SubLhemes ldenLlfled ln Agr|cu|tura| roduct|v|ty

O LecLln
O eLlllzes
O ffecLlve famlng
O 9lanLs Seeds
O uaculLue LlvesLck
Act|on In|t|ate on Ch|na seed sector turn|ng more construct|ve on fert|||zer compan|es
2

Nov 22 2010

We belleve seed and feLlllze cmanles ae besL slLlned L beneflL fm galn lce lnflaLln and
cnseuenLly sLng fame flLablllLy and demand gLh hlle esLlcldes uld beneflL L a smalle
exLenL We elLeaLe u aLLacLlve sLance n feLlllze cmanles and uld accumulaLe n eakness We
execL feLlllze cmanles L uLefm neaLem n bLh suLlve fundamenLals and cmaaLlvely
aLLacLlve valuaLlns flled by esLlclde and seed cmanles"

Act|on Scope for add|t|ona| upward rev|s|on |s becom|ng ||m|ted
7

Ioo 9 2011

Clveo tbe mosslve ootpetfotmooce of tbe fettlllzet compooles ovet tbe lost 6 mootbs we oo looqet floJ tbe
tlsk/ tewotJ os compellloq ooJ look to tbe seeJ compooles fot mote sostolooble qtowtb stotles

ert|||zers

CLh execLed ln aglculLual makeLs ln Lhe nea Lem aL Lhe back f l sLck L use level (clse L 13 yea
l% and hlgh c lces (almsL back L 2008 hlgh levels% glvlng fames lncenLlve L maxlmlze ylelds
1

nseuenLly feLlllse lces ln aLlcula f Lash have lnceased c30 cmaed L lasL yea xecL Lhe
feLlllze secL L uLefm ve Lhe nexL 12 mnLhs n LlghLenlng glbal feLlllze sulydemand
dynamlcs
2

xsue L Lash ve nlLgen efeed n Lhe accunL f 1% Lng Lem demand gLh aL 33
2% CeaLe degee f cnslldaLln 3% 9ducL seclallzaLln less f a cmmdlLy
1

Growth dr|vers for otash over N|trogen
O @he glbal allcaLln aLe f Lash ls c26 f Lhe sclenLlflcally ecmmended aLe hlle f nlLgen
based feLlllses lL ls 33 f Lhe sclenLlflcally ecmmended aLe lf allcaLln as L mve L Lhe
sclenLlflcally ecmmended aLes ve Lhe nexL decade Lash gLh aLes uld me Lhan duble

O llcaLln f Lash ln emeglng makeLs ls c13 f develed makeLs nseuenLly 9Lash demand
gLh fm bLh hlna and lndla (which represent c.20% and 14% of global potash consumption) and
fm emeglng makeLs me geneally execLed L emaln sLng ln Lhe lng un

O Clbal suly/demand mdel lndlcaLlve f busL demand elaLlvely hlgh caaclLy uLlllsaLln (c93 ln
2011 9 ln 2012 and 93 ln 2013 cmaed L 79 ln 2010% and LlghL makeL cndlLlns
otent|a| downs|de to otash
O eake Lhan execLed c lces and a eak suly/demand ln Lash culd have ffseLLlng effecL f
flms ln Lhls secL
O L naLual gas lces bsL nlLgen maglns (ln aL n Lhe back f shale gas% slgnlflcanL caaclLy
addlLlns ln hlna and Lhe Mlddle asL llkely L mL caaclLy gLh f nlLgen L 3 a ve Lhe
nexL fe yeas
owns|de (ert|||ser)
lqbet / lowet lotetest totes / leoJloq costs especlolly fot fettlllzets wltb blqb qeotloq ot oqqtesslve copex
ploos ooJ oJvetse weotbet cooJltloos bompetloq fettlllzet soles momeotom
** SlnfeL and Pubel ?lhua ln GS 8uy ||sts and ugade Clnghal SalL Lake 9Lash L 8uy
|ants Seeds
Seed lces mve ln LlghL celaLln L lLh c lces Lheeby besL slLlned L beneflL fm galn lce
lnflaLln (celaLln 091% s such seeds ae seen as lmay dlves L meeL lslng c yleld LageLs
r|vers (Ch|na)
2
O SuLlve gvenmenL llcles ln Lhe fm f hlghe lce fls and subsldles Plghe c lces L
ffseL lslng labu and eaLlng csLs lce lnceases ae llkely L be Lhe dlves f yleld
lmvemenL
O lmLs 30 f all cLLn SLucLual deflclL ln cLLn lll sen glven LhaL ecalLa cnsumLln
uLaces e calLa uLuL Meanhlle a d ln ecalLa cnsumLln f heaL vs a lse ln ecalLa
uLuL lll bsL exLable suluses
3

O ve a lnge Llme fame f 23 yeas execL sulydemand dynamlcs L lmve as cnLlnued e
esLlcLlns sLlcLe envlnmenLal eulemenLs and gvenmenLdlven elcaLln fce Lhe exlL f small
and lnefflclenL glyhsaLe duces
2

Amer|cas
S

ulves (1% ulmlnlshed dmesLlc feed demand (2% xanded suly due L yleld and aceage lnvesLmenL
glbally (3% a less cn dmesLlc llcy backd ln cmlng yeas

@end bsevables lces nea Lhe easlng u aL Lhe backd f (1% lmved lnvenLy levels ve Lhe
evlus fe mnLhs (2% symmeLlc uslde lce lsk cnLlngenL n suly shLages maLelallslng (lLh
egads L cn cs%

G|oba| r|vers

O @he Lend Lads hlghe Leln cnsumLln ls alslng Lhe demand f anlmal feed because Lhe
ducLln f meaL ls lnLenslve ln Lhe use f galns (anlmal feed accunLs f 0 f Lhe LLal galn
demand%
O Lhe glbal dlves f c lces (|ong term) lnclude (1% 8educed aable land e calLa (02 hecLae e
esn% (2% unad Lend ln ld gLh ln c yleld (fm 3 L 123 ve lasL 30 yeas% (3%
lncease ln Lhe Lln f aeas f sevee aLe sLess ln 88ls (1800 mlllln ln 2003 L 200 mlllln by
2030%
6
(% xLeme eaLhe cndlLlns

otent|a| k|sks
O ShaeLhanexecLed hlke ln Lhe mlnlmum lce aculslLln lce f 2011 (lLh esecL L Ch|na%
O WeaLhe lmacL emalns a key valable L suly le Sevee uughL ln @exas DSA and xlng[lan Ch|na
emaln Lhe key slng facL n cLLn lce as uS and hlna accunLs f 2 f glbal ducLln

Crop rotect|on est|c|des
Ch|na
2
@end 8lslng dmesLlc demand f esLlcldes and lslng esLlcldes exLs demand fm glbal esLlclde
glanLs bseved sevee vecaaclLy f glyhsaLe heblcldes

usldes (1% SLngeLhanexecLed ecvey ln esLlcldes demands (2% fasLeLhanexecLed cnslldaLln f
Lhe glyhsaLe lndusLy esulLlng ln LlghLeLhanexecLed suly

unslde (1% dvese eaLhe cndlLlns (2% Wse eakeLhanexecLed glyhsaLe exL lces due L
lnLenslfylng lce as veseas (3% 9ush backs fm dnsLeam dlsLlbuLs esulLlng ln le vlumes
lclng Lems (% Plghe / le lnLeesL aLes / lendlng csLs eseclally f esLlcldes lLh hlgh gealng
aggesslve caex lans

&&Ilooqso ooqoooq cbemlcol co toteJ boy lo C5 llst
8











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hLLs//360gscm/gs/Lal/?sL1acLlnacLlnblnayd1068831fn/dcumenLdf
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SLandad haLeed 2030 fecasLs

hLLs//360gscm/gl/Lal/eseach/cmmenLay/?acLlnvleagesL1d1102172ls8uLedLue
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u flgues
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