Slide 1: Citi's 2016 Basic Materials Conference
The Mosaic Company Citi's 2016 Basic Materials Conference Rick McLellan, Senior Vice President – Commercial November 30, 2016
Slide 2: Safe Harbor Statement
Safe Harbor Statement This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the Wa’ad Al Shamal Phosphate Company (also known as MWSPC) and other proposed or pend
Slide 3: Meaningful Steps to Create Long Term Value
Meaningful Steps to Create Long Term Value Anticipated H2 Improvement starting to materialize. Actions taken to capitalize on improvement. Mosaic is well positioned to create value for shareholders. 3
Slide 4: Market Update
Market Update
Slide 5: By Major Region
By Major Region India China Brazil North America 5
Slide 6: Positive Potash Developments
Positive Potash Developments Potash Prices Solid on-farm demand $ Tonne 425 400 375 Destocking of channel 350 325 inventories 300 275 250 Optimization of operations 225 200 Source: Argus FMB 175 Jan-14 Jul-14 Dec-14 Jul-15 Dec-15 Jun-16 fob NOLA c&f Brazil 6
Slide 7: Expect Rebound in 2017
Expect Rebound in 2017 Mil Tonnes KCl Global Potash Shipments 65 61-63 60 55 50 45 40 35 30 25 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16E 17F Source: Company Reports, CRU and Mosaic 7
Slide 8: DAP Margins Turn Up in Q3
DAP Margins Turn Up in Q3 DAP/MAP Prices $ Tonne Published Weekly Spot Prices 550 Source: Argus FMB 525 500 475 DAP Benchmark Stripping Margin 450 $ Tonne Calculated from Published Weekly Spot Prices 425 350 400 Source: Argus FMB 375 325 350 325 300 300 Jan-14 Jul-14 Dec-14 Jul-15 Dec-15 Jun-16 DAP
Slide 9: Positive Demand Outlook
Positive Demand Outlook MMT Product DAP/MAP/NPS/TSP Global Phosphate Shipments 70 66-68 65 60 55 50 45 40 35 30 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16E 17F Source: CRU and Mosaic 9
Slide 10: Expected China Capacity Rationalization
Expected China Capacity Rationalization Mil Tonnes China DAP/MAP/TSP Exports 14.0 “The country’s phosphate fertilizer 12.0 capacity will be controlled at 22 million tpy 10.0 (P2O5) by 2020, and some outdated plants will be phased out in the 2016- 8.0 2020 period, eliminating 3 million tpy capacity,
Slide 11: Mosaic's Performance
Mosaic’s Performé losaic’ Mosaic
Slide 12: Controlling Operating Expenses
Controlling Operating Expenses $ Millions $450 SG&A $400 $350 $330 Guidance range $300 $394 $315 $382 $361 $250 $230 YTD $200 2013 2014 2015 2016F Q3 SG&A: lowest in 9 years, despite adding CF phosphates and ADM Distribution 12
Slide 13: Potash: Optimizing Value
Potash: Optimizing Value $140 $136 $133 Operating Rate: 70% $120 $112 $100 $94 $95 Includes $80 $20/tonne of brine $60 management $40 costs $20 $- 2012 2013 2014 2015 TTM Q3 2016 * Source: Mosaic MOP Cash Cost Per Production Tonne 1 1 Excluding realized mark-to-market gains and losses * MOP producti
Slide 14: Mosaic Phosphates: Operational Excellence
Mosaic Phosphates: Operational Excellence $50 $41 $40 $30 Dollars/Tonne $20 $10 $0 2011 2012 2013 2014 2015 TTM Q3 Source: Mosaic Mining Cash Costs/Tonne of Phosphate Rock 2016 14 TTM Q3 2016 means the trailing twelve months from September 30, 2016
Slide 15: Mosaic: History of Innovation
Mosaic: History of Innovation 2,500 25% 2,000 20% Thousand Tonnes 1,500 15% 1,000 10% 500 5% - 0% 2011 2012 2013 2014 2015 TTM Q3 2016 Source: Mosaic MicroEssentials® sales volume MicroEssentials® % of phosphate product volumes TTM Q3 2016 means the trailing twelve months from September 30, 2016 15
Slide 16: Mosaic: International Distribution
Mosaic: International Distribution 16 Source: Mosaic
Slide 17: And Capital Spending
And Capital Spending $ Millions $1,800 $1,600 Down ~50% $1,400 From Peak $1,200 $1,000 $800 $600 $400 $900 $800 $800 $200 $- 2013 2014 2015 2016F 2017E 2018E 2019E Sustaining Capex Growth Capex Total Capex Investment in Ma'aden 17
Slide 18: Mosaic's Focus
Mosaic’s Focus Build on Mosaic’s Track Record of Success: • Execution • Smart Investments • Environmental Stewardship & Safety Prudently Manage Capital Grow Value for Mosaic’s Shareholders 18
Slide 19: Appendix
Appendix
Slide 20: Crop Nutrient Affordability a Significant Tailwind for Farmers
Crop Nutrient Affordability a Significant Tailwind for Farmers Plant Nutrient Affordability Plant Nutrient Price Index / Crop Price Index 1.60 Source: Weekly Price Publications, CME, USDA, AAPFCO, Mosaic 1.40 Less Affordable 1.20 1.00 0.80 More Affordable 0.60 0.40 05 06 07 08 09 10 11 12 13 14 15 1
Slide 21: Global Phosphate Shipment Forecasts by Region
Global Phosphate Shipment Forecasts by Region (November 1, 2016) Nov Nov Nov Nov Million Tonnes Low High Low High DAP/MAP/NPS*/TSP 2015 2016F 2016F 2017F 2017F Comments We have slightly trimmed our 2016 forecast on a slow start to the winter stockpiling program, as domestic prices are trading at a s
Slide 22: Chinese Phosphate Producers
Chinese Phosphate Producers 2016 third quarter report of listed fertilizer companies name Operation revenue in the first three Net profit in the first three quarters (million Net profit (million RMB) quarters (billion RMB) RMB) 2015 2016 Y/Y (%) 2015 2016 Y/Y (%) Jan-Jun 2016 Third quarter Kingenta
Slide 23: Chinese Phosphate Producers (continued)
Chinese Phosphate Producers (continued) 2016 third quarter report of listed fertilizer companies name Operation revenue in the first three Net profit in the first three quarters (million Net profit (million RMB) quarters (billion RMB) RMB) 2015 2016 Y/Y (%) 2015 2016 Y/Y (%) Jan-Jun 2016 Third quart
Slide 24: Global Potash Shipment Forecasts by Region
Global Potash Shipment Forecasts by Region (November 1, 2016) Nov Nov Nov Nov Muriate of Potash Low High Low High Million Tonnes (KCl) 2015 2016F 2016F 2017F 2017F Comments While still projecting a sharp drop in shipments this year due to the delayed settlement of 2016 contracts and a drawdown of ch
Slide 25: Lower Projected NA Producer Inventories
Lower Projected NA Producer Inventories Producer stocks projected to drop from highest June 30 level on record . . . . . . to a level near the Mil Tons bottom end of the KCl North American MOP Stocks seven year range 4.5 Source: IPNI and Mosaic 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Jul Aug Sep Oct Nov
Slide 26: Potash: Supply Reductions and Curtailments
Potash: Supply Reductions and Curtailments* Reduced / Closed Capacity Producer 2014-2018 (in tonnes) Hersey 100K Mosaic Carlsbad MOP 500K Colonsay re-scale 800K Supply Potash Corp New Brunswick 1,800K Response to Low Prices is Uralkali Solikamsk 2 50% of 2,400K Evident ICL Boulby MOP 900K Carlsbad E
Slide 27: Source Disclosure
Source Disclosure Slide 16, Closure Sources: Press release, "The Mosaic Company Reports Third Quarter 2013 Results", November 5, 2013 Press release, "The Mosaic Company Reports Second Quarter 2014 Results", July 31, 2014 Press release, "PotashCorp Reports 2015 Third-Quarter Earnings of $0.34 per Sha
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