Presentation on the current outlook for the key sectors of the Brazilian agribusiness. Presentation elaborated in November 2009

1. Brazilian Agribusiness Outlook2009/10 by Anderson Galvão November, 2010

2. Agenda The business environment The soybean sector The corn sector The cotton sector The sugar & ethanol sector

3. Soon after the world economic down turn, it was observed a speedy recovery in the Brazilian economy Investment grade by Moody’s Investment grade by S&P Source: Brazilian Central Bank/Bovespa Elaboration: Céleres

4. Brazilian Ag Trade BalanceThe agricultural sector plays a major role in the local trade surplus In spite of a downturn in the world economy, the Brazilian agricultural sector will sustain the country trade balance Even though, the net surplus in 2009 is going to be 4.5% lower than in 2008 Meats and timber products were the big losers in 2009 Ag trade balance in 2008 (US$ billion) US$ 57.1 Brazilian trade balance (US$ billion) Main changes in 2009 (Jan-Sep) x 2008 Source: Brazilian External Trade Secretariat Values in US$ billion

5. Although a major agricultural producer, Brazil has a secondary position as consumer and producer of fertilizer, being a net importer Under this condition, the country ends up being a price taker in the fertilizer and its raw material international market N (Amônia) Phosphate Rock KCl Source: IFA Elaboration: Céleres Base: 2008

6. Brazilian nutrient supply and demand in 2008A strong dependence on the imported products and raw material Source: ANDA Values of 2008 Elaboration: Céleres

7. After record fertilizers inventories in 2008, lower imports will bring the 2009 inventories to an affordable level to the companies Source: ANDA Elaboration and forecast: Céleres Values in million t

8. A constrained income will limit a higher fertilizer consumption in 2009/10 crop year Projection Source: ANDA Elaboration and projections: Céleres Values in million t

9. The farmer income presented a slightly recovery in the last couple of months but it is still 7.5% below its peak in late 2007 Source: Instituto de Economia Agrícola (IEA-SP) Base 100: August/1994

10. Investment in the Brazilian farming businessInstitutional investors resume their strategies in the Brazilian Ag New crop land availability in Brazil After the widespread disruption in FDI1/ business in the second semester of 2008, institutional investors are gradually resuming their activity in the Brazilian agricultural market place They aim to capture the potential valuation of hard assets like farmland and timberland Distressing situation might create opportunities for M&A deals among those players Land value in Brazil (,000 R$/hectare) Source: CONAB/Céleres 1/ Foreign direct investment

11. Logistic investment has the ability to push agricultural production in the new agricultural areas of Brazil Soybean planted area in Mato Grosso (value in million hectares) Santarém Cargill 1.0 M t Source: CONAB/Céleres Elaboration: Céleres

12. Yield improvement has been one of the main driver for the grain production growth in Brazil Throughout the last twenty years, the Brazilian grain production grew at 4.6% per year In the meantime, the planted area grew 1.2% per year, presenting significant improvement in the yield from the major crops Assuming the same yield levels of the early 1990’s it will be required a total planted area of 94.6 million ha to assure the current grain production Brazilian total grain production Source: CONAB/Céleres

13. Soybean production in BrazilSteady acreage due to income and credit constraints Brazilian soybean production The current crop is going to face income problems as the strengthening of the local currency will limit the profitability On the farm side, the current crop condition is likely to provide reasonable yield levels in the main growing areas A consolidation process is yet in course with individuals and corporations looking to increase their scale of production Soybean Complex Exports (US$ billion) Crush capacity in Brazil (,000 t/day) 144.7 thousand t Source: CONAB/SECEX/Céleres

14. Corn production in BrazilLimited liquidity in the domestic market hit hard summer crop acreage Brazilian corn production The corn production growth in Brazil has been sustained by significant yield improvement 2009/10 crop year is the second crop with biotech corn being deployed by local farmers The export market playsa key role in promoting a sustainable growth to the local production Corn Exports in Brazil (million t) Main buyers in 2008 6.4 M t Source: CONAB/SECEX/Céleres

15. Cotton production in BrazilLack of credit hurt the cotton production in the last two crop years Brazilian cotton production From the row crops cotton was the most affected due to the world economic down turn Lack of credit for working capital resulted in the smallest planted area since 2003/04 The recovery in the international market will be determinant to bring back new investments in this crop Cotton Exports in Brazil (,000 t) Main buyers in 2008 (,000 t) 532.9 K t Source: CONAB/SECEX/Céleres

16. Sugar production in BrazilInternational prices have been helping brown field projects Brazilian sugar production Higher prices for sugar in both international and domestic market have being helping the brown field sugar cane projects As a main consequence a new consolidation game is already in place among the key players Everybody is looking for scale of production and competitiveness Sugar Exports in Brazil Main players (% of sugar milled in 2009) Source: UNICA/SECEX/Céleres

17. Ethanol production in BrazilDomestic market is still being the backbone of ethanol sector Brazilian ethanol production While the long run points to the overseas market the domestic market is the most important source of income to the ethanol companies in Brazil Almost 100% of new car sales in Brazil are flex fuel cars which promote a long term demand for the ethanol locally External markets still need a huge promotion across the world Sugar Exports in Brazil Car sales in Brazil Source: UNICA/SECEX/Céleres

18. The company A local consulting company with a team with ten year experience in the analyze and advise of projects in the Brazilian agriculture Through these year, we have done studies and analyzes in: Agribusiness economic scenario Project analysis for agroindustrial investments Biotechnology economical and risk assessment Business advisory and outsourcing in agribusiness deals related We perform our analysis and studies with a agri food chain approach, with clients distributed along this value chain, from input companies up to final consumers We are driven by complete dedication to our clients needs. Our activities are performed by an experienced team of advisors, under principles of integrity and discretion.

19. Céleres has been providing consulting services to the key companies related to the local agribusiness biomatrix Alexander Farms, Inc.

20. Contact R. Eng. Hélvio Felice, 119 Uberlândia – MG – 38.411-114 :+55 34 3229-1313 : +55 34 3229-4949 www.celeres.com.br celeres@celeres.com.br Associada da Arcadia International (Bruxelas, Bélgica) Empresa associada Membro do ISAAA