2. Forward-Looking Statements
Certain statements contained in this release are quot;forward-looking statements,quot; such as statements
concerning the company's anticipated financial results, current and future product performance,
regulatory approvals, business and financial plans and other non-historical facts. These statements are
based on current expectations and currently available information. However, since these statements are
based on factors that involve risks and uncertainties, the company's actual performance and results may
differ materially from those described or implied by such forward-looking statements. Factors that could
cause or contribute to such differences include, among others: continued competition in seeds, traits and
agricultural chemicals; the company's exposure to various contingencies, including those related to
intellectual property protection, regulatory compliance and the speed with which approvals are received,
and public acceptance of biotechnology products; the success of the company's research and
development activities; the outcomes of major lawsuits, including proceedings related to Solutia Inc.;
developments related to foreign currencies and economies; successful completion and operation of
recent and proposed acquisitions, including Delta and Pine Land Company; fluctuations in commodity
prices; compliance with regulations affecting our manufacturing; the accuracy of the company's estimates
related to distribution inventory levels; the company's ability to fund its short-term financing needs and to
obtain payment for the products that it sells; the effect of weather conditions, natural disasters and
accidents on the agriculture business or the company's facilities; and other risks and factors detailed in
the company's filings with the SEC. Undue reliance should not be placed on these forward-looking
statements, which are current only as of the date of this release. The company disclaims any current
intention or obligation to update any forward-looking statements or any of the factors that may affect
actual results.
2
4. OVERVIEW
Building From Established Platform, Monsanto Has a Window
of Opportunity to Extend Our Leadership
R&D LEADERSHIP STRATEGIC PERFORMANCE
SEEDS & TRAITS
COMMERCIAL PLATFORM
In the 10 years since the introduction of Integrated platform with commonality
the first biotech trait, Monsanto has of technology and commercial
invested >$5B in seeds-and-traits R&D approach among crop platforms
TRAITS
Monsanto developed and
CHANNELS TO MARKET
commercialized the first
Industry’s only company to
broad-acre biotech traits;
widely employ dual market
First to launch stacked
approach of branded and
traits and second-
licensed seed and trait sales
generation traits
SEEDS
Global germplasm library
COMMERCIAL COORDINATION
unmatched in scale – with
Roundup, world’s best-
36 integrated breeding
SEED & TRAIT selling herbicide brand,
programs from 12 PLATFORM
uniquely complements
countries for corn and soy
seed-and-trait platform
and the world’s leading
vegetable seed company
BREEDING
>100 breeding research FINANCIAL PERFORMANCE
High-margin technology
centers worldwide,
business that generates
underpinning companywide
sustainable free cash flow
focus around molecular
breeding
4
5. OVERVIEW
Six Building Blocks Extend Leadership and Elevate Gross
Margin Opportunity Through 2010
MONSANTO’S OPPORTUNITY
GROSS MARGIN OPPORTUNITY
Delta between 2006 current gross
GROSS PROFIT AS A PERCENT OF SALES
margin and a 51-53% trajectory
54%
reflects continued growth opportunity
for seeds and traits
FACTOR VALUE1
GROSS MARGIN ‘PULL’
52%
HIGH
U.S. corn
International
MEDIUM
50% corn
Global biotech
MEDIUM
traits
48%
LOW
CURRENT LEVEL Cotton platform
MEDIUM
Seminis
46%
HIGH
R&D pipeline
44%
2003 2004 2005 2006 2007F 2008F 2009F 2010F
1. Increment to total gross profit in the period 2006-2010; Some categories will overlap.
MEDIUM LOW
HIGH >$250M $100M - $250M <$100M
5
6. U.S. CORN GROWTH
Opportunity for Corn Gross Profit Increases in Next Four Years
With Increased Traits and Branded Seed Share
U.S PLANTED ACREAGE
90
TOTAL PLANTED CORN & SOYBEAN ACRES (2001-2010)1
U.S. Corn
CORN
SITUATION: 85
ACRES (IN MILLIONS)
SOYBEANS
• Monsanto assumes a U.S. corn
market of 80M acres annually 80
• Largest historical swing in U.S.
acreage has been less than 5 75
percent
OUTLOOK:
70
• Combination of increased
penetration of stacked traits
65
and expansion of Monsanto
branded share increases
60
relative value of a corn acre
versus a soy acre 2001 2002 2003 2004 2005 2008F 2009F 2010F
2006-2007F
• The gross profit differential
between an average soybean
GROSS PROFIT DIFFERENTIAL: CORN vs. SOY
acre and a corn acre in a
Monsanto national seed brand In 2006, the average gross-profit differential for seeds and
increased 2X in favor of corn traits in DEKALB and Asgrow brands favored corn at ~$0.80
from 2006 to 2007F an acre. For 2007, that differential is expected to be ~$3.00
an acre in favor of corn.
1. USDA data and projections 2. Comparative difference in seeds-and-traits gross profit between soybeans and corn, as
sold in Monsanto national seed brands
6
7. U.S. CORN GROWTH
Projected Demand From Ethanol in U.S. Provides Positive Pull
for Monsanto Corn Technology
U.S. ETHANOL AND CORN TRAITS
U.S. Corn
CORRELATION OF ETHANOL SITES AND TRAIT PENETRATION
SITUATION:
• Assumption that by 2010,
Average trait
ethanol is MTBE replacement –
penetration was
representing 10% of U.S. fuel
2.5 X greater in
supply
NON- areas with a high
• Ethanol demand could require DRAW
concentration of
AREA
equivalent of up to 25M U.S. ETHANOL
ethanol facilities
DRAW AREA
acres by 2010
compared with
OUTLOOK:
areas without or
having low
• Ethanol demand creates pull
concentrations of
on corn that favors
ethanol facilities
technologies that enhance
yield, such as molecular
Higher trait
breeding and biotech
penetration per
• The average trait penetration is acre corresponds
2.5 X greater in areas of to increased
ethanol facilities gross profit per
ETHANOL PLANTS UNDER
ETHANOL PLANTS IN
CONSTRUCTION acre
PRODUCTION
7
8. U.S. CORN GROWTH
First Decision Farmers Make Is Seed Germplasm; More and
More Farmers Have Been Choosing Monsanto Seed
U.S. CORN MARKET SHARE EVOLUTION
MONSANTO BRANDS AND LICENSEES
U.S. Corn LICENSEES’ BRANDS
60% AMERICAN SEEDS, INC. BRANDS
SITUATION:
ASGROW AND DEKALB BRANDS
• In 2006, Monsanto’s DEKALB
50%
and Asgrow brands grew by 3
market share points
40% Continued
• Over 5 years, comparable
gains of 1-2
market share gain was 9 points
30% points for
OUTLOOK:
national
20%
• Gain of 1 market share point in
brands
U.S. adds approximately $10 to
$15M to corn seed gross profit 10%
in a Monsanto national seed
brand 0%
2001 2002 2003 2004 2005 2007F
2006
ACREAGE EXPANSION
In 2006, the addition of 1 market share point in a Monsanto
national brand translated into an average incremental value
of approximately $10M-$15M in gross profit opportunity for
Monsanto for the seed alone
8
9. U.S. CORN GROWTH
Farmer Demand Speeds Stacked Penetration, Accelerating
Seeds-and-Traits Opportunity
INCREASED MARGINS WITH STACKING
GROSS PROFIT VALUE PROGRESSION IN DEKALB/ASGROW BRANDS
U.S. Corn 4
3.63
SITUATION:
TRAIT GROSS PROFIT VALUE PER ACRE
3.5
• Stacking corn traits on to our
2.63
germplasm improves gross 3
profit contribution to the
2.5
business (INDEXED)
• In 2006, Monsanto sold more
2
stacked traits than single traits
1.48
• In 2007, in our national brands, 1.5
1.00
Monsanto expects to sell more
1
triple stacks than singles
OUTLOOK:
0.5
• The average additional gross
0
profit value for a triple stack is
SEED ONLY 1 TR A IT 2 TR A ITS 3 TR A ITS 4 TR A ITS
almost 2.5X above a single
• For a potential quadruple
MARGIN EXPANSION
stack, the premium over the
single would be >3X The average additional gross profit value for a triple stack
is almost 2.5X above a single
“4 trait” value assumed to be an average of the retail value of the three other first-generation traits
9
10. U.S. CORN GROWTH
With the Corn Trait Technology in Hand Today, There’s
Opportunity to Double Penetration By End of Decade
U.S. CORN TRAIT OPPORTUNITY U.S. TRAIT ACRE
OPPORTUNITY:
TOTAL MARKET OPPORTUNITY IN 20101
U.S. Corn CURRENT COMMERCIAL
CORN TRAITS
SITUATION:
RELATIVE RETAIL VALUE
YIELDGARD
ROOTWORM
• Through 2006, roughly 50
2006F:
percent of the available market
PER ACRE
has been penetrated with traits Only 50%
YIELDGARD penetrated
CORN BORER to date
OUTLOOK:
2006 2010
ROUNDUP READY
ROUNDUP READY
32.7M 60M
CORN
CORN 2
YIELDGARD
10.0M 25-30M
60
40 50
ROOTWORM 30
10 20
U.S. TRAIT-ACRE OPPORTUNITY
YIELDGARD CORN
32.3M 50-60M (ACRES IN MILLIONS)
BORER
TRIPLE STACK
SINGLE
TRIPLE
6.0M 25-30M DOUBLE
TRAITS
~10M ACRES
25-30M ACRES 20-25M ACRES
OPPORTUNITY
1. Market Opportunity
Acres exclusively
Because YieldGard Above triple
STACKED
reflects total acres
where technology is using Roundup
Rootworm has the stack, remaining
applicable, not
Ready, which would
lowest market YieldGard Corn
necessarily acres
projected for include “refuge”
opportunity of the 3 Borer forms
penetration by 2010.
acres required for
traits, its market double-stack
other acres using
potential is the proxy for opportunity
insect-protected
total potential for triple
traits
stack
10
11. INTERNATIONAL CORN GROWTH
Gross Profit Value of Seed Internationally Varies, Yet Still
Solid Contributor to Growth, Commercial Platform
TOTAL HYBRID GROSS
MONSANTO
CHANGE
MARKET MARKET PROFIT
BRAND OUTLOOK
(’04-’06)
SIZE SIZE VALUE PER
SHARE
(ACRES) (ACRES) ACRE1
International Corn
EUROPE-AFRICA
SITUATION:
HIGH
France 7.5M 7.5M 15% +5% • Second most
• Primary value in valuable market
HIGH
Italy 3.2M 3.2M 21% +7%
international corn markets behind U.S.
today is in the seed • Molecular
MEDIUM
Hungary 2.7M 2.7M 32% +6%
breeding
• Breeding gains that have HIGH application is ~ 2
Turkey 0.8M 0.7M 21% +4%
been made in the U.S. set years behind
LOW U.S.
South Africa 6.0M 6.0M 50% +12%
pace for market share
LATIN AMERICA
growth in other
international markets
MEDIUM • Argentina is
Mexico 17.3M 3.9M 61% +3%
OUTLOOK:
only country in
LOW
Brazil 30.8M 20.6M 34% -1% region with
• Monsanto is targeting to biotech traits
grow share in each of the • Next priority for
LOW
Argentina 7.3M 7.0M 35% FLAT
most valuable corn-growing molecular
breeding
countries
ASIA-PACIFIC
• India is primary
market of
LOW
India 15.6M 5.9M 35% +6% longer-term
value in region
1. Average incremental value in gross profit opportunity for the seed value (excluding traits)
of the addition of an acre in a Monsanto brand:
MEDIUM
HIGH LOW
>$20 $10 - $20 <$10
11
12. GLOBAL BIOTECH TRAIT GROWTH
Expansion of Corn Market Share Sets Stage for Corn Traits
Internationally
INTERNATIONAL MARKET OPPORTUNITY: CORN1
ROUNDUP YIELDGARD YIELDGARD
OUTLOOK
Global Biotech Traits READY CORN 2 CORN BORER ROOTWORM
SITUATION: • All traits in the regulatory
20M 15M 5M
Brazil queue
• “Footprint” established by
• ~85% YGCB penetration,
5M 4M 1M
Argentina
Monsanto’s corn market share Minor acres of RR
growth globally establishes
• YGCB and RR received
3 – 5M 3 – 5M -
India
the base to launch traits as approvals for field trials
they earn regulatory approvals
• YGCB planting on small
OUTLOOK: 24M 8M 5M
Europe acres in 7 countries in
2006
• Corn traits outside U.S. have
• Focused on S. Africa,
significant opportunity for where both traits are
penetration 6M 4M -
Africa commercial on small
acres and moving to
stacks
Total
58-60M 34-36M 11M
International
BIOTECH
ACRES Markets
PLANTED
3% 16% 0%
2006 YGCB=YieldGard Corn Borer
YGRW=YieldGard Rootworm
REMAINING
RR = Roundup Ready Corn 2
AVAILABLE
ACRES
1. Market Opportunity reflects total acres where technology is applicable, not necessarily acres projected for penetration by 2010.
12
13. GLOBAL BIOTECH TRAIT GROWTH
Soybean Trait Growth Expected to Be Fueled By Increased
Penetration in Brazil
INTERNATIONAL MARKET OPPORTUNITY: SOYBEANS1
Global Biotech Traits
OUTLOOK
SITUATION: ROUNDUP READY
• Largest soybean market • Pricing for penetration to grow total
50M
Brazil
acres and shift sales to new seed
outside U.S. is Brazil; Recent
pricing action taken there to • Legal proceedings pending in EU
35M
Argentina
promote penetration courts
OUTLOOK:
1M
Europe • Small acreage
• Driven by expanded
0.2M
Africa • Small acreage
penetration in Brazil, upside of
30M+ acres for continued Total
86.2M
expansion International
Markets
63%
BIOTECH
ACRES
PLANTED
2006
REMAINING
AVAILABLE
ACRES
1. Market Opportunity reflects total acres where technology is applicable, not necessarily acres projected for penetration by 2010.
13
14. GLOBAL BIOTECH TRAIT GROWTH
Like U.S., International Markets Are Already Moving Toward
Higher Technology Platforms in Cotton
INTERNATIONAL MARKET OPPORTUNITY: COTTON1
ROUNDUP READY
BOLLGARD
OUTLOOK
Global Biotech Traits AND ROUNDUP
AND BOLLGARD II
READY FLEX
SITUATION:
• BG currently planted on
2M
3M
Brazil
• Cotton traits are among most limited acres
advanced on global scale, with
• Pursuing dual path to
second-generation upgrades
resolution on pricing for
10-15M
10-15M
India
already beginning in FY2007 in BG before BGII
Australia and India introduced
OUTLOOK:
• S. Africa focus, where BG
10M
11M
Africa and RR are planted on
• Dual opportunity of initial
small acres
penetration into markets and
upgrading to second- • On par with U.S.;
generation traits offers a Penetration moving to 2nd-
0.5M-0.8M 0.5M-0.8M
Australia
strong gross profit addition gen traits in 2007
Total
BIOTECH
24.5-32.7M 22.5-27.8M
International
ACRES
Markets
PLANTED
2006
4% 38%
BG=Bollgard cotton
REMAINING BGII=Bollgard II cotton
AVAILABLE RR = Roundup Ready cotton
ACRES
1. Market Opportunity reflects total acres where technology is applicable, not necessarily acres projected for penetration by 2010.
14
15. COTTON GROWTH
Most Significant Near-Term Opportunity in Cotton Is
Upgrading to Second-Generation Traits
U.S. PENETRATION OF COTTON TRAITS: 2006
PENETRATION OF COTTON TRAITS IN 2006 AS
A PERCENT OF 2010 TOTAL MARKET OPPORTUNITY1
Cotton Platform
FIRST GENERATION
SITUATION:
• Cotton trait platform is the first
Bollgard
to move forward on complete
replacement of first-generation
Roundup
traits with second-generation
Ready
upgrades
• Roundup Ready Flex cotton SECOND GENERATION
launched in the U.S. in 2006;
Launched in Australia for Bollgard II
FY2007 planting
Roundup
OUTLOOK:
Ready
• Expansion of second-
Flex
generation trait offerings
creates opportunity to invest 0% 20% 40% 60% 80% 100%
in penetration of higher-margin
2006 SECOND-GENERATION TRAIT
traits in Delta and Pine Land
PENETRATION2
offerings
<10%
DELTA AND PINE LAND
>40%
STONEVILLE
1. Percent of total market opportunity reflects the ratio of number of actual acres planted to total trait-acre opportunity
identified for each particular trait
2. Second-generation trait penetration reflects percent of commercial portfolio containing either Roundup Ready Flex,
Bollgard II or both traits.
15
16. SEMINIS GROWTH
Seminis To Leverage Portfolio, Pricing and Molecular
Breeding To Create New Growth
SEMINIS VALUE CREATION
STAGED OPPORTUNITIES FOR INCREASING BUSINESS VALUE
Seminis
SITUATION: Significant use of
molecular markers
• In 2006, narrowed commercial
VALUE CREATION OPPORTUNITY
and research focus to 25 crops
Aggressively make hybrid
that generate the most profit
conversions in strategic crops
• Began application of breeding
technology, with genome-wide
Identify and implement opportunities
marker platform for tomatoes
to price products to value
and peppers; Melons,
watermelons and the brassica
Assemble genetic maps for key crops
family of cabbage, broccoli
and cauliflower next
OUTLOOK:
Focus on 25 most-profitable key crops
• Seminis is targeted to
contribute $0.10 - $0.125 to
2005 2006 2007 2008 2009 2010
EPS in FY2007 now that
NEW VALUE CREATION
inventory step-charge is OPERATIONAL EXCELLENCE PIPELINE ADVANCEMENT
complete
Monsanto Seminis Seminis Commercialize
acquires modestly accretive to first hybrids
Seminis accretive FY2007 EPS developed by
to FY2006 in range of molecular
EPS $0.10-$0.125 breeding
16
17. PIPELINE
Monsanto’s Pipeline Is Proven By Experience and Poised for
Further Success
DISCOVERY PHASE I PHASE II PHASE III
PHASE IV
Proof Of Early Advanced
Gene/Trait Pre-launch
As of Jan. 1, 2006 Concept Development Development
Identification
R&D Pipeline Roundup Ready Flex cotton
SITUATION: Roundup RReady2Yield soybeans
Roundup RReady2Yield canola
In FY2006: Dicamba-tolerant soybeans
• Three products exited the Dicamba-tolerant cotton
YieldGard VT Rootworm/RR2
pipeline for commercialization
2nd-Gen YieldGard Corn Borer
• There was positive movement Insect-protected soybeans
– advancing phases or adding YieldGard Rootworm II
to the pipeline – in 50 percent Soybean nematode-resistance
Bollgard III
of the pipeline projects
Drought-tolerant corn
• Three projects were 2nd-Gen Drought-tolerant corn
designated as “HIT” projects Higher-yielding canola
reflecting our confidence in Drought-tolerant soybeans
Drought-tolerant cotton
their commercial track
Higher-yielding corn
Nitrogen utilization corn
Higher-yielding soybeans
Mavera™ High-value corn with lysine1
Mavera™ I High-value soybeans1
Mavera™ II High-value soybeans1
2nd-Gen High-value corn with lysine1
Feed Corn with balanced proteins1
High oil soybeans for processing1
Improved-protein soybeans
Vistive II soybeans
Vistive III soybeans
Omega-3 soybeans
17
1. These product candidates are in the Renessen pipeline. Renessen is a Monsanto/Cargill joint venture
18. SUMMARY
Six Building Blocks Extend Leadership and Elevate Gross
Margin Opportunity Through 2010
MONSANTO’S OPPORTUNITY
GROSS MARGIN OPPORTUNITY
Delta between 2006 current gross
GROSS PROFIT AS A PERCENT OF SALES
margin and a 51-53% trajectory
54%
reflects continued growth opportunity
for seeds and traits
FACTOR VALUE1
GROSS MARGIN ‘PULL’
52%
HIGH
U.S. corn
International
MEDIUM
50% corn
Global biotech
MEDIUM
traits
48%
LOW
CURRENT LEVEL Cotton platform
MEDIUM
Seminis
46%
HIGH
R&D pipeline
44%
2003 2004 2005 2006 2007F 2008F 2009F 2010F
1. Increment to total gross profit in the period 2006-2010; Some categories will overlap.
MEDIUM LOW
HIGH >$250M $100M - $250M <$100M
18
