Wheat price volatility

Research evidence excerpt

Wheat price volatility

Flashnote GrainCorp

Target Price Risk Disclosures

Company Name Risk Disclosure

grain, feed, farm supplies and fertiliser prices, which are determined by global supply and demand. Elders is also impacted

movements in real estate prices.

Biosecurity: An outbreak of a systemic animal or plant disease can lead to quarantine conditions, including the restriction of •

movement of cattle in rural Australia, and reduce producers’ need for goods and services or affect their ability to operate.

Livestock export: Elders supplies sheep and cattle to livestock exporters. Elders may be impacted if demand from livestock •

exporters is adversely affected by the imposition of tariffs or free trade agreements, export or import bans or embargoes

Earnings growth in part driven by Delta Agri inclusion and synergies. Failure of synergy delivery and slower recovery in Delta •

earnings presents downside risk to our earnings and TP forecasts.

Key downside risks are earnings sensitivity to seasonal conditions, supply chain/input costs, risk that new Seeds products take Nufarm (NUF AU) •

longer than expected to ramp up, risk of larger-than-predicted regulatory phase-outs (e.g., Europe) and longer time for recovery in

prices and margins across Crop Protection biz. Highly levered balance sheet introduces additional risk to NUF and lessens its ability

to withstand cyclical nature of AgChem market.

Upside risks include better-than-expected Crop Protection sales and margins driving greater growth in 2H earnings. Rapid recovery •

in fish oil prices could also see stronger earnings growth in Seeds business vs our forecasts and lead to re-rating of the stock. Early

and successful conclusion of the Seeds review could also be a catalyst for re-rating.