The development of the Agrochemical Market in Europe Phillips McDougall Vineyard Business Centre Saughland Pathhead Midlothian EH37 5XP Tel : 01875 320611 john@phillipsmcdougall.com

2014

(Ex-manufacturer level – average exchange rates - Nominal US$) Market Performance 2014 (Ex-manufacturer level – average exchange rates - Nominal US$) Agrochemicals = $62,702 +3.3% Seed= $40,551 +2.9%

Crop Protection Market Outlook 2014 NAFTA: Lower crop prices Maize area -3.9% Soybean area +10.9% Canada wheat area -7.4% Continuing dryness in south and west USA Modest decline in glyphosate prices Hard winter affects citrus and autumn planted crops US Registration review Latin America: Increased soybean and wheat area in Brazil and Argentina, but decline for maize Dryness in Brazil in early 2014 Weaker Real affects Brazil crop exports Increased GM uptake in Region High inflation in Argentina High interest rates in Brazil Rising sugar and cotton price Economic improvement drives developing markets Asia: Japan: modest improvement Further GM uptake in China and India Drive for grain production in China Quest for rice self sufficiency in Malaysia and Indonesia Lower palm oil and rice prices Increasing food demand Dry weather affects East Australia Weak 2014 monsoon Tax rise on agrochemicals in Japan Europe: Wheat price remains high EU wheat area +3.2% Oilseed area increased marginally Re-registration under revised criteria Mild winter promotes Autumn crop survival Potential for high disease pressure Good start to 2014 season Wet summer in Central Europe Africa / Middle East: Modestly developing markets Speciality crops for export Improved political stability benefits North Africa Political and infrastructure problems Water availability Growth Markets Static to Slow Growth Static to Decline World Rising demand for crop commodities Static to declining glyphosate prices Crop prices weakening Farm economies strong, after good 2013 Lower maize and soybean prices

Regional Crop Protection Market Development

Crop Protection Market 2014 Analysis

Growth of European Crop Protection Market

Compound Annual Growth Rate of the European Crop Protection Market (% p.a.) € Terms

Top Twenty European Country Markets Sales Growth in € Terms 2014/2009 (% p.a.) -5 5 10 15 20 25 30 Belgium Netherlands France Austria Slovakia Greece Denmark Croatia Czech Germany Portugal Italy Switzerland Spain UK Hungary Poland Ukraine Russia Bulgaria Romania

Agrochemical Market Split by Product Category (2013) World Europe Herbicide, 46.3% Insecticide, 13.5% Fungicide, 36.8% Other, 3.4% 43.7% 27.5% 25.8% Other, 3.0%

Agrochemical Market Split by Crop (2013)

European Agrochemical Market 2013 Key Crop Product Sectors Red values are CAGR in % from 2009 -2013

Crop Commodity Prices

Indicative Global Trade Commodity Prices 1998-2014 $/Tonne Annual Average

GM Seed Market 2014

GM Trait Introductions Since 1995

Crops Planted with GM Varieties in 2014 NAFTA 46.4% Canada Canola – 91.5% Soybean – 91.7% USA Soybean – 96.0% Maize – 93.1% Cotton – 99.5% Canola – 91.0% Sugar beet – 98.1% Asia 11.4% China Cotton – 82.8% Argentina Soybean – 96.9% Maize – 90.7% India Cotton – 97.2% Brazil Soybean – 91.2% Maize – 85.4% Rest of World 1.5% Latin America 40.7% Total = 441.9 million acres (+3.5% over 2013)

Agrochemical Industry Structure and R&D Focus

Company Sales Increases 2014 (preliminary) Note –results are for company fiscal year

Crop Protection Company Market Shares 2013

Company Sales and R&D Expenditure 2013

R&D expenditure of Leading Agrochemical Companies

Cost of Bringing a New Product to Market Agrochemical Plant biotechnology trait Research Development Agrochemical costs based on 2009 Crop Life America/ECPA study Plant biotechnology trait costs based on 2011 Crop Life International study

Agrochemical Active Ingredients in Development

Future Developments in Agrochemical and Seeds Input Traits - Maize, Soybean, Cotton, Canola Additional herbicide tolerant traits – dicamba, 2,4-D (Enlist), HPPD Insect resistant traits for soybean Expansion of insect coverage from new insect resistant traits – e.g.VIP Output traits Drought / Stress tolerance/ Abiotic stress RNAi Precision Agriculture

Patents for Abiotic Stress 2009-2013

Patents for Abiotic Stress 2009-2013

RNAi – Gene Silencing Ribonucleic acid interference (RNAi) is a method of gene silencing in target organisms Potential applications of RNAi in agriculture include: In-plant insect protection – e.g. corn rootworm Foliar spray / seed treatments Weed Control

Precision Farming Applications Management Data Analysis GPS Systems Agronomic Advice Wireless Connectivity Irrigation Singulation and Spacing Variable Rate Application Steering Guidance and Autosteer Systems Display Screen Variable Rate Application Chemical/Nutrient Application Steering Guidance and Autosteer Systems Display Screen Seed Agchems & Fertiliser Precision Farming Field Monitoring Harvest Soil Analysis Remote Sensing Field Sensors Mapping Weather Yield monitor Display Screen Steering Guidance and Autosteer Systems

Market Environment in 2015

Monthly Crop Prices Corn Soybean Rapeseed Wheat

Maize Prices 2010 - 2016 $8.4 bushel $4.1 bushel Futures USDA

Wheat Prices 2012 - 2016 € 274 /T Futures €183 / T

Crop Protection Market Outlook 2015 NAFTA: Lower crop prices Maize area expected to decline Soybean area anticipated to rise Record EtOH production in 2014 Continuing dryness in south and west USA Modest decline in glyphosate prices Hard 2014/15 winter US Registration review Latin America: Increased soybean but decline for maize and wheat area in Brazil and Argentina, Dryness in Brazil in early 2015 Weaker Real affects Brazil crop exports Increased GM uptake in Region High inflation in Argentina High interest rates in Brazil Weaker sugar and cotton price Economic improvement drives developing markets Asia: Japan: modest improvement Further GM uptake in China and India Drive for grain production in China Quest for rice self sufficiency in Malaysia and Indonesia Low palm oil, but rising rice prices Increasing food demand Dry weather affects East Australia Europe: Wheat price weakening CAP reformed to Basic Payment Scheme Ecological Focus Areas – Non cultivated land EU-15 wheat area expected to decline Re-registration under revised criteria Mild winter promotes Autumn crop survival Potential for high disease pressure Africa / Middle East: Modestly developing markets Speciality crops for export Improved political stability benefits North Africa Political and infrastructure problems Water availability Growth Markets Static to Slow Growth Static to Decline World Sustained demand for crop commodities Weakening glyphosate prices Crop prices depressed Farm economies weakening

European Market Outlook Short term: Futures Crop prices reduced but potential for further volatility Challenging economic environment Agrochemical Prices Changes in EU CAP Longer term: Increasing demand for grain and oilseed crops Agrochemical product re-registration Resistance and regulatory issues create opportunities for new products New farming technologies

Disclaimers The information contained in this presentation constitutes our best judgement at the time of publication, but is subject to change. Phillips McDougall do not accept any liability for any loss, damage or any other accident arising from the use of the information in this presentation. The information given in this presentation has been drawn from analyses and reviews presented in the Phillips McDougall products AgriService, Seed Service, AMIS Global and AgreWorld. Phillips McDougall maintain a wide range of databases covering the crop protection and seed industries, this presentation presents only headline information. Access to these databases can be gained through subscription or consultancy. Our market research databases track product sales from global market totals down to brand level sales by crop and country in both volume, value and area treated terms. For more information about these products please visit www.phillipsmcdougall.com www.agreworld.com