monsanto 09-26-07

1

BRETT BEGEMANNEXECUTIVE VICE PRESIDENT, GLOBAL COMMERCIAL

CREDIT SUISSE

16TH ANNUAL CHEMICAL CONFERENCE

September 26, 2007

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Forward-Looking Statements

Certain statements contained in this presentation are "forward-looking statements," 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 acquisitions; 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 most recent periodic report to the SEC. Undue reliance should not be placed on these forward-looking statements, which are current only as of the date of this presentation. The company disclaims any current intention or obligation to update any forward-looking statements or any of the factors that may affect actual results.

TrademarksTrademarks owned by Monsanto Company and its wholly-owned subsidiaries are italicized in this presentation. All other trademarks are the property of their respective owners.

© 2007 Monsanto Company

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Market Forces Are Changing Agricultural Production Trends Globally

OVERVIEW

Brazil exploits land availability advantage to become commodity soy producer to meet demand from China

Expanding ethanol and export

demands favor U.S. as low-cost corn

producer

U.S. ramps up production of corn; Soy crop becomes increasingly focused on higher-value segments over commodities

Argentina leverages geographic proximity to

supply corn to Latin America

Growing wealth and population in Asia creates new demand for imported grain

Biggest increases in cotton acreage come in

Asia, with U.S. focused on quality and consistency of

supply

MACRO PRODUCTION TRENDS OVER THE NEXT DECADE: CORN, SOYBEANS, COTTON

Biodiesel drives oilseed demand in Europe

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Ag Landscape Is Changing, But Monsanto Is Well Positioned Ahead of Emerging Trends

OVERVIEW

Yield traits and first-ever approaches designed for Latin America help bolster increased production

Support commodity production in Latin America

Drought-tolerance family of traits in development creates a platform for yield-and-stress in seed

Address universal trends, like water use

Cotton breeding has a head start versus early work in corn in 1990sCombined with further trait upgrades, cotton is an expanding technology platform

Improved-oils platform allows U.S. production to differentiate and focus on high-value segment

Nitrogen-utilization corn has potential to do for input commodities what insect control did for insecticides

SOLUTIONS

Use technology infusion to lift yield and returns

De-commoditize the market in the U.S.

Bring commodities into proprietary in-seed revenue generators

OPPORTUNITIES

Cotton must become more profitable for farmers – boosting yields is key

COTTON

There will be a bifurcation of the global soybean production into commodity and value-added streams

SOYBEANS

The demand for corn grain will remain strong; Yield provides the bridge between fuel and food-feed demands

CORN

TRENDS OVER NEXT FIVE YEARS

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OVERVIEW

R&D pipeline

Seminis

Cotton platform

Global biotech traits

International corn

U.S. corn

FACTOR

By the end of the decade, Monsanto projects a gross margin in the range of 52-54%, reflecting growth opportunity in six areas of seeds and traits

MONSANTO’S OPPORTUNITY Grow 1-2 share points annually in key countries; stabilize Brazil share

Continue share growth for Monsanto brands

2010 OUTLOOKKEY PRIORITIES

International Corn

Complete approval for YieldGard Corn Borer/ Roundup Ready stack to facilitate penetration of RR corn in Argentina

Stacked Corn Traits in Argentina

Shift Indian hybrid market to Bollgard II; currently 1M acres of 15-20M acre opportunity

Second-Generation Cotton Traits in India

Complete approval for YieldGard Corn Borer for Brazil and launch in 100% infested marketCorn Traits in Brazil

Increase penetration of Roundup Ready Soy in Brazil to U.S. level of 95%; currently at 50% penetration

Roundup Ready Soy Penetration in Brazil

Expand to acres of meaningful scale in key countries in EuropeYieldGard Corn Borer in Europe


Global biotech traits

Currently in Phase II in the pipeline; pursue launch in U.S., Latin America and Europe

Drought Tolerant Corn in Brazil, Argentina and Europe

Insect-protected soybeans currently in Phase II; prepare for launch in early next decade in BrazilInsect-Protected Soybeans in Brazil

Currently in Phase I in the pipeline; pursue launch in U.S., Australia, India and Brazil

Drought Tolerant Cotton in Australia, India & Brazil


R&D pipeline

INTERNATIONAL BUSINESS DRIVERS

International Contributes Across Several of Our Six Growth Drivers and Aligns with Emerging Trends in Agriculture

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+313%27M+1$69Europe (EU 27)

7M

MARKET FUNDAMENTALS

+4

+5- 4

+2

2007SHARE POINT

CHANGE

2007 PERFORMANCE1

$15ASIA-PACIFIC

$26$29

LATIN AMERICA

$23

EUROPE-AFRICA

AVERAGE RETAIL VALUE

PER ACRE

8M

23M

6M

2007 HYBRID MARKET SIZE

(ACRES)

+1039%India

+540%Argentina

- 530%Brazil

+1351%South Africa

3-YEAR TREND: SHARE POINT

CHANGE (’04-’07)MONSANTO

BRAND SHARE

Consistent Share Gains in High-Value International Corn Markets Contributes Solid Growth

INTERNATIONAL CORN

1. Reflects expectations for share performance for 2007 planting season; For Brazil and Argentina, reflects 2006-2007 planting season

• Continued targeting of 1 to 2 share point gains in all regions except Brazil, where plan is to stabilize share

• Increased emphasis on breeding in tropical hybrids planned to stop share loss in Brazil

OUTLOOK:

• Value is in the seed• Early focus on high-value

temperate hybrids has led to annual 1 to 2 share point gains in key countries

SITUATION:

International Corn

7

0%5%

10%15%20%25%30%35%40%45%

2004 2005 2006 2007F 2008F 2009F 2010F0%

2%

4%

6%

8%

10%

12%

Corn Market Share Gains Yet To Fully Reflect Power of Molecular Breeding Application

BR

AN

DE

D M

AR

KE

T S

HA

RE

MOLECULAR-BREEDING (MAB) and DIHAPLOID HYBRIDS AS A PERCENT OF BRANDED UNITS SOLD IN EX-U.S. COMMERCIAL CORN PORTFOLIO

PE

RC

EN

T O

F BR

AN

DE

D U

NIT

S S

OLD

IN

CO

MM

ER

CIA

L CO

RN

PO

RT

FOLIO

DEKALB MARKET SHARE

• Molecular breeding improves genetic potential by 2X versus conventional breeding

• By 2010, over 8% of commercial portfolio will be derived from molecular breeding and dihaploid technologies

OUTLOOK:

• Conventional breeding improves genetic gain on average by 1.5% per year

SITUATION:

International Corn

INTERNATIONAL CORN

PROGRESSION OF BREEDING TECHNOLOGY

IN THE COMMERCIAL

PORTFOLIO

CYCLE 2:APPLICATION OF MAB TO SELECTION

CYCLE 3: SELECTION POWER OF MOLECULAR BREEDING

• BY 2006, FIRST MOLECULAR BREEDING HYBRIDS ENTER COMMERCIAL PORTFOLIO

• EU IS ROUGHLY 2 YEARS BEHIND THE U.S. FOLLOWED BY LATIN AMERICA AND ASIA PACIFIC

• PREDICTIVE COMBINATIONS ALLOW MORE EFFICIENT BREEDING

• APPLY MOLECULAR BREEDING TO TROPICAL MARKETS, SUCH AS BRAZIL AND ASIA

CYCLE 1: INTEGRATION OF GLOBAL GERMPLASM

• ASSEMBLED 36 MAJOR CORN BREEDING PROGRAMS IN 12 COUNTRIES

• FIRST INTRA-COMPANY CROSSES

ARGENTINA

BRAZIL

INDIA

EUROPE

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Acquisition of Agroeste in Brazil Bolsters Market Share and Provides Diverse Germplasm

• Increased emphasis on breeding in tropical hybrids and access to germplasm from this acquisition should stabilize share in Brazil

• Potential to accelerate launch of YieldGard Corn Borer

OUTLOOK:

• Acquisition increases focus on the high value segment in Brazil

• Solid position in the southern region complements our existing base

• Potential synergies with existing corn germplasm

SITUATION:

International Corn

Pioneer, 22% Syngenta, 12%

Monsanto, 30%

Others, 11%

Dow/Agromen, 15%

Agroeste, 10%

20071 BRAZIL CORN MARKET SHARE

INTERNATIONAL CORN

• Strong core management team to remain in place and run similar to the ASI model in the United States

• Approximately 20-25 million acres of hybrid corn planted annually in Brazil; Agroeste brand used on approximately 10 percent in 2007

ACQUISITION OF AGROESTE

• Acquired 100 percent ownership of Agroeste in September 2007 forapproximately $100 million cash

1. Reflects 2006-2007 planting season

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Penetration of Roundup Ready Soybeans in Brazil Expected to Mirror U.S. Penetration Curve

GLOBAL BIOTECH TRAITS

• Potential to penetrate 95% of the acres in Brazil at peak share, establishing footprint for transition to Roundup RReady2Yield and insect-protected soybeans

OPPORTUNITY:

• Brazil Roundup Readysoybean penetration currently at 50% of the opportunity

SITUATION:

Global Biotech Traits

ROUNDUP READY SOYBEANS

PENETRATION AS A PERCENTAGE OF THE OPPORTUNITY

0%

20%

40%

60%

80%

100%

120%

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07U.S. Roundup Ready soybeans Brazil Roundup Ready soybeans

50% penetration in Brazil consistent with U.S. trend in year four

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Bollgard Penetration Accelerated as Indian Farmers Experienced Clear Economic Benefit of the Technology


• Transition to biotech improves yield and reduces inputs to improve profits

• Opportunity to widen gap of economic benefit with Bollgard II and Roundup Ready Flex

OPPORTUNITY:

• Depressed cotton prices and lack of yield improvement had reduced on-farm profits in India

• India is the 2nd largest cotton producer in the world and seeks to surpass China via increased yields

SITUATION:

Global Biotech TraitsBOLLGARD COTTON VS. CONVENTIONAL COTTON IN INDIA

ASSOCHAM STUDY OF BT COTTON FARMING IN INDIA1

• 93% of Bt cotton farmers satisfied with Bt performance

PRODUCT PERFORMANCE

• Estimated 162% increase in 2006 to $172/acre for farmers planting Bt Cotton; additional $1.5B in income earned collectively by Indian farmers using Bt cotton in 2006

NET PROFIT PER ACRE

• Number of sprays reduced by approximately five; average savings of $21 per acre for Bt cotton farmers

PESTICIDE SPRAYS

• Estimated 50% increase in Bt cotton yields compared with conventional cotton yields in 2006

AVERAGE YIELD

1Assocham launched two studies on “BT Cotton Farming in India” after 2006 season; Indicus Analytics covered 9000 farmers in 467 villages and 28 districts of the 8 cotton growing states and IMRB study covered nearly 6000 farmers from 111 Taluks of 37 districts including 4188 farmers using biotech traits and 1793 conventional cotton farmers in 9 cotton growing states.

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Bollgard Cotton Penetration in India Nearly Doubles in 2007; Creates Platform for Second-Generation Traits


• Opportunity to upgrade 100% of the Bollgard acres with Bollgard II technology in India

OPPORTUNITY:

• Bollgard planted on 13M acres and Bollgard IIplanted to slightly more than 1M acres

• Hybrid market in India now estimated to be 15-20M acres

SITUATION:


0

5

10

15

20

25

BOLLGARD II BOLLGARD

BOLLGARD & BOLLGARD II COTTON IN INDIA

M ACRES

2004 2005 2006 2007 2010OPPORTUNITY

M A

CR

ES

RETAIL PRICE /ACRE SEED & TRAIT

BOLLGARD IIBOLLGARD

$22$ 18

15-20M

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Launch of Roundup Ready Flex in India Would Provide Opportunity to Further Improve Grower Profitability


• Roundup Ready Flex has a fit on all of the 15-20M hybrid cotton acres in India; allows India to leapfrog directly to 2nd

generation technology

OPPORTUNITY:

• Roundup Ready Flex currently launched in the U.S. and Australia

• Roundup Ready Flex awaiting approval in India; will only be offered in a stack with Bollgard II

SITUATION:


0

5

10

15

20

25

2007 AT LAUNCH

ROUNDUP READY FLEX OPPORTUNITY IN INDIA

BOLLGARD II

ROUNDUP READY FLEX/BOLLGARD II

BOLLGARD

ROUNDUP READY FLEX TECHNOLOGY

EXPECTED BENEFITS

ACRE OPPORTUNITY

Reduces labor costs associated with hand weedingReduces fuel associated with mechanical harrowingReplacement for herbicides used by some growers; ~$10/acre

15-20M acres

M A

CR

ES

OPPORTUNITY

15-20M

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Approval of Stacked Corn Traits in Argentina Opens the Door for Increased Roundup Ready Corn Penetration


• Roundup Ready Corn has a fit on all acres of corn in Argentina; currently growers unwilling to give up corn borer control for superior Roundup Readyweed control

OPPORTUNITY:

• Currently only single traits are available in corn in Argentina

• Roundup ReadyYieldGard Corn Borer corn received regulatory approval in Argentina at the end of August; awaiting local approvals for hybrids containing the stack

SITUATION:


0

2

4

6

8

10

2007 2010

TRAITED CORN OPPORTUNITY IN ARGENTINA

YIELDGARD CORN BORER

ROUNDUP READY CORN

ROUNDUP READY YIELDGARD CORN BORER - ARGENTINA

• Growers today utilize pre-plant herbicides in lieu of Roundup Ready technology• Growers seek both technologies but currently forced to make trade-offs• Significant loss from European corn borer and lack of other viable control

options makes YieldGard Corn Borer the technology of first choice

• Currently eight million acres planted to corn in Argentina today; expected to grow to 10 million acres to fill U.S. export gap

M A

CR

ES

OPPORTUNITY

YIELDGARD ROOTWORM

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Several Corn Trait Products Await Approval for Use in Brazil; Country in Need of Improved Corn Yields


• 100 percent of the corn acres planted in Brazil are infested with corn borer

OPPORTUNITY:

• Brazil plants approximately 20-25M acres to hybrid corn, its number two crop after soybeans

• Yields are low and demand for exports up

• Currently there are no commercial biotech traits approved for use in corn, although CTNBio recently approved YieldGard Corn Borer

• Seeking approval of the specific hybrids that contain the event by the Ag ministry

• Agroeste acquisition expands base for launch

SITUATION:


0

5

10

15

20

25

2007 2010

TRAITED CORN OPPORTUNITY IN BRAZIL

YIELDGARD CORN BORER

ROUNDUP READY CORN

• CTNBio approval may be followed by a review from the National Biosafety Council (CNBS) to examine social and economic factors

REGULATORY APPROVAL PROCESS IN BRAZIL

• Hybrid variety registrations required before commercial launch

• First step consists of approval from CTNBio, Brazil’s biosafety commission, which is managed by the Ministry of Science and Technology to make science-based technical assessments

M A

CR

ES

OPPORTUNITY

YIELDGARD ROOTWORM

15-20M

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YieldGard Corn Borer Moves Beyond Trial Status in Europe as 270K Acres Planted Across Eight Countries in 2007


• Nearly 30 percent of the corn acres planted in Europe are infested with European corn borer

• Growers seek expanded YieldGard corn borer acreage and additional traits

OPPORTUNITY:

• YieldGard corn borer approved for planting in eight European countries and in South Africa

SITUATION:


M ACRES0.0 2.0 4.0 6.0 8.0 10.0

YIELDGARD CORN BORER 2010 OPPORTUNITY IN EUROPE

YIELDGARD CORN BORER PENETRATION IN EUROPE IN 2007

270K Acres

8M Acres

• Average 2006 yield advantage of 21 bushels per acre across European locations

• Dramatic reduction of fumonisin on harvested grain provides a reduced risk of grain rejection

YIELDGARD CORN BORER BENEFITS

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Significant Growth Opportunity Lies in Expansion of Existing Commercial Biotech Traits Globally


• As is the case in the U.S., largest category of opportunity internationally is corn trait adoption

• With current traits, international opportunity still exists to nearly triple to approximately 270M acres from 2007 penetration of approximately 95M acres

OUTLOOK:

• Biotech traits are now approved for planting in all major agricultural regions

SITUATION:


INTERNATIONAL MARKET OPPORTUNITYMARKET OPPORTUNITY FOR BIOTECH TRAITS THROUGH 20101

0%16-18%3%62-81%24-5%71-79%2007 Penetration

15M40-45M60-65M

17.7-23M

18.7-24M

90.2-100.2M

Total Key International

Markets

-4M6M0.15M0.15M0.2MSouth Africa

CORNCOTTONSOYBEANS

---0.5M-0.8M

0.5M-0.8M-Australia

5M8M24M--1MEurope(EU27)

-6M6M15-20M15-20M-India

5M7M9M--39MArgentina

5M15-20M15-20M2M3M50-60MBrazil

YIELDGARDROOTWORM

YIELDGARDCORN BORER

ROUNDUP READY CORN 2

BOLLGARD AND

BOLLGARD II

ROUNDUP READY(FLEX)

ROUNDUP READY

1. Market Opportunity reflects total acres where technology is applicable, not necessarily acres projected for penetration by 2010.2. Primarily Bollgard penetration; opportunity to expand to second generation technology.

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R&D PIPELINE

Pipeline Has Some Likely Blockbusters and Some Hidden Gems

ANNUAL R&D CYCLE: SEEDS & TRAITS

Second-generation stacked products to accelerate globallyCotton could be a 3+ stack by middle of next decade with drought tolerance and lygus control

COTTON POTENTIAL TO BE UNLOCKED

At a greater pace than ever before, new breeding tools are being applied across all platforms and resulting in breakthrough products

YIELD AND STRESS POTENTIAL EXPLODING

Drought tolerance in corn expected to be first of a rapid series of blockbuster traits

Roundup RReady2Yield creates platform for futureFirst product developed exclusively for an ex-US market will be in soybeansSoybeans could be a 3+ stack by middle of next decade

BREEDING ENGINE FIRING ON ALL CYLINDERSBREEDING PIPELINE

SOYBEANS ARE EMERGING FROM CORN’S SHADOW

BIOTECH TRAIT PIPELINE

Q1 Q4

Q3Q2

18

0%0%PERCENT PENETRATED

35M

ARGENTINA

50-60MAVAILABLE MARKET

BRAZILKEY MARKET ACRES

Insect-Protected Soybeans

Insect-Protected Soybeans in Development for Heavily Infested Latin America Market

R & D PIPELINE

SITUATION:

• Value proposition set by the insecticide sprays displaced and enhanced yield that accrues to the farmer

• Insect pressure present on all acres in Brazil

85-95M acresTOTAL ACRE OPPORTUNITY:

$10 - $30/acreRETAIL VALUE/ACRE:

2007 STATUS:

VALUE CONSIDERATIONS:

PHASE II

• First Monsanto trait developed exclusively for a non-U.S. market, notably Brazil and Argentina, where insect pressure is a significant issue

• Initial field trials demonstrate significant yield protection vs. unsprayed controls

• Intended as a stacked offering with Roundup RReady2Yield soybeans for effective control of both insects and weeds

INSECT-PROTECTED SOYBEANS

R&D Pipeline

0%

1%

2%

3%

4%

5%

6%

INSECTICIDE TREATED INSECT-PROTECEDSOYBEANS

INITIAL PERFORMANCE OF INSECT-PROTECTED SOYBEANS2005/06 ARGENTINA – 10 LOCATIONS

AV

ER

AG

E Y

IELD

IN

CR

EA

SE

(%

) O

VE

R N

O-I

NS

EC

TIC

IDE

CO

NT

RO

L

1.0 % 5.5 %

WITHOUT GENE(NO SPRAYS)

WITH GENE(NO SPRAYS)

MONMOUTH, IL SCREENHOUSE – 2007

19

0%

10M

ARGENTINA

0%0%0%PERCENT PENETRATED

27M

EUROPE

20-25M90MAVAILABLE MARKET

BRAZILU.S.KEY MARKET ACRES

Drought-tolerant corn

Family of Drought-Tolerant Corn Products to Create Differentiated Value Across Multiple Market Segments

STABILITYDRYLANDIRRIGATED

Value is in improved yields when moisture is less than optimal

Value is in improved yields annually, by improving water-use efficiency

Value is in replacing irrigation, reducing variable costs of irrigation

Non-IrrigatedNon-IrrigatedIrrigated

R & D PIPELINE

PART OF MONSANTO BASF YIELD AND STRESS R&D COLLABORATION

• Value of trait reflects better yields under moisture-stressed conditions; varies by region

• Value will be specific to variable costs of water use by farmers, not fixed costs of irrigation

• Corn needs 18-to-20 inches of moisture during the growing season

147M-152M acresTOTAL ACRE OPPORTUNITY:


Drought-tolerant corn

2006 STATUS:


Phase II• Lead event has consistently delivered yield

improvements under water stressed conditions across four seasons of testing in the United States and Latin America, with yield advantage of up to 12 bushels per acre

• Currently in fifth season of field testing; significant expansion in number of locations, test environments and germplasm backgrounds

HIT Project

R&D Pipeline

P R O J E C T

PART OF MONSANTO-BASF YIELD AND STRESS R&D COLLABORATION

27-45M acresTOTAL ACRE OPPORTUNITY:


2007 STATUS:


• Value of trait reflects better yields under moisture-stressed conditions; varies by region

• Value will be specific to variable costs of water use by farmers, not fixed costs of irrigation

PHASE I

• First drought leads are advancing to multi-location testing

• First leads in field testing are showing promise; continued evaluation to assess drought performance

DROUGHT TOLERANT COTTON

R&D Pipeline

R & D PIPELINE

Drought Tolerant Cotton in Development to Address Needs in All Key Cotton Regions

0%

0.5-0.8M

AUSTRALIA

0%0%0%PERCENT PENETRATED

15-25M

INDIA

2-4M10-15MAVAILABLE MARKET

BRAZILU.S.KEY MARKET ACRES

WITHOUT GENE WITH GENE

with gene

without gene

with gene

without gene

Fully watered Stressed

GREENHOUSE TESTINGDavis, CA – 2007

LAS CRUCES, NEW MEXICO - 2006

20

21

SUMMARY

International Well Positioned for Layers of Complementary Growth Through the End of the Decade

Grow share in branded corn by 1-2 share points annually

VA

LUE

CR

EA

TIO

N O

PP

OR

TU

NIT

Y

Increase penetration in first-generation Roundup Readysoybeans in Brazil to set platform for future soy technologies

Convert Indian market to Bollgard II while increasing overall penetration of insect-protected cotton

2007 2008 2009 2010

Pursue final approvals of stacked corn in Argentina and traited corn in Brazil and launch

Successful launch of pipeline traits

INTERNATIONAL VALUE CREATIONSTAGED OPPORTUNITIES FOR INCREASING BUSINESS VALUE• Base of corn seed

established and growing• First-generation traits in

cotton and soybeans enjoy significant penetration increases in 2007 in Brazil and India

• Recent regulatory approvals in Latin America provide opportunity for corn trait expansion Ex U.S.

• Pipeline provides promise of new traits in yield and stress

OUTLOOK:

International

• Expect contribution from International to drive margin expansion to 52-54% by the end of the decade

SITUATION:

BEYOND

monsanto 09-26-07

Economy & Finance