Evolution of BASF's Product Portfolio Growth Clusters...Market development plant biotechnology....

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Agricultural Solutions Sustainable growth through market-driven innovations

Dr. Peter Eckes President BASF Plant Science

BASF Roundtable Agricultural Solutions

New York & Monmouth

August 8, 2011

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BASF Roundtable Agricultural Solutions, August 8, 2011

Disclaimer

This presentation includes forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. This presentation contains a number of forward-looking statements including, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views with respect to future events and financial performance. Actual financial performance of the entities described herein could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements.

Forward-looking statements represent estimates and assumptions only as of the date that they were made. The information contained in this presentation is subject to change without notice and BASF does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.

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BASF Roundtable Agricultural Solutions, August 8, 2011

1 | Introduction

2 | BASF Crop Protection

3 | BASF Plant Biotechnology

4 | Update Monsanto BASF Collaboration

4

Market development plant biotechnology

Source: ISAAA 2010

Key factsGlobal GM crop area continued to grow in 2010Biotech crops cover about 10% of the cultivated land In 2010, 15.4 million farmers grew GM crops in 29 countriesMarket expected to grow to USD50 billion by 2025

Pipeline PlatformStrategy Partners

Global GM crop area in million hectares; 1 ha = 2.47 acres

Continued strong growth

0

20

40

60

80

100

120

148

140

20031997 2006 20102000

CAGR 22%*

* CAGR 1997-2010

11

5

BASF Plant Science

Global research network at biotech hotspots

Ames Iowa

DNA LandMarks

RTP North Carolina

Crop Design

Limburgerhof

MetanomicsSunGene

Plant Science Sweden

HawaiiPuerto Rico

Midsouth

Ceara

Sao PauloSt. Catarina

Key factsFounded in 1998Leading platform for Plant Biotechnology 7 R&D and 13 field site centers750+ employees worldwideAnnual R&D spending~€150 million

Tamil Nadu

R&D sitesField site center


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BASF Plant Science strategy

What?Increase crop yield through Plant Biotechnology

How?Focus on yield traits for major cropsDevelop the leading technology platform to deliver the best traits for the best seedAccess market through partnerships with leading seed companies

Trait Technology Partner strategy


7

BASF Plant Science partnerships

Strong partners for yield traits in major crops

* Wheat: very fragmented global market** Sugar cane: market data for Brazil only

(main producing country)*** Monsanto: including licensing business **** Rice: hybrid rice market excluding China

0 50 100 150 200 250

Sugar beet

Sugar cane**

Cotton

Canola

Soybean

Rice

Corn

Wheat*

Total harvested crop area GM crop area

Source: USDA, ISAAA, BASF Plant Science

Global GM crop areain million hectares; 1 ha = 2.47 acres


Rankmarket share

Partner

-

****

***

***

2

1

2

2

1

1

1

*

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Plant Biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.

Traittotal development time: 10-12 years

Stage IIearly product development

Stage Iproof of concept in target crops

Discoverygene identification & proof of concept

Stage IVpre-launch

Stage IIIadv. product development

Partners: *Monsanto **CTC ***KWS ****Bayer *****Embrapa

Higher-yielding corn*Higher-yielding soybean* 2Higher-yielding canola*

Higher-yielding sugar cane**

Drought-tolerant cotton*

Improved corn feedHealthy fatty acids in canolaAmylopectin potatoes

Drought-tolerant corn* 2

Nematode resistant soybean*Herbicide-tolerant soybean*****

Fungal-resistant potato

Higher-yielding sugar beet***

Yield & Stress

Input traits

Feed

Specialties

Fungal-resistant soybean

Higher-yielding rice****

Improved nitrogen utilization in corn*Higher-yielding wheat*

2 1

Advancement 2010 New project

1 generation

1

3

Innovation yields results

+ €1=USD1.3


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EPA/DHA-omega-3 (Ω-3) fatty acid production in canola

10


Key factsGrowing consumer interest in products with EPA/DHA-Ω-3 fatty acids due to proven health effects: arteriosclerosis prevention, decreasing risk of cardiovascular diseases Current EPA/DHA-Ω-3 market is expected to double to about USD2.8 bn. by end of decadeInnovative production of EPA/DHA-Ω-3 fatty acid in canola

New EPA/DHA Ω-3 food product launches

Opportunity for plant-produced EPA/DHA-Ω-3 fatty acids

0

250

500

1994 1996 1998 2000 2002 2004 2006 2008

Source: Frost and Sullivan 2009, BASF

EPA/DHA Ω -3 source in food product launchesFish60%

Algae18%

Unknown/Other22%


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Elucidation of EPA/-DHA-Ω-3 biosynthesis

Scientific groundwork jointly established with academic partnersGenes identified and candidates for expression in plants selected from algal and fungal genomes

Transfer into plants

EPA/DHA-Ω-3 production of >500 different gene combinations tested in model and crop plantsIdentification of most promising gene combinations

Product development in canola

Concerted expression of 10 genes produce >20% EPA/DHA Ω-3 content in canola oil:– sustainable production– cost leadership position– ease of incorporation into food products– efficient scale-up


World record in plant metabolic engineering


12

Increased yield in rice

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* Basis: corn USD144/MT, soybeans USD329/MT, wheat USD186/MT,rice USD224/MT

** Based upon a single 10% yield increase trait example, assuming 60-70% of value is kept by farmer, depending on product and crop

Crop Global Production

(million MT/y)

Global Crop Value*(billion USD)

Gross Sales Value 10% Yield Increase**

(billion USD)

Corn 866 125 ~4

Wheat 664 124 ~4

Rice 456 102 ~4

Soybean 263 87 ~3

Key factsRice is the world’s largest food crop. Half of the world’s population consumes at least one meal of rice every day Besides insect resistance and herbicide tolerance, yield increase in rice offers an attractive value potentialHybrid rice seeds are gaining popularity and market share from traditional varieties due to their ability to produce higher yields

Large market potential for increased yield in rice


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3 8 104

Key hybrid rice markets

* estimated percentage of total rice market(M ac): million acres

Focus on future key hybrid rice marketsSource: USDA, BASF Plant Science

3%~20%

<1%~20%

30%~70%

Hybrid market* 2010:2020:

North America Brazil India

Total rice area (M ac):


Hyb

rid m

arke

t (M

ac)

2010 20200

20

15

Hyb

rid m

arke

t (M

ac)

2010 20200

20

15

Hyb

rid m

arke

t (M

ac)

2010 20200

20

15

15


Project goalDevelop & commercialize hybrid rice seeds that offer yield advantages of 10% over conventional hybrid rice

First partnership signed Global non-exclusive license agreement with Bayer CropScience (BCS) BASF Plant Science: trait development, de-regulationBCS: introgression of traits in its hybrids, commercializationFirst product launches expected by end of the decade

Target marketIndia and selected countries in SE-Asia, USA, Brazil

Seed count

Panicle size

Seed size

New partnership provides market access Control BASF


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Discovery engine

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Deliver best trait genes

Select the best candidates

BASF Plant Science Trait technology platform

Large capacity at high speedYield in cropsAcquired by BASF in 2006

Worlds largest industrial-scale metabolite profiling platformInvestigates Mode of ActionFounded by BASF in 1998

ExpertiseScoutingProprietary dataPublic data Academic partners

Select the best genes Ghent

Understand gene action Berlin


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Evaluation agreement with a technology management company


3-6

Timeline (months)



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Filled seeds

Roots

Leaves

Panicle

Seed numberSeed

weight

Flowering

Total yield


Select the best genes

Yield increase in rice under standard and stress conditions:

Up to 30% yield increase Up to 20% more filled seeds

Mode of Action hypothesis:Reduced secondary stress effectsMaintains growth under limited conditions

3-6

12-18

Timeline (months)



20

2nd

metabolite s

amino acids

sugars & lipids

secondary metabolites

tbd



Re-programmed central metabolism shifting towards sugars and lipids

Mode of Action confirmed: Reduced secondary stress effectsMaintains growth under limited conditions

Understand gene action

4-6

3-6

12-18

Timeline (months)



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4-6

3-6

12-18

3-6

Timeline (months)




IP extended Definition of constructs and gene combinations



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24-48

4-6

3-6

12-18

3-6

Timeline (months)





Field testing

On fast-track in Monsanto collaborationStrongest gene in Phase IPromoted to Phase II in 2010Successful results for 2 years in the field

5-6 years

Field trial results

20092010

Product concept

Event1 Event2 Event3 Event4 Event1 Event2 Event3 Event4

New promising events for collaboration



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Plant biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.





Stage IVpre-launch










Yield & Stress

Input traits

Feed

Specialties




2 1


1 generation

1

3


Innovation yields results

Partners: *Monsanto **CTC ***KWS **** Bayer ***** Embrapa+ €1=USD1.3


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Stage IVpre-launch










Yield & Stress

Input traits

Feed

Specialties




2 1


1 generation

1

3


BASF / Monsanto collaboration leading in yield trait technology

Partners: *Monsanto **CTC ***KWS ****Bayer *****Embrapa+ €1=USD1.3

Pipeline PlatformStrategy Partners Pipeline PlatformStrategy Partners

Plant biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.

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Evolution of BASF's Product Portfolio Growth Clusters...Market development plant biotechnology....

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