高盛-中国农业：化肥与谷物-中国国内价格粘性几何-CHINA AGRICULTURE Fertilizer and grains-how sticky are China domestic prices-20260505

htEtqpi:t/wse.arvauhelist

5May2026|10:02PMHKT

CHINAAGRICULTURE

Fertilizerandgrains-howstickyareChinadomesticprices

TheMiddleEastconfiicthasledtoahighlyinfiationarypricingenvironmentinglobalfertilizers.However,China’shighself-sufficiencyinitsdomesticfertilizerproduction,anditsmorediversifiedenergybase,inparticularcoalforurea,combinedwith

policye仟orts,haveprovidedmuchbu仟erinthishighlyinfiationaryenvironment,inparticularduringtheplantingseasonoftheyear.

Nevertheless,infertilizerssuchasphosphatewherecostsofrawmaterialstracktheglobalprices,marginpressureisdrivingtheindependentproducersintodeeplosses,thusimposingupsiderisksfromwherethecurrentlevelis,inourview.Ourcasestudyinthepathofdomesticfertilizerpricingin2022,orduringtheRussia-Ukraine

confiict,suggeststhatamorebalancedapproachbetweenfertilizerpricingfor

farmersandsustainablefertilizerindustrysupplyhasledtoapartialeaseinpricingmanagementposttheplantingseason.WeexpectanimprovementinunitprofitsoftopChinesefertilizerproducersin2H26E.

WhileChinahasachievedremarkableprogressinfoodsecurity(link),theriskof

infiationisnotfullyshieldedgiventheongoingimportsoffeed-relatedgraincropsincludingsoybeanandcorn.Onarelativebasis,undertheelevatedfertilizerprices,weseemoreimpactoncornproductionthansoybean,asthecostofproduction,

changesinharvestarea,andyieldswhichcorrelatewithfertilizerapplicationimposeupsideriskinthecomingplantingseason.

WeexpectphosphatemarginoftopproducerssuchasYTHtorecoverfrom

Rmb988/tin1H26,toRmb1,635/tin2H26,versusthehistoricalrangeof

Rmb660-1,749/t,asaresult.WealsoexpectXLXtoimproveitsureamarginfromRmb428/tin1H26,toRmb492/tin2H26,versusthehistoricalrangeof

Rmb345-920/t.WemaintainBuyonYTH,expectingpotentialeasingonpricing

managementleadingtomarginrecoveryin2H26E,whilecapturingLTbenefitfromitsupstreamresources.WehaveaBuyratingonXLX,factoringinahigherureaASPassumptiondrivenbypotentialexporteasing,andmaintainBuyonQHLforits

growthacceleration.Onseeds,weremainpositiveonDBNasdominantplayerindomesticbiotechseedmarket.

TrinaChen

+

852-2978-2678|trina.chen@

GoldmanSachs(Asia)L.L.C.

RoyShi

+

852-2978-0110|roy.shi@

GoldmanSachs(Asia)L.L.C.

DaisyDai

+

852-2978-7904|daisy.dai@

GoldmanSachs(Asia)L.L.C.

GoldmanSachsdoesandseekstodobusinesswithcompaniescoveredinitsresearchreports.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconfiictofinterestthatcoulda仟ecttheobjectivityofthisreport.

Investorsshouldconsiderthisreportasonlyasinglefactorinmakingtheirinvestmentdecision.ForRegAC

certificationandotherimportantdisclosures,seetheDisclosureAppendix,orgoto

/research/hedge.html.Analystsemployedbynon-USaffiliatesarenotregistered/quali

fiedasresearchanalystswithFINRAintheU.S.

GoldmanSachs

htp.l

hsin:/awgwrwicuvlurueelist

Exhibit1:Fertilizerprice-ChinaandexChina-higher

pricingoutlookinDAP/MAP,stableforpotashandurea,whileureaproducerscanbenefitfrompotentialeasingofexportin2H26

Pxchgs,versusavgof2025(%)

100%

80%

60%

40%

20%

0%

UreaDAPMAPPotash

83%

37%

51%35%

25%

26%

17%

6%4%

11%

5%5%

CNspot

CN

2H26E

Ex-CNspot

CNspot

CN

2H26E

Ex-CNspot

CNspot

CN

2H26E

Ex-CNspot

CNspot

CN

2H26E

Ex-CNspot

Source:Oilchem,Wind,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit2:Globalgrainandoilpricetrends-elevatedoilpricehasledgrainpriceinfiationduringthe

Russia-Ukraineconfiict

1Q20

2Q20

3Q20

4Q20

1Q21

2Q21

3Q21

4Q21

1Q22

2Q22

3Q22

4Q22

1Q23

2Q23

3Q23

4Q23

1Q24

2Q24

3Q24

4Q24

1Q25

2Q25

3Q25

4Q25

1Q26

2Q26

CBOTgrain,andbrentoilpx,normalized(1Q20avg=100)

250

200

150

100

50

CornSoybeanRiceOlil

Source:LSEGData&Analytics,DatacompiledbyGoldmanSachsGlobalInvestmentResearch

5May20262

GoldmanSachs

htp.l

hsin:/awgwrwicuvlurueelist

5May20263

ThestickinessofChina’sdomesticfertilizerprices-fromtheRussia-UkraineconfiicttotheMiddleEastconfiict

China’sdomesticfertilizerpricingismanagedthroughacombinationofguidedpriceandmarketclearingpricedrivenbyS/Dfundamentals.Givenitscriticalroleinsupporting

foodproduction,themovementindomesticfertilizerprices,theriseinparticular,tendstobemorestickierthaninex-Chinamarkets.However,itstillholdsfiexibilitysubjecttotheprioritybalancebetweenfarmers’a仟ordabilityandproducers’profitabilityin

respondingtotightsupplyconditions.

TheNDRCandMoAarethemainbodiesresponsibleforregulatingthefertilizermarket,includingmanagingpricingmovements,establishingindustrypolicies,andsecuring

fertilizersupplies.Someofthemeasuresincludeimposingminimumoutput

requirementsonsuppliers,supportingrawmaterialsupply,andreleaseofreserves

duringtheplantingseason.Industryassociationhasalsostartedtoprovideguided

DAP/MAPandpotashpricestothedomesticmarketsince2025.Onfertilizerexports,Customs,MOFCOM,andCustomsTari仟CommissionoftheStateCouncilareresponsibleforsettingtari仟sandexportquotas,andimplementingstatutoryinspections.

Nevertheless,withrisingcostsinparticularsulfur,themarginpressureisrisingforthe

fertilizerindustry,especiallyforthebottomonethirdoftheproducersinMAP/DAP,

wherethereisnomarginsupportfromtheupstreamphosphaterockandnoexposuretothelow-pricedrawmaterials,ortheindependentproducers.Weestimateatthecurrentspotprice,theindependentproducersaremakingRmb1,000cashlosspertonne,anon-sustainablelevelinahistoricalcontext.

Lookingbackat2022whenasimilarsituationtookplace,domesticMAP/DAPprices

werecloselymanagedbythegovernmentduringtheplantingseason.Withincreasing

energy-ledsulfurandammoniacostinfiation,marginalproducerswereloss-makingatRmb100-500/tduringtheplantingseason.Nevertheless,asthepolicyshiftedtoamorebalancedapproachforbothproductionandprofitposttheplantingseason,theaverageDAPpricereboundedby16%followingtheendoftheplantingseason,aspricing

managementeased.UnitprofitsimprovedtoRmb300/tformarginalproducers,asofJul2022.

Atthecurrentsulfurprice,weestimatetheDAPpricewouldneedtomoveupbyRmb1,000/tor23%,torestorethetheindustry’sproductionsustainability.

Onurea,pricemovementsweresimilartophosphatefertilizersduringtheplanting

season.However,historicalpatternssuggestthatexporteasingwouldlikelystartsincelateApr,whilemoreexportquotawouldbeassignedtomajorproducerstobenefitfromhigheroverseaspricepremiumifindustryprofitislow.AtcurrentFOBspotprices,we

estimatetheunitgrossprofitcouldreachoverRmb4,000/tforexport,versusRmb300-450/tfordomesticsales.

5May20264

Exhibit3:Domesticphosphatefertilizers(2022)-Easingofpricingmanagementtorestoreindustry’sprofitandproduction;sharepricerespondedpositivelyasfertilizerpricingrebounded

DomesticDAPandsulfurpx

(Rmb/t)5,000

4,500

Jan-22

Feb-22

Mar-22

Apr-22

May-22

Jun-22

Jul-22

Aug-22

Sep-22

Oct-22

Nov-22

Dec-22

Jan-23

YTH'sshrpxchgandindustryprofit(%x1000vsJan1st,Rmb/t)

Mar-2022

Releaseoffertilizerreservesaheadofschedule

800

600

4,000400

3,500200

3,0000

2,500(200)

lateApr-2022

2,000Endofplantingseason(400)

Mar-2022

1,500CNPCandSinopecsuppliedlow-(600)costsulphurtokeyproducers

1,000(800)

DAPSulfurYTH(RHS)Unitprofit(RHS)

Source:Wind,Oilchem,RefinitivEikonLSEGData&Analytics,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit5:Domesticurea(2022)-Sharepricedeclinedposttheplantingseason,partlyduetomargincontraction,asaresultofhighercoalprice.

XLX'sshrpxchgandindustryprofit(%x1000vsJan1st,Rmb/t)

Jan-22

Feb-22

Mar-22

Apr-22

May-22

Jun-22

Jul-22

Aug-22

Sep-22

Oct-22

Nov-22

Dec-22

Jan-23

1,000

800

600

400

200

0

(200)

(400)

Mar-2022

Ureaexport

1H22:0.74mnt,-74%yoy

2H22:2.10mnt,-27%yoy

DomesticUreaandthermalcoalpx(Rmb/t)

4,000Releaseoffertilizerreservesaheadof

3,500schedule3,000

2,5002,0001,500

1,000lgseason

500

0(600)

UreaQHD5500XLX(RHS)Unitprofit(RHS)

Source:Wind,Oilchem,LSEGData&Analytics,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit4:Domesticphosphatefertilizer(2026)-We

expecttheindustrysetupcouldresemble2Q-3Q2022,todrivesharepricesforphosphatefertilizerproducers.

DomesticDAPandsulfurpx(Rmb/t)

YTH'sshrpxchgandindustryprofit(%x1000vsJan1st,Rmb/t)

8,000

7,500

7,000

6,500

6,000

5,500

5,000

4,500

4,000

Jan-26

Feb-26

Mar-26

Apr-26

May-26

Jun-26

Jul-26

Aug-26

Sep-26

Oct-26

Nov-26

Dec-26

Jan-27

low-costsulphurtokeytproducersI

CNPCandSinopecsupplied

Mar-2026

Releaseoffertilizerreservesahead

schedule

of

lateApr-2026

Endofplantingseason

Dec-2025

Feb-Apr2026

AssociationguideddomesticDAPex-

Rmb4,250-4.450/tformajorproducers.

factoryprice(incl.inlandtransportation)at

400

200

0

(200)

(400)

(600)

(800)

(1,000)

(1,200)

DAP——SulfurYTH(RHS)-Unitprofit(RHS)

Source:Wind,Oilchem,LSEGData&Analytics,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit6:Domesticurea(2026)-pricing/margintrendsremainstableduringtheplantingseason,withpotentialeasingonexportsinthecomingmonths

XLX'sshrpxchgandindustryprofit(%x1000vsJan1st,Rmb/t)

DomesticUreaandthermalcoalpx(Rmb/t)

2,000

1,800

1,600

1,400

1,200

1,000

800

600

400

Jan-26

Feb-26

Mar-26

Apr-26

May-26

Jun-26

Jul-26

Aug-26

Sep-26

Oct-26

Nov-26

Dec-26

Jan-27

Mar-2026

Releaseoffertilizerreservesahead

Ureaexport

ofschedule

L1Q26:0.48mnt,vs.

nonein1Q25

___flateApr 2026

Endofplantingseason

N~

1,000

800

600

400

200

0

(200)

(400)

(600)

——UreaQHD5500——XLX(RHS)---Unitprofit(RHS)

Source:Wind,Oilchem,LSEGData&Analytics,Companydata,GoldmanSachsGlobalInvestmentResearch

Translatingintoahigherprofitoutlook,maintainBuyonYTH,QHL,andXLX

Historically,domesticfertilizerstockshavetraded2-6monthsaheadofthe1stspot

pricemovementthroughcycles.Withindependentproducersindeeplossesduringtheongoingplantingseason,webelievethesetupcouldresemble2Q-3Q2022,when

DAP/MAPpricesreboundedtorestoresustainability/profitfortheindustry’s

production.Ourillustrativescenarioanalysissuggestsa1,000/tofpriceincreasecan

improveYTH’sunitgrossprofitby65%in2H26Easpricingmanagementeases,whichis116%higherthanthecurrentsharepriceimpliedunitgrossprofitofRmb758/t.Wealsoseepotentialexporteasingtoimprovemarginfordomesticureaproducers,withXLX’sunitgrossprofittoreachRmb492/tin2H26E,fromthecurrentsharepriceimpliedunitgrossprofitofRmb437/t,or13%upside.ValuationisalsoattractiveforQHL,with

2H26Eunitgrossprofitofpotash73%higherthanthecurrentsharepriceimpliedunitprofit.

5May20265

Asaresult,weseevaluationisattractiveforYTH,QHLandXLX,with11-24%upside,versusthecurrentprices.WehaveBuyratingsonYTH,QHL,andXLX;NeutralonNewYonfer.

Exhibit7:OurhigherpricingoutlooksuggestsattractivevaluationforYTHandQHL,with2H26Eunitgrossprofitability116%and73%higherthanthecurrentsharepriceimpliedmargins

Company

Ticker

RatingSharepx

Asof4/30/2026Tccy/shr

Impliedmargins

@Apr30thspotRmb/t

MTMearnings/valuations

26Evs26EAvg

NPcons.P/EhistP/ERmbbn%xx

Company2H26

Px/unitGPRmb/t

Shrpx

ImpliedPx/unitGPRmb/t

vs.shr

implied

Upside%

Fertilizer

YTH600096.SSBuy

36.2

39.3

12.6

15.2QHL.

DAP

Price

Unitgrossprofit

4,450

849

4.7

-12%

14.1

15.0

5,500

1,635

4,355

758

26%

116%

QHL*000792.SZBuy

Potash

Price

Unitgrossprofit

3,280

2,035

17.4

56%

12.0

15.0

3,295

2,046

2,350

1,182

40%

73%

XLX1866.HKBuy

Urea

Price

1,886

501

1.5

-1%

8.9

10.0

1,852

492

1,820

437

2%

13%

NewYonfer000902.SZNeutral

*Assuminglithiumprofitatcurrentspotfor

Compoundfertilizer

Price

Unitgrossprofit

3,243

224

0.7

-63%

29.1

12.0

3,655

421

3,515

467

4%

-10%

Source:GoldmanSachsGlobalInvestmentResearch,Bloomberg

Exhibit8:YTHmargincouldmove60%higherfromthecurrentlevel,withapricehikeof1,000/tinDAP

GSeGSeGSeUnit1H25A2H25A1Q26E2Q26E2H26E

DAPpx,CNbenchmark

Rmb/tincl.VAT

3954

4079

4382

4450

5500

Sulfur,CNspot

Rmb/tincl.VAT

2167

3090

4471

6200

6200

Sulfur,lowcost

Rmb/tincl.VAT

2167

3090

2000

2000

2000

YTH

RealizedDAPASP

Rmb/texVAT

3152

3713

4020

4083

5046

iffvs.benchmark

%

-13%

-1%

0%

0%

0

Sulfurpx,weightedavg

Rmb/texVAT

1836

2546

3410

4558

5487

%oflowcostsulfurintotal

%

0%

0%

25%

25%

0%

UnitCOGS

Rmb/t

2231

2164

2670

3152

3544

Unitgrossprofit

Rmb/t

921

1549

1350

930

1502

Unitcashprofit

Rmb/t

618

1097

898

478

1050

Non-integratedproducer

RealizedDAPASP

Rmb/texVAT

3627

3742

4020

4083

5046

iffvs.benchmark

%

0%

0%

0%

0%

0

Sulfurpx,weightedavg

Rmb/texVAT

1917

2734

3957

5487

5487

%oflowcostsulfurintotal

%

0%

0%

0%

0%

0%

UnitCOGS

Rmb/t

3402

3663

4246

5011

5011

Unitcashprofit

Rmb/t

225

79

(225)

(928)

35

Source:Wind,Oilchem,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit9:XLX’sunitnetprofitcouldmove17%higherfromcurrentlevel,withhigherASPdrivenbypotentialexporteasing

GSeGSeGSeUnit1H25A2H25A1Q26E2Q26E2H26E

Ureapx,CNbenchmark

Rmb/tincl.VAT

1831

1711

1811

1884

1852

Ureapx,FOBexport

Rmb/tincl.VAT

2114

2988

3493

5734

5635

Thermalcoal,QHD5500

Rmb/tincl.VAT

678

719

716

758

850

XLX

RealizedureaASP,blend

Rmb/t

1680

1807

1779

1850

1952

RealizedureaASP,domestic

Rmb/texVAT

1680

1681

1779

1850

1818

diffvs.benchmark

%

0%

7%

7%

7%

7%

%ofexportintotal,est

%

0%

4%

0%

0%

3%

UnitCOGS

Rmb/t

1335

1434

1385

1385

1460

Unitgrossprofit

Rmb/t

345

373

394

466

492

Unitcashprofit

Rmb/t

49

57

75

146

172

Marginalproducer(w/pipelinegas)

RealizedureaASP

Rmb/t

1679

1570

1662

1729

1699

diffvs.benchmark

%

0%

0%

0%

0%

0%

Pipelinegascost

Rmb/t

1571

1403

1353

1378

1353

Othercost

Rmb/t

420

420

420

420

420

Unitcashprofit

Rmb/t

(311)

(253)

(111)

(70)

(75)

Source:Wind,Oilchem,Companydata,GoldmanSachsGlobalInvestmentResearch

China’sdomesticfertilizers-highself-sufficiencyandmanagedpricestosupportfoodsecurity

GlobalfertilizerpriceshavesurgedsincetheMiddleEastconfiict,drivenbyboththedisruptionsinproductionsinandtransportoffertilizersfromtheMiddleEastregion,disruptionsinenergysupplythatsupportthefertilizerproductionelsewhere,overlaidwithadeepersupplyshortageofsulfur,akeyrawmaterialforphosphatefertilizers.

Ex-Chinaureapricesarenow83%higherthantheaveragein2025,followedby

phosphatefertilizers(MAP/DAP)at25-35%,andpotashat17%.Nevertheless,China’sdomesticfertilizerpriceshavebeenmorestable,withmoremoderatehikes,or6-26%higher.China’shighself-sufficiencyinitsdomesticfertilizerproductionandmore

diversifiedenergybaseinparticularcoalforurea,combinedwithpolicye仟orts,haveprovidedmuchreprieveinthehighlyinfiationaryenvironment,especiallyduringtheplantingseasonoftheyear.

5May20266

Specifically,fertilizerassociationhasprovideddailyguidedex-factoryprices(incl.inlandtransportation),low-costsulfurtomajorphosphatefertilizerproducers,andtheearly

releaseofnationalfertilizerreserves.Whileitisacommonpolicypracticetosuspend

fertilizerexportsduringtheplantingseason,thereareadditionalannounced

suspensionsinexportsofphosphatefertilizersuntilAug2026basedonan

announcementbytheChinaFertilizerAssociation,andtheoutlookforureaexportsposttheplantingseasonremainsunclear.Thecurrentsituationandpolicymeasuresare

similartothosein2022,whentheRussia-Ukraineconfiictstarted.

Exhibit10:Fertilizerprices-ChinaandexChina-currentex-Chinaspotpriceis83%higherthan2025for

N-fertilizer,25-35%forP-fertilizer,whereasChinapricesmovesaremoderate

Jun-15

Dec-15

Jun-16

Dec-16

Jun-17

Dec-17

Jun-18

Dec-18

Jun-19

Dec-19

Jun-20

Dec-20

Jun-21

Dec-21

Jun-22

Dec-22

Jun-23

Dec-23

Jun-24

Dec-24

Jun-25

Dec-25

Jun-26

Dec-26

Domesticfertilizerprice(Rmb/t)Ex-Chinafertilizerprice(US$/t)

1200

900

600

300

0

5000

4000

3000

2000

1000

DAP,CNdomestic

DAP,exChina(RHS)

Urea,CNdomestic

Urea,exChina(RHS)

Potash,CNdomestic

Potash,ex-China(RHS)

Source:Oilchem,Wind,NBS,GoldmanSachsGlobalInvestmentResearch

Exhibit12:China’sself-sufficiencyonmajorfertilizersismostlyhigh

China'sself-sufficiencyratioonmajorfertilizer(%)

150%

100%

50%

0%

127%

110%

100%selfsufficient

107%

98%

95%

40%

MAP/DAPPhosrock,netUreaPhosrockPhosrock,

net,exbattery

Potash(incl

importfrom

Laos)

Source:Oilchem,Wind,MoA,Companydata,GoldmanSachsGlobalInvestmentResearch

Exhibit11:Fertilizerprices-ChinaandexChina-currentspotprice(asofApr30th)versus2025averageprice

Spotpxchgs,versusavgof2025(%)

100%

80%

60%

40%

20%

0%

-20%Ex-ChinaCNEx-ChinaCNEx-ChinaCNEx-ChinaCN

UreaDAPMAPPotash

83%

35%

25%

26%

17%

6%

11%

5%

Source:Oilchem,Wind,NBS,GoldmanSachsGlobalInvestmentResearch

Exhibit13:Globalureaismostlyproducedfromnaturalgas,withtheexceptionofChina,mostlyfromcoal

Ureaproductionbysource-China,SEAandglobal

100%73%5%15%

95%

80%25%

60%

60%40%

20%27%

0%

ChinaSEAGlobal

NaturalgasCoalOther

Source:InternalFertilizerAssociation,Oilchem,Energy,Companydata,GoldmanSachsGlobalInvestmentResearch

5May20267

Riskofgraininfiation

WhileChinahasachievedremarkableprogressinfoodsecurity(link),theriskofinfiationisnotfullyshieldedgiventheongoingimportsoffeed-relatedgraincropsincluding

soybeanandcorn.Onarelativebasis,undertheelevatedfertilizerprices,weseemoreimpactoncornproductionthansoybean.

Graincroppricesmovethroughcyclesbyasmuchas~50-150%,mostlyduetosupplyfactorssuchasyield,harvestarea,andothers.Fertilizer,closelytiedtoglobalenergypricesandgeopoliticalevents,canimpactthesedrivers.

WiththeMiddleEastsituation,weestimatethatcurrentex-Chinafertilizerpricehikes

haveledtoan8-21%increaseinthecashproductioncostsofmajorgrains,equivalentto3-13%ofthecurrentgrainprices,basedonfertilizerpricesinex-China.Furthermore,

globalgraincropoutputhasbeeninverselycorrelatedwithhighoilprices/fertilizer

priceswithaswingof-8%to+15%inthepast,asaresultofreductionintheharvest

area(especiallyforthosewithhigherfertilizerintensitysuchascorn),and/orloweryielddrivenbyreducedfertilizerapplication.

Exhibit14:Globalgrainoutputhasbeeninverselycorrelatedwithhighoilprice/fertilizerpricewithaswingof-8%to+15%.Grainpriceinfiationalsocorrectedwithhighoilpriceinextremecases

Globalcropoutputyoychgs(%)

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13

3Q13

1Q14

3Q14

1Q15

3Q15

1Q16

3Q16

1Q17

3Q17

1Q18

3Q18

1Q19

3Q19

1Q20

3Q20

1Q21

3Q21

1Q22

3Q22

1Q23

3Q23

1Q24

3Q24

1Q25

3Q25

1Q26

Grainandbrentoilprice-normalized(1Q25=100)

COVIDandR-Uconflict

2007-2008foodcrisis

30%

20%

10%

0%

-10%-20%

-30%

160

140

Soybean

120

Corn

Rice

100

OilBrent

80

SoybeanpriceCBOT

CornpriceCBOT

RicepriceCBOT

60

40

Source:FAO,USDA,Bloomberg,GoldmanSachsGlobalInvestmentResearch

Exhibit15:Fertilizersaccountfor15-26%ofcashcostforcorninmajorproductionregions,and6-29%forsoybean.

As%ofdirectcashcost,2024(%)

100%

80%

60%

40%

20%

0%

CornSoybean

37%

28%

77%

49%

60%

8%

16%

87%

32%

2%

18%

21%

15%

12%

11%

5%

15%

25%

26%

3%

5%

6%

13%

29%

China

USA

Brazil

China

USA

Brazil

Fertilizer%aSeed%-Chemical%aOther%

Source:MoA,USDA,CONAB,GoldmanSachsGlobalInvestmentResearch

Exhibit16:FertilizerintensitiesinparticularN-fertilizer,arehigherforcornandrice,andlessforsoybean

China

USA

Brazil

India

China

USA

Brazil

India

China

USA

Brazil

India

China

USA

Brazil

India

CornSoybeanRiceWheat

UreaMAP/DAPPotash

70

60

50

40

30

20

10

Fertilizerusage(kg/mu)

0

Source:FAO,USDA,GoldmanSachsGlobalInvestmentResearch

5May20268

-3%-4%

-6%

-6%

-9%

-12%

Exhibit18:Yieldreductionwhenreducedapplicationoffertilizer-10%lessapplicationinN,P,Kfertilizerwouldleadto3-12%yieldreductioningraincrops

%ofyieldreductionforeach10%lowerapplicationoffertilizer

0%

-2%

-4%

-6%

-8%

-10%

-12%

Corn-USSoybean-USCorn-BrazilSoybean-Rice-ChinaRice-SEABrazil

Soybean,areaharvested,yoychgs-US

Spotureaprice/soybeanpriceCBOTis0.7

10%

0%

20212006

2012

2009

2010

2022

2015

2018

2005

2007

Source:FAO,GoldmanSachsGlobalInvestmentResearch

Exhibit20:TheharvestareaofUSsoybeanhashadlimitedcorrelationwithureapricemove

Ureaprice/soybeanpriceCBOTversussoybean,areaharvested,yoychgs-US

20%

2008

2020

20172014

2024

20210613

20232011

-10%

2019

-20%

0.20.40.60.81.01.2Ureaprice/soybeanpriceCBOT-US

Exhibit17:Lowfarmer’saffordability,measuredbyratioofureaprice/grainprice,canleadtolowerapplicationofureabyasmuchas10%

1Q05

4Q05

3Q06

2Q07

1Q08

4Q08

3Q09

2Q10

1Q11

4Q11

3Q12

2Q13

1Q14

4Q14

3Q15

2Q16

1Q17

4Q17

3Q18

2Q19

1Q20

4Q20

3Q21

2Q22

1Q23

4Q23

3Q24

2Q25

1Q26

Ratio,ureapx/corn,soybandricepxUreafertilizerusageinUSA,yoychgs(%)

2007-2008foodcrisisCOVIDandR-Uconflict

1.6