2014 Investor Forum. Jim Fitterling Vice Chairman, Business Operations November 13, Dow.com

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1 2014 Investor Forum Jim Fitterling Vice Chairman, Business Operations November 13, 2014 Dow.com

2 SEC Disclosure Rules Some of our comments today include statements about our expectations for the future. Those expectations involve risks and uncertainties. Dow cannot guarantee the accuracy of any forecasts or estimates, and we do not plan to update any forward-looking statements if our expectations change. If you would like more information on the risks involved in forward-looking statements, please see our Annual Report and our SEC filings. In addition, some of our comments reference non-gaap financial measures. Where available, presentation of and reconciliation to the most directly comparable GAAP financial measures and other associated disclosures are provided on the Internet at Trademark of The Dow Chemical Company or an affiliated company of Dow. EBITDA is defined as earnings (i.e., Net Income ) before interest, income taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding the impact of Certain items. Adjusted EBITDA margin is defined as Adjusted EBITDA as a percentage of reported net sales. Adjusted EPS is defined as earnings per share excluding the impact of Certain items. Net Debt equals total debt ( Notes payable plus Long-term debt due within one year plus Long-Term Debt ) minus Cash and cash equivalents. Net Debt to Total Capitalization ratio is defined as Net Debt divided by Net Capital. Net Capital is defined as Total Equity + Redeemable Noncontrolling Interest + Net Debt. Net Debt to EBITDA is defined as Net Debt divided by Adjusted EBITDA. TTM is defined as trailing twelve months. Total Capital is defined as total assets minus non-interest bearing liabilities. Adjusted Return on Capital is defined as TTM Adjusted Net Operating Profit After Tax divided by average Total Capital. Adjusted Sales for joint ventures is defined as sales for joint ventures less sales to Dow and/or other Dow joint ventures. Net Debt for joint ventures excludes debt owed to Dow and/or other Dow joint ventures. Total Shareholder Return is defined as stock price appreciation plus dividends paid.

3 Our Priorities Going Forward Fully capitalize on growth levers Make further strategic choices: Go deeper and narrower to drive the next level of long-term growth Maintain strong focus on rewarding shareholders

4 Announcing New Segments Aligned to Dow s Strategy Agricultural Sciences Consumer Solutions Infrastructure Solutions Performance Materials & Chemicals Performance Plastics Crop Protection Seeds Revenue: $7.2B Adj. EBITDA: $0.9B Consumer Care Dow Automotive Systems Dow Electronic Materials Revenue: $4.6B Adj. EBITDA: $1.0B Foundation of Core Strengths Support the Entire Franchise Cost Advantaged Feedstocks in Every Region Scale & Operational Excellence Molecular and Physical Integration Dow Building & Construction Dow Coating Materials Energy & Water Solutions Performance Monomers Revenue: $8.5B Adj. EBITDA: $1.1B Chlor Alkali and Vinyl Chlorinated Organics Epoxy Industrial Solutions Polyurethanes Revenue: $14.9B Adj. EBITDA: $2.1B Dow Elastomers Dow Electrical and Telecommunications Dow Packaging and Specialty Plastics Energy Hydrocarbons Revenue: $22.6B Adj. EBITDA: $4.4B Global Reach Marketing, Business & Operations Expertise in Science & Technology Strong Brand Value 3Q14 Trailing Twelve Months Revenue and Adj. EBITDA data

5 COMMODITY Running an Integrated Enterprise Sell Out, Sell Up APPLY BEST OWNER MINDSET CREATE STRUCTURAL ADVANTAGES Low Cost, Technology, Targeted Marketing CapEx Selling and R&D DIVEST Chlorine Carve-Out Epoxy Industrial Solutions Polyurethanes Dow Packaging & Specialty Plastics Dow Elastomers Dow Electrical & Telecommunications SPECIALTY RETAIN FOR INTEGRATION / RUN FOR CASH Hydrocarbons & Energy Advantaged Feedstocks INNOVATE BACK TO SPECIALTY

6 Industrial Solutions Enabling Manufacturing Farm processing surfactants and solvents Polyurethanes Epoxy Performance Materials & Chemicals $14.9B Revenue Chlor- Alkali and Vinyls Chlorinated Organics Industrial Solutions Fast-evaporating solvents for chip-making High performing industrial fluids Solvent systems for coatings Making Things Better, Faster, Cleaner Through Additive Solutions 3Q14 Trailing Twelve Months Revenue

7 Epoxy and Polyurethanes Delivering Improvement Actions Major restructuring Organizational redesign Focused effort on manufacturing reliability and asset utilization Shut down assets and reduce fixed costs Improve total variable margin Reduce SARD Improve working capital Gain market share Results Organizational redesign complete Overall $200MM improvement through cost reductions 8 assets shut down Double-digit fixed cost improvements in Polyurethanes Significant SARD reductions in 2014, more to come in 2015 Single digit volume increases in Polyurethanes YTD

8 Bridge from Management Book to Chlorine Carve Out Financials Pro Forma EBITDA Bridge for Chlorine Carve-Out $MM $75 $125 $30 $60 ~$500 $300 $400 With Upside Potential As Dow Net Sales Between Dow and NewCo Ongoing Business Productivity Actions As Chlorine Carve-out Timeline Today YE 2014 Offers Selection 1Q15 Signing 2Q15 Close YE 2015

9 Innovations to Improve Functionality and Sustainability 100% PE Stand Up Pouch Two-Piece PE Bottle PACXPERT Differentiated Innovations in Sustainable Packaging Through Close Value Chain Engagement

10 Top Global Ethylene / Polyethylene Producers Ethylene Capacity Polyethylene Capacity Dow SABIC ExxonMobil SINOPEC LyondellBasell Royal Dutch/Shell Abu Dhabi Gov't NPC-Iran Ineos CNPC 0 4,000 8,000 12,000 MT ExxonMobil Dow SABIC LyondellBasell SINOPEC IPIC Chevron Phillips Ineos Braskem NPC Iran 0 5,000 10,000 MT Source: Dow, IHS Dow is the Biggest Ethylene Producer in the World Source: Dow, IHS

11 2013 Adjusted ROA Investments Enhance High-Return Franchise 18% 16% 14% 12% 10% 8% 6% 4% 2% Dow Performance Plastics* 0% Chemicals Companies Low Cost and Focus on Attractive Markets Drive Consistent and Higher Earnings Peer List: AXLL, BASF, BMS, CE, CF, DD, EMN, FMC, HUN, LYB, MOS, POT, PPG, SEE, WLK *For comparison purposes only, the ROA for Dow Performance Plastics shown above includes ~20% allocation of Corporate segment. Corporate segment allocation based on Dow Performance Plastics' % of total assets. Excluding this allocation, Dow Performance Plastics has a ROA of ~22%, see Reg G file. Source: Dow, Capital IQ Adjusted ROA: Adj. EBIT*(1-Tax) / Avg Total Assets

12 Sources of Value in Performance Plastics Mix and Application PE Cycle Ethylene Cycle Oil to Gas Spread $100 $200/MT $200 $300/MT $600 $1000/MT Dow Value Comes from Four Sources

13 Advantage Dow Innovation in Plastics QUALITY & SERVICE OFFERING $100- $200/MT PREMIUM I n n o v a t i o n Price Competition Complexity Dow Customers Depend on Assets, Innovation and Customer Intimacy Assets Advantaged feedstock in 5 regions Specialized asset technology Innovation Best in class material science High throughput R&D IP protected technology Customer Intimacy High-performance PE, adhesives, barrier, tie layer materials Industry leading brands Value chain intimate approach COMMODITY

14 Operating Rate Derivative Operating Rates Nearing Peak Conditions 90% 85% 80% Industry Global Polyethylene Operating Rate 87.5% 87.0% 86.3% 85.2% 83.9% 83.9% Demand Exceeds New Builds Source: Dow Near Term Strengthening Pricing power continues to strengthen North America continues to be sold out European duty discourages imports improving S/D dynamics Peak May Extend Into Mid-Term Further start-up delays / postponements likely (i.e., USGC, China CTO, etc.) 1% increase in global GDP would increase global O/Rs by 2% Assumptions Base GDP growth 2.8%, 3.4% and 3.7% for 2014, 2015 and 2016, respectively

15 Ethylene, Millions of Tons Operating Rate, % Global Ethylene Operating Rates Entering the Peak Operating rates continue recovery from the 2008 lows Expect peak scenarios in , with pricing power improving through 2014 into 2015 Ethylene Production=Demand Nameplate Capacity Industry Op Rate Cycle Pricing Power will Add ~$2.5B/yr for Dow Global Insight GDP 4.1% 1.7% -1.9% 4.3% 3.0% 2.5% 2.6% 2.8% 3.4% 3.7% 3.8% 3.7% Low Case 2.8% 2.9% 3.0% 3.0% 3.0% Source: Dow, IHS, Global Insight (8/14)

16 Demand per Capita (kg per person) The Loaded Spring Growing Commodity Demand Per Capita Demand for Plastics, etc. Increases 50 Global PE Consumption Per Capita Driven by: Urbanization 40 United States & Canada 33.1 kg per person US US && W. W. Europe Spread of middle-class in emerging world 30 Western Europe Population growth Japan and Korea Higher than OECD growth in GDP Africa 11.8 kg per person India Other Asia Eastern Europe Latin America Middle East China Population (millions) Source: Dow, IHS Non-OECD demand is not driver of current market tightness Recovery in non-oecd will have double impact of increased per capita use and stronger GDP

17 US Natural Gas ($/MMBTU) Brent Crude Oil ($/bbl) Peak Pricing Power versus Feedstock Advantage Cracker Margins Expanded by $200/MT $300/MT in Last Three Peaks Dow Produces ~10MM tons/year Natural Gas Cycle Peaks Brent Oil CRUDE : GAS Price Arbitrage Source: Bloomberg

18 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Volume Advantaged Positions Across the Globe USGC Investments US shale Sadara Low cost Access to Asia Revamped Alberta Advantage Alberta advantage European LPG Extending US shale advantage Abundant LPG for Europe Established Key Alliances in Latin America Growing ethane Next large shale development U.S. Shale Gas Production

19 Dow Ethane Cracking Capability for Ethylene Production Dow s Feedslate in the Americas Moving Lighter 90% 85% 80% Argentina Initiatives Rejuvenate Ethane Supplies Actions Drive Canada Ethane Long LA-3 Project TX-9 Startup 75% SCO2 Restart 70% 65% Source: Dow

20 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Volume Shale Drives Growth in NGL Supplies in U.S. and Europe Dow Europe LPG Contribution $MM 250 Dow Europe LPG Cracking Volume Increasing YTD Improved efficiency in Terneuzen Doubled capability in Tarragona More to come in 2015 Source: Dow

21 Value of Gulfstream Investments at Authorization Project HH Gas Ethane Propane Brent Cap Ex ROC Full Run Rate Auth EBITDA St. Charles Ethylene Restart $6.00/mmbtu $0.69/gal $1.41/gal $109/bbl $160MM 37% $250MM/yr Freeport PDH $5.30/mmbtu $0.70/gal $1.60/gal $132/bbl $1,200MM 16% $450MM/yr PDH Infrastructure $400MM Plaquemine Feedstock Flexibility & Debottleneck $5.60/mmbtu $0.75/gal $1.67/gal $136/bbl $250MM 57% $250MM/yr Freeport World Scale Ethylene & Derivatives $6.00/mmbtu $0.59/gal $1.36/gal $129/bbl $3,400MM 23% $1,500MM/yr Cracker & Derivatives Infrastructure $1,000MM

22 Value of Gulfstream Investments at Authorization versus Today Today s Cost Structure $3.80/ mmbtu $0.22/ gal $0.87/ gal $85/ bbl Project HH Gas Ethane Propane Brent Cap Ex ROC Full Run Rate Auth EBITDA EBITDA St. Charles Ethylene Restart $6.00/mmbtu $0.69/gal $1.41/gal $109/bbl $160MM 37% $250MM/yr $280MM Freeport PDH $5.30/mmbtu $0.70/gal $1.60/gal $132/bbl $1,200MM 16% $450MM/yr $600MM PDH Infrastructure $400MM Plaquemine Feedstock Flexibility & Debottleneck $5.60/mmbtu $0.75/gal $1.67/gal $136/bbl $250MM 57% $250MM/yr $270MM Freeport World Scale Ethylene & Derivatives $6.00/mmbtu $0.59/gal $1.36/gal $129/bbl $3,400MM 23% $1,500MM/yr Cracker & Derivatives Infrastructure $1,000MM Today s cost structure as of 10/27/14 $1,800MM

23 Executing on Our Growth Levers Polyurethanes: Streamline and sell out Industrial Solutions: Narrower, deeper, more Chlorine and Epoxy: In the market, closing in 2015 Performance Plastics: $4.4B EBITDA the peak is coming Plans on Track, Delivering Today, Upside to Come 3Q14 Trailing Twelve Months Adj. EBITDA data

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