Translating Strategy into Operational Reality - The 10

Year View

Dr. William S. NieburPioneer Hi-Bred International, Inc.

April 26, 2005

PioneerBreeding &

Genetics

ConservationTillage

Soil Fertility

SoilTemperatures

Oil Prices

Water/DroughtIrrigation

Nitrogen Fertilizer

Weeds

Nematodes

Diseases

Insects

Soil Salinity

PioneerBreeding &Genetics

DuPont Crop ProtectionChemicals

In-FieldCrop

Production&

Crop Performance

Customer Demographics

& Segmentation

GrowerGlobalGrain

Produced

Environ-ment

ArableLand

Product QualityTraits

YieldGrainPrices

GrainUses

FoodDemand

LivestockDemand

OilPrices

WorldPopulation

CropSubsidies

Urbanization

• Soil Prep• Planting• Treatment• Harvesting

Budgets

WTODecisions

Biotic FactorsAbiotic Factors

• World Population• Developing Economies• Population Demographics

IndustrialUses, incl.

Ethanol

Oil Prices

GovernmentPolicies

Gov’tPolicies

Grain for Specialty

Food, Feed &Industrial Uses

DuP

ont A

g &

Nut

ritio

n Pl

atfo

rm /

2005

Pioneer Hi-Bred International and Global Grain Production

Population Projections (2050) Land Available for Agriculture 3%

Oceans Seas

Rock IceDesert

CitiesTowns

A world of salt

Only 50-100MM ha

of additional

Ag land possible

Growing Demand for Freshwater

0

500

1000

1500

2000

2500

3000

3500

1995 2020 1995 2020

Billio

n c

ub

ic m

ete

rs

Domestic Industrial Agricultural

1250 1500

2500

3250Developed Developing

Increasing Affluence (Billions)

2.72.0

2.2 3.9

1.2

2.0

Affluent

Middle Market

Subsistence

6.1

7.9

2000 2025

External Realities – Increasing Demand and Shrinking Natural Resources

6 9 BILLION

Pioneer’s Long Look

Pioneer, founded in Iowa in 1926 by Henry Wallace, was the first companyto develop, produce, and market hybrid seed corn and is now a subsidiary of DuPont.

Our business philosophy and policy continues to be: • Strive to produce the best products on the market.• Deal honestly and fairly.• Advertise and sell our products vigorously without misrepresentation.• Provide crop production assistance so customers profit from our products.DuPont’s Core Values• Safety• Ethics• Environmental Stewardship• Respect for People

Pioneer Hi-Bred International and DuPontPioneer Hi-Bred International and DuPont

Growth in TotalGrain Production

• Crop yields will need to continue to increase to keep pace with increasing incomes, population and demand for meat

• If yields don’t keep pace, more area will be pulled into production

• Global corn area increased 4.8% since 1980; production increased 45.0% in that same time

• More than 130 million “virtual acres” have been created since 1980

World Grain Consumption: 1960-2008

Source Information: USDA & GlobalInsight

PioneerPioneer®®

Brand BrandSeedSeed

ProductsProducts

PioneerPioneer®®

Brand BrandSeedSeed

ProductsProducts

Corn, Sorghum, and Sunflower Hybrids Soybean, Alfalfa, Canola, and Wheat

Varieties Microbial Inoculants for Forage and

Grain

World leader in crop genetics

– Sales in over 70 countries

– 5,000 employees

R&D Goal: Rapidly create seed products with ever-greater “total economic value”

– Increase yield potential– Reduce losses and costs– Increase product value

Key: Integration of valuable “traits” into

superior, proprietary germplasm

Pioneer TodayPioneer Today

Translating Strategy into Operational RealityTranslating Strategy into Operational Reality

Vision

PPerformance Metrics

Execution

PPlanning

SStrategy

Critical Factors for Success

• Clear & commonly-held vision and strategies

• Continuity of leadership, funding and staffing

• Agreement on problem definition and likely root causes

• Commitment to plan and execute

• Metrics to measure and track progress