Potash Outlook TFI Fertilizer Outlook & Technology Conference November 15, 2017 Josh Paula Market & Strategic Analysis The Mosaic Company 1
Forward Looking Statements This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about our proposed acquisition of the global phosphate and potash operations of Vale S.A. ("Vale") conducted through Vale Fertilizantes S.A. (the "Transaction") and the anticipated benefits and synergies of the proposed Transaction, other proposed or pending future transactions or strategic plans and other statements about future financial and operating results. Such statements are based upon the current beliefs and expectations of The Mosaic Company's management and are subject to significant risks and uncertainties. These risks and uncertainties include but are not limited to risks and uncertainties arising from the possibility that the closing of the proposed Transaction may be delayed or may not occur, including delays or risks arising from any inability of Vale to achieve certain specified regulatory and operational milestones, and the ability to satisfy any of the other closing conditions; our ability to secure financing, or financing on satisfactory terms and in amounts sufficient to fund the cash portion of the purchase price without the need for additional funds from other liquidity sources; difficulties with realization of the benefits of the proposed Transaction, including the risks that the acquired business may not be integrated successfully or that the anticipated synergies or cost or capital expenditure savings from the Transaction may not be fully realized or may take longer to realize than expected, including because of political and economic instability in Brazil or changes in government policy in Brazil; the predictability and volatility of, and customer expectations about, agriculture, fertilizer, raw material, energy and transportation markets that are subject to competitive and other pressures and economic and credit market conditions; the level of inventories in the distribution channels for crop nutrients; the effect of future product innovations or development of new technologies on demand for our products; changes in foreign currency and exchange rates; international trade risks and other risks associated with Mosaic's international operations and those of joint ventures in which Mosaic participates, including the performance of the Wa'ad Al Shamal Phosphate Company (also known as MWSPC) and the entity operating the Miski Mayo mine, the risk that protests against natural resource companies in Peru extend to or impact the Miski Mayo mine, the ability of MWSPC to obtain additional planned funding in acceptable amounts and upon acceptable terms, the timely development and commencement of operations of production facilities in the Kingdom of Saudi Arabia, the future success of current plans for MWSPC and any future changes in those plans; difficulties with realization of the benefits of our long term natural gas based pricing ammonia supply agreement with CF Industries, Inc., including the risk that the cost savings initially anticipated from the agreement may not be fully realized over its term or that the price of natural gas or ammonia during the term are at levels at which the pricing is disadvantageous to Mosaic; customer defaults; the effects of Mosaic's decisions to exit business operations or locations; changes in government policy; changes in environmental and other governmental regulation, including expansion of the types and extent of water resources regulated under federal law, carbon taxes or other greenhouse gas regulation, implementation of numeric water quality standards for the discharge of nutrients into Florida waterways or efforts to reduce the flow of excess nutrients into the Mississippi River basin, the Gulf of Mexico or elsewhere; further developments in judicial or administrative proceedings, or complaints that Mosaic's operations are adversely impacting nearby farms, business operations or properties; difficulties or delays in receiving, increased costs of or challenges to necessary governmental permits or approvals or increased financial assurance requirements; resolution of global tax audit activity; the effectiveness of Mosaic's processes for managing its strategic priorities; adverse weather conditions affecting operations in Central Florida, the Mississippi River basin, the Gulf Coast of the United States or Canada, and including potential hurricanes, excess heat, cold, snow, rainfall or drought; actual costs of various items differing from management's current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental regulation, Canadian resources taxes and royalties, or the costs of the MWSPC, its existing or future funding and Mosaic's commitments in support of such funding; reduction of Mosaic's available cash and liquidity, and increased leverage, due to its use of cash and/or available debt capacity to fund financial assurance requirements and strategic investments; brine inflows at Mosaic's Esterhazy, Saskatchewan, potash mine or other potash shaft mines; other accidents and disruptions involving Mosaic's operations, including potential mine fires, floods, explosions, seismic events, sinkholes or releases of hazardous or volatile chemicals; and risks associated with cyber security, including reputational loss, as well as other risks and uncertainties reported from time to time in The Mosaic Company's reports filed with the Securities and Exchange Commission. Actual results may differ from those set forth in the forward-looking statements. 2
Take-Aways Prices have trended upward since mid-2016 but they remain below prior peaks Demand projected to grow 3% per year during the next five years Greenfield projects have come on line this this year and more will start up in 2018 But no chronic or severe supply/demand imbalance is forecast 3
Prices have trended up since mid-2016 $ Tonne Potash Prices 475 450 425 400 375 350 325 300 275 250 225 Source: Argus 200 175 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 fob NOLA fob U.S. Corn Belt c&f Brazil Strong broad-based demand growth Restructured/optimized operations Stable to stronger potash export currencies No immediate threat from new capacity 4
Prices have trended up since mid-2016 (A quick recap) What Happened in 2015-16? 1. Global shipments declined in 2015 and 2016 following the 9+ million tonne surge in 2014. Mil Tonnes KCl Global Potash Shipments 67.5 Source: IFA, CRU, Mosaic and Company Reports 65.0 62.5 60.0 2. Five Canpotex proving runs added nearly 7 million tonnes of new capacity between 2013 and 2016. Other producers also brought brownfield expansions on line. 3. Key potash export currencies, particularly the Russian and Belarussian ruble, collapsed with the price of oil in 2015. 57.5 55.0 52.5 50.0 47.5 10 11 12 13 14 15 16 MOP Russian Ruble vs. Brazil Potash Price $ Tonne Monthly Average 2014-16 Source: CME Forex, Publication Prices 400 375 350 325 300 275 250 225 200 30 40 50 60 70 80 Rubles/US$ 5
Prices have trended up since mid-2016 (Looking ahead) Mil Tonnes KCl Global Potash Shipments What is Driving the Recovery Since Mid-2016? 67.5 65.0 62.5 60.0 Source: IFA, CRU, Mosaic and Company Reports 63.5 64-66 1. A broad-based rebound in global shipments is underway. 2. North American producers have optimized operations following the completion of several brownfield expansion projects. 57.5 55.0 52.5 3. Key export currencies have stabilized or strengthened and inflationary cost pressures have picked up in these regions. 50.0 47.5 10 11 12 13 14 15 16 17E 18F We project global MOP shipments will rebound ~4% or 2.7 million tonnes KCl to 63.5 million in 2017. Our first look at 2018 shows shipments will increase another ~3% or 1.7 million tonnes to 64-66 million. Company Facility Capacity (Tonnes) Date Closed Mosaic Hersey 50,000 Mid-2014 Mosaic Carlsbad 450,000 December 2014 PotashCorp Penobsquis 800,000 December 2015 PotashCorp Picadilly 2,000,000 December 2015 PotashCorp Cory Red 600,000 November 2016 Intrepid West Mine 350,000 July 2016 Intrepid East Mine 200,000 Conversion to Trio Total 3,650,000 Picadilly was a larger replacement for the Penobsquis mine so the net loss in Eastern Canada is 2.0 million tonnes KCl. 6
Strong Broad-Based Demand Growth Mil Tonnes Brazil MOP Shipments KCl 10.5 Source: ANDA, Mosaic and Company Reports 10.0 9.5 9.0 8.5 8.0 7.5 7.0 6.5 6.0 5.5 5.0 10 11 12 13 14 15 16 17E 18F Mil Tonnes China MOP Shipments KCl 18.0 Source: CRU and Mosaic 16.0 14.0 12.0 10.0 8.0 6.0 4.0 10 11 12 13 14 15 16 17E 18F Steady increases in soybean production in particular Decent farm economics despite stronger real MOP imports up 14% Jan-Oct 2017 Record crop production year after year Efforts to improve its potassium balance Big import recovery in 2017 combined with gains in domestic production Despite farm program uncertainties, changes in crop mix unlikely to impact onfarm K use in 2018 7
Strong Broad-Based Demand Growth Mil Tonnes KCl 10.0 9.5 9.0 8.5 8.0 7.5 7.0 6.5 6.0 Source: IPNI, DOC and Mosaic North American MOP Shipments 10 11 12 13 14 15 16 17E 18F MOP shipments typically range bound after a few volatile years driven by weather and fill program timing On-farm use projected about flat despite changes in crop mix Shipments also staying stable at 9.2-9.4 in CY 2017 and 2018 Mil Tonnes India MOP Shipments KCl 6.5 Source: FAI, IFA, and Mosaic 6.0 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 10 11 12 13 14 15 16 17E 18F Indian shipments slowly recovering from subsidy changes in 10/11 that resulted in a near tripling of retail potash prices A good monsoon, higher minimum crop support prices, rupee strength, and moderate K prices have underpinned demand growth 8
Strong Broad-Based Demand Growth Mil Tonnes Malaysia+Indonesia MOP Shipments KCl 6.0 Source: IFA and Mosaic 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 10 11 12 13 14 15 16 17E 18F Indonesia Malaysia Indo/Malay shipments have trended steadily upward (with a couple surges) driven mostly by palm oil production Normal rainfall this year, moderate palm oil prices, and higher rice prices underpin near-term demand gains Mil Tonnes KCl 21.0 20.0 19.0 18.0 17.0 16.0 15.0 Source: IFA, CRU and Mosaic Rest of World MOP Shipments 10 11 12 13 14 15 16 17E 18F Shipments outside the Big Six countries/regions have taken off Led mostly by other Asian and other Latin American countries as well as a doubling of African use (albeit from a low starting point) 9
What s driving demand growth? Record harvests have removed record nutrients Bil Tonnes World Grain and Oilseed Production and Use 3.2 Source: USDA 3.0 1.60 1.40 Affordable nutrients spur demand Plant Nutrient Affordability Plant Nutrient Price Index / Crop Price Index Source: Weekly Price Publications, CME, USDA, AAPFCO, Mosaic 2.8 1.20 Less Affordable 2.6 1.00 2.4 0.80 2.2 2.0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17E Production Use 0.60 More Affordable 0.40 07 08 09 10 11 12 13 14 15 16 17 Affordability Metric Average (2010-present) 10
Longer-term view: Broad-based demand growth MMT MOP Global Potash Shipments 75 Source: Mosaic, CRU 70 65 60 55 50 45 40 10 11 12 13 14 15 16 17E 22F Actual High Forecast Low Forecast Likely Forecast CRU - August 2017 Global MOP shipments increased 2.3% per year or 7.7 million tonnes from 2010 to 2016. Shipments are forecast to increase 3.0% per year or 12.0 million tonnes from 2016 to 2022. Demand drivers remain positive, and more rapid and consistent growth is expected. 11
Longer-term view: Broad-based demand growth China Brazil Other Asia/Oceania Indonesia/Malaysia Other Latin Amer Africa Europe/FSU Rest of World North America India Change in Potash Shipments 2016 vs. 2010-7.0% -0.2% 0.2% 0.3% 2.0% 2.3% 6.8% 3.9% 5.3% 7.9% Mil Tonnes KCl -3.0-2.0-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 (Percentage is CAGR) Source: Mosaic and CRU Outlook August 2017 Europe/FSU Other Asia/Oceania Indonesia/Malaysia Other Latin Amer Rest of World North America Change in Potash Shipments 2022 vs. 2016 China Brazil India Africa -0.1% 1.3% 1.5% 8.5% 2.1% 3.8% 6.1% 2.6% 3.4% 4.1% -0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 Mil Tonnes KCl (Percentage is CAGR) Source: Mosaic and CRU August 2017 The traditional growth geographies - Brazil, China, India, Indonesia, and Malaysia account for almost 70% of the projected gain from 2016 to 2022, but other regions such as the former Soviet Union, other Asian countries and Africa are expected to post significant increases during the next five years. 12
No long-term supply and demand imbalance Mil Tonnes 90 80 70 60 50 40 30 20 10 Global Potash Supply and Demand MOP Capacity, Production and Operating Rate Source: Company Reports, CRU and Mosaic Op Rate 97.5% 95.0% 92.5% 90.0% 87.5% 85.0% 82.5% 80.0% 77.5% Strong demand outlook leads to a tighter S&D from 2019 forward. Global operational capacity is projected to increase 12.8 million tonnes from 69.0 million in 2016 to 81.8 million in 2022. The global MOP operating rate is forecast to dip to ~86% in 2018 before moving back up to the 89% range by 2022. Assumes global demand will grow 3% per year and the four greenfield projects in Turkmenistan, Saskatchewan and Russia (2) will ramp-up based on cumulative production increases below: 0 10 11 12 13 14 15 16 17E 18F 19F 20F 21F 22F 75.0% Operational Capacity Production Operating Rate Mil Tonnes KCl 2017 2018 2019 2020 2021 2022 Production.50 2.1 3.2 4.5 5.7 6.9 13
Factors to Watch Agricultural commodity prices Will demand continue to soak up big supplies? Ramp up of new capacity Timelines, operating strategies Industry consolidation and optimization Demand in Africa, FSU, India India back on track or still a drag on global shipments? Key exchange rates Will producer currencies continue to appreciate? Government policies Subsidies, taxes, farm programs Mil Tonnes 800 750 700 650 600 550 500 450 400 350 Index 110 100 90 80 70 Source: USDA World Grain and Oilseed Stocks 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17E Stocks Percent of Use Key Potash Exporter Exchange Rates 2014 Q1=100 Percent 30% 28% 26% 24% 22% 20% 18% 16% 14% 12% 60 50 Source: CRB 40 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Canadian Dollar Russian Ruble Euro 14
Thank you! TFI Fertilizer Outlook & Technology Conference November 15, 2017 Josh Paula Market & Strategic Analysis The Mosaic Company 15