Yara International ASA · OSL:YAR
Yara International ASA — Investor Day (November 2007)
8 slides from Yara International ASA's investor day presentation, Nov 20, 2007
Slide 1: Grain forward prices give incentives to more planting and higher yield
Grain forward prices give incentives to more planting and higher yield Maize Wheat USD/bu USD/bu 5.0 10.0 4.0 8.0 6.0 3.0 Fertilizer market attractiveness 4.0 2.0 2.0 1.0 0.0 0.0 2007 2008 2009 2010 2007 2008 2009 2010 USD/bu Soybeans 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2007 2008 2009 2010 Average prices
Slide 2: Grain stocks to drop further through June 2008; Demand drivers for grain
Grain stocks to drop further through June Demand drivers for grain 2008 Population growth Million tons 2,200 1.17% a year, according to UN forecasts for 2005-2010 35% 2,150 2001-2008: 1.7% growth/year 115 days inventory 30% Diet change, linked to economic growth. Even higher effect on other crops 2,
Slide 3: World calorie consumption shifting towards meat, fruits and vegetables; Biofuel production increasing strongly
World calorie consumption shifting towards meat, fruits and vegetables 2005 consumption relative to 1990 Biofuel production increasing strongly 70% Ethanol Biodiesel million barrels/day million barrels/day 60% Average calorie consumption per person per day in 2005 was 2899kcal, up 5.7% since 1990 50
Slide 4: US ethanol production still profitable; Urea consumption growth restricted by supply
US ethanol production still profitable Urea consumption growth restricted by supply Ethanol versus Gasoline Profitability rebounding with oil Urea consumption ex.China Urea fob Black Sea USD/gallon USD/gallon Million tons USD/ton 3.0 Gasoline (NY RBOB) Ethanol (NY) 1.0 Ethanol cash margin 95 350 2.8
Slide 5: Chinese export necessary to cover 10% increase in urea import demand; Further delays to new urea capacity
38 Chinese export necessary to cover 10% increase in urea import demand Further delays to new urea capacity 1H 2007 compared to 1H 2006 Global urea capacity Year Driving regions 3.0 DEMAND INCREASE SOURCING growth estimate* World Excluding China World Ex. China 0.6 1.1 2007 4.4% (5.0%) 2.7% (3.0%) C
Slide 6: Main phosphate processing routes; Global phosphoric acid capacity ex. China
Main phosphate processing routes Global phosphoric acid capacity ex. China 2006 production and exports, million tons P2O5 38 Phosphate rock Production: 52 (72% BPL*, 33% P2O5 ) Export: 10 37 Sulphur** 36 35 million tons P2O5 Phosphoric acid Production: 34 34 (100% P2O5) Export: 5 Ammonia 33 ( 82% N)
Slide 7: Strong increase in value of phosphate production; Strong demand for phosphates, but limited supply
Strong increase in value of phosphate Strong demand for phosphates, but limited production* supply Value of phos.acid production Value of DAP production USD/ton USD/ton DAP/MAP/TSP consumption ex.China DAP fob Morocco 600 500 Million tons P2O5 DAP price USD/ton Phos.acid 450 20 450 500 price 400 400
Slide 8: China fast becoming a significant net phosphate exporter; Limited new phos.acid expansions
China fast becoming a significant net phosphate Limited new phos.acid expansions exporter Global phos.acid capacity DAP net export MAP net export Year Driving regions Million tons Million tons growth estimate* 1.0 1.2 World Excluding China World Ex. China 2007 1.0 0.5 0.8 2007 2007 1.4% -2.2% China