60 250
ACRES IN MILLIONS
50
200
SKU COUNT
40
150
Cost 30
Management 100
20
50
10
Portfolio
Management 0 0
2001 2002 2003 2004 2005 2006
Quality
SKU SKU
A B
SKU
Unproductive Area
A
REDUCING
SKUs ALLOWS SKU SKU
MONSANTO
C D
TO USE
PRODUCTION
FIELDS MORE
Border Rows Border Row
EFFECTIVELY
HYPOTHETICAL SEED FACTORY
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12. Ensuring Production Quality and Consistency Improves
Farmer Yield
CONCEPT 2
What has Monsanto done to increase our
competitive position in production?
GENETIC GAIN
Testing programs assure trait purity of FROM IMPROVED
PERFORMANCE
COLD TEST
QUALITY:
products Monsanto advances into
SEED QUALITY IS AT
production
PEAK IN THE FIELD,
SO THE OBJECTIVE IS
Quality checkpoints in trait
TO MINIMIZE EROSION
development process control the OF SEED QUALITY,
presence of traits other than those of WHICH CAN NULLIFY
Cost
BREEDING GAINS
interest
Management
Research shows significant increase in HARVEST PACKAGING
emergence over all maturity groups vs.
Portfolio competitor
Seed Quality Measured by Emergence
Management
The result (right) is continued
satisfaction improvement in quality, 100
Monsanto
compared to the competition Leading Competitor
Quality
95
(IN PERCENT)
EMERGENCE
90
85
RM<96 RM 96-105 RM 106-112 RM>113
RELATIVE MATURITY
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13. World Class Seed Production Yields Significant
Improvement in Gross Profit
CONCEPT 3
What are the result so far?
NA Varieties/Trait Options 2000 - 2005 NA Production Yield 1993 - 2005
8
YG on female
160
f ar ei s
#o v r i t e
#o o t o s
f pi n
1993 = 100%
% of Target
5
80
2
'01 '02 '03 '04 '05
0
Varieties T raits Options
'93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05
Seed Quality Measured by Emergence
NA Production Unit Cost 2000 - 2005 100
Monsanto
100%
Leading Competitor
$71M
(IN PERCENT)
95
EMERGENCE
2000 = 100%
90
85
50%
RM<96 RM 96-105 RM 106-112 RM>113
RELATIVE MATURITY
FY04 FY05
FY00 FY01 FY02 FY03
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14. Paired With Great Breeding, Monsanto’s Seed Production
Capability Is Helping Boost Our Commercial Opportunity
U.S. CORN MARKET SHARE
60%
2006
50% FRONTLINE
UPDATE:
ASGROW AND
40%
DEKALB AND
ASI BRANDS
30% ARE EXPECTED
TO GROW
MARKET
20%
SHARE IN 2006
10%
0%
2001 2002 2003 2004 2005 2006F
DEKALB AND ASGROW AMERICAN SEEDS, INC. HOLDEN’S/CORN STATES
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