Advantages and Challenges of Transportation Modes. Tampa Bay Applications Group April 2013

Transcription

1 Advantages and Challenges of Transportation Modes Tampa Bay Applications Group April 2013

2 Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Such statements include, but are not limited to, statements about future 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 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; changes in foreign currency and exchange rates; international trade risks; changes in government policy; changes in environmental and other governmental regulation, including greenhouse gas regulation, including orders, rulings, injunctions or other actions by the court or the Army Corps of Engineers or others, or any other difficulties or delays in receiving, or increased costs of, or revocation of, necessary governmental permits or approvals; the effectiveness of the Company s processes for managing its strategic priorities; adverse weather conditions affecting operations in Central Florida or the Gulf Coast of the United States, including potential hurricanes or excess rainfall; actual costs of various items differing from management s current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental obligations Actual results may differ from those set forth in the forward-looking statements.

3 Mosaic: Who We Are Global producer of crop nutrients Largest integrated phosphate producer in the world Second largest potash capacity in the world Vertically integrated - mining, production, distribution Formed in with veteran industry experience Our Mission We help the world grow the food it needs Our Vision To be the world s leading crop nutrition company Our Values Our values of integrity, excellence, sustainability and connectivity define how we conduct our business, how we interact with each other and how we treat our communities and our planet

4 Recognitions Corporate Responsibility Magazine s 100 Best Corporate Citizens - Fourth year in a row Ethisphere Institute s list of World s Most Ethical Companies CSX 2012 Chemical Safety Excellence Award (multiple) 2012 Argus Award for innovative partnership with CSX and another third party

5 Recognitions Committee Encouraging Corporate Philanthropy s 2013 Excellence Award in Corporate Philanthropy United Way Worldwide presented Mosaic Co. a 2013 Summit Award, for national and international philanthropic efforts, including helping to feed the hungry in Africa, Guatemala, India and Central Florida. Tampa Bay Times named Mosaic one of the region s top workplaces

6 What is Important to Mosaic s Customers? Right product, right place, right time Product delivered on most competitive basis Highest quality product available Product delivered in dependable, well maintained equipment Mosaic and its service providers to be responsive to their needs Our customers look to us for the same things we look to our transportation providers for: Partnership Service Value Competitiveness

7 Mosaic Phosphate Operations Four rock mines and five chemical plants strategically located in the U.S. Gulf

8 Phosphate Mining Locations in Florida MINE COUNTY Four Corners Hillsborough, Polk, & Manatee Hookers Prairie Polk South Ft Meade Polk Wingate Manatee **Mosaic owns approximately 30 years of phosphate rock reserves in Florida.

9 Fertilizer Manufacturing Locations in Florida PLANT COUNTY Riverview Hillsborough Bartow Polk New Wales Polk South Pierce Polk

10 Fertilizer Production Key Raw Materials: Sulphur to make Sulfuric Acid Phosphate Rock to mix with Sulfuric Acid to make Phosphoric Acid Ammonia to mix with Phosphoric Acid to make Fertilizer

11 Raw Materials Processing Network Consumer Mines/Rock Suppliers (5 mines) Rail Rail, Truck, & Vessel Cross-Gulf Big Bend Terminal Vessel & Container Sulphur Suppliers Nat Gas Suppliers NH3 Suppliers Micros Suppliers Lime/DE/Si Suppliers Rail, Cross-Gulf, & Truck Pipeline Vessel NH3 Plant (D ville) NH3 Terminals Truck & Rail Truck & Rail Pipeline Pipeline Concentrate Plants (4 plants) Truck, Rail & Transmission Rail & Truck Export Terminals Direct Shipped Owned Warehouses Leased Warehouses Customer Warehouses Rail, Truck, & Barge Rail & Barge Rail & Barge Rail & Barge Export, Domestic, & Feed Customers Phosphate s complex and dynamic supply chain. SO4, FSA & Electricity Customers Dir.Transfer Locations Rail & Barge

12 Supply Chain Volumes (mt/year) Production Fertilizer and Feed Millions Phosphates Concentrates Production 8.1 Potash Production (MOP & K-Mag only) 7.0 Raw Materials Consumption Mined Rock Consumed in Fertilizer Production 11.7 Ammonia Consumed in Production (purchased and produced) 1.3 Sulphur consumed in production (long tons) 3.5 Sulphuric Acid Production 10.4

13 Mosaic Units per Year ~240,000 railcars ~350 vessels ~3,150 barges ~400,000 trucks ~800 containers

14 Mosaic Truck Routes

15 Sulphur Sulphur: a by-product from the oil refining and natural gas processing industries. The largest use (90%) is for the manufacturing of phosphate fertilizers Approximately 4,000,000 tons of liquid sulphur is moved every year through the Mosaic facilities located along the US Gulf Coast 0.45 ton of Sulphur is required per 1 ton fertilizer (DAP) Sulphuric Acid production from Sulphur generates steam which generates electricity to run 100% of the power needs of our phosphate facilities

16 Mosaic Sulphur: 150,000 Shipments Per Year Canada Internal US 5

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18 Trucking Green Initiatives in Logistics Utilize local service providers and vendors when possible to reduce transportation costs (and greenhouse emissions) In plant No Idle policies for trucks; encourages installation of automatic engine shut offs New contract utilizing CNG fueling, adding CNG capacity in Tampa Bay area Utilize increased capacity trucks to reduce truck traffic by 20% Rail N-ViroMotive locomotive replaced two standard locomotives at mine More fuel efficient, reduces fuel cost nearly 50% Quieter than replaced locomotives 80% fewer emissions

19 Green Initiatives in Logistics Saddleback Trailer for Sulphur from port with DAP Backhaul to Port

20 Green Initiatives in Logistics Natural Gas heavy duty trucks produce up to 18% fewer greenhouse gas emissions compared to diesel engines Mosaic is partnering with a pioneer in the field to bring Natural Gas trucking capability to Central Florida in May 2013 Mosaic is contracting a trucker that is a member of the U.S. Environmental Protection Agency's SmartWay Transport Partnership, a voluntary alliance of freight industry organizations that establishes incentives for fuel efficiency and greenhouse gas reductions.

21 Tampa Export : Mosaic uses various export terminals Manatee & Port Sutton are owned by Kinder Morgan CSXT owns Rockport while Ingram owns Eastern Big Bend & Riverview are Mosaic-owned terminals Florida export terminals Eastern (Ingram) Water draft: 38FT Air draft: 52FT (WLTHC) Rockport (CSXT) Water draft: 42FT Air draft: 52FT (WLTHC) Tampaplex (Kinder Morgan) Water draft: 36FT Air draft: 43FT (WLTHC) Riverview (Mosaic) Water draft: 34FT Air draft: 42FT (WLTHC) Big Bend (Mosaic) Water draft: 34FT Air draft: 53FT (WLTHC) Port Manatee (Kinder Morgan) Water draft: 39FT Air draft: 46FT (WLTHC)

22 Plant-To-Port Flow Chart DAP GMAP1152 Micros PLANTS Riverview Riverview PORTS DAP GMAP1152 Micros Phosphate Rock Mines (3) Port Manatee DAP GMAP1152 PMAP GMAP 1050 DAP GMAP1152 PMAP GMAP1050 Nexfos New Wales Big Bend TampaPlex Phosphate Rock DAP Nexfos Eastern DAP GMAP1152 Micros GMAP1050 DAP GMAP1152 Micros Bartow Rockport DAP

23 PHOSPHATE EXPORT VOLUMES YEAR (CALENDAR) TONS (MT) ,300, ,000,000

24 PLANT TO PORT VOLUMES NEW WALES TO PORT (m MT) BARTOW TO PORT (m MT) RIVERVIEW EXPORT (m MT) ,970 1,830 1, ,800 1,580 1,620

25 Collaborative Rail Projects GATX and CSX tank car training, utilizing specialized training equipment Assessing Rockport Terminal conversion of one idled rotary dumper to conventional hopper unloader Share Sales forecasts for projecting equipment and transit requirements Increased unit train size to 85 From 52% in 2008 to 67% in 2012 New unit train destinations on CSX and BNSF

26 Future Mosaic Projects to Consider Import phosrock vessels Port of entry TBN Deep draft ports to supplement Rockport/Eastern/Manatee Big Bend terminal development (early 2014) 100k ton warehouse with new rail and truck unloading Future mining Ona, DeSoto (about 2020) Transportation TBN; rail is contender

27 Projected Infrastructure Needs Integrated Primary corridor development East-West corridors Hills Duval Heartland Express Capacity for CSX W.H. Intermodal terminal S.R. 41 enhancements between I-4 and I-275 Turn lanes Improved signaling Rail crossing refurbishments through CFL Preparation for renewed urbanization Mass transit development Exclusive truck lanes

28 Legislative Challenges to Trucking HOS CSA EOBR s Hiring, screening costs > $7K per FTE ATA projects 239k driver shortage by 2025 >20% of commercial drivers are years old* <8% of commercial drivers are years old* CDL act of 2012 facilitates ex-military hiring *USBLS

29 Mitigation Efforts New RDLA railcars PhosPro collaborative process improvement initiative between Mosaic and CSX Reduce cycle times of train movements Plant infrastructure investments Performance based contracts with data driven metrics Conversion to CNG Trucks Increase truck efficiencies 20% trip reduction through increased load capacity Carrier friendly Origins/Destinations Unique backhaul opportunities (Saddleback trailers)