View
1
Download
0
Category
Preview:
Citation preview
1
Global and Brazilian Fertilizer Market
Company Overview
March, 2011
2
World Fertilizer Consumption by Nutrient
Source : Heffer, IFA, December 2010
Decrease of 7.3% in 2008/09 due to global crisis
Estimated average growth of 4.6% between 2008/09 and 2011/12
28.9 23.5 23.5 27.4 29.4
38.4 33.7 37.5 39.8 41.7
100.5 98.5
102.6 104.2 106.9
07/08 08/09 09/10 (e) 10/11 (p) 11/12 (p)
N P₂O₅ K₂O
Σ 167.8Σ 155.6
Σ 163.7 171.4
(mill
ion
s o
f to
ns
by
Nu
trie
nt
-N
PK
)
177.9
(e) estimated ; (p) preview
3
World’s Leading Fertilizer Producers - 2008
Phosphate Rock (P)
Potassium Chloride (K)
Source: IFA/ANDA
Ammonia (N)
America15.1%
Africa2.2%
Asia54.9%
Other Cont.27.8%
America22.4%
Africa23.2%
Asia45.8%
Other Cont.8.5%
America37.2% Asia
16.4%
Europe46.4%
4
World Markets and CAGR of Leading Markets, 2009
World’s Leading Fertilizer Markets (1) CAGR of Leading Markets
Note:(1) In nutrients consumption / Source: IFA/ANDA
Brazil is the 4th largest fertilizer market in the world and is growing above the global average
China 31%
India 16.2%
US 11.3%
Brazil 5.7%Indonesia
2.5%
Pakistan
2.5%
France 1.8%
Others 29%
3.4%
4.3%-0.2%
7.9%
-7.0%
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
7.0%
9.0%
11.0%
0.0
10.0
20.0
30.0
40.0
50.0
60.0
China India US Brazil
CA
GR
(19
90
-2
00
9)
mm
to
ns
1990 2009 CAGR
5
Evolution of the Brazilian Fertilizer Market
Source : Anda
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011E
10.812.2
13.8 14.613.6
16.3 17.019.1
22.8 22.8
20.2 21.0
24.6
22.4 22.4
24.526.0
(in
mil
lio
ns
of
ton
s)
6
Sustainability and Technology Applied to Fertilizer Use in Brazil
*Planted area in hectares of soybean, corn, beans (grains), paddy rice, wheat (grains), herbaceous cotton (seeds), sorghum (grains), oats (grains), barley (grains), triticale (grains), sunflower (grains), rye (grains).*Agricultural production of the following crops: soybean, corn, beans (grains), paddy rice, wheat (grains), herbaceous cotton (seeds), sorghum (grains), oats (grains), barley (grains), triticale (grains), sunflower (grains), rye (grains).
Source: Agroconsult
CAGR of planted area was 2% from 1969 to 2009, while CAGR of agricultural production was 5%
The 7% CAGR in fertilizer consumption shows this input’s contribution to environmental preservation,combined with significant gain in agricultural productivity
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
19
69
19
70
19
71
19
72
19
73
19
74
19
75
19
76
19
77
19
78
19
79
19
80
19
81
19
82
19
83
19
84
19
85
19
86
19
87
19
88
19
89
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
*PLANTED AREA/ha (CAGR 2%)
*AGRI-PRODUCTION (CAGR 5%)
FERTILIZERS (CAGR 7%)
INDEX - Harvest 69/70 = 100
7
Brazil – Estimated Area (millions of hectares)
Source: IBGE, CONAB, MAPA , GV Agro
% total area
% available
area for
agricultureAmazon Forest 350 41.1%
Legal Reserve 58 6.8%
Cities, lakes, rivers and wetlands 20 2.4%
Others 78 9.2%
Reforest 5 0.6%
Sub-total 511 60.0%
Pasture 172 20.2% 50.6%
Annual and Permanent Crops 72 8.5% 21.2%
Available Area for Agriculture 96 11.3% 28.2%
Sub-total 340 40.0% 100.0%
Total Brazil 851 100.0%
Estimated Area - millions of ha
8
Brazilian Fertilizer Production Chain
Increased integration and concentration of fertilizer producers
In 2010 Brazil produced 38% of the total consumed
Basic Raw Material
PhosphateRock (P)
Natural Gas (N)
Potassium(K)
Vale Fert.Copebras Galvani
Petrobras Vale Fert.
Fertilizer Production
Phosphorus(P)
Nitrogen(N)
Potassium (K)
HeringerVale Fert. Copebras Galvani
YaraRoulierOthers
Vale Fert.Petrobras
Vale Fert.
FinalProduct
Mixtures and Distributors
(NPK)
BungeHeringer MosaicFertipar
YaraADM
Others
9
Heringer reached 18.5% of market share in 2010
Major Players in the NPK Market
Source: Heringer’s Estimates
20101995
30%
Takenaka4%
Manah10%
IAP7%
Serrana11%
Trevo 14%
Fertibras3%
Solorico7%
Fertiza4%
6%4%
COPAS
HERINGER
BUNGE 32%
MOSAIC 11%
YARA17%
OTHERS
18.5%
6 companies: 80%
Aprox. 100 companies:
20%
10
Production Cycle in Brazil
Production cycle of the five main crops with the highest fertilizer consumption in Brazil
CROPS
Harvest Winter Crop Harvest
Cotton
(Mato
Grosso)
Winter Crop Plantation / Coverage Crop Plantation
North East Harvest Mid-South Harvest North East
Harvest
Plantation/Coverage Plantation/Coverage
HarvestCoffee
CornWinter Crop Plantation Plantation
Winter Crop HarvestCrop Harvest
SoybeanPlantation
Harvest
SugarcaneSugarcane Summer and Spring Crops Plantation Sugarcane Summer Crop Platation
JUL AUG SEPT OCT NOV DECJAN FEB MAR APR MAY JUN
11
Brazil: Important Agribusiness Player
Brazil as a % of World Exports, 2010/11
Brazil is one of the largest producers/exporters of agricultural products, and has one of the lowest production costs worldwide
Source: USDA/ Agroconsult – in tons
Brazil as a % of World Production, 2010/11
Orange
Juice
Coffee
grain (bag)
Soybean -
grain
Sugar Cotton Corn
58%
39%
27% 24%
7% 6%
1st
1st
2nd
5th 3rd
Orange
Juice
Coffee
grain (bag)
Soybean -
grain
Sugar Cotton Corn
83%
31% 33%52%
7% 8%
1st
1st
1st
2nd
5th 3rd
12
Evolution of Brazilian Market and Heringer
3.7% Heringer Market Share 18.5%
Source: Anda
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
0.40.7 0.8
1.01.1
1.5 1.51.7
2.1 2.22.0
2.5
3.3 3.2
3.9
4.5
( in
tho
usa
nd
s o
f to
ns)
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
10.8 12.213.8 14.6 13.6
16.3 17.019.1
22.8 22.820.2 21.0
24.622.4 22.4
24.5
( in
tho
usa
nd
s o
f to
ns)
13
Fertilizers Delivered by Crop
Heringer offers solutions for many different crops, minimizing the volatility associated with local climates and other specific conditions, such as price cyclicality and pests
Source: LSPA – IBGE/CEPE AGRO e ANDA
Heringer – 2010Brazilian Market - 2010
Sugarcane20%
Others22%
Reforest6%
Coffee17%
Corn17%
Soybean18%
Sugarcane14%
Others27%
Reforest3%
Coffee6%
Corn16%
Soybean34%
14
Sales by Segment and Number of Clients - 2010
Focus on the retail segment is important for increasing profitability and mitigating risks
Individuals/Companies = 86% of volume
Sales by Segment Number of Clients
Individuals
42%
Companies
44%
Cooperatives8%
Resale
6%
2008 2009 2010
34,99745,190 44,958
Mixing Units and Production Capacity
19 units located in the main consumer markets, installed mixing capacity of 5.7 million tons
1 Sulfuric Acid and Single Super Phosphate (SSP) Unit
15
NORTH
Rosário do Catete
Camaçari
NORTHWEST
Legend
Mixing Units
SSP Unit
MIDWEST
Rondonópolis Anápolis
Dourados
Rio Verde
SOUTH
Paranaguá
Porto Alegre
Bebedouro
Ourinhos
ManhuaçuTrês Corações
Uberaba
Viana
Paulínia
Iguatama
SOUTHEAST
Rio Grande
São João doManhuaçu
Catalão1.9%
12.2%
29.7%28.6%
27.6%
Total deliveries per country region - 2010
North Northwest Midwest Southeast South
16
Financial Highlights
EBITDA in 2010 was the highest in Heringer's history
2006 2007 2008 2009 2010
Volume (Million Tons) 2,5 3,3 3,2 3,9 4,5
Net Revenue (R$ thousand) 1.435.969 2.260.839 3.524.559 3.192.314 3.521.473
EBITDA (R$ thousand) 58.606 83.266 90.113 38.765 212.331
EBITDA Margin 4,1% 3,7% 2,6% 1,2% 6,0%
Brazilian Fertilizer Market - Seasonality
Source: Anda / Heringer 17
2007 2008 2009 2010 2011E
62%49%
63% 65% 61%
38%51%
37% 35% 39%
1st Half 2nd Half
Recommended