2Q26 Ag Preview: Riding the Hormuz rollercoaster into 2H26

Research evidence excerpt

2Q26 Ag Preview: Riding the Hormuz rollercoaster into 2H26

s from nutrient application risks,

MOS: The Mosaic Companythe “super” El Niño, and potential buy from China under the $17bn deal.

MOU: Memorandum ofSeeds business holding in well but value closer to full Understanding

Despite the volatility in grain and farmer economics, we see little reason to shift our

CTVA forecast into 2Q. Farmers we meet remain committed to buying high quality SOH: Strait of Hormuz

seeds, spoke favorably of Pioneer’s disease resistance performance and continue to

SoTP: Sum of the Partsfavor Enlist beans over Bayer given dicamba drift. This is all reassuring for the strength

of CTVA’s business but in our view isn’t enough to get more optimistic on 2Q. Its 2H’26 Ytd: Year to date

outlook is more a function of crop chemical sales in LatAm, and we continue to be

cautious on demand here. That said, we don’t expect CTVA to pull away from its double-

digit volume growth guide. As for shares, CTVA has performed well ytd (+29% vs 9% in

SPY) but nearing the bounds of what we consider fair value. Exhibit 1: POs change for CTVA and NTR

BofA Agriculture POs

Adjusting estimates to reflect volatile fertilizer market

We are trimming our nitrogen forecast on account of the weaker price backdrop exiting Ticker New PO Old PO

2Q. While we expect a seasonal rally through 2H, price traction should be more muted, CF 106 106

CTVA 96 90

even with SOH closed as China enters the export market and new capacity ramps. MOS 25 25

Potash moves up as the market stays stronger for longer, while DAP prices are also NTR 78 83

holding in at highs given sulfur price inflation. With the latter, we see negative estimate Source: BofA Global Research

revisions in MOS for 27/28 as stripping margin assumptions are moving lower.