Yara in Brazil A history of profitable growth Yar ara a is tr is - - PowerPoint PPT Presentation

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Yara in Brazil A history of profitable growth Yar ara a is tr is - - PowerPoint PPT Presentation

Nov 29, 2022 171 likes •410 views

Yara in Brazil A history of profitable growth Yar ara a is tr is trul uly y globa lobal l Oper Operati tion ons i s in mor more e tha than 50 n 50 cou countries ntries Sales Sales to a to abo bout 15 ut 150 co 0 coun

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SLIDE 1

Yara in Brazil

A history of profitable growth

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SLIDE 2

KEY FIGURES 2014 Revenues

USD 15.1 billion

Number of employees

> 12 000

6 continents sold

26.3 million tons of fertilizers Yar ara a is tr is trul uly y globa lobal l – Oper Operati tion

  • ns i

s in mor more e tha than 50 n 50 cou countries ntries

Sales Sales to a to abo bout 15 ut 150 co 0 coun untries tries

Agricultural products

26.3 million tons

Industrial products

4.4 million tons

Environmental solutions

2.2 million tons

37% 37% 5% 13% 1% 7%

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SLIDE 3

Agriculture importance for Brazil

Brazil fertilizer sector

Yara Brazil story

Agenda

3

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SLIDE 4

The Brazilian agribusiness is important for the Brazilian economy

23,5 25,5 22,8 22,5 10 12 14 16 18 20 22 24 26 28 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Agribusiness Share in Brazilian GDP (in %)

Source: CEPEA

4

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SLIDE 5

The Brazilian agribusiness trade surplus contributes significantly to the trade balance

  • 0,7

2,7 13,2 24,9 33,8 44,9 46,5 40,0 25,0 25,3 20,1 29,8 19,4 2,6

  • 4,2

14,8 19,1 20,4 25,9 34,2 38,5 42,8 49,7 60,0 54,9 63,0 77,5 79,4 82,9 74,6 00 01 02 03 04 05 06 07 08 09 10 11 12 23 14*

Trade Balance

(in USD Billion)

Total Balance Brazil Total Balance Agri

Source: CGOE / DPI / SRI / MAPA * Jan-Nov

5

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SLIDE 6

Agriculture importance for Brazil

Brazil fertilizer sector

Yara Brazil story

Agenda

6

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SLIDE 7

Brazil has a unique combination of land, water, climate and stable economic growth

  • 50.000

100.000 150.000 200.000 250.000 300.000 350.000 400.000 Brasil USA EU Russia India China Congo Australia Canada Argentina Sudan Angola Indonesia Nigeria

Fonte: FAO. Elaboração: MB Agro 1.000 ha

Área agricultável potencial Área agricultável atual (2005)

Source: FAO – MB Agro consultants

Potential arable land Land used for agricultural production (2005)

7

Australia and Oceania; 6% Europe; 7% Africa; 9% Brazil; 12%

Americas

  • ex. Brazil;

34%

Asia; 32% Fresh water by region/country in percent of world total

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SLIDE 8

Brazil will replace USA as the bread basket of the world in the 21st century (source: FAO)

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USA 206 Brazil 149 34 24 14 10

+240,0% Current consumption/ current area US standards/ current area Current consumption/ potentialarable land US standards/potential arable land Fertilizer consumption Kg nutrient/ha

But significant increase in fertilization required

Fertilizer consumption mt nutrients

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SLIDE 9

Brazil is today world´s largest producer of key crops

Soybean Maize Sugar Cane Coffee Orange 1st 4th 1st 1st 1st Prodution Ranking Product 1st 3rd 1st 1st 1st Exports

Source: USDA, Agroconsult 2009

9

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SLIDE 10

Brazilian farming is characterized by professional farming

10

Fazenda Planalto Mato Grosso

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SLIDE 11

Br Braz azil il - the the f fas astes test g t growing wing fer ertil tiliz izer er ma market et

Sources: FAO, Conab/ Market Intelligence Brazil, ANDA

Soybean Corn 1st Wheat

Yield evolution ( tons / hectare) 90’s 00’s 10’s Brazil fertilizer industry deliveries

8,2 10,8 16,4 20,2 24,5 32,2 5 10 15 20 25 30 35 1990 1995 2000 2005 2010

CAGR (1990-2014) 5.9%

  • mill. tonnes

2014 3,0 2,5 2,2 5,0 3,5 2,5 3,6 2,8 2,4

Best practice

3.0 10.0 7.2

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SLIDE 12

Fertilizers consumption help to boost Brazilian grains and oilseeds production

More Fertilizer Higher Yields More Production

+97%

00 14

+30% +95%

00 14 00 14 (in MMT) (in MMT) (in kg/ha) 00 14

38 57

+50%

(in M hectares)

Planted Area

Source: ANDA and CONAB

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SLIDE 13

Agriculture importance for Brazil

Brazil fertilizer sector

Yara Brazil story

Agenda

13

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SLIDE 14

With almost 40 years of presence, Yara has a vast experience in Brazilian fertilizer sector

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1977 Norsk Hydro - CN 2000 Acquisition 2006 Acquisition 2013 Acquisition 2014 Acquisition

Yara Brazil including Galvani now counts ~3,500 permanent employees

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SLIDE 15

kt

Yara Brazil sells ~30% of Yara global fertilizer

  • volume. Relative importance will continue to grow

15

1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 9 000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

TPP OPP

Fertilizer volume sold (8,000kt representing ~270,000 trucks) Galvani expansion projects enable continued growth beyond 2015

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SLIDE 16

Brazil performing well – significant Bunge synergies realized

NOK million

334 1 076 52 100 200 300 400 500 600 700 800 900 1 000 1 100 8 7 6 5 4 3 2 1 2014 7.9 2013 5.2 2012 3.3

Yara Brazil performance

  • mill. tonnes

Deliveries EBITDA

Realized synergies

Realized 2014 55 30% 20% 50% Business case 2014 44 45% 10% 45% Fixed costs Logistics Sourcing

USD million

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SLIDE 17

Yara footprint secures national coverage in all main agricultural production and expansion areas

17 1

Yara’s plant Galvani’s industrial plants, greenfield projects, phosphate mine

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SLIDE 18

Talking ‘safety’…..

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SLIDE 19

Walking ‘safety’…..

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SLIDE 20

Increased end-user interaction in Brazil

45%

Cooperatives

25%

Agroindustry

20% 10%

Retailer

GROWERS

Knowledge Crop focus Product portfolio Application competence

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SLIDE 21

Angico (Irecé) L.E.M. Lagamar Paulínia Angico L.E.M. Paulínia Santa Quiteria1 Salitre

AS-IS

Fertilizer plants Phosphate mines

Galvani expansions further improve scale and cost position

End-products (mainly SSP) Phoshate rock

Lagamar

1.0

L.E.M. Paulinia

0.5

Angico Paulinia

2.0

Santa Q.

2.2

L.E.M. Salitre Santa Q.

End-products (mainly SSP) Phosphate rock

Angico Salitre

Future operations (~2018)

mt mt

  • Salitre project and Angico expansion will triple phosphate rock production and reduce opex

level signficantly

  • Salitre project investment decision during H2 2015 with start-up ~2 years later
  • Yara’s share of indicated capex for the projects ~USD 550 mill.

Self-sufficiency

  • n phosphate

rock Phosphate rock surplus

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SLIDE 22

Growth in Brazil strengthens Yara’s global competitive advantages

  • Scale in logistics
  • Scale in raw material sourcing
  • Cash crop market - untapped potential for Yara’s

differentiated products and crop nutrition programs Brazil also complements Yara’s fertilizer season exposure enhancing the flexibility in our business model

  • Operational excellence

Po Further potential

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SLIDE 23

The safest fertilizer company to work for

The innovator of the Latin American fertilizer industry

A balanced product portfolio with both local production and imports

Recognized for both improving farmers’ profit and sustainability

Vision for Yara Brazil going forward