BASE PROSPECTUS February 9, 2006

Cargill, Incorporated (incorporated with limited liability in the State of Delaware, United States of America) U.S.$2,000,000,000 Euro Medium Term Note Program On December 16, 1996, each of Cargill, Incorporated (“Cargill, Inc.”orthe“Issuer”), Cargill Global Funding PLC (“Cargill Global”) and Cargill Asia Pacific Treasury Ltd. (“Cargill Asia Pacific”) entered into a U.S.$1,000,000,000 Euro Medium Term Note Program (the “Program”) and issued an offering circular on that date describing the Program. The Program has been updated from time to time and several offering circulars have been issued in connection therewith. This base prospectus (the “Base Prospectus”) further updates the Program, supersedes all previous offering circulars and is valid for a period of 12 months as from the date hereof. Any Notes (as defined below) issued under the Program on or after the date of this Base Prospectus are issued subject to the provisions herein. This does not affect any Notes already issued. Under the Program, Cargill, Inc., may from time to time issue notes (the “Notes”) denominated in any currency (including euro) as agreed between Cargill, Inc. and the relevant Dealer (as defined below). The maximum aggregate nominal amount of all Notes from time to time outstanding will not exceed U.S.$2,000,000,000 (or its equivalent in other currencies calculated as described herein). Application has been made to the Luxembourg Stock Exchange for Notes issued under the Program as described in this Base Prospectus to be admitted to trading on the Bourse de Luxembourg, which is the Luxembourg Stock Exchange’s Regulated Market (as such term is defined in Title 1, Article 4(14) of European Council Directive 2004/39) and to be listed on the Luxembourg Stock Exchange. Application has also been made to the Commission de Surveillance du Secteur Financier (the “CSSF”) in its capacity as competent authority under the Luxembourg Act dated 10 July 2005 on prospectuses for securities to approve this document as a base prospectus. Under the Luxembourg Act on prospectuses for securities which implements Directive 2003/71/EC (the “Prospectus Directive”), prospectuses relating to money market instruments having a maturity at issue of less than 12 months and complying also with the definition of securities are not subject to the approval provisions of Part II of such Act. Notice of the aggregate nominal amount of Notes, interest (if any) payable in respect of Notes, the issue price of Notes and any other terms and conditions not contained herein which are applicable to each Tranche (as defined herein) of Notes will be set forth in the final terms (the “Final Terms”) which, with respect to Notes to be listed on the Luxembourg Stock Exchange will be delivered to the CSSF on or before the date of issue of the Notes of such Tranche. The Program provides that Notes may be listed on or admitted to trading, as the case may be, on such other or further stock exchange(s) or markets as may be agreed between the Issuer and the relevant Dealer. In addition, Cargill, Inc. may from time to time issue unlisted Notes and/or Notes which are not admitted to trading on any market. See “Risk Factors” on page 9 for a discussion of certain factors to be considered in connection with an investment in the Notes. The Program has been rated by Standard & Poor’s Ratings Services, a Division of the McGraw-Hill Companies (“S&P”) and by Moody’s Investors Service Limited (“Moody’s”). Tranches of Notes issued under the Program may be rated or unrated. Where a Tranche of Notes is rated, such ratings will not necessarily be the same as the ratings assigned to the Program. A security rating is not a recommendation to buy, sell, or hold securities and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency. Notes issued under the Program are, unless otherwise specified in the Final Terms, expected to be rated A+ by S&P and A2 by Moody’s. Arranger Merrill Lynch International Dealers ABN AMRO Credit Suisse Deutsche Bank Goldman Sachs International Merrill Lynch International Morgan Stanley TABLE OF CONTENTS

Table of Contents ...... 2 Available Information ...... 4 Summary of the Program ...... 5 Risk Factors ...... 9 General Description of the Program ...... 14 Form of Final Terms ...... 15 Part A—Contractual terms ...... 15 Terms and Conditions of the Notes ...... 26 Use of Proceeds ...... 50 Business ...... 51 Management’s Discussion and Analysis of Financial Condition and Results of Operations ...... 61 Directors ...... 96 Taxation ...... 97 European Union Savings Directive ...... 102 Subscription and Sale ...... 103 Summary of Principal Differences Between US GAAP and IFRS ...... 105 General Information ...... 109

In connection with the issue of any tranche of notes, the dealer or dealers (if any) named as the stabilising manager(s) (or persons acting on behalf of any stabilising manager(s)) in the applicable final terms may over-allot notes (provided that, in the case of any tranche of notes to be admitted to trading on the regulated market of the Luxembourg Stock Exchange or any other regulated market (within the meaning of the Investment Services Directive (Directive 93/22/EEC) in the European Economic Area, the aggregate principal amount of notes allotted does not exceed 105 percent of the aggregate principal amount of the relevant tranche) or effect transactions with a view to supporting the market price of the notes at a level higher than that which might otherwise prevail. However, there is no assurance that the stabilising manager(s) (or persons acting on behalf of a stabilising manager) will undertake stabilisation action. Any stabilisation action may begin on or after the date on which adequate public disclosure of the terms of the offer of the relevant tranche of notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of the relevant tranche of notes and 60 days after the date of the allotment of the relevant tranche of notes.

2 This Base Prospectus comprises a base prospectus for the purposes of Article 5.4 of the Prospectus Directive.

Cargill, Inc. accepts responsibility for the information contained in this Base Prospectus. To the best of the knowledge and belief of Cargill, Inc. (having taken all reasonable care to ensure that such is the case) such information contained in this Base Prospectus is in accordance with the facts and does not omit anything likely to affect the import of such information.

No person has been authorized by Cargill, Inc. to give any information or to make any representation not contained in or not consistent with this Base Prospectus or any other document entered into in relation to the Program or any information supplied by Cargill, Inc. or such other information as is in the public domain and, if given or made, such information or representation should not be relied upon as having been authorized by Cargill, Inc. or any dealer.

The Dealers have not separately verified the information contained herein. Accordingly, no representation or warranty is made or implied by the Dealers or any of their respective affiliates, and neither the Dealers nor any of their respective affiliates make any representation or warranty or accept any responsibility, as to the accuracy or completeness of the information contained in this Base Prospectus. Neither the delivery of this Base Prospectus or any Final Terms nor the offering, sale or delivery of any Note shall, in any circumstances, create any implication that the information contained in this Base Prospectus is true subsequent to the date hereof or the date upon which this Base Prospectus has been most recently amended or supplemented or that there has been no adverse change in the financial situation of the Issuer or the Issuer, if applicable, since the date hereof or, as the case may be, the date upon which this Base Prospectus has been most recently amended or supplemented or that any other information supplied in connection with the program is correct at any time subsequent to the date on which it is supplied or, if different, the date indicated in the document containing the same.

The distribution of this Base Prospectus and any Final Terms and the offering, sale and delivery of Notes in certain jurisdictions may be restricted by law. Persons into whose possession this Base Prospectus or any Final Terms comes are required by the Issuer and the Dealers to inform themselves about and to observe any such restrictions. For a description of certain restrictions on offers, sales and deliveries of notes and on the distribution of this Base Prospectus or any Final Terms and other offering material relating to the Notes, see “Subscription and Sale”. In particular, Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”) and are in bearer form which are subject to U.S. tax law requirements. Notes may not be offered, sold or delivered within the United States or to United States persons (other than distributors) unless the Notes are registered under the Securities Act or an exemption from such registration requirements is available (see “Subscription and Sale”). Neither this Base Prospectus nor any Final Terms may be used for the purpose of an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation.

Neither this Base Prospectus nor any Final Terms constitutes an offer or an invitation to subscribe for or purchase any Notes and should not be considered as a recommendation by Cargill, Inc. or the Dealers that any recipient of this Base Prospectus or any Final Terms should subscribe for or purchase any Notes. Each recipient of the Base Prospectus or any Final Terms shall be deemed to have made its own investigation and appraisal of the condition (financial or otherwise) of Cargill, Inc.

All references in this Base Prospectus to “$”, “dollars”, “Dollars”, “U.S.$”, or “U.S. dollars” are to United States dollars, references to “EUR”, “€”, “Euro”and“euro” refer to the currency introduced at the start of the third stage of European economic and monetary union pursuant to the treaty establishing the European Community, as amended.

Notwithstanding anything to the contrary contained herein, a prospective purchaser (and each employee, representative, or other agent of a prospective purchaser) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions described in this Base Prospectus and all materials of any kind that are provided to the prospective purchaser relating to such tax treatment and tax structure (as such terms are defined in Treasury Regulation Section 1.6011-4). This authorization of tax disclosure is retroactively effective to the commencement of discussions between the Issuer, the Dealers or their respective representatives and a prospective purchaser regarding the transactions contemplated herein.

3 AVAILABLE INFORMATION

Cargill, Inc. is not subject to the information reporting requirements of the United States Securities Exchange Act of 1934, as amended.

This document may contain forward-looking statements that reflect management’s current view with respect to future results, achievements and financial performance. These statements may be identified by their use of forward-looking terminology such as “believes,” “expects,” “anticipates,” “may,” “will,” “should,” “seeks,” “approximates,” “intends,” “aims,” “plans,” “estimates,” or the negative of these words or other comparable terminology. Such forward-looking statements are subject to risks and uncertainties that may cause the Company’s actual results, achievements or performance to differ materially from those projected or implied. The most significant of these risks are described in this document. To the extent permitted by applicable law, Cargill, Inc. assumes no obligation to update any forward-looking statements as a result of new information or future events.

The Issuer will, at the specified offices of the Paying Agents provide, free of charge, upon the oral or written request therefor, a copy of this Base Prospectus. Written or oral requests for this document should be directed to Cargill, Inc. at its principal office set out at the end of this Base Prospectus. In addition, for Notes listed on the Luxembourg Stock Exchange this document will be available free of charge from the principal office in Luxembourg of Dexia Banque Internationale à Luxembourg in its capacity as listing agent (the “Luxembourg Listing Agent”).

If the terms of the Program are modified or amended in a manner which would make this Base Prospectus, as supplemented, inaccurate or misleading, a new Base Prospectus will be prepared. The Issuer will, in connection with the listing of the Notes on the Luxembourg Stock Exchange, so long as any Notes remain outstanding and listed on such exchange, in the event of any material adverse change in the financial condition of the Issuer or material change in the Terms and Conditions of the Notes or the Program (including an increase in the size of the Program) which is not reflected in the Base Prospectus, prepare a further supplement to the Base Prospectus or a new Base Prospectus for use in connection with any subsequent issue of Notes to be listed on the Luxembourg Stock Exchange.

4 SUMMARY OF THE PROGRAM

The following is a brief summary only and is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this document and, in relation to any Notes, in conjunction with the relevant Final Terms and, to the extent applicable, the Terms and Conditions of the Notes set out herein.

ISSUER: Cargill, Incorporated

ARRANGER: Merrill Lynch International

DEALERS: ABN AMRO Bank N.V., Credit Suisse Securities (Europe) Limited, Deutsche Bank AG, London Branch, Goldman Sachs International, Merrill Lynch International, and Morgan Stanley & Co. International Limited

Each issue of Notes denominated in a currency in respect of which particular laws, guidelines, regulations, restrictions or reporting requirements apply will only be issued in circumstances which comply with such laws, guidelines, regulations, restrictions or reporting requirements from time to time (see “Subscription and Sale”).

At the date of this Base Prospectus:

(i) Issues of Notes denominated in Sterling will be issued in accordance with any applicable requirements from time to time of the Bank of England and shall comply with all other applicable laws and regulations (as amended from time to time) of United Kingdom authorities.

FISCAL AGENT: Citibank, N.A., London.

CALCULATION AGENT: Citibank, N.A., London, unless otherwise specified in the relevant Final Terms.

LUXEMBOURG LISTING Dexia Banque Internationale à Luxembourg. AGENT:

ISSUE PRICE: Notes may be issued at any price and either on a fully or partly paid basis, as specified in the relevant Final Terms.

MATURITIES: Notes may have such maturities as may be agreed between the Issuer and the relevant Dealer and as indicated in the applicable Final Terms, subject to such minimum or maximum maturities as may be allowed or required from time to time by the relevant central bank (or equivalent body) or any laws or regulations applicable to the Issuer or the relevant currency specified in the applicable Final Terms. At the date of this Base Prospectus, the minimum maturity of all Notes is one month.

Unless permitted by then current laws, regulations and directives, Notes (including Notes denominated in Sterling) in respect of which the issue proceeds are received by the Issuer in the United Kingdom and which have a maturity of less than one year will only be issued if (a) the redemption value of each such Note is not less than £100,000 as determined at the time of issuance or an amount of equivalent value denominated wholly or partly in a currency other than Sterling, (b) no part of any Note may be transferred unless the redemption value of that part is not less than £100,000, or such an equivalent amount, and (c) they are issued to a limited class of professional investors, unless the relevant Note(s) can be issued and sold without contravention of Section 19 of the FSMA.

5 PROGRAM AMOUNT: U.S.$2,000,000,000 in aggregate principal amount of Notes outstanding at any one time. For this purpose, any Notes denominated in another currency shall be translated into U.S. dollars at the date of the agreement to issue such Notes using the spot rate of exchange for the purchase of such currency against payment of U.S. dollars being quoted by the Fiscal Agent on the date on which the Relevant Agreement (as defined in the Dealership Agreement) in respect of the relevant Tranche was made or such other rate as the Issuer and the Relevant Dealer (as defined in the Dealership Agreement) may agree. The maximum aggregate principal amount of Notes which may be outstanding under the Program may be increased from time to time, subject to compliance with the relevant provisions of the Dealership Agreement.

ISSUANCE IN SERIES: Notes will be issued in series (each, a “Series”). Each Series may comprise one or more tranches (“Tranches” and each, a “Tranche”) issued on different issue dates. The Notes of each Series will have identical terms, except that (i) the issue date, the issue price and the amount of the first payment of interest may be different in respect of different Tranches and (ii) a Series may comprise Notes in more than one denomination. The Notes of each Tranche will all have identical terms in all respects save that a Tranche may comprise Notes of different denominations.

FORM OF NOTES: Notes may be issued in bearer form only. In respect of each Tranche of Notes, the Issuer will deliver a Temporary Global Note that will be deposited on or before the relevant issue date therefor, as set forth in the relevant Final Terms, with a depositary or a common depositary for Euroclear Bank, S.A./ N.V. as operator of the Euroclear System (“Euroclear”) and/or Clearstream Banking, société anonyme (“Clearstream, Luxembourg”) and/or any other relevant clearing system. Each Temporary Global Note will be exchangeable for a Permanent Global Note or, if so specified in the relevant Final Terms, for Notes in definitive bearer form. Each permanent global Note will be exchangeable in whole but not in part for Notes in definitive bearer form: see Condition 1(a)(iv) of the Terms and Conditions of the Notes for further details. Notes in definitive bearer form will, if interest-bearing, have interest coupons (“Coupons”) attached and, if appropriate, a talon (“Talon”) for further Coupons and will, if the principal thereof is repayable by installments, have a grid for recording the payment of principal endorsed thereon or, if so specified in the relevant Final Terms, have payment receipts (“Receipts”) attached.

CURRENCIES: Subject to any applicable legal or regulatory restrictions, such currencies as may be agreed between the Issuer and the relevant Dealer(s), including, without limitation, euro, Sterling, U.S. Dollars and Japanese Yen (as indicated in the applicable Final Terms).

Payments in respect of Notes may, subject to compliance as aforesaid, be made in and/or linked to, any currency or currencies other than the currency in which such Notes are denominated.

REDENOMINATION: The applicable Final Terms may provide that certain Notes may be redenominated into euro. The relevant provisions applicable to such redenomination will be set forth in full in the applicable Final Terms.

STATUS: Notes will be direct, unsecured (subject to the Negative Pledge provisions described herein) and senior obligations of the Issuer ranking pari passu with all other present and future unsecured and senior general obligations of the Issuer but in the event of insolvency, only to the extent permitted by applicable laws relating to creditors’ rights.

REDEMPTION: Notes may be redeemable at par or at such other redemption amount (detailed in a formula or otherwise) as may be specified in the relevant Final Terms.

6 EARLY REDEMPTION: Early redemptions will be permitted for taxation reasons as set out in Condition 7(b) and Condition 9(c) of the Terms and Conditions of the Notes, but will otherwise be permitted only to the extent specified in the relevant Final Terms.

INTEREST: Notes may be interest-bearing or non-interest bearing. Interest (if any) may accrue at a fixed or floating rate and may vary during the lifetime of the relevant Series.

DENOMINATIONS: Notes will be issued in such denominations as may be specified in the relevant Final Terms (save that the minimum denomination of any Notes admitted to trading on a European Economic Area exchange or offered to the public in a Member State of the European Economic Area in circumstances which require the publication of a prospectus under the Prospectus Directive will be €50,000 (or if the Notes are denominated in a currency other than euro, the equivalent amount in such currency) or such other higher amount. The minimum denomination of any Notes issued with a maturity of 183 days or less will be U.S.$500,000 or its approximate equivalent in other currencies determined by reference to the spot rate at the date of issuance), subject to compliance with all applicable legal and/or regulatory and/or central bank requirements applicable to the relevant specified currency.

Notes (including Notes denominated in Sterling) issued on terms that they must be redeemed before their first anniversary may be subject to restrictions on their denomination and distribution. See “Redemption” above.

TAXATION: All payments in respect of Notes will be made without deduction for or on account of any withholding taxes imposed by the United States or its political sub-divisions, subject to certain exceptions, see Condition 9 of the Terms and Conditions of the Notes.

NEGATIVE PLEDGE: The terms of the Notes will contain a negative pledge provision as further described in Conditions 4(a) to 4(d) of the Terms and Conditions of the Notes.

CONSOLIDATION, MERGER The terms of the Notes will contain a provision on consolidation, merger or OR SALE OF ASSETS: sale of assets, as further described in Condition 5 of the Terms and Conditions of the Notes.

CROSS DEFAULT: The terms of the Notes will contain a cross-default provision as further described in Condition 8 of the Terms and Conditions of the Notes.

GOVERNING LAW: The Notes and all related contractual documentation will be governed by, and construed in accordance with, the laws of the State of New York.

LISTING AND ADMISSION TO Application has been made to the CSSF to approve this document as a base TRADING: prospectus. Application has been made to the Luxembourg Stock Exchange for Notes issued under the Program to be admitted to trading on the Luxembourg Stock Exchange’s regulated market and to list the Notes on the Luxembourg Stock Exchange. The Notes may also be listed or admitted to trading, as the case may be, on such other or further stock exchange(s) or markets, as may be agreed between the Issuer and the relevant Dealer in relation to each Series. Notes which are neither listed nor admitted to trading on any market may also be issued.

The applicable Final Terms relating to each Tranche of Notes will state whether or not and, if so, on which additional stock exchange(s) or markets the Notes are to be listed and/or admitted to trading.

7 TERMS AND CONDITIONS: The terms and conditions applicable to each Tranche will be those set out herein under “Terms and Conditions of the Notes” as supplemented, modified or replaced by the relevant Final Terms.

CLEARING SYSTEMS: Euroclear, Clearstream, Luxembourg and/or, in relation to any Notes, any other clearing system as may be specified in the relevant Final Terms.

PUT/CALLS: In the event that put and/or call options are applicable to any Notes (as agreed between the Issuer and the relevant Dealer), the details thereof (including notice periods) will be inserted in the relevant Final Terms. Put/ call options will in all cases be subject to any legal and/or regulatory and/or central bank requirement providing for minimum maturities for an issue denominated in a specific currency.

SELLING RESTRICTIONS: There are selling restrictions in relation to the United States, the United Kingdom, Japan, Germany and the Netherlands and such other restrictions as may be required in connection with the offering and sale of a particular Tranche of Notes. See “Subscription and Sale”.

8 RISK FACTORS

The Issuer believes that the following factors may affect its ability to fulfil its obligations under Notes issued under the Program. Most of these factors are contingencies which may or may not occur and the Issuer is not in a position to express a view on the likelihood of any such contingency occurring.

In addition, factors which are material for the purpose of assessing the market risks associated with Notes issued under the Program are also described below.

The Issuer believes that the factors described below represent the principal risks inherent in investing in Notes issued under the Program, but the inability of the Issuer to pay interest, principal or other amounts on or in connection with any Notes may occur for other reasons and the Issuer does not represent that the statements below regarding the risks of holding any Notes are exhaustive. Prospective investors should also read the detailed information set out elsewhere in this Base Prospectus and reach their own views prior to making any investment decision.

Factors which are material for the purpose of assessing the market risks associated with Notes issued under the Program The Notes may not be a suitable investment for all investors Each potential investor in the Notes must determine the suitability of that investment in light of its own circumstances. In particular, each potential investor should: (i) have sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits and risks of investing in the Notes and the information contained in this Base Prospectus or any applicable supplement; (ii) have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its particular financial situation, an investment in the Notes and the impact the Notes will have on its overall investment portfolio; (iii) have sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes, including Notes with principal or interest payable in one or more currencies, or where the currency for principal or interest payments is different from the potential investor’s currency; (iv) understand thoroughly the terms of the Notes and be familiar with the behaviour of any relevant indices and financial markets; and (v) be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for economic, interest rate and other factors that may affect its investment and its ability to bear the applicable risks.

Some Notes are complex financial instruments. Sophisticated institutional investors generally do not purchase complex financial instruments as stand-alone investments. They purchase complex financial instruments as a way to reduce risk or enhance yield with an understood, measured, appropriate addition of risk to their overall portfolios. A potential investor should not invest in Notes which are complex financial instruments unless it has the expertise (either alone or with a financial adviser) to evaluate how the Notes will perform under changing conditions, the resulting effects on the value of the Notes and the impact this investment will have on the potential investor’s overall investment portfolio.

Risk related to the structure of a particular issue of Notes A wide range of Notes may be issued under the Program. A number of these Notes may have features which contain particular risks for potential investors. Set out below is a description of the most common such features: Notes subject to optional redemption by the issuer An optional redemption feature of Notes is likely to limit their market value. During any period when the Issuer may elect to redeem Notes, the market value of those Notes generally will not rise substantially above the price at which they can be redeemed. This also may be true prior to any redemption period.

9 The Issuer may be expected to redeem Notes when its cost of borrowing is lower than the interest rate on the Notes. At those times, an investor generally would not be able to reinvest the redemption proceeds at an effective interest rate as high as the interest rate on the Notes being redeemed and may only be able to do so at a significantly lower rate. Potential investors should consider reinvestment risk in light of other investments available at that time.

Index Linked Notes and Dual Currency Notes The Issuer may issue Notes with principal or interest determined by reference to an index or formula, to changes in the prices of securities or commodities, to movements in currency exchange rates or other factors (each, a “Relevant Factor”). In addition, the Issuer may issue Notes with principal or interest payable in one or more currencies which may be different from the currency in which the Notes are denominated. Potential investors should be aware that: (i) the market price of such Notes may be volatile; (ii) they may receive no interest; (iii) payment of principal or interest may occur at a different time or in a different currency than expected; (iv) they may lose all or a substantial portion of their principal; (v) a Relevant Factor may be subject to significant fluctuations that may not correlate with changes in interest rates, currencies or other indices; (vi) if a Relevant Factor is applied to Notes in conjunction with a multiplier greater than one or contains some other leverage factor, the effect of changes in the Relevant Factor on principal or interest payable will likely be magnified; and (vii) the timing of changes in a Relevant Factor may affect the actual yield to investors, even if the average level is consistent with their expectations. In general, the earlier the change in the Relevant Factor, the greater the effect on yield.

Partly-paid Notes The Issuer may issue Notes where the issue price is payable in more than one instalment. Failure to pay any subsequent instalment could result in an investor losing all of his investment.

Fixed/Floating Rate Notes Fixed/Floating rate Notes may bear interest at a rate that converts from a fixed rate to a floating rate, or from a floating rate to a fixed rate. Where the Issuer has the right to effect such a conversion, this will affect the secondary market and the market value of the Notes since the Issuer may be expected to convert the rate when it is likely to produce a lower overall cost of borrowing. If the Issuer converts from a fixed rate to a floating rate in such circumstances, the spread on the Fixed/Floating Rate Notes may be less favourable than then prevailing spreads on comparable Floating Rate Notes tied to the same reference rate. In addition, the new floating rate at any time may be lower than the rates on other Notes. If the Issuer converts from a floating rate to a fixed rate in such circumstances, the fixed rate may be lower than then prevailing rates on its Notes.

Notes issued at a substantial discount or premium The market values of securities issued at a substantial discount or premium from their principal amount tend to fluctuate more in relation to general changes in interest rates than do prices for conventional interest- bearing securities. Generally, the longer the remaining term of the securities, the greater the price volatility as compared to conventional interest-bearing securities with comparable maturities.

Risks related to Notes generally Modification, waivers and substitution The Terms and Conditions of the Notes contain provisions for calling meetings of Noteholders to consider matters affecting their interests generally. These provisions permit defined majorities to bind all Noteholders including Noteholders who did not attend and vote at the relevant meeting and Noteholders who voted in a manner contrary to the majority.

10 The Terms and Conditions of the Notes also provide that the Fiscal Agent and the Issuer may, without the consent of Noteholders, agree to any modification of any of the provisions of the Notes, the Receipts, the Coupons or the Issue and Paying Agency Agreement (as defined in the Terms and Conditions of the Notes), in the circumstances described in Condition 14 of the Terms and Conditions of the Notes.

EU Savings Directive Under EU Council Directive 2003/48/EC on the taxation of savings income, Member States are required, from 1 July, 2005 to provide to the tax authorities of another Member State details of payments of interest (or similar income) paid by a Paying Agent within its jurisdiction to an individual resident in that other Member State. However, for a transitional period, Belgium, Luxembourg and Austria are instead required (unless during that period they elect otherwise) to operate a withholding system in relation to such payments (the ending of such transitional period being dependent upon the conclusion of certain other agreements relating to information exchange with certain other countries) unless the beneficiary opts for the exchange of information. A number of non-EU countries and territories including Switzerland have adopted similar measures (a withholding system in the case of Switzerland) with effect from the same date.

If a payment were to be made or collected through a Member State which has opted for a withholding system and an amount of, or in respect of tax were to be withheld from that payment, neither the Issuer nor any Paying Agent nor any other person would be obliged to pay additional amounts with respect of any Note as a result of the imposition of such withholding tax. If a withholding tax is imposed on payment made by a Paying Agent, the Issuer will be required to maintain a Paying Agent in a Member State that will not be obliged to withhold or deduct tax pursuant to the Directive.

Exchange Listing When the Issuer specifies in the applicable Final Terms that a Series of Notes is to be listed and admitted to trading on the Luxembourg Stock Exchange and/or listed on or admitted to trading by any other relevant stock exchange or market within the European Union (“EU”), which qualifies as a regulated market within the meaning of Article 1(13) of Directive 93/22/EEC, (each, for the purposes of the following, an “EU Exchange”), the Issuer expects, but is not obligated to Noteholders, to maintain such listing of the Notes on such EU Exchange(s). Changed circumstances, including changes in listing requirements, could result in a suspension or removal of any such listing, or cause the Issuer to conclude that continued listing of the Notes on such EU Exchange(s) is unduly burdensome. For example, in December 2004 the Directive of the European Parliament and of the Council of the EU on the harmonization of transparency requirements with regard to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC (the “Transparency Directive”) was formally adopted. The Transparency Directive relates to information about issuers whose securities are admitted to trading on a regulated market in the EU. The Transparency Directive is expected to be implemented in late 2006 or early 2007. It will have the effect of requiring U.S. companies (such as the Issuer) preparing their financial statements in accordance with United States Generally Accepted Accounting Principles (“US GAAP”) to prepare financial statements in respect of any financial year starting on or after January 1, 2007 in accordance with International Financial Reporting Standards (“IFRS”), in order for Notes issued by such entities to remain listed on such EU Exchange(s), unless it is determined that U.S. law imposes “equivalent” requirements. It is unknown as of the date of this Base Prospectus whether the requirement to prepare financial statements in accordance with US GAAP will be determined to be “equivalent” in all respects to the requirements of the Transparency Directive.

Because the proposed Transparency Directive may be implemented in a manner which could be unduly burdensome for the Issuer, the Issuer is under no obligation to maintain the listing of the Notes. Accordingly, Noteholders (as defined under “Terms and Condition of the Notes” below) should be aware that, in circumstances where a listing or admission to trading on any EU Exchange(s) would require preparation of financial statements in accordance with standards other than US GAAP or require the Issuer to provide additional information and/or a report from its auditors as a result of differences between US GAAP and IFRS, or in any other circumstances where the EU Financial Services Action Plan is implemented in a manner that, in the opinion of the Issuer, is unduly burdensome, Notes issued under the Program may be de-listed. The Issuer may, but is not obliged to, seek an alternative listing for such Notes. However, if such an alternative listing is not available to the Issuer or is, in the opinion of the Issuer, unduly burdensome, an alternative listing for such Notes may not be obtained. Although no assurance is made as to the liquidity of such Notes as a result of a listing on any EU Exchange(s), de-listing of Notes from any EU Exchange(s) may have a material affect on the ability of Noteholders to resell such Notes in the secondary market.

11 Change of law The conditions of the Notes are based on the laws of the State of New York in effect as at the date of this Base Prospectus. No assurance can be given as to the impact of any possible judicial decision or change to the laws of the State of New York or administrative practice after the date of this Base Prospectus.

Trading in the clearing systems In relation to any issue of Notes which have a minimum denomination and are tradeable in the clearing systems in amounts above such minimum denomination which are smaller than it, should definitive notes require to be issued, a holder who does not have an integral multiple of the minimum denomination in his account with the relevant clearing system at the relevant time may not receive all his entitlement in the form of definitive Notes unless and until such time as his holding becomes an integral multiple of the minimum denomination.

Risks related to the market generally Set out below is a brief description of the principal market risks, including liquidity risk, exchange rate risk, interest rate risk and credit risk: The secondary market generally Notes may have no established trading market when issued, and one may never develop. If a market does develop, it may not be very liquid. Therefore, investors may not be able to sell their Notes easily or at prices that will provide them with a yield comparable to similar investments that have a developed secondary market. This is particularly the case for Notes that are especially sensitive to interest rate, currency or market risks, are designed for specific investment objectives or strategies or have been structured to meet the investment requirements of limited categories of investors. These types of Notes generally would have a more limited secondary market and more price volatility than conventional debt securities. Illiquidity may have a severely adverse effect on the market value of Notes.

Exchange rate risks and exchange controls The Issuer will pay principal and interest on the Notes and make any payments in the Specified Currency. This presents certain risks relating to currency conversions if an investor’s financial activities are denominated principally in a currency or currency unit (the “Investor’s Currency”) other than the Specified Currency. These include the risk that exchange rates may significantly change (including changes due to devaluation of the Specified Currency or revaluation of the Investor’s Currency) and the risk that authorities with jurisdiction over the Investor’s Currency may impose or modify exchange controls. An appreciation in the value of the Investor’s Currency relative to the Specified Currency would decrease (1) the Investor’s Currency-equivalent yield on the Notes, (2) the Investor’s Currency-equivalent value of the principal payable on the Notes and (3) the Investor’s Currency-equivalent market value of the Notes.

Government and monetary authorities may impose (as some have done in the past) exchange controls that could adversely affect an applicable exchange rate. As a result, investors may receive less interest or principal than expected, or no interest or principal.

Interest rate risks Investment in Fixed Rate Notes involves the risk that subsequent changes in market interest rates may adversely affect the value of the Fixed Rate Notes.

Credit ratings may not reflect all risks One or more independent credit rating agencies may assign credit ratings to the Notes. The ratings may not reflect the potential impact of all risks related to structure, market, additional factors discussed above, and other factors that may affect the value of the Notes. A credit rating is not a recommendation to buy, sell or hold securities and may be revised or withdrawn by the rating agency at any time.

Legal investment considerations may restrict certain investments The investment activities of certain investors are subject to legal investment laws and regulations, or review or regulation by certain authorities. Each potential investor should consult its legal advisers to determine

12 whether and to what extent (1) Notes are legal investments for it, (2) Notes can be used as collateral for various types of borrowing and (3) other restrictions apply to its purchase or pledge of any Notes. Financial institutions should consult their legal advisors or the appropriate regulators to determine the appropriate treatment of Notes under any applicable risk-based capital or similar rules.

Risks related to the Issuer’s Business The Issuer’s involvement in the processing of food and food ingredients results in a significant risk that Cargill or its subsidiaries will be subject to product liability claims resulting from the production and sale of same. From time to time, Cargill or its subsidiaries will be held liable or incur costs to settle or defend claims if Cargill or its subsidiaries cause, or are claimed to cause, injury. These risks exist even with respect to food products that have received, or in the future may receive, regulatory approval or clearance for consumer use. Cargill cannot guarantee that it or its subsidiaries will be able to avoid product liability exposure. Although the Company currently maintains product liability insurance at levels that it believes are sufficient and consistent for companies in its industry and of its size, Cargill cannot guarantee that our product liability insurance is adequate. A product liability claim or product recall could result in liability to Cargill in a greater amount than is covered by Cargill’s insurance coverage.

13 GENERAL DESCRIPTION OF THE PROGRAM

Under the Program, the Issuer may from time to time issue the Notes denominated in any currency agreed by the Issuer and the relevant Dealer(s) having maturities of one month or longer (or such other minimum or maximum maturity as may be allowed or required from time to time by the relevant central bank (or equivalent body) or any laws or regulations applicable to the relevant currency). The Issuer may issue Notes (i) that bear interest at fixed rates or floating rates or no interest at all, and (ii) whose Specified Amounts (as defined above) are linked to the level of an index, portfolio or formula based on one or more currencies, equity or debt securities or commodities, or the credit of one or more specified entities or any combination thereof. A summary of the terms and conditions of the Program and the Notes appears on pages 5 to 8. The applicable terms of any Notes will be agreed between the Issuer and the relevant Dealer(s) prior to the issue of the Notes and will be set out in the Terms and Conditions of the Notes attached to, incorporated by reference into, or endorsed on the Notes, as modified and supplemented by the applicable Final Terms attached to, or endorsed on, such Notes.

Subject as set out herein, this Base Prospectus and any supplement hereto may only be used for listing Notes on the market of the Luxembourg Stock Exchange appearing on the list of regulated markets issued by the European Commission and/or obtaining the listing and/or admission to trading of Notes on or by any other relevant stock exchange and/or market in an aggregate principal amount which, when added to the aggregate principal amount then outstanding of all Notes previously or simultaneously issued under this Program (including unlisted Notes), does not exceed U.S.$2,000,000,000 or its equivalent in other currencies.

The aggregate principal amount of Notes outstanding at any time under the Program is subject to, and will be limited by, the then existing grant of authority by the Board of Directors of the Issuer. The grant of authority existing from time to time may permit the Issuer to issue and have outstanding more or less than U.S.$2,000,000,000 aggregate principal amount of Notes. This Base Prospectus will be amended or supplemented to indicate any such increase which may result in Notes outstanding in an aggregate principal amount in excess of U.S.$2,000,000,000.

14 FORM OF FINAL TERMS

The Final Terms relating to each Tranche of Notes will contain, inter alia, such of the following information as is applicable in respect of such Notes (all references to numbered Conditions being to the Terms and Conditions of the relevant Notes).

FINAL TERMS

[Date]

Cargill, Incorporated Issue of [Aggregate Nominal Amount of Tranche] [Title of Notes] under the U.S. $2,000,000,000 Euro Medium Term Note Program

PART A—CONTRACTUAL TERMS

Terms used herein shall be deemed to be defined as such for the purposes of the terms and conditions (the “Conditions”) set forth in the Base Prospectus dated February 9, 2006 which constitutes a base prospectus for the purposes of the Prospectus Directive (Directive 2003/71/EC) (the “Prospectus Directive”). This document constitutes the Final Terms of the Notes described herein for the purposes of Article 5.4 of the Prospectus Directive and must be read in conjunction with the Base Prospectus. Full information on the Issuer and the offer of Notes is only available on the basis of the combination of these Final Terms and the Base Prospectus. The Base Prospectus is available for viewing at, and copies may be obtained from the specified office of the Paying Agent. The Prospectus and (in the case of Notes listed and admitted to trading on the regulated market of the Luxembourg Stock Exchange) the applicable Final Terms will also be published on the website of the Luxembourg Stock Exchange at www.bourse.lu.

The following alternative language applies if the first tranche of an issue which is being increased was issued under a Base Prospectus with an earlier date. Terms used herein shall be deemed to be defined as such for the purposes of the terms and conditions (the “Conditions”) set forth in the Base Prospectus dated February 9, 2006. This document contains the Final Terms of the Notes described herein for the purposes of Article 5.4 of the Prospectus Directive (Directive 2003/71/ EC) (the “Prospectus Directive”) and must be read in conjunction with the Base Prospectus dated [current date] which constitutes a base prospectus for the purposes of the Prospectus Directive, save in respect of the Conditions which are extracted from the Base Prospectus dated February 9, 2006 and are attached hereto.] Full information on the Issuer and the offer of Notes is only available on the basis of the combination of these Final Terms and the Base Prospectus. The Base Prospectus is available for viewing at, and copies may be obtained from, the specified office of the Paying Agent. The Prospectus and (in the case of Notes listed and admitted to trading on the regulated market of the Luxembourg Stock Exchange) the applicable Final Terms will also be published on the website of the Luxembourg Stock Exchange www.bourse.lu.

[Include whichever of the following apply or specify as “Not Applicable” (N/A). Note that the numbering should remain as set out below, even if “Not Applicable” is indicated for individual paragraphs or subparagraphs. Italics denote directions for completing the Final Terms.]

[Any Notes issued with a maturity of 183 days or less will be U.S.$500,000 or its equivalent in other currencies (determined by reference to the spot rate at the date of issuance).]

[If the Notes have a maturity of less than one year from the date of their issue, the minimum denomination must be £100,000 or its equivalent in any other currency.]

1. Issuer: Cargill, Incorporated

2. [(i)] Series Number: [ ]

[(ii) Tranche Number: [ ] (If fungible with an existing Series, details of that Series, including the date on which the Notes become fungible).]

15 3. Specified Currency or Currencies: [ ]

4. Aggregate Nominal Amount: [ ]

[(i)] Series: [ ]

[(ii) Tranche: [ ]]

5. [(i)] Issue Price: [ ] per cent. of the Aggregate Nominal Amount [plus accrued interest from [insert date](in the case of fungible issues only, if applicable)]

[(ii) Net proceeds: [ ] (Required only for listed issues)]

6. Specified Denominations: [ ] []

7. [(i)] Issue Date: [ ]

[(ii)] Interest Commencement Date (if different from the Issue Date) [ ]

8. Maturity Date: [Fixed Rate Notes specify date or for Floating Rate Notes specify the Interest Payment Date falling in or nearest to the relevant month and year]

9. Interest Basis: [ ] per cent. Fixed Rate [[specify reference rate] +/– [ ] per cent Floating Rate] [Zero Coupon] [Index Linked Interest] [Other (specify)] (further particulars specified below)

10. Redemption/Payment Basis: [Redemption at par] [Index Linked Redemption] [Dual Currency] [Partly Paid] [Instalment] [Other (specify)]

(NB: If the Final Redemption Amount is other than 100% of the nominal value the Notes will be derivative securities for the purposes of the Prospectus Directive and the requirements of Annex XII to the Prospectus Directive Regulation will apply.)

11. Change of Interest or Redemption/Payment [Specify details of any provision for convertibility of Notes Basis: into another interest or redemption/payment basis]

12. Put/Call Options: [Investor Put—Optional Early Redemption (Put)] (Condition 7(f)) [Investor Call—Optional Early Redemption (Call)] (Condition 7(c)) [(further particulars specified below)]

13. [(i)] Status of the Notes: [Senior/[Dated/Perpetual]/Subordinated]

16 [(ii)]Date [Board] approval for issuance of [ ] [and [ ], respectively]] (NB: Only relevant where Notes obtained: [ ]] Board (or similar) authorisation is required for the particular tranche of Notes)

14. Method of distribution: [Syndicated/Non-syndicated]

PROVISIONS RELATING TO INTEREST (IF ANY) PAYABLE

15. Fixed Rate Note Provisions [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) Rate[(s)] of Interest: [ ] per cent. per annum [payable [annually/semi-annually/ quarterly/monthly] in arrear] (if payable other than annually, consider amending Condition 6)

(ii) Interest Payment Date(s): [[ ] in each year up to and including the Maturity Date]/ [specify other] (NB: This will need to be amended in the case of long or short coupons)

(iii) Fixed Coupon Amount[(s)]: [ ] per [ ] in Nominal Amount

(iv) Broken Amount(s): [Insert particulars of any initial or final broken interest amounts which do not correspond with the Fixed Coupon Amount[(s)]]

(v) Day Count Fraction: [30/360 / Actual/Actual (ISMA/ISDA) / specify other] (NB: Actual/Actual (ISMA) is normally only appropriate for Fixed Rate Notes denominated in euros)

(vi) Determination Dates: [ ] in each year (insert regular interest payment dates, ignoring issue date or maturity date in the case of a long or short first or last coupon. N.B. only relevant where Day Count Fraction is Actual/Actual (ISMA))

(vii) Other terms relating to the method of [Not Applicable/give details] calculating interest for Fixed Rate Notes:

16. Floating Rate Note Provisions [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph.)

(i) Specified Period(s)/Specified Interest [] Payment Dates:

(ii) Business Day Convention: [Floating Rate Convention/ Following Business Day Convention/Modified Following Business Day Convention/ Preceding Business Day Convention/other [specify others]]

(iii) Additional Business Centre(s): [ ]

(iv) Manner in which the Rate(s) of Interest [Screen Rate Determination/ISDA Determination/other is/are to be determined: [specify others]]

17 (v) Party responsible for calculating the [] Rate(s) of Interest and Interest Amount(s) (if not the [Agent]):

(vi) Screen Rate Determination:

— Reference Rate: [ ] (Either LIBOR, EURIBOR or other, although additional information is required if other)

— Interest Determination Date(s): [ ] (Second London business day prior to the start of each Interest Period if LIBOR (other than sterling or euro LIBOR), first day of each Interest Period if sterling LIBOR and the second day on which the TARGET System is open prior to the start of each Interest Period if EURIBOR or euro LIBOR)

— Relevant Screen Page: [ ] (In the case of EURIBOR, if not Telerate 248 ensure it is a page which shows a composite rate or amend the fallback provisions approximately)

(vii) ISDA Determination:

— Floating Rate Option: [ ]

— Designated Maturity: [ ]

— Reset Date: [ ]

(viii) Margin(s): [+/-][ ] per cent. per annum

(ix) Minimum Rate of Interest: [ ] per cent per. annum

(x) Maximum Rate of Interest: [ ] per cent per. annum

(xi) Day Count Fraction: [Actual/365 Actual/365 (Fixed) Actual/365 (Sterling) Actual/360 30/360 30E/360 Other (See Condition 6 for alternatives)]

(xii) Fall back provisions, rounding [] provisions, denominator and any other terms relating to the method of calculating interest on Floating Rate Notes, if different from those set out in the Conditions:

17. Zero Coupon Note Provisions [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) [Amortisation/Accrual] Yield: [ ] per cent per annum

18 (ii) Reference Price: [ ]

(iii) Any other formula/basis of determining [] amount payable: (Consider applicable day count fraction if euro denominated)

18. Index-Linked Interest Note Provisions [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) Index/Formula: [give or annex details]

(ii) Calculation Agent responsible for [] calculating the interest due:

(iii) Provisions for determining coupon [] where calculated by reference to Index and/or Formula:

(iv) Provisions for determining Coupon [] where calculation by reference to Index and/or Formula is impossible or impracticable:

(v) Interest calculation period(s): [ ]

(vi) Specified Period(s)/Specified Interest [] Payment Dates:

(vii) Business Day Convention: [Floating Rate Convention/Following Business Day Convention/Modified Following Business Day Convention/ Preceding Business Day Convention/other (give details)]

(viii) Additional Business Centre(s): [ ]

(ix) Minimum Rate of Interest: [ ] per cent. per annum

(x) Maximum Rate of Interest: [ ] per cent. per annum

(xi) Day Count Fraction: [ ]

19. Dual Currency Note Provisions [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) Rate of Exchange/method of [give details] calculating Rate of Exchange:

(ii) Calculation Agent, if any, responsible [] for calculating the principal and/or interest due:

(iii) Provisions applicable where calculation [need to include a description of market disruption or by reference to Rate of Exchange settlement disruption events and adjustment provisions] impossible or impracticable:

(iv) Person at whose option Specified [] Currency(ies) is/are payable:

19 PROVISIONS RELATING TO REDEMPTION

20. Call Option (Optional Early Redemption [Applicable/Not Applicable] (Call) Condition 7(c)): (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) Optional Redemption Date(s): [ ]

(ii) Optional Redemption Amount(s) of [ ] per Note of [ ] Specified Denomination each Note and method, if any, of calculation of such amount(s):

(iii) If redeemable in part:

(a) Minimum Redemption Amount: [ ]

(b) Maximum Redemption Amount: [ ]

(iv) Notice period [ ] (N.B. If setting notice periods which are different to those provided in the Terms and Conditions, the Issuer is advised to consider the practicalities of distribution of information through intermediaries, for example, clearing systems and custodians, as well as any other notice requirements which may apply, for example, as between the Issuer and the Agent.)

21. Put Option (Optional Early Redemption [Applicable/Not Applicable] (Put) Condition 7(f)): (If not applicable, delete the remaining sub-paragraphs of this paragraph)

(i) Optional Redemption Date(s): [ ]

(ii) Optional Redemption Amount(s) of [ ] per Note of [ ] Specified Denomination each Note and method, if any, of calculation of such amount(s):

(iii) Notice period [ ] (N.B. If setting notice periods which are different to those provided in the Terms and Conditions, the Issuer is advised to consider the practicalities of distribution of information through intermediaries, for example, clearing systems and custodians, as well as any other notice requirements which may apply, for example, as between the Issuer and the Agent.)

22. Final Redemption Amount [[per Note of [ ] Specified Denomination/specify other/see Appendix]] (NB: In relation to any issue of Notes which are expressed at paragraph 6 above to have a minimum denomination and tradeable amounts above such minimum denomination which are smaller than it the following wording should be added: “For the avoidance of doubt, in the case of a holding of Notes in an integral multiple of [ ] in excess of [ ] as envisaged in paragraph 6 above such holding will be redeemed at its nominal amount.”)

(i) Index/Formula/variable: [give or annex details]

20 (ii) Calculation Agent responsible for [] calculating the Final Redemption Amount:

(iii) Provisions for determining Final [] Redemption Amount where calculated by reference to Index and/or Formula and/or other variable:

(iv) Determination Date(s): [ ]

(v) Provisions for determining Final [] Redemption Amount where calculation by reference to Index and/or Formula and/or other variable is impossible or impracticable or otherwise disrupted:

(vi) Payment Date: [ ]

(vii) Minimum Final Redemption Amount: [ ]

(viii) Maximum Final Redemption Amount: [ ]

23. Early Redemption Amount

Early Redemption Amount(s) of each Note (NB: If the Final Redemption Amount is other than 100% of payable on redemption for taxation reasons the nominal value the Notes will be derivative securities for or on event of default or other early the purposes of the Prospectus Directive and the redemption and/or the method of calculating requirements of Annex XII to the Prospectus Directive the same (if required or if different from that Regulation will apply) set out in Condition 7(b)): GENERAL PROVISIONS APPLICABLE TO THE NOTES 24. Form of Notes: [Temporary Global Note exchangeable for a Permanent Global Note which is exchangeable for Definitive Notes [under Condition 1(a)(iv)(D) at the option of the bearer] [under Condition 1(a)(iv)(A), (B) or (C) at the option of the Holder]

[Temporary Global Note exchangeable for Definitive Notes on and after the Exchange Date]

[other]

25. Additional Financial Centre(s) or other [Not Applicable/give details.] special provisions relating to Payment (Note that this item relates to the date and place of payment, Dates: and not interest period end dates, to which items 16(ii), 17(iii) and 19(vi) relates)

26. Talons for future Coupons or Receipts to be [Yes/No. If yes, give details] attached to Definitive Notes (and dates on which such Talons mature):

27. Details relating to Partly Paid Notes: amount [Not Applicable/give details](N.B. A new form of of each payment comprising the Issue Price Temporary Global Note and/or Permanent Global Note may and date on which each payment is to be made be required for Partly Paid issues). and consequences (if any) of failure to pay, including any right of the Issuer to forfeit the Notes and interest due on late payment:

21 28. Details relating to Instalment Notes: amount [Not Applicable/give details] of each instalment, date on which each payment is to be made:

29. Redenomination, renominalisation and [Not Applicable/The provisions [in Condition Š] [annexed to reconventioning provisions: these Final Terms] apply]

30. Consolidation provisions: [Not Applicable/The provisions [in Condition Š] [annexed to these Final Terms] apply]

31. Other Final Terms or special conditions: [Not Applicable/give details]

DISTRIBUTION

32. (i) If syndicated, names of Managers: [Not Applicable/give names]

(ii) Stabilising Managers (if any): [Not Applicable/give name]

33. If non-syndicated, name of Dealer: [Not Applicable/give name]

34. Additional selling restrictions: [Not Applicable/give details]

22 LISTING AND ADMISSION TO TRADING APPLICATION

These Final Terms comprise the final terms required to list and have admitted to trading the issue of Notes described herein pursuant to the US$2,000,000,000 Euro Medium Term Note Program of Cargill, Incorporated.

RESPONSIBILITY

The Issuer accepts responsibility for the information contained in these Final Terms. [[ ] has been extracted from [ ]. The Issuer confirms that such information has been accurately reproduced and that, so far as it is aware and is able to ascertain from information published by [ ], no facts have been omitted which would render the reproduced information inaccurate or misleading].

Signed on behalf of the Issuer:

By: Duly authorised

23 PART B—OTHER INFORMATION

1. LISTING

(i) Listing: [Luxembourg Stock Exchange/other (specify)/ None]

(ii) Admission to trading: [Application has been made for the Notes to be admitted to trading on [ ] with effect from [ ].] [Not Applicable.]

(iii) Estimate of total expenses related to [] admission to trading:

2. RATINGS

Ratings The Notes to be issued have been rated:

[S&P: [ ]] [Moody’s: [ ]] [[Other]: [ ]]

(The above disclosure should reflect the rating allocated to Notes of the type being issued under the Program generally or, where the issue has been specifically rated, that rating.)

[3. NOTIFICATION

The [name of competent authority in EEA home Member State] [has been requested to provide/has provided—include first alternative for an issue which is contemporaneous with the establishment or update of the Program and the second alternative for subsequent Issues]the[names of competent authorities of host Member States] with a certificate of approval attesting that the Prospectus has been drawn up in accordance with the Prospectus Directive.]

4. INTERESTS OF NATURAL AND LEGAL PERSONS INVOLVED IN THE ISSUE

[Save for any fees payable to the Dealers, so far as the Issuer is aware, no person involved in the issue of the Notes has an interest material to the offer. —Amend as appropriate if there are other interests]

5. REASONS FOR THE OFFER, ESTIMATED NET PROCEEDS AND TOTAL EXPENSES

[(i) Reasons for the offer: [ ]

[(ii)] Estimated net proceeds: [ ]

[(iii)] Estimated total expenses: [ ]

(If the Notes are derivative securities to which Annex XII of the Prospectus Directive Regulation applies (i) above is required where the reasons for the offer are different from making profit and/or hedging certain risks regardless of the minimum denomination of’ the securities and where this is the core disclosure of net proceeds and total expenses at (ii) and (iii) above are also required)

24 6. YIELD (Fixed Rate Notes only)

Indication of yield: [ ]

The yield is calculated at the Issue Date on the basis of the Issue Price. It is not an indication of future yield.

7. PERFORMANCE OF INDEX/FORMULA, EXPLANATION OF EFFECT ON VALUE OF INVESTMENT AND ASSOCIATED RISKS AND OTHER INFORMATION CONCERNING THE UNDERLYING (Index-Linked Notes only)

[Need to include details of where past and future performance and volatility of the index/formula can be obtained.]

[Need to include a description of any market disruption or settlement disruption events that affect the underlying.]

[Need to include adjustment rules in relation to events covering the underlying.]

[Where the underlying is a security the name of the issuer of the security and its ISIN or other such security identification code.]

[Where the underlying is an index need to include the name of the index and a description if composed by the Issuer and if the index is not composed by the Issuer need to include details of where the information about the index can be obtained. Where the underlying is not an index need to include equivalent information.]

[Where the underlying is an interest rate a description of the interest rate.]

[Where the underlying is a basket of underlyings, disclosure of the relevant weightings of each underlying in the basket.]

8. PERFORMANCE OF RATE [S] OF EXCHANGE AND EXPLANATION OF EFFECT ON VALUE OF INVESTMENT (Dual Currency Notes only)

[Need to include details of where past and future performance and volatility of the relevant rates can be obtained.]

9. OPERATIONAL INFORMATION

(i) ISIN Code: [ ]

(ii) Common Code: [ ]

(iii) Any clearing system(s) other than [Not Applicable/give name(s) and number(s)] Euroclear Bank S.A./N.V. and Clearstream Banking, société anonyme and the relevant identification number(s):

(iv) Delivery: Delivery [against/free of] payment

(v) Names and addresses of additional [] Paying Agent(s) (if any):

(vi) Governing Law: New York

(vii) Additional Investment Considerations: [Applicable. See Annex/Not Applicable]

25 TERMS AND CONDITIONS OF THE NOTES

The following are the Terms and Conditions of the Notes which (subject to completion and amendment) will be applicable to each Series of Notes, provided that the relevant Final Terms in relation to any Notes may specify other Terms and Conditions which shall, to the extent so specified or to the extent inconsistent with these Terms and Conditions, replace the following Terms and Conditions for the purposes of such Notes.

The Notes are issued pursuant to and in accordance with a second amended and restated issue and paying agency agreement dated February 9, 2006 (as supplemented and/or modified and/or restated from time to time) (the “Issue and Paying Agency Agreement”) among Cargill, Incorporated, Citibank, N.A., in its capacity as fiscal agent and principal paying agent (the “Fiscal Agent”, which expression shall include any successor thereto) and the other paying agents named therein (the “Paying Agents”, which expression shall include the Fiscal Agent and any substitute or additional paying agents appointed in accordance with the Issue and Paying Agency Agreement, including a paying agent in Luxembourg which will be appointed at or prior to the issuance of any Tranche of Notes which is listed on the Luxembourg Stock Exchange). Copies of the Issue and Paying Agency Agreement are available for inspection during normal business hours at the specified office of each of the Paying Agents. All persons from time to time entitled to the benefit of obligations under any Notes shall be deemed to have notice of, and shall be bound by, all of the provisions of the Issue and Paying Agency Agreement insofar as they relate to the relevant Notes.

The Notes are issued in series (each, a “Series”) and each Series may comprise one or more tranches (“Tranches” and each, a “Tranche”) of Notes. Each Tranche will be the subject of a Final Terms (each, a “Final Terms”), a copy of which will be available during normal business hours at the specified office of each of the Paying Agents. In the case of a Tranche of Notes in relation to which application has not been made for listing on any stock exchange, copies of the Final Terms will only be available for inspection by a Holder (as defined in Condition 2(a)) of such Notes.

References in these Terms and Conditions to the “Notes” are to the Notes of the relevant Series only and not to the Notes of any other Series and any references to Coupons (as defined in Condition 1(a)(v)) and Receipts (as defined in Condition 1(a)(vi)) are to Coupons and Receipts relating to the Notes. For the purposes of these Terms and Conditions, references to “Notes” shall, as the context may require, be deemed to be Temporary Global Notes, Permanent Global Notes or, as the case may be, Definitive Notes (each as defined in Condition 1(a)).

References in these Terms and Conditions to the Final Terms are to the Final Terms prepared in relation to the Notes of the relevant Tranche or Series. Words and expressions used in the Final Terms shall have the same meanings given thereto in these Terms and Conditions unless the context otherwise requires or unless otherwise stated.

In respect of any Notes, references herein to these Terms and Conditions are to these terms and conditions as supplemented or modified or (to the extent thereof) replaced by the Final Terms.

1. Form and Denomination (a) Notes The Notes are issued only in bearer form and are serially numbered. (i) Each Tranche of Notes is represented upon issue by a temporary global Note (a “Temporary Global Note”).

Interests in the Temporary Global Note may be exchanged for: (A) interests in a permanent global Note (a “Permanent Global Note”); or (B) if so specified in the Final Terms, definitive Notes in bearer form (“Definitive Notes”).

Exchanges of interests in a Temporary Global Note for a Permanent Global Note or, as the case may be, Definitive Notes will be made only on or after the date (the “Exchange Date”) which is forty days after the completion of the distribution of the Notes of the relevant Tranche and, in the case of Notes with maturities of over 183 days, provided certification has been received as to the beneficial ownership thereof as required by U.S. Treasury regulations (in substantially the form set out in the Temporary Global Note or in such other form as is customarily issued in such circumstances by the relevant clearing system).

26 (ii) The bearer of any Temporary Global Note shall not (unless, upon due presentation of such Temporary Global Note for exchange (in whole or in part) for a Permanent Global Note or for delivery of Definitive Notes, such exchange or delivery is improperly withheld or refused and such withholding or refusal is continuing at the relevant payment date) be entitled to receive any payment in respect of the Note represented by such Temporary Global Note which falls due on or after the Exchange Date or be entitled to exercise any option on a date after the Exchange Date. (iii) Subject to Condition 1(a)(ii), any date on which a payment of interest is due on the Notes of a Tranche occurs whilst any of the Notes of that Tranche are represented by a Temporary Global Note, the related interest payment will be made on the Temporary Global Note only to the extent that, in the case of Notes with maturities of over 183 days, certification as to the beneficial ownership thereof as required by U.S. Treasury regulations (in substantially the form set out in the Temporary Global Note or in such other form as is customarily issued in such circumstances by the relevant clearing system) has been received by Euroclear Bank, S.A./N.V., as operator of the Euroclear System (“Euroclear”) or Clearstream Banking, société anonyme (“Clearstream, Luxembourg”) or any other relevant clearing system. Payments of amounts due in respect of a Permanent Global Note will be made through Euroclear or Clearstream, Luxembourg or any other relevant clearing system without any requirement for certification. (iv) Interests in a Permanent Global Note will be exchanged by the Issuer in whole but not in part only at the option of the Holder of such Permanent Global Note (and, in the case of paragraph (C), at the option of the Issuer) for Definitive Notes: (A) if an Event of Default (as defined in Condition 8) occurs and is continuing; or (B) if either Euroclear or Clearstream, Luxembourg or any other relevant clearing system is closed for business for a continuous period of fourteen days (other than by reason of public holidays) or announces an intention to cease business permanently or in fact does so; or (C) the Issuer or any Paying Agent has or will become obliged to pay Additional Amounts as provided or referred to in Condition 9 which would not be required were the Notes represented by the Permanent Global Note to be in definitive form; or (D) if so specified in the Final Terms, at the option of the Holder of such Permanent Global Note upon such Holder’s request, in all cases free of charge to the Holder. In order for the Holder to exercise the option contained in paragraph (A), (B) or (D) above, the Holder must, not less than fifteen days in the case of paragraph (A) or (B) or forty-five days in the case of paragraph (D), before the date upon which the delivery of such Definitive Notes is required, give notice to the Fiscal Agent at its specified office. In order for the Issuer to exercise the option contained in paragraph (C) above, the Issuer must give not less than fifteen days notice to the Holder. (v) Interest-bearing Definitive Notes have attached thereto at the time of their initial delivery coupons (“Coupons”), presentation of which will be a prerequisite to the payment of interest save in certain circumstances specified herein. Interest-bearing Definitive Notes, if so specified in the Final Terms, have attached thereto at the time of their initial delivery, a talon (“Talon”) for further coupons and the expression “Coupons” shall, where the context so requires, include Talons. (vi) Notes, the principal amount of which is repayable by installments (“Installment Notes”) which are Definitive Notes, have endorsed thereon a grid for recording the repayment of principal or, if so specified in the Final Terms, have attached thereto at the time of their initial delivery, payment receipts (“Receipts”) in respect of the installments of principal.

(b) Denomination Notes are in the denomination or denominations specified in the Final Terms (save that the minimum denomination of any Notes admitted to trading on a European Economic Area exchange or offered to the public in a Member State of the European Economic Area in circumstances which require the publication of a prospectus under the Prospectus Directive will be €50,000 (or, if the Notes are denominated in a currency other than euro, the equivalent amount in such currency) or such other higher amount. The minimum denomination of any Notes issued with a maturity of 183 days or less will be U.S.$500,000 or its approximate equivalent in other currencies determined by reference to the spot rate as at the date of issuance). Notes of one denomination may not be exchanged for Notes of any other denomination.

27 (c) Currency of Notes Subject to any legal or regulatory restrictions and/or central bank requirements, the Notes are denominated and/or payable in such currency as may be specified in the Final Terms (including, without limitation, Euro, Japanese Yen and United States dollars).

(d) Partly Paid Notes Notes may be issued on a partly paid basis (“Partly Paid Notes”) if so specified in the Final Terms. The subscription moneys therefor shall be paid in such number of installments (“Partly Paid Installments”), in such amounts, on such dates and in such manner as may be specified in the Final Terms. The first such installment shall be due and payable on the date of issue of the Notes. For the purposes of these Terms and Conditions, in respect of any Partly Paid Note, “Paid Up Amount” means the aggregate amount of all Partly Paid Installments in respect thereof as shall have fallen due and been paid up in full in accordance with the Terms and Conditions.

Not less than 14 days nor more than 30 days prior to the due date for payment of any Partly Paid Installment (other than the first such Installment) the Issuer shall publish a notice in accordance with Condition 15 stating the due date for payment thereof and stating that failure to pay any such Partly Paid Installment on or prior to such date will entitle the Issuer to forfeit the Notes with effect from such date (“Forfeiture Date”) as may be specified in such notice (not being less than 14 days after the due date for payment of such Partly Paid Note), unless payment of the relevant Partly Paid Installment together with any interest accrued thereon is paid prior to the Forfeiture Date. The Issuer shall ensure that any Partly Paid Installments paid in respect of any Notes subsequent to the Forfeiture Date in respect thereof shall be returned promptly to the persons entitled thereto. The Issuer shall not be liable for any interest on any Partly Paid Installment so returned.

Interest shall accrue on any Partly Paid Installment which is not paid on or prior to the due date for payment thereof at the Interest Rate (in the case of non-interest bearing Notes, at the rate applicable to overdue payments) and shall be calculated in the same manner and on the same basis as if it were interest accruing on the Notes for the period from and including the due date for payment of the relevant Partly Paid Installment up to but excluding the Forfeiture Date. For the purpose of the accrual of interest, any payment of any Partly Paid Installment made after the due date for payment shall be treated as having been made on the day preceding the Forfeiture Date (whether or not a Business Day as defined in Condition 6(i)).

Unless an Event of Default (or an event which with the giving of notice, the lapse of time or the making or giving of any determination or certification would constitute an Event of Default) shall have occurred and be continuing, on the Forfeiture Date, the Issuer shall forfeit all of the Notes in respect of which any Partly Paid Installment shall not have been duly paid, whereupon the Issuer shall be entitled to retain all Partly Paid Installments previously paid in respect of such Notes and shall be discharged from any obligation to repay such amount or to pay interest thereon, or (where such Notes are represented by a Temporary Global Note or a Permanent Global Note) to exchange any interests in such Note for interests in a Permanent Global Note or to deliver Definitive Notes in respect thereof.

In respect of any Partly Paid Note, until such time as all the subscription moneys in respect of such Partly Paid Note shall have been paid in full and except in the case where an Event of Default shall have occurred and be continuing or if any of Euroclear or Clearstream, Luxembourg or any other relevant clearing system is closed for business for a continuous period of 14 days (other than by reason of public holidays) or announces an intention to cease business permanently or in fact does so, such Partly Paid Note, if represented by an interest in a Temporary Global Note or a Permanent Global Note, may not be exchanged for, in the case of an interest represented by a Temporary Global Note, an interest in a Permanent Global Note or for Definitive Notes or, in the case of an interest represented by a Permanent Global Note, for Definitive Notes.

2. Title and Transfer (a) Transfer of Title Title to the Notes, Receipts and Coupons passes by delivery. Subject as provided below, references herein to the “Holders” of Notes or of Receipts or Coupons are to the bearers of the Notes or such Receipts or Coupons. For so long as any of the Notes is represented by a Temporary Global Note and/or a Permanent Global Note held on behalf of Euroclear and/or Clearstream, Luxembourg, each person (other than Euroclear or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear or of Clearstream, Luxembourg as the holder of a particular nominal amount of Notes (each an “Accountholder”) (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the nominal amount of such Notes

28 standing to the account of any person shall be conclusive and binding for all purposes save in the case of manifest error) shall be treated by the Issuer, the Fiscal Agent and any other Paying Agent as the holder of such nominal amount of such Notes for all purposes other than, save as specifically otherwise provided in the relevant Temporary Global Note and/or Permanent Global Note, with respect to the payment of principal or interest on the Notes, for which purpose the bearer of the relevant Temporary Global Note and/or Permanent Global Note shall be treated by the Issuer, the Fiscal Agent and any Paying Agent as the Holder of such nominal amount of such Notes in accordance with and subject to the terms of the Temporary Global Note and/or a Permanent Global Note (and the expression “Holder” and related expressions shall be construed accordingly). Notes which are represented by a Temporary Global Note and/or a Permanent Global Note will be transferable only in accordance with the then current rules and procedures of Euroclear or of Clearstream, Luxembourg, as the case may be.

References to Euroclear and/or Clearstream, Luxembourg shall, whenever the context so permits, be deemed to include a reference to any additional or alternative clearing system approved by the Issuer and the Fiscal Agent.

(b) Title to Notes The Holder of any Note, Coupon or Receipt will (except as otherwise required by applicable law or regulatory requirement) be treated as its absolute owner for all purposes (whether or not it is overdue and regardless of any notice of ownership, trust or any interest thereof or therein, any writing thereon, or any theft or loss thereof) and no person shall be liable for so treating such Holder.

3. Status of Obligations Status of the Notes The Notes are direct, unsecured (subject to Condition 4(d)) and senior obligations of the Issuer ranking pari passu without any preference among themselves and at least pari passu with all other present and future unsecured and senior general obligations of such Issuer but in the event of insolvency only to the extent permitted by applicable laws relating to creditors’ rights.

4. Covenants (a) Definitions As used herein: “Attributable Debt” means, as to any particular Sale and Leaseback Transaction, at the time of determination, the present value (discounted at the rate per annum of 10%, compounded semi-annually) of the obligation of the lessee of the property subject to such Sale and Leaseback Transaction for rental payments under the remaining term of the lease included in such transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended or until the earliest date on which the lessee may terminate such lease upon payment of a penalty (in which case the rental payments shall include such penalty), after excluding all amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water, utilities and similar charges. Notwithstanding the foregoing, there shall not be deemed to be any “Attributable Debt” in respect of a Sale and Leaseback Transaction if such transaction is excluded from the provisions of Condition 4(c) by virtue of clause (ii) thereof.

“Consolidated Net Tangible Assets” means as of the date of any determination thereof the aggregate amount of all assets (less depreciation, valuation and other reserves and items deductible therefrom under generally accepted accounting principles) after deducting therefrom (a) all goodwill, patents, trademarks and other like intangibles and (b) all current liabilities (excluding any thereof which are by their terms extendible or renewable at the option of the obligor for a time more than twelve months after the time as of which the amount thereof is being computed), all as set forth on the most recent quarterly consolidated balance sheet of Cargill, Inc. and its consolidated Subsidiaries and computed in accordance with United States generally accepted accounting principles.

“Debt” means any obligation for borrowed money.

“Funded Debt” means (a) all Debt of Cargill, Inc. or any consolidated Subsidiary (excluding Debt that is payable on demand, non-recourse Debt, or Debt that is an intercompany borrowing), having a final maturity of more than twelve months from the date as of which the amount thereof is to be determined or having a final

29 maturity of less than twelve months but by its terms is renewable or extendible beyond twelve months from such date at the option of the obligor, computed in accordance with generally accepted accounting principles, and there shall not be included any principal amount of Debt having such a final maturity required to be redeemed within twelve months from the date as of which the amount thereof is to be determined pursuant to any sinking fund provisions or otherwise, (b) any guaranty by Cargill, Inc. or any consolidated Subsidiary of Funded Debt of the kind described in the preceding clause, and (c) the total amounts required to be capitalized by Cargill, Inc. or any consolidated Subsidiary under any leases which are not non-recourse.

“Lien” means any mortgage, security interest, pledge, lien or other encumbrance.

“Person” means an individual, a corporation, a partnership, a joint venture, a trust, an unincorporated organization or a government or any agency or political subdivision thereof.

“Principal Property” means any building, structure or other facility (which for purposes of this definition shall not include barges, railroad cars or other transportation equipment, vehicles or vessels), together with the land upon which it is erected and fixtures comprising a part thereof, used primarily for manufacturing, processing, or warehousing in the United States of America or Canada, owned or leased (under capital lease) by Cargill, Inc. or any Restricted Subsidiary, the gross book value (without deduction of any depreciation reserves) of which on the date as of which the determination is being made exceeds 1% of Consolidated Net Tangible Assets, other than any such building, structure to other facility or portion thereof or any such land or fixture (a) which is financed by outstanding obligations issued by a state, a territory or a possession of the United States of America, or any political subdivision of any of the foregoing, or the District of Columbia, or (b) which, in the reasonable opinion of the applicable Board of Directors, is not of material importance to the total business conducted by the Issuer and its Restricted Subsidiaries as an entirety.

“Restricted Subsidiary” means Cargill Americas, Inc., Cargill Juice North America, Inc., Cargill Limited, Cargill Canada Ltd., Mighty Peace Shipping & Transportation Ltd., National Grain & Feeds Limited, Cargill Marine and Terminal, Inc., Leslie Production Company, Sunny Fresh Foods, Inc. and any other Subsidiary of Cargill, Inc. (a) which is organized under the laws of any state of the United States of America, Canada or any Province of Canada, (b) which conducts the major portion of its business in the United States of America or Canada, (c) which is not engaged in banking, leasing, insurance or finance business, and (d) which is designated as a Restricted Subsidiary with respect to the Notes by the Board of Directors of Cargill, Inc.

“Sale and Leaseback Transaction” has the meaning specified under Condition 4(c) below; and

“Subsidiary” means any corporation a majority of the voting stock of every class of which shall, at the time as of which any determination is made, be owned by Cargill, Inc. either directly or through Subsidiaries, or through voting trusts.

(b) Restrictions on Secured Debt Except as provided under Condition 4(d) below, Cargill, Inc. will not, and will not permit any Restricted Subsidiary to, incur, issue, assume, guarantee or otherwise become liable in respect of any Debt secured by a Lien upon any of its Principal Property or any Restricted Subsidiary, whether now owned or hereafter acquired, unless after giving effect thereto, the aggregate amount of all Debt secured by such Liens then outstanding on Principal Property plus all Attributable Debt of Cargill, Inc. and its Restricted Subsidiaries in respect of Sale and Leaseback Transactions involving Principal Property would not exceed 5% of Consolidated Net Tangible Assets; provided, however, that the following are specifically excepted from the foregoing limitations on Liens and any computations with respect thereto: (i) Liens existing on any property of any corporation at the time it becomes a Restricted Subsidiary, Liens existing on any property acquired by Cargill, Inc. or any Restricted Subsidiary, whether or not assumed by Cargill, Inc. or such Restricted Subsidiary, or Liens placed upon property being acquired or constructed by Cargill, Inc. or any Restricted Subsidiary to secure all or any portion of the purchase price or construction cost thereof and incurred within nine months of such acquisition or construction; (ii) Liens on property or assets of a Restricted Subsidiary to secure obligations of such Restricted Subsidiary to Cargill, Inc. or another Restricted Subsidiary; (iii) Liens in favor of the United States of America or any state or any agency, department or other instrumentality thereof, to secure progress, advance or other payments pursuant to any contract or provision of any statute; and

30 (iv) any Lien renewing, extending or refunding, in whole or in part, any Liens permitted under clauses (i) through (iii) above, provided that the principal amount then secured is not increased and the Lien is not extended to other property.

(c) Restrictions on Sales and Leasebacks Cargill, Inc. will not and will not permit any Restricted Subsidiary to enter into any arrangement with any Person (not including arrangements between Cargill, Inc. and a Restricted Subsidiary or between Restricted Subsidiaries) providing for the sale and leasing back by Cargill, Inc. or any Restricted Subsidiary for a period, including renewal, in excess of three years of any Principal Property which has been owned or operated for more than nine months after the acquisition thereof or the completion of construction and commencement of full operation thereof by Cargill, Inc. or any Restricted Subsidiary (a “Sale and Leaseback Transaction”) involving any Principal Property, unless either: (i) Cargill, Inc. or such Restricted Subsidiary would be entitled pursuant to the provisions of Condition 4(b) above to incur Debt secured by Liens on the Principal Property to be leased back in an amount equal to Attributable Debt with respect to such Sale and Leaseback Transaction: or (ii) Cargill, Inc., within 120 days after the sale or transfer shall have been made by Cargill, Inc. or by any such Restricted Subsidiary, applies an amount equal to the fair market value of the Principal Property so sold and leased back at the time of entering into such arrangements (as reasonably determined in good faith by Cargill, Inc.) to the optional prepayment of Funded Debt (other than Funded Debt owed to Subsidiaries).

(d) Covenant to Secure Securities If Cargill, Inc. or any Restricted Subsidiary shall, without the approval by Extraordinary Resolution (as defined in the Agency Agreement) of the Holders of the Notes at the time outstanding, incur, issue, guarantee or assume or otherwise become liable in respect of any Debt secured by any Lien upon any of its Principal Properties now owned or hereafter acquired, which is in violation of the provisions of Condition 4(b) above, it will make or cause to be made effective provisions whereby the Notes will be validly secured by such Lien equally and rateably with any other Debt thereby secured.

5. Consolidation, Merger or Sale of Assets Cargill, Inc. may without the consent of the Holders consolidate or merge with or into any other corporation and may convey, transfer or lease its property as an entirety or substantially as an entirety to any corporation, provided that (i) the corporation (if other than Cargill, Inc.) formed by or resulting from any such consolidation or merger or which shall have received such property shall be a corporation organized and existing under the laws of the United States of America, any state thereof or the District of Columbia and shall expressly assume by supplemental agreement the due and punctual payment of the principal of, and premium, if any, and interest, if any, on, the Notes issued by Cargill, Inc. and the performance and observance of each agreement or covenant to be performed or observed by Cargill, Inc. under the Notes, the Issue and Paying Agency Agreement, and (ii) immediately after giving effect to such transaction, no Event of Default and no event which, after notice or lapse of time or both, would become an Event of Default shall have occurred and be continuing. Cargill, Inc. shall be obligated to deliver to the Fiscal Agent an officers’ certificate and an opinion of counsel, each stating that all conditions precedent to such consolidation, merger, conveyance, transfer or lease have been satisfied.

The Issuer may consolidate or merge with or into any other corporation and may convey, transfer or lease its property as an entirety or substantially as an entirety to any corporation, provided that (i) the corporation (if other than the Issuer) formed by or resulting from any such consolidation or merger or which shall have received such property shall be a corporation organized and existing under the laws of the jurisdiction of the Issuer’s incorporation or the United States of America, any state thereof or the District of Columbia and shall expressly assume by supplemental agreement the due and punctual payment of the principal of, and premium, if any, and interest, if any, on, the Notes and the performance and observance of each agreement or covenant to be performed or observed by the Issuer under the Notes and the Issue and Paying Agency Agreement, and (ii) immediately after giving effect to such transaction, no Event of Default and no event which, after notice or lapse of time or both, would become an Event of Default shall have occurred and be continuing. The Issuer shall be obligated to deliver to the Fiscal Agent an officers’ certificate and an opinion of counsel, each stating that all conditions precedent to such consolidation, merger, conveyance, transfer or lease have been satisfied.

31 6. Interest In this Condition 6, “Business Day” means (unless otherwise provided in the applicable Final Terms) a day which is both: (A) a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in London and any Additional Business Centre specified in the applicable Final Terms; and (B) either (1) in relation to any sum payable in a Specified Currency other than euro, a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in the principal financial centre of the country of the relevant Specified Currency (if other than London and any Additional Business Centre and which if the Specified Currency is Australian dollars or New Zealand dollars shall be Sydney or Auckland, respectively) or (2) in relation to any sum payable in euro, a day on which Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System (the “Target System”) is open.

(a) Interest on Fixed Rate Notes (i) Each Fixed Rate Note bears interest on its principal amount (or, if it is a Partly Paid Note, the amount paid up) from (and including) the Interest Commencement Date specified in the applicable Final Terms at the rate(s) per annum equal to the Fixed Rate(s) of Interest specified in the applicable Final Terms payable on the Fixed Interest Date(s) in each year and on the Maturity Date so specified if it does not fall on a Fixed Interest Date. The first payment of interest shall be made on the Fixed Interest Date next following the Interest Commencement Date and, if the first anniversary of the Interest Commencement Date is not a Fixed Interest Date, will amount to the Initial Broken Amount specified in the applicable Final Terms. If the Maturity Date is not a Fixed Interest Date, interest from (and including) the preceding Fixed Interest Date (or the Interest Commencement Date, as the case may be) to (but excluding) the Maturity Date will amount to the Final Broken Amount specified in the applicable Final Terms. (ii) Interest shall be paid, with respect to Fixed Rate Notes in definitive form, against surrender of the appropriate Coupons, subject to and in accordance with the provisions of Condition 10. (iii) If interest is required to be calculated for a period of less than a full year, such interest shall be calculated by applying the Rate of Interest to each Specified Denomination, multiplying such sum by the applicable Fixed Day Count Fraction, and rounding the resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded upwards or otherwise in accordance with applicable market convention.

“Day Count Fraction” for Fixed Rate Notes means: (i) if “Actual/Actual (ISMA)” is specified in the applicable Final Terms: (a) in the case of Notes where the number of days in the relevant period from (and including) the most recent Interest Payment Date (or, if none, the Interest Commencement Date) to (but excluding) the relevant payment date (the “Accrual Period”) is equal to or shorter than the Determination Period during which the Accrual Period ends, the number of days in such Accrual Period divided by the product of (1) the number of days in such Determination Period and (2) the number of Determination Dates (as specified in the applicable Final Terms) that would occur in one calendar year; or (b) in the case of Notes where the Accrual Period is longer than the Determination Period during which the Accrual Period ends, the sum of: (1) the number of days in such Accrual Period falling in the Determination Period in which the Accrual Period begins divided by the product of (x) the number of days in such Determination Period and (y) the number of Determination Dates (as specified in the applicable Final Terms) that would occur in one calendar year; and (2) the number of days in such Accrual Period falling in the next Determination Period divided by the product of (x) the number of days in such Determination Period and (y) the number of Determination Dates that would occur in one calendar year; and (ii) if “30/360” is specified in the applicable Final Terms, the number of days in the period from (and including) the most recent Interest Payment Date (or, if none, the Interest Commencement Date) to (but excluding) the relevant payment date (such number of days being calculated on the basis of a year of 360 days with 12 30-day months) divided by 360.

32 In these Terms and Conditions: “Determination Period” means the period from (and including) a Determination Date to (but excluding) the next Determination Date; and

“sub-unit” means, with respect to any currency other than euro, the lowest amount of such currency that is available as legal tender in the country of such currency and, with respect to euro, means one cent.

(b) Interest on Floating Rate Notes (i) Interest Payment Dates Each Floating Rate Note bears interest on its principal amount (or, if it is a Partly Paid Note, the amount paid up) from (and including) the Interest Commencement Date specified in the applicable Final Terms and such interest will be payable on each interest payment date (each an “Interest Payment Date”) or, if no express Interest Payment Date(s) is/are specified in the applicable Final Terms, each date (an “Interest Payment Date”) which falls the number of months or other period specified as the Interest Period in the applicable Final Terms after the preceding Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date. If any Interest Payment Date (or other date) which is specified in the applicable Final Terms to be subject to adjustment in accordance with a business day convention would otherwise fall on a day which is not a Business Day, then, if the business day convention specified is: (1) in any case where Interest Periods are specified in accordance with Condition 6(b)(i) above, the Floating Rate Convention, such Interest Payment Date (or other date) shall be postponed to the next day which is a Business Day unless it would thereby fall into the next calendar month, in which event (A) such Interest Payment Date (or other date) shall be brought forward to the immediately preceding Business Day and (B) each subsequent Interest Payment Date (or other date) shall be the last Business Day in the month which falls the number of months or other period specified as the Interest Period in the applicable Final Terms after the preceding applicable Interest Payment Date (or other date) occurred; or (2) the Following Business Day Convention, such Interest Payment Date (or other date) shall be postponed to the next day which is a Business Day; or (3) the Modified Following Business Day Convention, such Interest Payment Date (or other date) shall be postponed to the next day which is a Business Day unless it would thereby fall into the next calendar month, in which event such Interest Payment Date (or other such date) shall be brought forward to the immediately preceding Business Day; or (4) the Preceding Business Day Convention, such Interest Payment Date (or other date) shall be brought forward to the immediately preceding Business Day.

(ii) Interest payments Interest will be paid, with respect to Floating Rate Notes in definitive form, against surrender of the appropriate Coupons, subject to and in accordance with the provisions of Condition 10.

(iii) Rate of Interest The Rate of Interest payable from time to time with respect to each Series of Floating Rate Notes shall be determined in the manner specified in the applicable Final Terms: (A) If the applicable Final Terms specifies that this Condition 6(b)(iii)(A) shall apply, the Rate of Interest shall be calculated on such dates and in such amounts as would have been calculated (regardless of any event of default or termination event thereunder) by the Issuer if it had entered into an interest rate swap transaction governed by an agreement in the form of the Interest Rate and Currency Exchange Agreement published by the International Swaps and Derivatives Association, Inc. (the “ISDA Agreement”) and evidenced by a Confirmation (as defined in the ISDA Definitions) incorporating the 2000 ISDA Definitions (as amended and updated as at the issue date of the first Tranche of the Notes and as published by the International Swaps and Derivatives Association, Inc.) (the “ISDA Definitions”) under which: (1) the basis of calculation was the Floating Rate Option; (2) the Issuer was the Floating Rate Payer;

33 (3) the Fiscal Agent was the Calculation Agent or as otherwise specified in the applicable Final Terms; (4) the Interest Commencement Date was the Effective Date; (5) the aggregate principal amount of the Series was the Notional Amount; (6) the Designated Maturity was the period specified in the applicable Final Terms; (7) the relevant Reset Date is either (i) if the applicable Floating Rate Option is based on the London inter-bank offered rate (“LIBOR”) for a currency or on the Euro-zone inter-bank offered rate (“EURIBOR”), the first day of that Interest Period or (ii) in any other case, as specified in the applicable Final Terms; (8) the Interest Payment Dates were the Floating Rate Payer Payment Dates; and (9) all other terms were as specified in the applicable Final Terms. For the purposes of this sub-paragraph (A), “Floating Rate Option”, “Designated Maturity”and“Reset Date” have the meanings given to those terms in the ISDA Definitions.

(B) When Condition 6(b)(iii)(A) applies, with respect to each relevant Interest Payment Date: (1) the amount of interest determined for such Interest Payment Date shall be the Interest Amount for the relevant Interest Period for the purposes of these Terms and Conditions as though calculated under Condition 6(b)(v) below; (2) the Rate of Interest for such Interest Period shall be the Floating Rate (as defined in the ISDA Definitions) determined by the Fiscal Agent (or such other agent specified in the applicable Final Terms) in accordance with the preceding sentence; and (3) the Fiscal Agent will be deemed to have discharged its obligations under Condition 6(b)(v) below if it has determined the Rate of Interest and the Interest Amount payable on such Interest Payment Date in the manner provided in the preceding sentence. (C) If the applicable Final Terms specifies that this Condition 6(b)(iii)(C) applies: (1) the Rate of Interest for each Interest Period shall, subject as provided below, be: I. the quotation; or II. the arithmetic mean (rounded, if necessary, to the fourth decimal place, with 0.00005 being rounded upwards) of the offered quotations (expressed as a percentage rate per annum), for the Reference Rate or Rates which appears or appear, as the case may be, on the appropriate page of the Screen as at 11:00 a.m. (London time) in the case of LIBOR or 11:00 a.m. (Brussels time) in the case of EURIBOR on the Interest Determination Date (as defined below) in question plus or minus (as indicated in the applicable Final Terms) the Margin (if any), all as determined by the Fiscal Agent; (2) if, in the case of (I) above, no such rate appears or, in the case of (II) above, fewer than two of such offered rates appear at such time or if the offered rate or rates which appears or appear, as the case may be, as at such time do not apply to a period of a duration equal to the relevant Interest Period, the Rate of Interest for such Interest Period shall, subject as provided below, be the arithmetic mean (rounded, if necessary, to the fourth decimal place, with 0.00005 being rounded upwards) of the quotations for deposits in the Specified Currency for that Interest Period (expressed as a percentage rate per annum) of which the Fiscal Agent is advised by, if the Reference Rate is LIBOR, the London offices or, if the Reference Rate is EURIBOR, the principal Euro-zone offices, of four leading banks engaged in the Eurodollar market (the “Reference Banks”), if the Reference Rate if LIBOR, as at 11:00 a.m. (London time) or, if the Reference Rate is EURIBOR, as at 11:00 a.m. (Brussels time) on the Interest Determination Date plus or minus (as appropriate) the Margin (if any), all as determined by the Fiscal Agent; (3) if on any Interest Determination Date to which this Condition 6(b)(iii)(C) applies two or three only of the Reference Banks advise the Fiscal Agent of such offered quotations, the

34 Rate of Interest for such Interest Period shall, subject as provided below, be determined as in Condition 6(b)(iii)(C) on the basis of the rates of those Reference Banks advising such offered quotations; (4) if on any Interest Determination Date to which this Condition 6(b)(iii)(C) applies only one or none of the Reference Banks advises the Fiscal Agent of such quotations, the Rate of Interest for such Interest Period shall, subject as provided below, be whichever is the higher of: I. the Rate of Interest in effect for the last preceding Interest Period to which Condition 6(b)(iii)(C) shall have applied (plus or minus (as appropriate), where a different Margin is to be applied to the next Interest Period to that which applied to the last preceding Interest Period, the Margin relating to that last preceding Interest Period, plus or minus (as appropriate) the Margin for the next Interest Period) and II. the reserve interest rate which shall be the rate per annum which the Fiscal Agent determines to be either (x) the arithmetic mean (rounded, if necessary, to the fourth decimal place, with 0.00005 being rounded upwards) of the lending rates for the Specified Currency which leading banks selected by the Fiscal Agent in the principal financial center of the country of the Specified Currency or, in the case of Notes payable in euro, in the Euro-zone, are quoting on the relevant Interest Determination Date for the next Interest Period to the Reference Banks or those of them (being at least two in number) to which such quotations are, in the opinion of the Fiscal Agent, being so made plus or minus (as appropriate) the Margin (if any), or (y) in the event that the Fiscal Agent can determine no such arithmetic mean, the lowest lending rate for the Specified Currency which leading banks selected by the Agent in the principal financial center of the country of the Specified Currency or, in the case of Notes payable in euro, in the Euro-zone, are quoting on such Interest Determination Date to leading European banks for the next Interest Period plus or minus (as appropriate) the Margin (if any), provided that if the banks selected as aforesaid by the Fiscal Agent are not quoting as mentioned above, the Rate of Interest shall be the Rate of Interest specified in (I) above; (5) the expression “the appropriate page of the Screen” means such page, whatever its designation, on which, if the Reference Rate is LIBOR, London inter-bank offered rates or, if the Reference Rate is EURIBOR, the Euro-zone inter-bank offered rates, in each case for deposits in the Specified Currency of prime banks, are for the time being displayed on the Reuters Monitor Money Rates Service, or the Dow Jones Markets, or any successor service or such other service, as specified in the applicable Final Terms; (6) “Interest Determination Date” means, unless otherwise specified in the applicable Final Terms, (x) other than in the case of Condition 6(b)(iii)(C)(4), with respect to Notes denominated in any Specified Currency other than Sterling, the second Banking Day in London prior to the commencement of the relevant Interest Period and, in the case of Condition 6(b)(iii)(C)(4), the second Banking Day in the principal financial center of the country of the Specified Currency prior to the commencement of the relevant Interest Period and (y) with respect to Notes denominated in Sterling, the first Banking Day in London of the relevant Interest Period; (7) the expression “Banking Day” means, in respect of any place, any day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in that place or, as the case may be, as indicated in the applicable Final Terms; and (8) if the Reference Rate from time to time in respect of Floating Rate Notes is specified as being other than the London inter-bank offered rate or the Euro-zone inter-bank offered rate, the Rate of Interest in respect of such Notes will be determined as provided in the applicable Final Terms.

(iv) Minimum and/or maximum Rate of Interest The applicable Final Terms specifies a minimum Rate of Interest for any Interest Period, then in no event shall the Rate of Interest for such period be less than such minimum Rate of Interest. If the applicable Final Terms specifies a maximum Rate of Interest for any Interest Period, then in no event shall the Rate of Interest for such Interest Period be greater than such maximum Rate of Interest.

35 (v) Determination of Rate of Interest and calculation of Interest Amount The Fiscal Agent will, on or as soon as practicable after, if the Reference Rate is LIBOR, 11:00 a.m. (London time) or, if the Reference Rate is EURIBOR, 11:00 a.m. (Brussels time) (or, if appropriate, such other time as is customary in the principal financial center of the country of the Specified Currency) on each Interest Determination Date, determine the Rate of Interest (subject to any minimum or maximum Rate of Interest specified in the applicable Final Terms) and calculate the amount of interest (the “Interest Amount”) payable on the Floating Rate Notes with respect to each Specified Denomination for the relevant Interest Period. Each Interest Amount shall be calculated by applying the Rate of Interest to each Specified Denomination, multiplying such sum by the applicable Floating Day Count Fraction, and rounding the resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded upwards or otherwise in accordance with applicable market convention.

“Day Count Fraction” for Floating Rate Notes means, in respect of the calculation of an amount of interest for any Interest Period: (1) if “Actual/365”or“Actual/Actual ISDA” is specified in the applicable Final Terms, the actual number of days in the Interest Period divided by 365 (or, if any portion of that Interest Period falls in a leap year, the sum of (A) the actual number of days in that portion of the Interest Period falling in a leap year divided by 366 and (B) the actual number of days in that portion of the Interest Period falling in a non-leap year divided by 365); (2) if “Actual/365 (Fixed)” is specified in the applicable Final Terms, the actual number of days in the Interest Period divided by 365; (3) if “Actual/365 (sterling)” is specified in the applicable Final Terms, the actual number of days in the Interest Period divided by 365 or, in the case of an Interest Payment Date falling in a leap year, 366; (4) if “Actual/360” is specified in the applicable Final Terms, the actual number of days in the Interest Period divided by 360; (5) if “30/360”, “360/360”or“Bond Basis” is specified in the applicable Final Terms, the number of days in the Interest Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months (unless (a) the last day of the Interest Period is the 31st day of a month but the first day of the Interest Period is a day other than the 30th or 31st day of a month, in which case the month that includes that last day shall not be considered to be shortened to a 30-day month, or (b) the last day of the Interest Period is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month)); and (6) if “30E/360”or“Eurobond Basis” is specified in the applicable Final Terms, the number of days in the Interest Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months, without regard to the date of the first day or last day of the Interest Period unless, in the case of an Interest Period ending on the Maturity Date, the Maturity Date is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month).

(vi) Notification of Rate of Interest and Interest Amount The Fiscal Agent will notify the Issuer, any other Paying Agent and any stock exchange on which the relevant Floating Rate Notes are for the time being listed of the Rate of Interest and each Interest Amount for each Interest Period and the relevant Interest Payment Date, and will cause the same to be published in accordance with Condition 15 as soon as possible after their determination but in no event later than the fourth London Business Day thereafter. Each Interest Amount and Interest Payment Date so notified may subsequently be amended (or appropriate alternative arrangements made by way of adjustment) without publication as aforesaid in the event of an extension or shortening of the Interest Period in accordance with the provisions hereof. Each stock exchange on which the relevant Floating Rate Notes are for the time being listed shall be promptly notified of any such amendment. For the purposes of this subparagraph (vi), the expression “London Business Day” means a day (other than a Saturday or a Sunday) on which banks and foreign exchange markets settle payments in London.

(vii) Certificates to be final All certificates, communications, opinions, determinations, calculations, quotations and decisions given, expressed, made or obtained for the purposes of the provisions of this paragraph (b), by the Fiscal Agent, shall (in the absence of manifest error) be binding on the Company, the Fiscal Agent, any other Paying

36 Agents and all Noteholders, Receiptholders and Couponholders and (in the absence as aforesaid) no liability to the Noteholders, the Receiptholders or the Couponholders shall attach to the Fiscal Agent in connection with the exercise or non-exercise by it of its powers, duties and discretions pursuant to such provisions.

(viii) Limitations on Interest In addition to any maximum Rate of Interest which may be applicable to any Floating Rate Note pursuant to Condition 6(b)(iv) above, the interest rate on Floating Rate Notes shall in no event be higher than the maximum rate permitted by New York law, as the same may be modified by United States law of general application. Under present New York law, the maximum rate of interest is 25 per cent. per annum on a simple interest basis. This limit may not apply to the Notes in which U.S.$2,500,000 or more has been invested. While the Company believes that New York law would be given effect by a state or federal court sitting outside of New York, state laws frequently regulate the amount of interest that may be charged to and paid by a borrower (including, in some cases, corporate borrowers).

(c) Interest on Partly Paid Notes In the case of Partly Paid Notes (other than Partly Paid Notes which are Non-Interest Bearing Notes), interest will accrue as aforesaid on the paid up principal amount of such Notes and otherwise as specified in the applicable Final Terms.

(d) Accrual of Interest Interest shall accrue on the Outstanding Principal Amount of each Note during each Interest Accrual Period from the Interest Commencement Date. Interest will cease to accrue as of and from the due date for redemption therefor (or, in the case of an Installment Note, in respect of each installment of principal, on the due date for payment of the relevant Installment Amount) unless upon due presentation or surrender thereof (if required), payment in full of the Redemption Amount (as defined in Condition 7(j)) or the relevant Installment Amount is improperly withheld or refused or default is otherwise made in the payment thereof in which case interest shall continue to accrue on the principal amount in respect of which payment has been improperly withheld or refused or default has been made (as well after as before any demand or judgment) at the Interest Rate then applicable or such Default Rate as may be specified for this purpose in the Final Terms until the date on which, upon due presentation or surrender of the relevant Note (if required), the relevant payment is made or, if earlier (except where presentation or surrender of the relevant Note is not required as a precondition of payment), the date on which, the Fiscal Agent having received the funds required to make such payment, notice is given to the Holders of the Notes in accordance with Condition 15 that the Fiscal Agent has received the required funds (except to the extent that there is failure in the subsequent payment thereof to the relevant Holder).

(e) Interest Amount(s), Calculation Agent and Reference Banks If a Calculation Agent is specified in the Final Terms, the Calculation Agent, as soon as practicable after the Relevant Time on each Interest Determination Date (or such other time on such date as the Calculation Agent may be required to calculate any Redemption Amount or Installment Amount, obtain any quote or make any determination or calculation) will determine the Interest Rate and calculate the amount(s) of interest payable (the “Interest Amount(s)”) in respect of each Denomination of the Notes for the relevant Interest Accrual Period, calculate the Redemption Amount or Installment Amount, obtain such quote or make such determination or calculation, as the case may be, and cause the Interest Rate and the Interest Amounts for each Interest Period and the relevant Interest Payment Date or, as the case may be, the Redemption Amount or any Installment Amount to be notified to the Fiscal Agent, the Issuer, the Holders in accordance with Condition 15 and if the Notes are listed on any stock exchange and the rules of such exchange so requires, such exchange as soon as possible after their determination or calculation or in the time required by the laws of the relevant stock exchange. The Interest Amounts and the Interest Payment Date so notified may subsequently be amended (or appropriate alternative arrangements made by way of adjustment) without notice in the event of an extension or shortening of an Interest Accrual Period or the Interest Period. If the Notes become due and payable under Condition 8, the Interest Rate and the accrued interest payable in respect of the Notes shall nevertheless continue to be calculated as previously in accordance with this Condition but no publication of the Interest Rate or the Interest Amount so calculated need be made. The determination of each Interest Rate, Interest Amount, Redemption Amount and Installment Amount, the obtaining of each quote and the making of each determination or calculation by the Calculation Agent shall (in the absence of manifest error) be final and binding upon the Issuer and the Holders and neither the Calculation Agent nor any Reference Bank shall have any liability to the Holders in respect of any determination, calculation, quote or rate made or provided by it.

37 The Issuer will procure that there shall at all times be such Reference Banks as may be required for the purpose of determining the Interest Rate applicable to the Notes and a Calculation Agent, if provision is made for one in the Terms and Conditions.

If the Calculation Agent is incapable or unwilling to act as such or if the Calculation Agent fails duly to establish the Interest Rate for any Interest Accrual Period or to calculate the Interest Amounts or to fulfil any other requirements, the Issuer will appoint the London office of a leading bank engaged in the London interbank market to act as such in its place. The Calculation Agent may not resign its duties without a successor having been appointed as aforesaid.

(f) Non-Interest Bearing Notes If any Maturity Redemption Amount (as defined in Condition 7(a)) in respect of any Note which is non-interest bearing is not paid when due, interest shall accrue on the overdue amount at a rate per annum (expressed as a percentage per annum) equal to the Amortization Yield defined in, or determined in accordance with the provisions of, the Final Terms or at such other rate as may be specified for this purpose in the Final Terms until the date on which, upon due presentation or surrender of the relevant Note (if required), the relevant payment is made or, if earlier (except where presentation or surrender of the relevant Note is not required as a precondition of payment), the date on which, the Fiscal Agent having received the funds required to make such payment, notice is given to the Holders of the Notes in accordance with Condition 15 that the Fiscal Agent has received the required funds (except to the extent that there is failure in the subsequent payment thereof to the relevant Holder). The amount of any such interest shall be calculated in accordance with the provisions of Condition 6(h) as if the Interest Rate was the Amortization Yield, the Outstanding Principal Amount was the overdue sum and the Day Count Fraction was as specified for this purpose in the Final Terms or, if not so specified, 30E/360.

(g) Calculations and Adjustments For the purposes of any calculations referred to in these Terms and Conditions (unless otherwise specified in the Final Terms), (a) all percentages resulting from such calculations will be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point (with 0.000005% being rounded up to 0.00001%), (b) all United States dollar amounts used in or resulting from such calculations will be rounded to the nearest cent (with one half cent being rounded up), (c) all Japanese Yen amounts used in or resulting from such calculations will be rounded downwards to the next lower whole Japanese Yen amount, (d) all Italian Lira and Portuguese Escudos amounts will be rounded to the nearest Italian Lira or Portuguese Escudos (with one half Italian Lira or Portuguese Escudos being rounded up), and (e) all amounts denominated in any other currency used in or resulting from such calculations will be rounded to the nearest two decimal places in such currency, with 0.005 being rounded upwards.

7. Redemption and Purchase (a) Redemption at Maturity Unless previously redeemed, or purchased and cancelled, each Note shall be redeemed at its maturity redemption amount (the “Maturity Redemption Amount”) (which shall be its Outstanding Principal Amount or, in the case of a Note which is non-interest bearing, its Amortized Face Amount (as defined in Condition 7(k)) or such other redemption amount as may be specified in or determined in accordance with the Final Terms) (or, in the case of Installment Notes, in such number of installments and in such amounts (“Installment Amounts”) as may be specified in, or determined in accordance with the provisions of, the Final Terms) on the maturity date or dates specified in the Final Terms.

(b) Early Redemption for Taxation Reasons If (a) as a result of any change in, or amendment to, the laws (or any regulations or rulings promulgated thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or any change in the official application (including a ruling by a court of competent jurisdiction in the United States) or interpretation of such laws, regulations or rulings which change or amendment is announced or becomes effective on or after the date on which agreement is reached to issue the first Tranche of the Notes, the Issuer becomes or will become obligated to pay Additional Amounts as provided in Condition 9 or (b) any act is taken by a taxing authority of the United States on or after the date on which agreement is reached to issue the first Tranche of the Notes, whether or not such act is taken with respect to the Issuer or any affiliate, that results in a substantial likelihood that the Issuer will or may be required to pay such Additional Amounts then the Issuer

38 may, at its option, redeem all the outstanding Notes (but not some only) on not less than 30 nor more than 60 days prior notice (ending, in the case of Notes which bear interest at a Floating Rate, on a day on which interest is payable), at their early tax redemption amount (the “Early Redemption Amount (Tax)”) (which shall be their Outstanding Principal Amount or, in the case of Notes which are non-interest bearing, their Amortized Face Amount (as defined in Condition 7(k)) or such other redemption amount as may be specified in, or determined in accordance with the provisions of, the Final Terms), together with accrued interest (if any) thereon, to but excluding the due date for redemption; provided that the Issuer determines, in its business judgment, that the obligation to pay such Additional Amounts cannot be avoided by the use of reasonable measures available to it, not including substitution of the obligor under the Notes or any action that would entail a material cost to the Issuer. No redemption pursuant to this Condition 7(b) may be made unless the Issuer shall have received an opinion of independent counsel to the effect that an act taken by a taxing authority of the United States results in a substantial likelihood that it will or may be required to pay the Additional Amounts described above and the Issuer shall have delivered to the Fiscal Agent a certificate, signed by a duly authorized officer, stating that based on such opinion the Issuer is entitled to redeem the Notes pursuant to this provision.

No such notice of redemption may be given earlier than 90 days (or, in the case of Notes which bear interest at a floating rate a number of days which is equal to the aggregate of the number of days falling within the then current interest period applicable to the Notes plus 60 days) prior to the earliest date on which the Issuer would be obliged to pay such Additional Amounts were a payment in respect of the Notes then due.

The Issuer may not exercise such option in respect of any Note which is the subject of the prior exercise by the Holder thereof of its option to require the redemption of such Notes under Condition 8.

(c) Optional Early Redemption (Call) If this Condition 7(c) is specified in the Final Terms as being applicable, then the Issuer may, having given the appropriate notice and subject to such conditions as may be specified in the Final Terms, redeem all (but not, unless and to the extent that the Final Terms specifies otherwise, some only) of the Notes at their call early redemption amount (the “Early Redemption Amount (Call)”) (which shall be their Outstanding Principal Amount or, in the case of Notes which are non-interest bearing, their Amortized Face Amount or such other redemption amount as may be specified in, or determined in accordance with the provisions of, the Final Terms), together with accrued interest (if any) thereon, to but excluding the due date for redemption.

The Issuer may not exercise such option in respect of any Note which is the subject of the prior exercise by the Holder thereof of its option to require the redemption of such Note under Condition 7(f).

(d) Notice The appropriate notice referred to in Condition 7(c) is a notice given by the Issuer to the Holders of the Notes in accordance with Condition 15, which notice shall be irrevocable and shall specify: (i) the Notes that are subject to redemption; (ii) whether the Notes are to be redeemed in whole or in part only and, if in part only, the aggregate principal amount of and (except in the case of a Temporary Global Note or Permanent Global Note) the serial numbers of the Notes which are to be redeemed; (iii) the due date for such redemption, which shall be not less than thirty days nor more than sixty days after the date on which such notice is given and which shall be such date or the next of such dates (“Call Option Date(s)”) or a day falling within such period (“Call Option Period”), as may be specified in the Final Terms and which is, in the case of Notes which bear interest at a floating rate, a date upon which interest is payable; and (iv) the Early Redemption Amount (Call) at which such Notes are to be redeemed.

(e) Partial Redemption If the Notes are to be redeemed in part only on any date in accordance with Condition 7(c): (i) in the case of Notes (other than a Temporary Global Note or Permanent Global Note), the Notes to be redeemed shall be drawn by lot in such city as the Fiscal Agent may specify, or identified in such other manner or in such other place as the Fiscal Agent may approve and deem appropriate and fair; and (ii) in the case of a Temporary Global Note or a Permanent Global Note, the Notes to be redeemed shall be selected in accordance with the rules of Euroclear and/or Clearstream, Luxembourg and/or any other relevant clearing system, subject always to compliance with all applicable rules and the requirements of the Luxembourg Stock Exchange and/or any other stock exchange on which the Notes may be listed.

39 (f) Optional Early Redemption (Put) If this Condition 7(f) is specified in the Final Terms as being applicable, then the Issuer shall, upon the exercise of the relevant option by the Holder of any Note, redeem such Note on the date specified in the relevant Put Notice (as defined below) at its put early redemption amount (the “Early Redemption Amount (Put)”) (which shall be its Outstanding Principal Amount or, if such Note is non-interest bearing, its Amortized Face Amount or such other redemption amount as may be specified in, or determined in accordance with the provisions of, the Final Terms), together with accrued interest (if any) thereon to but excluding the due date for redemption. In order to exercise such option, the Holder must, not less than forty-five days before the date on which such redemption is required to be made as specified in the Put Notice (which date shall be such date or the next of the dates (“Put Date(s)”) or a day falling within such period (“Put Period”) as may be specified in the Final Terms), deposit the relevant Note (together in the case of an interest-bearing Definitive Note, with all unmatured Coupons appertaining thereto other than any Coupon maturing on or before the date of redemption (failing which the provisions of Condition 10(e) apply)) during normal business hours at the specified office of any Paying Agent outside the United States together with a duly completed early redemption notice (“Put Notice”) in the form which is available from the specified office of any of the Paying Agents specifying, in the case of a Temporary Global Note or Permanent Global Note, the aggregate principal amount in respect of which such option is exercised (which must be the minimum denomination specified in the Final Terms or an integral multiple thereof). No Note so deposited and option exercised may be withdrawn except where prior to the due date of redemption an Event of Default (as defined in Condition 8) shall have occurred and be continuing in which event the relevant Holder, at its option, may elect by notice to the Paying Agent to withdraw the Put Notice given pursuant to this Condition 7(f) and instead declare such Note to be forthwith due and payable pursuant to Condition 8.

The Holder of a Note may not exercise such option in respect of any Note which is the subject of a prior exercise by the Issuer of its option to redeem such Note under Condition 7(b) or 7(c) or Condition 9.

(g) Purchase of Notes The Issuer or any of its Affiliates may at any time purchase Notes in the open market or otherwise and at any price provided that all unmatured Receipts and Coupons appertaining thereto are purchased therewith.

For the purposes hereof, “Affiliates” means, with respect to the Issuer, any corporation, partnership, joint venture or other person (including a natural person) that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Issuer.

(h) Cancellation of Redeemed and Purchased Notes All unmatured Notes and Coupons redeemed or purchased in accordance with this Condition 7 may at the option of the Issuer, be cancelled forthwith and not be reissued or resold.

(i) Further Provisions applicable to Redemption Amounts and installment Amounts The provisions of Conditions 6(e) and 6(g) shall apply to any determination or calculation of the Redemption Amounts or any Installment Amounts required by the Final Terms to be made by the Calculation Agent.

(j) Redemption Amount References herein to “Redemption Amount” shall mean, as appropriate, the Maturity Redemption Amount, the final Installment Amount, Early Redemption Amount (Tax), Early Redemption Amount (Call), Early Redemption Amount (Put) and Early Termination Amount or such other amount in the nature of a redemption amount as may be specified in, or determined in accordance with the provisions of, the Final Terms.

(k) Amortized Face Amount—Calculation In the case of any Note which is non-interest bearing, the “Amortized Face Amount” shall be an amount equal to the sum of: (i) the Issue Price specified in the Final Terms; and (ii) the product of the Amortization Yield (compounded annually) being applied to the Issue Price from (and including) the Issue Date specified in the Final Terms to (but excluding) the date fixed for redemption or (as the case may be) the date upon which such Note becomes due and payable.

40 Where such calculation is to be made for a period which is not a whole number of years, the calculation in respect of the period of less than a full year shall be made on the basis of the Day Count Fraction specified in the Final Terms for the purposes of this Condition 7(k).

(l) Amortized Face Amount—Alternative Method of Calculation In the case of any Note which is non-interest bearing, if any Redemption Amount (other than the Maturity Redemption Amount) is improperly withheld or refused or default is otherwise made in the payment thereof, the Amortized Face Amount shall be calculated as provided in Condition 7(k) but as if references in subparagraph (ii) to the date fixed for redemption or the date upon which such Note becomes due and repayable were replaced by references to the earlier of: (i) the date on which, upon due presentation or surrender of the relevant Note (if required), the relevant payment is made; (ii) (except where presentation or surrender of the relevant Note is not required as a precondition of payment) the date on which, the Fiscal Agent having received the funds required to make such payment, notice is given to the Holders of the Notes in accordance with Condition 15 of that circumstance (except to the extent that there is a failure in the subsequent payment thereof to the relevant Holder).

8. Events of Default In case one or more of the following events (herein referred to as “Events of Default”) shall have occurred and be continuing, that is to say: (a) default in the payment of any interest on any Note when due and payable, and continuance of such default for a period of 30 days; or (b) default in the payment of the principal of, or any premium on, any Note when due and payable, and continuance of such default for a period of 7 days; or (c) default in the performance, or breach, of any covenant of Cargill, Inc. contained in the Notes and continuance of such default or breach for a period of 30 days after written notice thereof shall have been given to Cargill, Inc. by a Holder of Notes then outstanding; or (d) if any event of default (as defined in any mortgage, indenture or instrument under which they may be issued, or by which there may be secured or evidenced) of any indebtedness of Cargill, Inc. or any Restricted Subsidiary for money borrowed, whether such indebtedness exists on the Issue Date or shall be created thereafter, shall occur and shall result in such indebtedness in principal amount in excess of U.S.$50,000,000 (or the equivalent thereof in other or composite currencies) becoming or being declared due and payable prior to the date on which it would otherwise become due and payable, and such acceleration shall not be rescinded or annulled, or such indebtedness shall not have been discharged, within a period of 30 days after written notice thereof shall have been given to Cargill, Inc. by a Holder of Notes then outstanding; or (e) the entry by a court of competent jurisdiction of (i) a decree or order for relief in respect of Cargill, Inc. in an involuntary case or proceeding under any applicable bankruptcy, insolvency, reorganization or other similar law, as the case may be, or (ii) a decree or order adjudging Cargill, Inc. bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of Cargill, Inc. under any applicable law, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar official of Cargill, Inc. or for all or substantially all of the property of Cargill, Inc., or ordering the winding up or liquidation of the affairs of Cargill, Inc., and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; or (f) Cargill, Inc., shall have commenced a voluntary case or proceeding under any applicable bankruptcy, insolvency, reorganization or other similar law, as the case may be, or consent to the institution of proceedings thereunder or to the entry of an order for relief in an involuntary case under any such law or consent to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar official of Cargill, Inc. or for any substantial part of the property of Cargill, Inc., or the making by Cargill, Inc. of a general assignment for the benefit of creditors, or Cargill, Inc. shall admit in writing its liability to pay its debts generally as they become due, or shall take any corporate action in furtherance of any of the foregoing,

then any Holder of an outstanding Note may, by written notice to Cargill, Inc., and to the Fiscal Agent, effective on the date of receipt thereof by Cargill, Inc., declare the principal amount of, and all interest then

41 accrued on, the Note held by the Holder to be forthwith due and payable, whereupon the same shall become forthwith due and payable, without presentment, demand, protest or other notice or any kind unless prior to such date all Events of Default shall have been cured.

For the purposes of paragraph (d) above, any indebtedness which is in a currency other than U.S. dollars shall be translated into U.S. dollars at the “spot” rate for the sale of the U.S. dollars against the purchase of the relevant currency as quoted by the Fiscal Agent on the calendar day in London corresponding to the calendar day on which such premature repayment becomes due or, as the case may be, such default occurs (or, if for any reason such a rate is not available on that day, on the earliest possible date thereafter).

The amount payable in respect of each Note upon default shall be its early termination amount (the “Early Termination Amount”) (which shall be its Outstanding Principal Amount or, if such Note is non-interest bearing, its Amortized Face Amount or such other redemption amount as may be specified in, or determined in accordance with the provisions of, the Final Terms), together with accrued interest (if any) thereon to but excluding the date paid.

9. Taxation (a) Except as otherwise indicated, for purposes of these Terms and Conditions: (i) “United States”, means the United States of America (including any state thereof and the District of Columbia), and its possessions; (ii) “United States person” means an individual who is a citizen or resident of the United States, a corporation or partnership, including an entity treated as a corporation or partnership for United States Federal income tax purposes, created or organized in or under the laws of the United States, any state thereof, the District of Columbia (except, in the case of a partnership, as provided by U.S. Treasury Regulations), an estate the income of which is subject to United States Federal income taxation regardless of its source, or a trust with respect to which a court within the United States is able to exercise primary supervision over its administration and one or more United States persons have the authority to control all of its substantial decisions (and certain other trusts as provided by U.S. Treasury Regulations); and (iii) “United States Alien” means any person who is not a United States person.

U.S. Taxation (b) The Issuer will, subject to the exceptions and limitations set forth below, pay to the Holder of any Note, Receipt or Coupon who is a United States Alien as additional interest such additional amounts (“Additional Amounts”) as may be necessary so that every net payment on such Note, Receipt or Coupon, after deduction or other withholding for or on account of any present or future tax, assessment or governmental charge imposed upon or as a result of such payment by the United States (or any political subdivision or taxing authority thereof or therein), will not be less than the amount provided in such Note or in such Receipt or in such Coupon to be then due and payable. However, the Issuer will not be required to make any payment of Additional Amounts for or on account of: (i) any tax, assessment or other governmental charge that would not have been so imposed but for (1) the existence of any present or former connection between such Holder or beneficial owner (or between a fiduciary, settlor, beneficiary, member or shareholder of, or a person holding a power over, such Holder, if such Holder is an estate, trust, partnership or corporation) and the United States or any political subdivision or taxing authority thereof or therein, including, without limitation, such Holder (or such fiduciary, settlor, beneficiary, member, shareholder or person holding a power) being or having been a citizen or resident or treated as a resident thereof, or being or having been engaged in a trade or business or present therein, or having or having had a permanent establishment therein, (2) the presentation by the Holder of any Note or any Receipt or any Coupon for payment on a date more than 10 days after the date on which such payment became due and payable or the date on which payment thereof was duly provided for, whichever occurred later, or (3) such Holder’s present or former status as a controlled foreign corporation for United States tax purposes, a foreign private foundation or other foreign tax-exempt organization or a corporation that accumulates earnings to avoid United States Federal income tax; or (ii) any estate, inheritance, gift, sales, transfer, wealth, personal property or similar tax, assessment or other governmental charge; or

42 (iii) any tax, assessment or other governmental charge that is payable otherwise than by deduction or withholding from a payment on a Note, Receipt or Coupon; or (iv) any tax, assessment or other governmental charge required to be withheld by any Paying Agent from any payment on a Note, Receipt or Coupon if such payment can be made without such withholding by any other Paying Agent; or (v) any tax, assessment or other governmental charge that would not have been imposed but for a failure to comply with any applicable certification, information, identification, documentation or other reporting requirements concerning the nationality, residence, identity or connection with the United States of the Holder or beneficial owner of a Note, Receipt or Coupon if, without regard to any tax treaties, such compliance is required as a precondition to relief or exemption from such tax, assessment or other governmental charge; or (vi) any tax, assessment or other governmental charge imposed as a result of a person’s actual or constructive holding of 10% or more of the total combined voting power of all classes of stock of the Issuer entitled to vote or as the result of the receipt of interest by a bank on an extension of credit made pursuant to a loan agreement entered into in the ordinary course of its trade or business; or (vii) any tax, assessment or other governmental charge imposed on any payment on a Note, Receipt or Coupon to a Holder who is a fiduciary or partnership or other than the sole beneficial owner of such payment to the extent a beneficiary or settlor with respect to such fiduciary, a member of such partnership or the beneficial owner would not have been entitled to the Additional Amounts had such beneficiary, settlor, member or beneficial owner been the Holder of such Note, Receipt or Coupon; or (viii) any tax, assessment or other government charge which would not have been imposed but for the fact that such Note, Receipt or Coupon constitutes a “United States real property interest”as defined in section 897(c)(1) of the United States Internal Revenue Code of 1986, as amended, with respect to the beneficial owner of such Note, Receipt or Coupon; or (ix) any withholding or deduction which is imposed on a payment to an individual and is required to be made pursuant to European Union Directive 2003/48/EC or any law implementing or complying with, or introduced in order to conform to, such Directive; or (x) any presentment of payment by or on behalf of a holder who would have been able to avoid such withholding or deduction by presenting the relevant Note or Coupon to another Paying Agent in a Member State of the European Union; or (xi) any combination of (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix) and (x) above.

(c) Early redemption for U.S. Tax Information Reporting Reasons If the Issuer shall determine, based upon a written opinion of independent legal counsel of recognized standing, that any payment made outside the United States by the Issuer or any Paying Agent of any amount of principal or interest due with respect to any Note, Receipt or Coupon would be subject to any certification, documentation, information or other reporting requirement of any kind under any present or future United States laws or regulations, the effect of which requirement would be the disclosure to the Issuer, any Paying Agent or any governmental authority of the nationality, residence or identity of a beneficial owner of such Note, Receipt or Coupon who is a United States Alien (other than a requirement (a) that would not be applicable to a payment made by the Issuer or any Paying Agent (i) directly to the beneficial owner or (ii) to a custodian, nominee or other agent of the beneficial owner, or (b) that can be satisfied by such custodian, nominee or other agent certifying to the effect that the beneficial owner is a United States Alien, provided that, in any case referred to in clauses (a)(ii) or (b), payment by the custodian, nominee or other agent to the beneficial owner is not otherwise subject to any such requirement, or (c) that would not be applicable to a payment by at least one Paying Agent), the Issuer shall at its option either (x) redeem all of the outstanding Notes (but not some only), at their Early Redemption Amount (Tax) together with accrued interest (if any) thereon, or (y) if the conditions in Condition 9(d) are satisfied, pay the Additional Amounts specified in Condition 9(d). The Issuer shall make such determination as soon as practicable and publish prompt notice thereof in the manner specified in Condition 15 (the “Determination Notice”), stating the effective date of such certification, documentation, information or other reporting requirement, whether the Issuer will redeem the Notes or pay the additional amounts specified in Condition 9(d), and (if applicable) the last date by which the redemption of the Notes must take place, as provided in the next succeeding sentence. If the Notes are to be redeemed pursuant to this paragraph, such

43 redemption shall take place on such date (which date, in the case of Notes which bear interest at a floating rate, shall be a date upon which interest is payable), not later than one year after the publication of the Determination Notice, as the Issuer shall elect by notice to the Fiscal Agent at least 30 days before the date fixed for redemption. Notice of such redemption of the Notes will be given to the Holders of the Notes by publication in the manner specified in Condition 15, the publication to be not less than 30 days nor more than 60 days prior to the date fixed for redemption. Notwithstanding the foregoing, the Issuer shall not so redeem the Notes if the Issuer shall subsequently determine, not less than 30 days prior to the date fixed for redemption, that subsequent payments in respect of the Notes and Coupons would not be subject to any such certification, documentation, information or other reporting requirement, in which case the Issuer shall give prompt notice of such subsequent determination by publication in the manner specified in Condition 15 and any earlier redemption notice shall be revoked and of no further effect.

(d) Payment of Additional Amounts Notwithstanding Condition 9(c), if and so long as the certification, documentation, information or other reporting requirement referred to in Condition 9(c) would be fully satisfied by payment of a backup withholding tax or similar charge, the Issuer may elect, prior to publication of the Determination Notice, to pay as additional interest such additional amounts (“Additional Amounts”) as may be necessary so that every net payment made by the Issuer or any Paying Agent outside the United States following the effective date of such requirement in respect of any Note or any Coupon of which the beneficial owner is a United States Alien (but without any requirement that the nationality, residence or identity, other than status as a United States Alien, of such beneficial owner be disclosed to the Issuer, any Paying Agent or any governmental authority), after deducting or withholding for or on account of such backup withholding tax or similar charge (other than a backup withholding tax or similar charge that (i) would not be applicable in the circumstances referred to in the first parenthetical clause of the first sentence of the preceding paragraph, (ii) is imposed as a result of presentation of such Note, Receipt or Coupon for payment more than 10 days after the date on which such payment became due and payable or on which payment thereof was duly provided for, whichever occurred later, or (iii) is imposed as a result of the fact that the Issuer or any Paying Agent has actual knowledge that the beneficial owner of such Note, Receipt or Coupon is within the category of persons described above in paragraph (a)(i) or (a)(iii) of Condition 9(c)), will not be less than the amount provided for in such Note, Receipt or Coupon to be then due and payable. If the Issuer elects to pay Additional Amounts pursuant to this Condition 9(d), the Issuer shall continue to have the right to redeem the Note at any time (in the case of Notes which do not bear interest at a floating rate) or on any date upon which interest is payable (in the case of Notes which do bear interest at a floating rate), as a whole but not in part, subject to the provisions of the last two sentences of Condition 9(c). If the Issuer elects to pay Additional Amounts pursuant to this Condition 9(d) and the condition specified in the first sentence of this Condition 9(d) can no longer be satisfied, then the Issuer shall redeem the Notes pursuant to the provisions of Condition 9(c).

(e) Definitions Any reference in these Terms and Conditions to “principal” and/or “interest” in respect of the Notes shall be deemed also to refer to any additional amounts which may be payable under this Condition 9. Unless the context otherwise requires, any reference in these Terms and Conditions to “principal” shall include any premium payable in respect of a Note, any Installment Amount or Redemption Amount and any other amounts in the nature of principal payable pursuant to these Terms and Conditions and “interest” shall include all amounts payable pursuant to Condition 6 and any other amounts in the nature of interest payable pursuant to these Terms and Conditions.

As used herein, the “Relevant Date” means the date on which such payment first becomes due, except that, if the full amount of the moneys payable has not been duly received by the relevant Paying Agent on or prior to such due date, it means the date on which, the full amount of such moneys having been so received, notice to that effect is duly given to the Noteholders in accordance with Condition 15.

10. Payments (a) Payment of amounts (other than interest) due in respect of the Notes will be made against presentation and (save in the case of partial payment or payment of an Installment Amount (other than the final Installment Amount)) surrender of the relevant Notes at the specified office of any of the Paying Agents.

Payment of Installment Amounts (other than the final Installment Amount) in respect of an Installment Note which is a Definitive Note with Receipts will be made against presentation of the relevant Note together with the relevant Receipt and surrender of such Receipt.

44 (b) The Receipts are not and shall not in any circumstances be deemed to be documents of title and if separated from the Note to which they relate will not represent any obligation of the Issuer. Accordingly, the presentation of a Note without the related Receipt or the presentation of a Receipt without the Note to which it appertains shall not entitle the Holder to any payment in respect of the relevant Installment Amount.

Payment of amounts in respect of interest on the Notes will be made: (i) in the case of a Temporary Global Note or Permanent Global Note, against presentation of the relevant Temporary Global Note or Permanent Global Note at the specified office of any of the Paying Agents outside the United States (unless Condition 10(c) applies) and, in the case of a Temporary Global Note with a maturity of over 183 days, upon due certification as required therein; (ii) in the case of Definitive Notes without Coupons attached thereto at the time of their initial delivery, against presentation of the relevant Definitive Notes at the specified office of any of the Paying Agents outside the United States (unless Condition 10(c) applies); and (iii) in the case of Definitive Notes delivered with Coupons attached thereto at the time of their initial delivery, against surrender of the relevant Coupons or, in the case of interest due otherwise than on a scheduled date for the payment of interest, against presentation of the relevant Definitive Notes, in either case at the specified office of any of the Paying Agents outside the United States (unless Condition 10(c) applies).

(c) Payments of amounts due in respect of interest on the Notes and exchanges of Talons for coupon sheets in accordance with Condition 10(f) will not be made at the specified office of any Paying Agent in the United States (as defined in the United States Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder) unless (x) payment in full of amounts due in respect of interest on such Notes when due or, as the case may be, the exchange of Talons at all the specified offices of the Paying Agents outside the United States is illegal or effectively precluded by exchange controls or other similar restrictions and (y) such payment or exchange is permitted by applicable United States law. If paragraphs (x) and (y) of the previous sentence apply, the Issuer shall forthwith appoint a further Paying Agent with a specified office in New York City.

(d) If the due date for payment of any amount due in respect of any Note is not both a Relevant Financial Center Day (as defined in Condition 10(h)) and a local banking day (as defined in Condition 10(h)), then the Holder thereof will not be entitled to payment thereof until the next day which is such a day, and from such day and thereafter will be entitled to receive payment by cheque on any local banking day, and will be entitled to payment by transfer to a designated account on any day which is a local banking day, a Relevant Financial Center Day and a day on which commercial banks and foreign exchange markets settle payments in the relevant currency in the place where the relevant designated account is located and no further payment on account of interest or otherwise shall be due in respect of such postponed payment unless there is a subsequent failure to pay in accordance with these Terms and Conditions in which event interest shall continue to accrue as provided in Condition 6(f) or, if appropriate, Condition 6(j).

(e) Each Definitive Note initially delivered with Coupons, Talons or Receipts attached thereto should be presented and, save in the case of partial payment of the Redemption Amount, surrendered for final redemption together with all unmatured Receipts, Coupons and Talons relating thereto, failing which: (i) if the Final Terms specifies that this paragraph (i) of Condition 10(e) is applicable (and, in the absence of specification, this paragraph (i) shall apply to Definitive Notes which bear interest at a fixed rate or rates or in fixed amounts) and subject as hereinafter provided, the amount of any missing unmatured Coupons (or, in the case of a payment not being made in full, that portion of the amount of such missing Coupon which the Redemption Amount paid bears to the total Redemption Amount due) (excluding, for this purpose, but without prejudice to paragraph (iii) below, Talons) will be deducted from the amount otherwise payable on such final redemption, the amount so deducted being payable against surrender of the relevant Coupon at the specified office of any of the Paying Agents at any time within ten years of the Relevant Date (as defined in Condition 9(f)) applicable to payment of such Redemption Amount; (ii) if the Final Terms specifies that this paragraph (ii) of Condition 10(e) is applicable (and, in the absence of specification, this paragraph (ii) shall apply to Definitive Notes which bear interest at a floating rate or rates or in variable amounts) all unmatured Coupons (excluding, for this purpose,

45 but without prejudice to paragraph (iii) below, Talons) relating to such Definitive Notes (whether or not surrendered therewith) shall become void and no payment shall be made thereafter in respect of them; (iii) in the case of Definitive Notes initially delivered with Talons attached thereto, all unmatured Talons (whether or not surrendered therewith) shall become void and no exchange for Coupons shall be made thereafter in respect of them; and (iv) in the case of Definitive Notes initially delivered with Receipts attached thereto, all Receipts relating to such Notes in respect of a payment of an Installment Amount which (but for such redemption) would have fallen due on a date after such due date for redemption (whether or not surrendered therewith) shall become void and no payment shall be made thereafter in respect of them.

The provisions of paragraph (i) of this Condition 10(e) notwithstanding, if any Definitive Notes should be issued with a maturity date and an Interest Rate or Rates such that, on the presentation for payment of any such Definitive Note without any unmatured Coupons attached thereto or surrendered therewith, the amount required by paragraph (i) to be deducted would be greater than the Redemption Amount otherwise due for payment, then, upon the due date for redemption of any such Definitive Note, such unmatured Coupons (whether or not attached) shall become void (and no payment shall be made in respect thereof) as shall be required so that, upon application of the provisions of paragraph (i) in respect of such Coupons as have not so become void, the amount required by paragraph (i) to be deducted would not be greater than the Redemption Amount otherwise due for payment. Where the application of the foregoing sentence requires some but not all of the unmatured Coupons relating to a Definitive Note to become void, the relevant Paying Agent shall determine which unmatured Coupons are to become void, and shall select for such purpose Coupons maturing on later dates in preference to Coupons maturing on earlier dates.

(f) In relation to Definitive Notes initially delivered with Talons attached thereto, on or after the due date for the payment of interest on which the final Coupon sheet matures, the Talon comprised in the Coupon sheet may be surrendered at the specified office of any Paying Agent outside (unless Condition 10(c) applies) the United States in exchange for a further Coupon sheet (including any appropriate further Talon), subject to the provisions of Condition 11 below. Each Talon shall, for the purpose of these Conditions, be deemed to mature on the Interest Payment Date on which the final Coupon comprised in the relative Coupon sheet matures.

(g) Payments of amounts due (whether principal, interest or otherwise) in respect of Notes will be made in the currency in which such amount is due (a) by cheque (drawn on a bank in a principal financial centre of the country of such Specified Currency), (b) at the option of the payee, by transfer to an account denominated in the relevant currency specified by the payee (in the case of payment in Japanese Yen to a non-resident of Japan, non-resident account specified by the payee) or, (c) if in euro, by credit or transfer to a euro account (or any other account to which euro may be credited or transferred) specified by the payee or, at the option of the payee, by a euro cheque. Payments will, without prejudice to the provisions of Condition 9, be subject in all cases to any applicable fiscal or other laws and regulations.

(h) For the purposes of these Terms and Conditions: (i) “Relevant Financial Center Day” means, in the case of any currency other than euro, a day on which commercial banks and foreign exchange markets settle payments in the relevant Financial Center (as defined in the ISDA Definitions) and in any Additional Financial Centre specified in the Final Terms or in the case of payment in euro, a day on which the TARGET System is open and in any Additional Financial Centre specified in the Final Terms; (ii) “local banking day” means a day (other than a Saturday or Sunday) on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) in the place of presentation of the relevant Notes or, as the case may be, Receipt or Coupon.

(i) No commissions or expenses shall be charged to the Holders of Notes Receipts or Coupons in respect of such payments.

11. Limitation The Notes, Receipts and Coupons will become void unless presented for payment within a period of ten years (in the case of principal) and five years (in the case of interest) after the Relevant Date (as defined in

46 Condition 9). Talons will become void unless presented for exchange for a further Coupon sheet within a period of 5 years from the date on which all Coupons on the Coupon sheet to which the Talon appertains have matured. Under the State of New York’s statute of limitations, any legal action upon the Notes must be commenced within 6 years after the payment thereof is due.

There shall not be included in any Coupon sheet issued upon exchange of a Talon any Coupon which would be void upon issue pursuant to Condition 10(e) or the due date for the payment of which would fall after the due date for the redemption of the relevant Note or which would be void pursuant to this Condition 11 or any Talon the maturity date of which would fall after the due date for redemption of the relevant Note.

12. The Paying Agents and the Calculation Agent (a) Appointment of the Paying Agents and the Calculation Agent The initial Paying Agents and their respective initial specified offices are specified below. The Calculation Agent (as defined in the ISDA Definitions) in respect of any Notes shall be specified in the Final Terms. The Issuer reserves the right at any time to vary or terminate the appointment of any Paying Agent (including the Fiscal Agent) or the Calculation Agent and to appoint additional or other Paying Agents (including the Fiscal Agent) or any other Calculation Agent provided that the Issuer will at all times maintain (i) a Fiscal Agent, (ii) a Paying Agent (which may be the Fiscal Agent) with a specified office in a continental European city, (iii) so long as the Notes are listed on the Luxembourg Stock Exchange and/or any other stock exchange, a Paying Agent with a specified office in Luxembourg and/or in such other place as may be required by the rules of such other stock exchange, (iv) in the circumstances described in Condition 10(c), a Paying Agent with a specified office in New York City and (v) a Calculation Agent where required by the Terms and Conditions applicable to any Notes (in the case of (i), (ii), (iii) and (iv) with a specified office located in such place (if any) as may be required by these Terms and Conditions). The Paying Agents reserve the right at any time to change their respective specified offices to some other specified office in the same city. Notice of all changes in the identities or specified offices of any Paying Agent or the Calculation Agent will be given promptly by the Issuer to the Holders in accordance with Condition 15. The Issuer undertakes that it will ensure that it maintains a paying agent in a Member State of the European Union that will not be obliged to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any law implementing or complying with or introduced in order to conform to such Directive.

(b) Terms of the Agency The Paying Agents and the Calculation Agent act solely as agents of the Issuer and save as provided in the Issue and Paying Agency Agreement or any other agreement entered into with respect to its appointment, do not assume any obligations towards or relationship of agency or trust for any Holder of any Note, Receipt or Coupon and each of them shall only be responsible for the performance of the duties and obligations expressly imposed upon it in the Issue and Paying Agency Agreement or other agreement entered into with respect to its appointment or incidental thereto.

13. Replacement of Notes If any Note, Receipt or Coupon is lost, stolen, mutilated, defaced or destroyed, it may be replaced at the specified office of the Fiscal Agent or such Paying Agent or Paying Agents as may be specified for such purpose in the Final Terms (“Replacement Agent”), subject to all applicable rules and regulations and the requirements of the Luxembourg Stock Exchange and/or any other stock exchange on which the Notes are listed, upon payment by the claimant of all expenses incurred in connection with such replacement and upon such terms as to evidence, security, indemnity and otherwise as the Issuer and the Replacement Agent may require. Mutilated or defaced Notes, Receipts and Coupons must be surrendered before replacements will be delivered therefor.

14. Meetings of Holders and Modification, Amendments and Waivers The Issue and Paying Agency Agreement contains provisions for convening meetings of the Holders to consider any matter affecting their interests, including the sanctioning by Extraordinary Resolution (as defined in the Issue and Paying Agency Agreement) of a modification of the Notes, the Receipts, the Coupons or any of the provisions of the Issue and Paying Agency Agreement. Such a meeting may be convened by the Issuer or Holders holding not less than five per cent in nominal amount of the Notes for the time being remaining outstanding. The quorum at any such meeting for passing an Extraordinary Resolution is one or more persons holding or representing not less than 50% in nominal amount of the Notes for the time being outstanding, or at

47 any adjourned meeting one or more persons being or representing Holders whatever the nominal amount of the Notes so held or represented, except that at any meeting the business of which includes the modification of the Notes or any date for payment of interest thereof, reducing or cancelling the amount of principal or the rate of interest payable in respect of the Notes or altering the currency of payment of the Notes, Receipts or Coupons or the majority required to pass an Extraordinary Resolution, the quorum shall be one or more persons holding or representing not less than 75% in nominal amount of the Notes for the time being outstanding, or at any adjourned such meeting one or more persons holding or representing a clear majority, in nominal amount of the Notes for the time being outstanding. An Extraordinary Resolution passed at any meeting of the Holders shall be binding on all the Holders, whether or not they are present at the meeting, and on all holders of Receipts or Coupons.

The Fiscal Agent and the Issuer may agree, without the consent of the Holders, holders of Receipts or holders of Coupons, to: (i) any modification (except as mentioned above) of the Issue and Paying Agency Agreement which is not prejudicial to the interests of the Holders; or (ii) any modification of the Notes, the Receipts, the Coupons or the Issue and Paying Agency Agreement which is of a formal, minor or technical nature or is made to correct a manifest error or to comply with mandatory provisions of the law of the jurisdiction in which the Issuer is incorporated or any other applicable mandatory provision of law.

Any such modification shall be binding on the Holders, the holders of Receipts and the holders of Coupons and any such modification shall be notified to the Holders in accordance with Condition 15 as soon as practicable thereafter.

15. Notices Notices to Holders of Notes will, save where another means of effective communication has been specified herein or in the Final Terms, be published (i) in a leading daily newspaper having general circulation in London (which is expected to be the Financial Times) and (ii) if and for so long as the Notes are listed on the Luxembourg Stock Exchange, a daily newspaper of general circulation in Luxembourg (which is expected to be the D’Wort) and on the website of the Luxembourg Stock Exchange at www.bourse.lu or, if in either case, this is not practicable, one other English language daily newspaper having general circulation in Europe as the Issuer, in consultation with the Fiscal Agent shall decide. The Issuer shall also ensure that notices are duly published in a manner which complies with the rules and regulations of any other stock exchange on which the Notes are for the time being listed.

Until such time as any Definitive Notes are issued, there may (provided that, in the case of Notes listed on a stock exchange, the rules of such stock exchange permits) so long as the relevant Temporary Global Note or Permanent Global Note is or are held on its/their entirety on behalf of Euroclear and Clearstream, Luxembourg, be substituted for such publication in such newspaper(s) the delivery of the relevant notice to Euroclear and Clearstream, Luxembourg and/or any other relevant clearing system for communication by them to the persons shown in their respective records as having instruments in the relevant Temporary Global Note or Permanent Global Note.

Any notice so given will be deemed to have been validly given on the date of first such publication (or, if required to be published in more than one newspaper, on the first date on which publication shall have been made in all the required newspapers) or, as the case may be, on the fourth weekday after the date of such delivery to Euroclear and Clearstream, Luxembourg and/or such other clearing system.

Holders of Coupons will be deemed for all purposes to have notice of the contents of any notice given to Holders of Notes in accordance with this Condition.

16. Further Issues The Issuer may from time to time, without the consent of the Holders of the Notes or the Coupons (if any) appertaining thereto, create and issue further notes, bonds or debentures having the same terms and conditions as the Notes in all respects (or in all respects except for the first payment of interest, if any, on them and/or the denomination(s) thereof) so as to be consolidated and form a single series with the outstanding Notes, subject to the provisions set forth in Conditions 4(a) to 4(d) above.

48 17. Waiver and Remedies No failure to exercise, and no delay in exercising, on the part of the Holder of any Note, any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right. Rights hereunder shall be in addition to all other rights provided by law. No notice or demand given in any case shall constitute a waiver of rights to take another action in the same, similar or other instances without such notice or demand.

18. Governing Law and Jurisdiction The Notes, the Receipts, the Coupons and the Issue and Paying Agency Agreement are governed by, and shall be construed in accordance with, the laws of the State of New York applicable to agreements made and to be performed wholly within such jurisdiction.

The Issuer submits to the non-exclusive jurisdiction of any United States Federal or New York State court sitting in New York City, the Borough of Manhattan solely for the purpose of any legal action or proceeding brought to enforce its obligations hereunder or under any Coupon, Receipt or Talon. As long as any Note or Coupon remains outstanding, the Issuer shall either maintain an office or have an authorized agent in New York City, upon whom process may be served in any such legal action or proceeding. Service of process upon the Issuer at its office or upon such agents with written notice of such service mailed or delivered to the Issuer shall to the fullest extent permitted by applicable law be deemed in every respect effective service of process upon the Issuer in any such legal action or proceeding. The Issuer appoints CT Corporation System, presently situated at 111 Eighth Avenue, New York, New York 10011, as their agent for such purposes and covenant and agree that service of process in any legal action or proceeding may be made upon them at their respective offices, or upon their agent at such agent’s specified offices in New York City.

49 USE OF PROCEEDS

The net proceeds to the Company from the sale of the Notes will be used by the Company for general corporate purposes. If in respect of any particular issue, there is a particular identified use of proceeds, this will be stated in the applicable Final Terms.

50 BUSINESS

Cargill, Incorporated, headquartered in Minneapolis, Minnesota, is an international marketer, processor and distributor of agricultural, food, financial and industrial products and services, with 124,000 employees in 59 countries. Founded as a grain warehousing and merchandising company in 1865, Cargill, Inc. is regarded as one of the largest privately owned companies in the world based on revenues. Its global growth has resulted from reinvestment of cash flow from operations and strategic diversification into related businesses. Cargill, Inc.’s strategic intent is to be the premier provider of customer solutions in food and agriculture.

Cargill, Inc. has 73 business units that operate in four geographic regions: Asia Pacific, Europe/Africa, Latin America and North America. Cargill, Inc.’s business units are organized around five business segments: Agricultural Services, Origination and Processing, Food Ingredients and Applications, Risk Management and Financial, and Industrial.

Cargill, Inc. is incorporated under the laws of the State of Delaware. The Company’s registered offices are located at 15615 McGinty Road West, Wayzata, MN 55391-2399 and its telephone number is: +1 (952) 742-2000.

Cargill, Incorporated and Subsidiaries Summary of Cargill Business Segments and Units As of November 30, 2005

Cargill reports results by five segments: 1. Agriculture Services provides crop and livestock producers worldwide with customized farm services and products. 2. Origination and Processing connects producers and users of grain, oilseeds and other agricultural commodities through origination, processing, marketing and distribution services. 3. Food Ingredients and Applications serves food makers, food service companies and retailers with food and beverage ingredients, meat and poultry products, and new food applications. 4. Risk Management and Financial provides customers and Cargill with risk management and financial solutions in world markets. 5. Industrial supplies customers with fertilizer, salt, steel and industrial uses for agricultural feedstocks.

AGRICULTURE SERVICES Cargill Animal Nutrition develops and markets a broad range of animal feeds and customized animal productivity solutions to commercial producers in 26 countries across North and South America, Europe and Asia. Branded products are sold in the aqua, beef, dairy, poultry, pork and pet food segments. Its Livestock Solutions unit provides technical services, technology licensing and/or management services to customers. Another area, feed applications, develops specialty feed ingredients that focus on improving digestibility and animal health, and increasing meat yields.

Cargill AgHorizons United States serves farm customers in the United States with a 1,000-member team in over 100 locations. The business is dedicated to helping farmers prosper. Products and services include grain origination and storage, grain marketing resources and advice, crop input products such as seed and fertilizer, agronomic advice and information services.

Cargill AgHorizons Canada serves farm customers from more than 60 locations throughout Canada. The business originates, stores and transports grain and oilseeds; offers commodity risk management products; sells seed, bulk fertilizer, crop protection products and custom application services; and provides agronomic advisory services.

Frontier Agriculture Limited is a 50-50 joint venture formed by Cargill and Associated British Foods on April 2, 2005. Banks Cargill Agriculture transferred its trade and assets to the joint venture known as Frontier Agriculture Ltd. ABF also transferred the trade and assets of their Allied Grain subsidiaries into the joint venture. Frontier Agriculture Ltd. originates and markets grain to food and feed makers in the U.K. and sells crop inputs (fertilizer, seed and crop protection products) to farmers. In addition, the business provides crop marketing and

51 agronomic services and also processes a full range of cereal, oilseed, pulse and herbage seeds. Frontier Agriculture Ltd. employs 650 people in the main farmland areas of the U.K. and centers its operations in six commercial hubs in Lincolnshire, Bedfordshire, Hampshire, Norfolk, Yorkshire and Northumberland. In 2004, significant storage and elevation facilities were added at the port of Hull, England, and in the same year similar facilities were also brought into operation at the port of Southampton under a joint venture agreement with J Soufflet (UK) Ltd.

Renessen Feed & Processing is a biotechnology joint venture between Cargill and Monsanto headquartered near Chicago. Through advanced breeding techniques and biotechnology, Renessen is creating a pipeline of value-added products for the feed and processing industries. These products create value for customers by significantly increasing the energy, protein content, digestability and amino acid balance in corn and soybeans. Renessen’s first product was launched in Argentina and serves customers in several countries.

ORIGINATION AND PROCESSING Cargill Grain & Oilseed Supply Chain consists of 11 business units that operate on an integrated global basis. The group sources, trades, processes and distributes grain and oilseeds. The main bulk products handled are wheat, corn, oilseeds, barley and sorghum, as well as vegetable oils and meals. The group also includes Cargill’s ocean freight and logistics business. It coordinates all of Cargill’s ocean bulk freight needs and a growing volume of other companies’ coal and mineral freights. Grain & Oilseed Supply Chain employs 10,500 people in 50 countries. It operates 321 interior silos, 31 import/export elevators, 54 crush plants in 17 countries and a 25,000-hectare palmoil plantation in Indonesia. It also encompasses 30 joint ventures. Grain & Oilseed Supply Chain has developed significant expertise in handling identity-preserved and differentiated products that sustain their distinctiveness in overseas markets. Because it charters more than 145 million metric tons of dry bulk tonnage, it has the logistical flexibility and opportunity to leverage efficiencies in the supply chain. Close cooperation with Cargill’s Trade and Structured Finance business unit and the company’s risk management teams adds a further range of financial and hedging products to the products and services offered.

Cargill Cotton merchandises cotton worldwide. From its office in Cordova, Tenn., it originates cotton grown primarily in the western hemisphere for sale worldwide to textile mills. It also operates four cotton storage warehouses in the United States, and a trading office and warehouse in Rondonopolis, Brazil. From its Liverpool, England office, it originates cotton from other parts of the developing world for sale to European and Asian textile mills. The Liverpool office also manages the operation of cotton gins in Tanzania and Zimbabwe.

Cargill Sugar trades raw sugar in bulk and white sugar in bags or containers from offices located in Geneva, Hong Kong, Minneapolis and Amsterdam. It originates sugar from the world’s leading sugar-producing countries including Brazil, where it co-owns and operates two major sugar export terminals, handling bulk since 1998 and bags since 2002. It ships and distributes sugar to customers, industrials, distributors and end-users through local offices in the former Soviet Union, Egypt, Venezuela, Sri Lanka and India, and other consuming countries worldwide. In 2003, it invested a minority share in a major sugar milling group in Mexico to complement its significant local distribution business. In April 2004, it started worldwide trading of ethanol. In November 2004, it invested in a joint venture in El Salvador, which includes an ethanol dehydration facility, origination from Brazil and marketing distribution in the United States. In May 2005, through a joint venture with its Brazilian milling partner Crystalsev, it invested in an ethanol terminal with 80,000 cubic meters of storage capacity in Santos, Brazil. Recent investments include the acquisition of a minority share in a Russian sugar beet mill and the construction of a sugar refinery through a joint venture in Syria.

FOOD INGREDIENTS AND APPLICATIONS Food Ingredients North America Cargill Sweeteners North America is one of the world’s leading producers of corn sweeteners. In addition to manufacturing high fructose corn syrup, which is used in soft drinks and other food and beverage applications, it makes corn syrups, dextrose syrups and sucrose that are used in a variety of confectionery, brewing, food and pharmaceutical applications. The business also produces fuel-grade ethanol, and is a leading supplier of corn oil, corn gluten meal and corn gluten feed products. Its facilities are located in Iowa, Nebraska, North Dakota, Ohio, Indiana, Alabama, Texas and Tennessee.

Horizon Milling is a joint venture between Cargill and CHS, Inc. flour milling, with Cargill as the majority owner and managing member. Horizon Milling operates mills in the United States that grind durum wheat, spring wheat, hard winter wheat and soft winter wheat into flours for sale to retail and commercial bakeries, food manufacturers and retailers, government agencies and the export market. Its products are sold in

52 bulk, packaged for private label and branded, including Progressive Baker® brand products for premium-quality bakeries. Operations are located in Minnesota, North Dakota, Wisconsin, Tennessee, Virginia, Pennsylvania, Massachusetts, New York, Louisiana, Kansas, Texas, Utah and California.

Cargill Dressings, Sauces, and Oils North America refines vegetable and tropical oils and animal fat for a wide range of food and nonfood manufacturers. It also makes shortenings, frying oils, mayonnaise, dressings, and sauces for the foodservice industry. The business operates eight refineries, six shortening and oil packaging plants, a mayonnaise production facility, a dressings plant and a culinary sauce facility, all of which are located in the United States. It also operates an oil refinery in Mexico. Customers include major food manufacturers and quick-service and casual-dining restaurant chains. The business is integrated with Cargill’s soybean crushing activities, which provide a reliable source of crude soybean oil for further processing.

Cargill Malt Americas and a second business unit, Cargill Malt Eurasia, process barley primarily into brewing malt for major beer companies around the world. Together, the two businesses make Cargill one of the world’s leading maltsters. Cargill Malt Americas operates four facilities in the Americas.

Cargill Acidulants produces high-value, fermentation-based products for the food and beverage industry and for industrial applications. At its Eddyville, Iowa, facility, Cargill Acidulants produces citric acid, sodium citrate and potassium citrate. It also makes itaconic acid, which is used by the paper and textile industries in the production of latexes. A second facility in Uberlândia, Brazil, produces citric acid and sodium citrate. In June 2003, Cargill Acidulants began producing REGENASURE® glucosamine, a dietary supplement used to promote joint health. All products are sold worldwide.

Food Ingredients Europe Cargill Sweeteners Europe is the leading wheat and corn wet miller in Europe. It produces sweeteners and wheat proteins for food customers, including confectioners, brewers, beverage makers, dairy and ice cream producers, and preserves and bakery manufacturers. In addition, a full range of wheat and corn-derived proteins, lipids and fibers are sold to the feed industry. The business operates various plants throughout Europe and has sales offices in Scandinavia, Austria, the Baltic States and United Arab Emirates. The breadth of production plants allows the business to tailor glucose and fructose blends to match individual customer needs. Its products are supported with a Center of Excellence in Vilvoorde, Belgium and local specialists in each geography served. Application specialists optimize formulations that adapt to a full range of applications that it serves. This application and development capability also supports the vital wheat gluten provided to the food and other industries. Activities also include production of ethanols, which are used for food and technical purposes. The business also provides a comprehensive range of supply chain services, including identity-preserved raw material sourcing, full quality and microbiological testing and other operational services, and expanded service to bulk customers. Collaborating with other businesses, risk management products are also offered to customers.

Cargill Starches & Sweeteners Russia provides sweeteners to the confectionery and drink industries, starch to industrial and food customers, and ingredients to the farm and pet food sectors. Its corn wet mill in Efremov was acquired in 1995, and has been upgraded extensively to deliver more volume and higher-quality products. It is the largest of its kind in Russia.

Cargill Starches & Sweeteners Turkey supplies glucose and fructose syrups and corn starches to food and industrial customers in Turkey, with a focus on serving global soft drink manufacturers. Locally grown and imported corn is processed at its two wet mills in Vaniköy near Istanbul and in Orhangazi near Bursa. Cargill also is a 50 percent owner of PNS, a joint venture with Ulker, a local leading food manufacturing company.

Cargill Industrial Starches provides high quality products to the paper and corrugating, and chemical and industrial binders industries. The business purchases corn, its primary raw material, and wheat, and manufactures and distributes a broad range of native and modified starches and derivatives such as polyols and dextroses. Plant facilities are located in the Netherlands (2), Germany (2), Spain, France, Italy, the United Kingdom and the United States. Most industrial starch products are sold to third-party customers in Europe and the United States, to other Cargill units in Canada for further distribution, and worldwide via Cargill’s international sales organization.

Cargill Malt Eurasia supplies quality malt to brewing markets in Europe, with exports to Asia, Latin America and Africa. Headquartered in St. Germain en Laye, near Paris, it has a network of five malt facilities in Belgium, France, Germany, Holland and Spain. In Russia, Malt Eurasia is developing malting barley origination

53 and building a new malt plant in Efremov (Tula region), which will begin operating in 2006. More recently, it installed a microbrewery, which provides information to optimize industrial processing conditions, improve malt quality and develop new products.

Cargill Refined Oils Europe refines and further processes a wide selection of vegetable oils and fats for the food and industrial applications. ROE operates refineries and oil modification plants at 15 locations throughout Germany, the United Kingdom, the Netherlands, Belgium, France and Spain. Products offered include refined, winterized, hydrogenated, interesterified and fractionated oils and fats. The customer base includes all large food manufacturers throughout Europe.

Cargill Bottled Oil Europe serves European food markets with a wide variety of branded and non-branded vegetable and olive oils, and operates bottling plants in Belgium, Germany, France and Spain. In fiscal 2005, the business acquired two bottling plants in Romania to serve the Eastern European market. An additional bottling plant is being constructed in Russia and is expected to be operational in April 2006.

OCG Chocolate produces high-quality dark, milk and white chocolates in liquid, five-kilo blocks and an array of drops, chunks, strips and wafers. Principal customers include bakers, confectioners and dairy product manufacturers who use chocolate as an ingredient in their branded products. OCG Chocolate has plants in Rouen, France; Nottingham, U.K.; Antwerp, Belgium and Mouscron, Belgium. Additional sales offices are maintained in Germany and the United States. In June 2005, Cargill purchased Schiersteder Schokoladefabrik, a small industrial chocolate facility in Klein Schierstadt, Germany.

Cargill Cocoa is a major cocoa bean originator and processor. It offers a wide range of high-quality cocoa powder, butter and liquor products under the Gerkens® and Wilbur® brands to leading manufacturers of food, chocolate and confectionery products worldwide. Gerkens, based in Wormer, the Netherlands, ranks among the largest processors of cocoa in the world. It operates in the high-quality segment of the market. Products are sold through an international network of offices, agents and distributors. Facilities include: Ivory Coast for production of cocoa liquor, butter and powder and origination of cocoa beans; the Netherlands for production of compound chocolate coatings, fillings and chocolate in drops and a refinery for vegetable oils and fats; Indonesia, Nigeria and Vietnam for origination of cocoa beans; Germany and the United Kingdom for production of cocoa liquor; and Turkey for the origination and processing of hazelnuts.

Food Ingredients Latin America Cargill Starches & Sweeteners Brazil produces a variety of starches, sweeteners, syrups, dextrins, high maltose and maltodextrin products from corn and tapioca for use in the food, paper, corrugated board and mining industries in Brazil, Central and South America and South Africa. It also markets products from the corn wet milling process (corn gluten fiber and meal) and from other processes (citrus pulp pellet, soy feed and flour residues) to local feed companies. The unit conducts corn wet milling and corn starch/corn syrup modification in Uberlândia in Minas Gerais State, and tapioca processing and tapioca starch modification in São Miguel do Iguaçu in the state of Parana. It also manages the applications development center in Mairinque, São Paulo State, serving other Cargill businesses, and manages a distribution center in São Bernardo do Campo, São Paulo State, utilizing products from various Cargill partners. A plant in São José do Rio Pardo, encompasses a product line of fruits preparations, cake fillings, toppings, sauces and other products. A plant located in Porto Ferreira, São Paulo State, was acquired in July 2005. This acquisition complements the existing Latin American Starch and Sweetener product line and strengthens its ability to provide value-added solutions for food and food service customers.

Cargill Foods Brazil serves two segments of the food industry: retailers and manufacturers. For the retail market, it produces bottled and canned cooking oils, under the brands Liza®, Veleiro®, Olivia™ Purilev™ and Mazola™. In June 2005, it started to produce mayonnaise under the Liza® brand. These products are distributed to retail chains, distributors and small supermarkets. Production and distribution sites include Mairinque, Uberlândia, Barreiras and Rio Verde. Its sales team as well as sales representatives cover all of Brazil territory. The business also distributes olive oils imported from Portugal and Spain, salad dressings under the brands Liza® and Purilev™, produced by a third-party Brazilian food manufacturer. For food manufacturers, it produces refined and hydrogenated oils. In July 2004, Cargill Foods Brazil acquired a new facility in the city of Itumbiara that produces hydrogenated oils. With this acquisition, hydrogenated oils are produced and distributed out of Mairinque and Itumbiara production and distribution of refined oils are handled out of Mairinque and Uberlândia facilities.

54 Cargill Foods Venezuela is a leading food distributor in Venezuela, specializing in staple food production and distribution. At retail outlet stores, it offers leading lines of branded flour, pasta, rice and bottled oils, and also distributes products for other food suppliers. For bakeries, it provides flour, shortenings, premixes, yeast, salt and sugar, plus technical support. For global packaged foods companies, it provides oils, fats, flour and premixes. Foods Venezuela operates five plants: an oil refinery in Valencia; two pasta plants, located in Catia La Mar and Maracaibo; a flour mill in Catia; and a rice plant in Píritu. It also operates six distributions centers, located in Barquisimeto, El Llanito, Puerto La Cruz, Turmero, Maracaibo and San Cristóbal.

Cargill Cocoa Brazil is a major cocoa bean originator and processor in Latin America. It offers a wide range of high-quality cocoa powder, butter and liquor products under the Gerkens® Brazil and Spectrum Line™ brands to leading manufacturers of chocolate and confectionery products in South America. Brazil Cocoa has a processing facility in Ilhéus, Bahia, to serve the domestic and U.S. markets, and exports the balance worldwide.

Cargill Flour Mercosur is a leading supplier of flour to the bakery, food manufacturing, wholesale and export flour markets in Argentina and two in Brazil. Its products are sold in bulk and packaged under its own brands to customers regionwide. It operates seven flour mills in Argentina, two in Brazil, and wheat storage sites in both countries.

Food Asia Cargill Starches & Sweeteners China is headquartered in Shanghai and operates in four markets. Through a corn milling joint venture located in Song Yuan, Jilin Province of China, it produces native starch, modified starch, dextrose, glucose and spray dried products. Customers include domestic food companies as well as multinational accounts. Through another joint venture in Shanghai, it produces fructose, which is primarily sold to Coca-Cola® bottlers. A food system business, located in Beijing, was acquired in June 2005. It will focus on developing the food system products business in China, including emulsifiers and stabilizers, mainly for domestic beverage companies. A team in Singapore trades within Asia all products manufactured within its business as well as sweeteners products from other Cargill businesses.

Toshoku handles wheat, corn, edible oil, sugar, cacao, coffee, eggs, meat, beverages, frozen vegetables, canned goods and other food products and food ingredients. The 19 product groups are sourcing and sales organizations, which work closely with mostly Japan-based Japanese customers, to identify and define requirements, mainly for food products and food ingredients. To deliver the unique products and ingredients required by its Japanese customers, Toshoku works closely with Cargill and non-Cargill suppliers around the world. Toshoku has 6 domestic offices and 13 overseas offices in 10 countries.

Cargill Refined Oils India imports, refines, sells and markets a wide range of vegetable oils and fats to wholesale trade, industrial and household consumers across India. It owns and operates four vegetable oil refining facilities, three are located on east and west coast ports of India, and one inland refinery is located in western India. Refined Oils India markets its range of refined sunflower, soy, palm, olein and ground nut oils, hydrogenated fats and bakery shortenings under its national brands, Nature Fresh™, Gemini™, Purita™, and other region-specific brands. The business engages a network of storage points and distributors across the country to access over 100,000 retail stores that sell its products.

Food System Design Cargill Sweetness Solutions is a global business unit that produces sweetening functionality for the use in a wide variety of processed food, bakery, beverage, confectionery, and pharmaceutical applications. European markets are served out of production facilities in Germany, Italy, the United Kingdom and France that produce dextrose and a variety of polyols, including: sorbitol, mannitol, maltitol, xylitol and isomalt. The European facilities also supply the United States and other markets with exports of dextrose and polyols products. Erythritol, another polyol product, is produced in Blair, Neb., for distribution to worldwide markets. Additional investment in the Blair plant will provide capabilities to produce additional polyol lines. A key focus of the business is the development of high intensity and specialty sweetener product lines.

Cargill Texturizing Solutions is a global business that produces a variety of texture-enhancing ingredients. Native and modified food starches and spray-dried specialty starches/maltodextrines are produced in plants located in Germany, Italy, the Netherlands, France, Spain and the United States. The starches are used in a wide range of food applications, including convenience food, bakery and dairy products to improve stability, texture, consistency and shelf life. The business also offers a variety of products and services to the pharma

55 industry. Soy protein is produced in plants located in Belgium, the Netherlands and the United States for use in bakery, meat and feed applications, milks, yoghurts and desserts. Pectin is produced in the newly acquired plant in Germany, for use in the dairy, fruit processing and confectionery markets primarily as a gelling agent, but can also act as thickener, water binder and stabilizer. Lecithin, an emulsifier derived from soybeans that helps blend fats with water, is produced in plants in the United Kingdom, Belgium, Brazil and through a toll processor in the United States. Xanthan gum, a thickener, stabilizer and emulsifier agent that is used in both food and industrial applications, is produced in China.

Cargill Health & Food Technologies is a developer, processor and marketer of science-based, health- promoting ingredients for the food and dietary supplement industries worldwide. Its vision is to accelerate health innovations in foods and supplements by focusing on health conditions that are important to our customers and consumers. HFT’s product brands include Corowise™ phytosterols, OptaFlex™ chondroitin sulfate, Oliggo- Fiber® inulin and Prolisse® soy isolate.

Wilbur Chocolate transforms fats, flavorings and bulking agents into a broad array of ingredients for a wide range of customers in North America. Sales personnel are located throughout the United States, and products are sold under the Wilbur®, Peter’s® Chocolate and OCG™ brand names. Customers include food manufacturers, retail confectioners, bakery, dairy and grocery and proprietary industries. Based in Pennsylvania, with production facilities in the United States and Canada, Wilbur makes coatings, blocks, chips and wafers in milk and dark chocolate, as well as other flavors and colors. Additional offerings include sugar-free chocolate coatings that appeal to sugar-intolerant consumers, chocolate-flavored ice cream coatings and colored, flavored or nutritionally enhanced fillings for grocery and bakery applications. In North America, Wilbur also markets cocoa powders created by Cargill businesses in Brazil, the Netherlands, Ivory Coast and France, and Cargill chocolate products made in Belgium.

Duckworth Flavors was formed from the acquisition of The Duckworth Group in January 2004. Duckworth is a flavor company based in Manchester, England, with additional facilities in Bangalore, India, and Cape Town, South Africa. It creates flavor ingredient and systems for makers of savory foods, bakery, confectionery, dairy and beverage products.

Cargill Orange Juice supplies frozen concentrate orange juice, not-from-concentrate and orange byproducts to customers around the world. In July 2004, Cargill sold its Brazilian juice activities to two Brazilian companies, Cutrale and Citrosuco. The assets sold included citrus production farms at Planura, Comendador Gomes, Cajobi and Frutal, the processing plants at Bebedouro and Uchoa and related assets. The sale of the vessel, M/V Bebedouro, was completed in August 2004. Cargill continues to serve its worldwide juice customers by sourcing Brazilian origin citrus products from these two companies.

Cargill Juice Beverage Applications North America operates processing and storage facilities in central Florida and a terminal facility in Port Elizabeth, N.J. Headquartered in Frostproof, Florida, the business unit is comprised of four product lines: orange and grapefruit processing, flavor ingredients, food service and beverage applications. Bulk orange and grapefruit juice products are sold to a variety of customers including national brands, regional brands, dairies and institutional packers. Primary markets include North America, Asia and Europe. The flavor ingredients product line leverages a leadership position in production of grapefruit oils/ essences targeting flavor and fragrance houses, branded beverage companies and Takasago, the leading consumer of grapefruit oils in Japan. The business entered into the beverage applications segment of the food service market this year. Beverage applications develops ingredient systems (bases/compounds) and finished beverage applications for private label retailers, second tier brands and foodservice.

Cargill Juice Beverage Applications Europe, Middle East & Africa markets fruit juice beverages to customers in Europe, Asia and Africa. Its fruit-concentrate blending operation develops tailor-made recipes for several applications, including juice beverages, dairy products and ice cream coatings. It manages a supply chain that runs from the global sourcing of fruit ingredients to the packaging of finished products for the food service industry. The business is located in Amsterdam, Netherlands. In 2005 Cargill acquired a small lab in Uden, which specializes in flavor applications.

Meat Solutions Cargill Food Distribution has 11 state-of-the-art distribution centers that provide quality, fresh and high- value meat products to processors, distributors, retailers, hotels, restaurants and other institutions throughout the United States.

56 Cargill Value Added Meats is a grower and processor of live turkeys and a manufacturer of further- processed beef, pork and poultry products. Its product offerings include whole bird turkeys, case ready turkey products, cooked meats, hamburger patties, portion control steaks, and commodity turkey parts. Its principal customers are the top 200 U.S. restaurant chains, major food service distributors, retail grocery chains and other food processors. The business operates manufacturing facilities in Arkansas, Iowa, Wisconsin, Texas, Virginia, Missouri and Nebraska.

Cargill Case Ready Beef provides prepackaged case ready beef and pork meat solutions to leading food retailers in the United States and Canada from facilities in Ontario, Quebec, Georgia, Missouri and Pennsylvania. The business includes Precept Foods, a joint venture between Hormel Foods Corporation and Cargill Meat Solutions Corporation, that markets fresh case-ready beef and pork under the HORMEL® ALWAYS TENDER® brand name to U.S. retailers.

Cargill Beef is the second largest beef processor in North America. It processes cattle raised and fed for beef production. Headquartered in Wichita, Kansas., Cargill Beef operates beef slaughter and fabrication facilities in the United States and Canada, from which the lead product is boxed beef: large, wholesale cuts of meat that are vacuum packed and boxed for chilled shipment to food retailers and food service customers domestically and abroad. Fed cattle are harvested and fabricated at six facilities located in Texas, Kansas, Colorado, Nebraska and High River, Alberta, Canada. Over 7.2 million head of cattle are processed annually, generating more than 7.5 billion pounds of boxed beef and by-products. It also has seven regional sales offices in Wichita, Atlanta, Dallas, Denver, Philadelphia, Toronto and Calgary. To support overseas efforts, it maintains offices in Japan, Hong Kong, Korea, Shanghai and Taiwan. Cargill Beef sells fresh meat and other products to virtually every major chain, wholesaler and distributor in the country. Cargill Beef also leads the way in improving critical food safety controls, measures and procedures. The business includes Cargill Cattle Feeders, one of the largest commercial cattle feeders in the United States. Headquartered in Wichita, Kansas, it feeds about 600,000 head of finished cattle annually, from four feedlots located in Kansas and Texas, and works closely with Cargill’s Animal Nutrition and Risk Management business units. On June 1, 2004, Cargill acquired a 50 percent share of Finexcor, a leading Argentine beef packing and processing firm. Cargill acquired the remaining 50 percent of Finexcor on June 28, 2005. From two plants in Buenos Aires and Nelson, in the province of Santa Fe, Finexcor exports three quarters of its production to markets in Europe, the United States and the Middle East. On Sept, 2, 2005, Cargill acquired the assets of Better Beef Limited, the leading provider of boxed beef, case ready and ground beef products to retail and food service customers in eastern Canada and the United States. It operates two plants in Guelph, Ontario, consisting of a 2000 head per day slaughter and fabrication plant, and a case ready and foodservice grind plant. A back-up case ready plant is located in Hamilton, Ontario.

Cargill Taylor Beef produces high-quality cow products specializing in custom-made cow blend ground beef, which is sold in both chub and case-ready packages. It operates cow slaughter, processing, grinding and case-ready facilities in Pennsylvania and Wisconsin. The business serves retail grocery and food service companies. It also is the largest collector and processor of nature-fed veal and box veal calfskins in North America. These skins are cured and exported abroad for further processing into high-quality leather products.

Cargill Beef Australia operates a vertically integrated beef business that includes a major feedlot and two export-licensed beef processing facilities in New South Wales, Australia. The feedlot has a 17,000-head capacity, and the two processing facilities have a combined capacity of 1,950 head per day. The business offers a comprehensive range of beef products and branded beef programs, including grain and grass-fed cattle, to the Australian market and for export to Asia, North America and other markets. Sales representatives are located in Japan, Korea, Taiwan, China, Hong Kong and the United States. The business serves customers in the retail, food service, distribution, and hotel, restaurant and institutional sectors of the market.

Cargill Pork is involved in pork production, with contract operations in eight states throughout the central United States. Its PorkWorks® program works with family farmers, and is the premier pig supply program in the United States. The business operates two hog processing facilities in Illinois and Iowa. Its refrigerated boxed pork products serve food retailers, food service companies, further processors and export markets. Many of its products are branded.

Retail Food Service Solutions Sunny Fresh Foods is a leading marketer of high value, further-processed egg products in the United States. With processing plants in Minnesota, Iowa and Michigan, Sunny Fresh Foods’ customers include premier quick-service restaurant chains as well as food manufacturers. In 1999, Sunny Fresh Foods became the first food company in the United States to receive the prestigious Malcolm Baldrige National Quality Award. In November 2005, Sunny Fresh Foods received the Malcolm Baldrige award for the second time.

57 Sun Valley Central America is a retail-branded business that processes and distributes chilled and frozen poultry and luncheon meats to large and small food retailers throughout Central America. It also distributes processed cheeses and French fries. Its poultry operations are located in Honduras and Nicaragua, and its processed-meat operations are in Costa Rica, Guatemala and Honduras. Recognized local brands include: Pollo Norteno® and Delicia® in Honduras; Tip Top®, Delicia® and Cinta Azul® in Nicaragua; Perry® and Premier® in Guatemala, and Cinta Azul® in Costa Rica. In November 2004, a joint venture was formed in El Salvador for the distribution of products that will be initially outsourced from its operations in Guatemala. In May 2005, the assets and trademark of a local competitor in Honduras were acquired.

Sun Valley Europe, headquartered in Hereford, U.K., supplies food products to retail, food service and food manufacturing customers in European and world markets. Focused primarily on poultry products, it is a major supplier of both branded and customer-branded chicken and further-processed poultry products to U.K. retail chains and the quick-service food industry in Europe. Its Cargill Integra division, with plants in the United Kingdom, Holland, and Ireland, focuses on serving food manufacturers.

Sun Valley Foods Canada is a dedicated supplier to McDonald’s Restaurants of Canada Ltd. Sun Valley supplies all of the chicken and beef products to approximately 1,300 McDonald’s restaurants in Canada. Sun Valley Foods Canada owns and operates four processing plants in Canada, including: a plant, located in London, Ontario, processes about 21 million chickens per year, generating 17,000 tons of finished chicken product; an operation in Jarvis, Ontario, hatches about 36 million chicks per year; a manufacturing plant in Brampton, Ontario, produces about 18,000 tons of frozen patties per year; and a manufacturing plant in Spruce Grove, Alberta, produces about 9,000 tons of frozen patties per year.

Sun Valley Thailand is a large, fully integrated poultry processing business located in Saraburi, Thailand, with a sales office in Tokyo, Japan. It produces a wide range of cooked chicken products, with more than 80 percent of its products exported to Japan, Europe, Canada and Hong Kong. In Asia, Sun Valley’s customers are large food manufacturers and distributors such as Nicherei, McDonald’s Japan and McDonald’s Hong Kong. It serves the Canadian and European markets by supplying other Cargill business units that engage in food processing and distribution.

Seara is a major Brazilian poultry and pork processor, which Cargill acquired in Fiscal 2005. Seara has seven poultry processing facilities, two pork processing facilities, four regional sales offices, nine feed production facilities, seven distribution centers and one port terminal in Brazil. It also has sales distribution center for Europe in Amsterdam, sales forces in Tokyo, Singapore, Buenos Aires, Moscow and Dubai.

Joint Ventures/Other PGLA-1 is a joint venture partnership between Cargill and PURAC, a subsidiary of the Dutch food group CSM. PGLA-1 produces lactic acid at its Nebraska plant for sale to its parent companies, including PURAC’s food and pharmaceutical business.

Cargill Specialty Canola Oils develops, produces and markets high-performance canola oils. Its business is backed by an intellectual property position in the genetic engineering of canola, and by a leading team of molecular biologists specializing in oil modification. It develops proprietary planting seed, contracts with growers in Canada and crushes and refines canola into premium oils sold to food processors and food service users. Limited amounts of high oleic sunflower oil also are available.

RISK MANAGEMENT AND FINANCIAL Black River Asset Management, a wholly owned subsidiary of Cargill, is an independently run global asset management company with offices in nine countries and more than 19 years of worldwide investment experience. Black River, formerly Cargill’s proprietary trading operation, Cargill Global Capital Markets, provides qualified investors with alternative investment strategies. It offers a wide range of investment products supported by experienced investment professionals, rigorous risk processes and a well-established global infrastructure. Targeted clients include foundations, pensions, endowments, family offices and other institutional investors.

Cargill Value Investment is among the world’s leading investors in management- and credit-intensive assets, including corporate credit (high-yield bonds, bank notes and reorganization situations), loan portfolios and real estate. The business has more than 75 investment professionals working with approximately 110 administrative, tax and legal professionals in 10 offices around the globe and is a recognized international leader in value investing.

58 Cargill Trade & Structured Finance works with Cargill’s commodity business units to provide financial solutions to their suppliers and customers. Its expertise in global financial markets aids in mitigating the documentary, cross-border and credit risks associated with structured trade finance. The business plays a key role in funding the global operations of Cargill through cross-border funding structures and the management of transferability and convertibility risks. In addition to structured trade finance and internal funding, it also leverages Cargill’s international trade flows to create trade structures that provide funding to emerging market- based financial institutions and corporations.

Cargill Power & Gas Markets is a proprietary trader of electricity and natural gas, with offices in Minneapolis and Calgary. CPGM leverages its trading and risk management capabilities by aligning itself with entities that own, control or seek control of energy assets including gas transportation and storage or power generation. It is one of North America’s largest physical shippers of both natural gas and power, and a provider of management services and customer solutions to Canadian gas producers and end-users. CPGM also provides other Cargill business units and external customers with products that help mitigate energy price exposures and protect operating margins.

Cargill Petroleum is a proprietary trader and merchandiser of crude oil, petroleum products and petroleum derivatives, with trading offices in Geneva, Minneapolis, Singapore, Shanghai and Moscow.

Cargill Coal, headquartered in Geneva, is a proprietary trader and merchandiser of steam coal and coal products.

Cargill Ferrous International is involved in the global trading, distribution, and processing of steel mill consumables and products, including iron ore, pig iron, scrap, slabs, billets, plates, hot rolled, cold rolled, coated products, wire-rods, bars and sections. Through offices worldwide, it serves mills, processors and users. Cargill Ferrous International operates steel service centers in Indiana, Tennessee, Florida, Texas, and Oklahoma. These facilities process flat-rolled steel for use by industrial manufacturers in making products such as storage tanks, lawn mowers, metal furniture, and oil filters.

Cargill Risk Management structures and distributes over-the-counter risk management products to food and agricultural companies that help mitigate price exposure and protect operating margins. It embeds risk management products into commodity contracts and also delivers over-the-counter risk management products. CRM focuses on three customer segments: Hedging Products tailors products to meet the needs of commercial institutions; Investor Solutions provides hedge funds and pension funds with market expertise and investment alternatives; and Producer Risk Management focuses on providing farmers and livestock producers with unique marketing alternatives. CRM’s team is located in eleven offices in North and South America, Europe, and Asia.

Emerging Business Cargill Ventures is the venture capital arm of Cargill. It invests in high-growth technology-based companies that enable commerce, innovation and efficiencies in industries relevant to Cargill growth. Its investments often are synergistic or complementary to Cargill businesses. Cargill Ventures has offices in San Mateo, California and Minneapolis, Minnesota.

INDUSTRIAL Cargill Salt produces, packages and ships salt for the following six major market segment applications: agricultural, food, water conditioning, industrial, chemical and packaged ice control. Cargill Salt operates over 20 manufacturing/processing/warehousing locations, making salt from three major production methods including: mechanical evaporation at facilities in California, Kansas, Louisiana, Michigan, New York, and Ohio, solar evaporation and harvesting from ponds in California, Oklahoma, Utah, and Bonaire in the Dutch Antilles; and rock salt mining from underground mines in Louisiana, New York, and Ohio. Cargill Salt services a wide variety of customers ranging from home improvement, hardware, grocery, and convenience store retailers, to food makers/processors, water conditioning dealers, and food service and general wholesale distribution. Cargill Salt makes over 1,000 different salt products/package sizes and markets national and regional brands, including Diamond Crystal® branded household consumer food and water softener salt products, Champions Choice® branded agricultural products for animal feeding, as well as Cargill® and Alberger® branded specialty salt products for food manufacturing customers.

Cargill Deicing Technology mines, processes and transports bulk salt, enhanced treated salt and liquid deicers used for deicing roads. Its major customers are governmental agencies and private commercial accounts responsible for safe transportation in the snow belt regions of North America. Rock salt mines are located in Louisiana, New York and Ohio.

59 Cargill Industrial Oils & Lubricants provides high-performance, vegetable oil-based products to industrial customers in the paints and coatings, hardboard manufacturing, inks, lubricants, pharmaceuticals, textiles and specialty chemical industries. It serves customers in North America, Europe and South America from its main manufacturing site in Chicago, and ships products from other oil refineries in the United States. European customers are served by oil refineries in England, France, Germany and the Netherlands. In Brazil, products are shipped from Cargill’s Mairinque and Uberlândia oil refineries. Through a Brazilian joint venture with Hatco, IOL has constructed a lubricant plant alongside the Mairinque plant to serve customers in the refrigerant, oil drilling, metalworking and other lubricant markets. The plant, opened in November 2004, has been producing and shipping through Hatco and is awaiting local product approvals to begin full production.

The Mosaic Company (NYSE: MOS), in which Cargill is the major investor, mines, manufactures, markets and distributes fertilizer around the world. The company offers all three of the major crop nutrition products—phosphate, potash and nitrogen—and a number of specialty products such as K-Mag® fertilizer and MicroEssentials™ S15 fertilizer. Mosaic is the largest producer of processed phosphate, with significant equity interests in growing markets in China and Brazil. It also is the leading miner, processor and distributor of potash worldwide. Mosaic is the exclusive marketing agent of 1.2 million metric tons of nitrogen products and owns a 50 percent equity stake in Saskferco Products, one of the world’s most efficient nitrogen production facilities. The company’s diverse product lines are complemented by customized services, including tools for improving fertilizer application and for market forecasting.

NatureWorks LLC offers a family of polymers derived from annually renewable resources with the cost and performance to compete with petroleum-based packaging materials and fibers. The company uses its unique manufacturing technology to create a proprietary polylactide polymer sold as NatureWorks® PLA and Ingeo® fiber brand names.

North Star Steel (BlueScope JV) produces flat-rolled steel through a joint venture with Australia’s BlueScope Steel Ltd.

60 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Summary may contain forward-looking statements that reflect management’s current view with respect to future results, achievements and performance. These statements may be identified by their use of forward-looking terminology such as “believes,” “expects,” “anticipates,” “may,” “will,” “should,” “seeks,” “approximates,” “intends,” “aims,” “plans,” “estimates,” or the negative of these words or other comparable terminology. Such forward-looking statements are subject to risks and uncertainties that may cause our actual results, achievements or performance to differ materially from those projected or implied. To the extent permitted by applicable law, Cargill assumes no obligation to update any forward-looking statements as a result of new information or future events.

Six months ended Nov. 30, 2005, compared with six months ended Nov. 30, 2004

I. OVERVIEW Cargill, Incorporated, headquartered in Minneapolis, Minn., is an international provider of food, agricultural and risk management products and services with 124,000 employees in 59 countries. Founded as a grain warehousing and merchandising company in 1865, Cargill today is one of the largest, privately owned companies in the world. We are committed to using our knowledge and experience to collaborate with customers to help them succeed.

A. Corporate Organization Cargill reports results from operations in five segments: Agriculture Services, Origination and Processing, Food Ingredients and Applications, Risk Management and Financial, and Industrial. Our business units operate in four geographic regions: Asia Pacific, Europe/Africa, Latin America and North America.

B. Corporate Strategy By 2010, Cargill intends to be the recognized global leader in providing food and agricultural customers with solutions that help them succeed. The key elements of our strategy are depicted in the graph below.

In the initial years, we concentrated on aligning our businesses and organization, strengthening the company’s market position, gaining an understanding of customer solutions and improving our financial performance. Today, we are focusing on using our knowledge and experience to collaborate with customers to help them succeed.

61 As we continue Cargill’s strategic intent journey, we are emphasizing three elements: Š Providing supply chain solutions. This includes coordinating the global sourcing needs of food manufacturers and food service operators, as well as seeking to manage entire portions of customers’ supply chains. It also includes operating processing assets for customers that prefer to concentrate their resources on product development and marketing. Š Developing food applications solutions. This involves enhancing the functionality of existing products, combining ingredients into new products, developing convenience foods and applying technology to optimize food processing. Š The third element is developing health and nutrition solutions. This includes increasing crop and livestock yields and quality, and developing health-related solutions for humans pertaining to nutrients, wellness, disease resistance and therapeutics.

II. CONSOLIDATED REVIEW A. Financial Performance All comparative figures are for the second quarter of fiscal 2006, which ended Nov. 30, 2005, and the second quarter of fiscal 2005, which ended Nov. 30, 2004.

Reclassification: Certain fiscal 2005 amounts in Sections II., III., IV. and the Appendix were reclassified to conform with the current year presentation.

Consolidated summary of quarterly financial results

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Earnings from continuing operations ...... $ 495 $ 359 38 Earning from discontinued operations ...... —56— Net earnings, excluding noncash net gain ...... $ 495 $ 415 19

Noncash gain on fertilizer merger ...... $ 597 Net earnings ...... $ 1,012

Sales and other revenues ...... $18,694 $17,336 8

In the second quarter: Cargill reported net earnings of $495 million for the second quarter, up 19 percent from the same period a year ago, excluding the $597 million, noncash net gain realized in last year’s second quarter related to the formation of The Mosaic Company. The Mosaic Company, created from the merger of Cargill’s fertilizer businesses and IMC Global, debuted as a publicly traded company on the New York Stock Exchange on Oct. 25, 2004. Since its formation date, financial results of The Mosaic Company have been included in Cargill’s consolidated results.

Cargill’s second-quarter results were led by two segments: Origination and Processing, and Risk Management and Financial. Earnings in the Agriculture Services and Industrial segments also increased for the second quarter. Earnings in Food Ingredients and Applications were below the year-ago level.

Revenues were $18.7 billion in the second quarter of fiscal 2006, an increase of $1.4 billion, or 8 percent, from last year. The improvement was broad based, with three of the five segments reporting increased revenues for the comparative quarter.

62 Consolidated summary of six-month financial results

Six months ended Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Net earnings from continuing operations ...... $ 999 $ 816 22 Net earning from discontinued operations ...... —94— Net earnings, excluding noncash net gain ...... $ 999 $ 910 10

Gain on fertilizer merger ...... $ 597 Net earnings ...... $ 1,507

Sales and other revenues ...... $37,548 $34,751 8 Cash flow from continuing operations ...... 1,714 1,424 20 Cash flow from discontinued operations ...... — 427 — Capital investments ...... 1,291 581 122

In the first six months: Cargill reported net earnings of $999 million in the first half. This included $85 million in earnings from The Mosaic Company. Cargill’s net earnings were up 10 percent from $910 million a year ago, excluding the one-time net gain. Last year’s results included earnings from discontinued operations from steel assets sold Nov. 1, 2004.

Revenues reached $37.5 billion in the first six months, an increase of $2.8 billion or 8 percent from the same period last year. Food Ingredients and Applications, and Origination and Processing segments reported increased revenues for the six-month period. The Industrial segment includes revenues of $2.9 billion for The Mosaic Company.

B. Significant Developments 1. Acquisitions and alliances completed The following acquisitions, which were discussed in prior quarters’ MD&As, were completed in the second quarter: Š Cargill purchased the beef processing and related assets of Ontario-based Better Beef on Sept. 2, 2005. Š On Sept. 9, 2005, Cargill purchased two grain elevators in the Krasnodar region of Russia and a river grain import/export terminal in Rostov. The acquisition adds to Cargill’s presence in the Black Sea region. Along with joint venture partners, Cargill owns and operates 75 grain elevators in Hungary, Kazakhstan, Romania, Russia and Ukraine, which represent about 2 million metric tons of storage capacity. The company also owns several processing assets in the region.

On Nov. 1, 2005, Cargill and joint venture partner Temasek Holdings, an Asia investment group headquartered in Singapore, acquired UK-based CDC Group’s palm plantation interests in Indonesia and Papua New Guinea. Cargill’s existing palm plantation in Sumatra also became part of the new venture, registered in Singapore as CTP Holdings. Demand for palm oil is growing globally and production worldwide is about 30 million tons. Cargill is the majority shareholder, with managerial and operational responsibility. This acquisition enables Cargill to provide customers with a high-quality supply of palm oil products and adds further diversity to the company’s portfolio of edible oils.

On Nov. 30, 2005, Cargill opened its first office in Dubai, United Arab Emirates, to better serve food manufacturing customers in the Middle East.

On Dec. 7, 2005, Cargill acquired a grain elevator in the Voronezh region of Russia to enhance sourcing of raw materials in that area.

2. Agreements and alliances announced Cargill and Louisiana Sugar Cane Products, a cooperative of 10 Louisianan sugar cane mills and 700 growers, announced on Nov. 1, 2005, their intent to form a joint venture to construct and operate a large sugar refinery in Reserve, La. The facility is aimed at providing U.S. food and beverage makers with refined sugar products. The joint venture expects to break ground this spring and be ready to commence operations two years later.

63 As discussed in the 2006 first quarter MD&A, Cargill announced in September an agreement to purchase Degussa Food Ingredients, a leading provider of texturizing and flavor ingredients to the food and beverage industry. The proposed acquisition is subject to clearance by the European Commission.

3. Divestitures As reported previously, Cargill completed the sale of Cargill Investor Services (CIS) to Refco Group (Refco) on Aug. 31, 2005, and a gain of $50.5 million was included in fiscal 2006 first-quarter earnings. During the second quarter, Refco filed for bankruptcy, and Cargill established reserves related to deferred sale proceeds. As of Nov. 30, 2005, the gain on the sale of CIS was reduced to $19.1 million. Cargill also has recorded additional charges of $18.7 million related to other receivables due from Refco.

As a part of the sale agreement, Cargill and Refco entered into an Exclusivity Agreement whereby Cargill agreed to clear its exchange traded futures and options through Refco for the next five years, subject to competitive service and rates. In October 2005, Refco filed for bankruptcy protection and then sold its regulated futures business to Man Financial in November 2005. Subsequent to the end of the second quarter, Cargill transferred its clearing business from Man Financial to another brokerage firm. Man Financial withdrew $66 million from the customer accounts of Cargill to offset what they claim are damages arising from Cargill’s alleged breach of the Exclusivity Agreement. Cargill believes that the funds were improperly withheld and filed suit against Man Financial requesting that the funds be returned. At this time, Cargill has not established any reserves related to the Man Financial decision to withhold Cargill’s funds.

C. Liquidity and Capital Resources Consolidated summary of cash flow

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Cash flow from continuing operations ...... $1,714 $1,424 20 Cash flow from discontinued operations ...... — 427 — Total cash flow ...... $1,714 $1,851 (7) Capital investments: Property additions ...... $ 792 $ 493 61 Business acquisitions, less cash received ...... 388 6 — Investments in nonconsolidated companies and purchase of minority interests ...... 111 82 35 Total capital investments ...... $1,291 $ 581 122

1. Cash flow Cash flow from continuing operations totaled $1.7 billion in the first six months of fiscal 2006, an increase of $290 million from the same period a year ago. Improved operating earnings accounted for the increase in cash flow. Dividends from nonconsolidated entities, primarily from the Cargill Value Investment entities and the North Star BlueScope joint venture, also increased and contributed to the change. Last year’s cash flow from discontinued operations included the earnings from steel assets that were disposed of Nov. 1, 2004.

2. Capital investments Business acquisitions and investments, less cash received, were $388 million in the first half. Acquisitions included are discussed in Section II.B.1. Last year’s second-quarter investments included the acquisition of Caravelle Foods, a supplier of frozen meat patties to the Canadian quick-service restaurant industry; the purchase of two of Nestlé’s cocoa processing facilities in Europe, and the acquisition of Smucker do Brasil in Brazil.

3. Debt Cargill total consolidated debt was $13.8 billion as of Nov. 30, 2005, a slight decrease from Aug. 31, 2005. The company’s consolidated debt is made up of the debt of closely owned businesses and of The Mosaic Company, a publicly traded company in which Cargill is the majority shareholder.

64 Summary of Debt

Nov. 30, Aug. 31, Increase Percent 2005 2005 (decrease) change (Dollars in millions) Cargill debt excluding Mosaic: Recourse debt: Short-term ...... $ 4,506 $ 4,466 $ 40 1 Long-term ...... 5,397 5,583 (186) (3) Total recourse debt ...... $ 9,903 $10,049 $(146) (1) Nonrecourse debt from VIEs: Short-term ...... $ 303 $ 324 $ (21) (6) Long-term ...... 1,127 995 132 13 Total nonrecourse debt ...... $ 1,430 $ 1,319 $ 111 8 Cargill debt excluding Mosaic ...... $11,333 $11,368 $ (35) — Mosaic debt: Nonrecourse to Cargill ...... $ 2,452 $ 2,493 $ (41) (2) Other debt ...... 14 14 — — Total Mosaic debt ...... $ 2,466 $ 2,507 $ (41) (2) Cargill consolidated debt ...... $13,799 $13,875 $ (76) (1)

The variable interest entities (VIEs) are discussed in Appendix B.1.

Consolidated interest expense on short-term debt increased by $44.2 million, or 44 percent, to $145.1 million for the six-month period. Interest expense on long-term debt increased by $117 million, or 62 percent, to $306.4 million for the period. These amounts include interest expense on debt for The Mosaic Company of $81 million. Interest expense for nonrecourse debt of variable interest entities totaled $24 million for the six-month period.

Cargill’s syndicated committed credit facility was $3.5 billion on Nov. 30, 2005. It is structured as a revolving line of credit, consisting of a $1.33 billion, 364-day facility and a $2.17 billion, 5-year facility. The syndicated facility is supplemented by $250 million of committed bilateral lines. These credit facilities, which may be further supplemented with additional bank lines as necessary, provide backup liquidity to the company’s commercial paper programs.

4. Credit rating Cargill’s credit ratings summary at Nov. 30, 2005

Outlook: Long-term Short-term Long-term/ Agency rating rating Short-term Standard & Poor’s ...... A+ A-1 Negative Watch/Stable Moody’s Investors Service ...... A2 P-1 Stable/Stable Fitch Ratings ...... A+ F-1 Stable/Stable Dominion Bond Rating Service (DBRS) ...... A (high) R-1 (middle) Stable/Stable

III. SEGMENT REVIEW All comparative figures are for the first six months of fiscal 2006, which ended Nov. 30, 2005, and the first six months of fiscal 2005, which ended Nov. 30, 2004.

Reclassification: Certain fiscal 2005 amounts in this section were reclassified to conform with the current year presentation.

65 Summary of earnings from continuing operations by segment

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Agriculture Services ...... $ 77.4 $ 51.0 52 Origination and Processing ...... 234.2 197.0 19 Food Ingredients and Applications ...... 246.6 353.3 (30) Risk Management and Financial ...... 316.9 289.3 10 Industrial ...... 100.2 83.5 20 Corporate and Other ...... 23.6 (157.6) 115 Total ...... $998.9 $ 816.5 22

Summary of sales and other revenues to unaffiliated customers by segment

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Agriculture Services ...... $ 2,900.5 $ 3,242.4 (11) Origination and Processing ...... 12,328.6 11,437.3 8 Food Ingredients and Applications ...... 17,328.7 16,325.7 6 Risk Management and Financial ...... 1,565.7 1,579.3 (1) Industrial ...... 3,257.3 2,093.1 56 Corporate and Other ...... 167.1 73.1 129 Total ...... $37,547.9 $34,750.9 8

A. Agriculture Services Agriculture Services provides crop and livestock producers worldwide with customized farm services and products

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Revenues ...... $2,900.5 $3,242.3 (11) Earnings ...... 77.4 51.0 52

Segment earnings increased $26.4 million to reach $77.4 million for the six-month period. Sales revenue decreased due to the formation of the Frontier joint venture; the new entity’s sales are deconsolidated from Cargill. Excluding that change, revenues matched last year’s level for the period.

Although margins improved over last year for the same period, earnings in Cargill Animal Nutrition slowed in the second quarter. CAN’s results were affected by a swine disease outbreak in parts of China, high distribution costs in Brazil and a drop in Brazilian shrimp feed sales due to both disease and U.S. import barriers.

Earnings in Cargill AgHorizons United States rose significantly. The business seized opportunities arising from this year’s big U.S. corn and soybean crops and managed effectively the aftereffects of Hurricanes Katrina and Rita on grain accumulation and transportation.

66 Cargill AgHorizons in Canada generated profits in the second quarter compared with a loss in the same period last year, when smaller amounts of poor quality grain hurt results.

B. Origination and Processing Origination and Processing connects producers and users of grain, oilseeds and other agricultural commodities through origination, processing, marketing and distribution services.

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Revenues ...... $12,328.6 $11,437.3 8 Earnings ...... 234.2 197.0 19

Segment earnings improved by $37.2 million, up 19 percent from last year’s first six months. Revenue increased $891.8 million, or 8 percent.

Cargill Grain & Oilseed Supply Chain earnings strengthened in the second quarter, aided by favorable positioning in markets pressured by large commodity supplies relative to demand. The Supply Chain’s six-month results were considerably above the year-ago level. Refunds of value-added taxes from the Ukrainian government’s grain export program boosted earnings in Cargill’s European region. Demand for biodiesel also strengthened rapeseed oil values and margins relative to other vegetable oils in that geography. Oilseed processing results in North America also were favorable. The dry bulk ocean freight market has subsided, with rates less than half of last year’s elevated levels. While earnings in the Ocean Transportation unit were still strong, they were down from last year’s six-month historic high.

To meet customer demand for biofuels, Cargill announced plans to build a biodiesel plant in Frankfurt/ Main, Germany. Construction will begin soon with production expected to start in August 2006. The new facility complements existing oilseed crushing and refining operations in Germany.

Cargill Sugar results declined in the second quarter. Rising world sugar prices generated trading profits, but lower local market prices, notably in Russia and Mexico, dampened distribution results.

Earnings in Cargill Cotton lagged in the second quarter as stocks continued to build under another global bumper crop. Because lower cotton prices generated a brisk pace of export volumes in the first quarter, six-month earnings were ahead of last year.

C. Food Ingredients and Applications Food Ingredients and Applications serves food makers, food service companies and retailers with food and beverage ingredients, meat and poultry products, and new food applications.

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Revenues ...... $17,328.7 $16,325.7 6 Earnings ...... 246.6 353.3 (30)

Six-month segment earnings decreased $106.7 million, or 30 percent, from the previous year. The decline reflected weaker results from sweeteners and flavors in Europe and from beef processing in North America. Revenues increased by $1 billion, or 6 percent, to $17.3 billion for the first six months. Seara, the Brazilian poultry and pork processing business purchased in the third quarter of fiscal 2005, contributed substantially to the increased revenues. Beef revenues also were up on higher volumes, although margins were weaker than the prior year.

1. Food ingredients Six-month earnings in Cargill Sweeteners North America exceeded the year-ago level due to strong performances across all product lines. Volumes increased in ethanol, corn syrup, high fructose corn syrup and sugar products. Cargill announced plans to add a 110-million-gallon-a-year ethanol plant to its corn processing complex in Blair, Neb. The new facility will more than double Blair’s existing ethanol capacity and raise Cargill’s U.S. ethanol production capacity to 230 million gallons annually.

67 In the Western European sweetener and starches businesses, raw material and natural gas costs continued to rise in the second quarter. That brought year-to-date earnings substantially below last year’s level. The sweeteners business in Turkey benefited from larger volumes shipped as a result of increases in the government sugar quotas.

Robust demand and margins in the second quarter lifted Cargill Cocoa’s six-month earnings above last year’s strong results. Increased chocolate and cocoa powder shipments and solid margins also benefited OCG Chocolate’s results. Although second-quarter earnings improved in Cargill Cocoa Brazil, higher-priced beans continued to dampen performance relative to the same period last year.

In Cargill Foods Venezuela, governmental limits on the purchase of lower-cost imports led to higher raw material costs for oil products. Competitive pricing pressure in pasta products, primarily from the government, which functions as largest distributor in the country, continued to weaken earnings.

2. Meat products Earnings in Cargill Beef were substantially below last year for the same period as weaker demand for beef domestically and the BSE-related loss of premium export markets continued to pressure margins. On Dec. 12, 2005, Japan eased its ban on imports of beef and beef products from U.S. and Canadian cattle under 21 months of age. Cargill Meat Solutions was among the first U.S. processors to re-enter the Japanese market. The U.S. beef industry expects it will take several years to restore U.S. beef exports to pre-BSE levels.

High live hog prices, favorable grain economics and good live hog productivity led to an upsurge in second-quarter earnings in Cargill Pork.

Robust turkey markets and favorable grain economics generated strong earnings in Cargill Value Added Meats. The cooked beef product line continued to face a challenging environment; two plants were closed during the first half-year.

3. Food service and retail products For the first six months, all of Cargill’s poultry and egg further processing businesses posted earnings increases from a year ago.

Seara, the Brazilian poultry and pork processor acquired by Cargill in the fiscal 2005 third quarter, generated stronger second-quarter earnings despite a strike in November of the Brazilian federal inspections services that slowed shipments and increased storage and transportation costs in Brazil. Shipments from the European inventories allowed Seara to continue serving Asian and European markets.

Sun Valley Europe’s focus on value-added products and cost management generated strong earnings compared with last year’s loss.

Higher domestic selling prices generated solid profits for Sun Valley Thailand. Improved agricultural performance offset higher feed ingredient costs.

Sunny Fresh Foods began production at its newest facility in Big Lake, Minn., during the second quarter. The plant supports business growth in value-added egg products. For the second time, Sunny Fresh Foods received the Malcolm Baldrige National Quality Award, the highest recognition of performance that a U.S. company can receive. It is one of only four Baldrige recipients to receive the award twice.

4. Food system design An asset impairment charge was taken on assets in the European food system design business. The growth in the European flavor industry was slower than projected, and the development time required to bring sales opportunities to fruition was longer than anticipated. The business is reengineering operations to focus on key strengths and customers, and to improve asset utilization.

Although year-to-date results remained profitable, Cargill Juice Beverage Applications North America was hurt by hurricane activity in Florida that reduced sales volumes and generated losses on futures positions.

68 D. Risk Management and Financial Risk Management and Financial provides customers and Cargill with risk management and financial solutions in world markets.

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Revenues ...... $1,565.7 $1,579.3 (1) Earnings ...... 316.9 289.3 10

Segment earnings rose $27.6 million, or 10 percent, from the prior year. Revenues decreased slightly, down 1 percent from the prior year, primarily due to lower revenues in the petroleum and steel trading businesses.

Strong performance across a broad base of investments and geographies boosted results in Cargill Value Investment.

Cargill’s investments in funds managed by Black River Asset Management, including Black River’s flagship Multi-Strategy Fund, yielded solid returns. Since the start of the fiscal year, Black River has added four new funds to its lineup.

Cargill Petroleum generated gains in the second quarter, which lessened the year-to-date loss. Market disruptions triggered by Hurricane Katrina at the end of the first quarter generated larger U.S. imports and higher prices initially, but diminished demand in the American, European and Asian markets. The business is focused on supply-demand analysis in this volatile industry. Cargill Power & Gas Markets benefited from volatile markets by managing spreads, positions and physical executions. CPGM’s year-to-date loss was due to timing differences between revenue recognition on certain forward contracts and the related derivatives. Revenue will be recognized when the underlying contracts are executed.

Cargill Ferrous International returned to profitability in the second quarter, but remained below last year’s strong results. The steel service centers optimized margins on rising sales prices and lower-cost prepurchased inventory. U.S. trading activity began to capitalize on improved sales prices, although international trading remained soft.

As discussed in Section II.B.3., Cargill sold its futures brokerage business to Refco Group, a provider of execution and clearing services for exchange-traded derivatives. A gain was included in fiscal 2006 first-quarter earnings. The second quarter’s results included a reversal of a portion of the gain following Refco’s breakup and bankruptcy in October 2005.

E. Industrial The Industrial segment supplies customers with fertilizer, salt, steel and industrial uses for agricultural feedstocks.

Nov. 30, Nov. 30, Percent 2005 2004 change (Dollars in millions) Revenues ...... $3,257.3 $2,093.1 56 Earnings ...... 100.2 83.5 20

Segment earnings increased $16.7 million for the first six months compared with the year-ago period.

Earnings in the North Star BlueScope joint venture strengthened in the second quarter but remained considerably lower than last year’s strong profits. This year’s lower steel prices and higher energy costs outweighed the benefit of lower raw material costs.

Higher sales prices and wintry conditions boosted second-quarter earnings in Cargill Salt.

Results for the first six months of fiscal 2006 include revenues and Cargill’s share of earnings from The Mosaic Company, which was formed in the second quarter of fiscal 2005.

69 F. Corporate and Other Cargill prevailed on its appeal to the Brazilian Supreme Court regarding a transactional tax issue. Corporate and Other includes $88 million of income from the reversal of a reserve for this issue.

IV. OTHER OPERATING MATTERS A. Discontinued Operations On Nov. 1, 2004, Cargill sold its remaining steelmaking plants and wire manufacturing facilities to Gerdau Ameristeel. Earnings in these businesses were reported as discontinued operations for fiscal 2005. Cargill retains a 50 percent interest in the Delta, Ohio-based North Star BlueScope steel joint venture, which is not included in discontinued operations. Net earnings of $94 million from discontinued operations were realized in the first six months of fiscal 2005.

B. Business Disposals Business disposals during the 2006 first half included Cargill Investor Services as noted in Section II.B.3. Net proceeds from disposals were $276 million with gains of $26 million, net of tax. Proceeds on disposals in the 2005 second quarter totaled $160 million with gains of $65 million, net of tax, which included the sale of orange juice assets in Brazil.

C. Litigation Summary In July and August 2000, an outbreak of E. coli 0157:H7 occurred in two Sizzler chain restaurants in the Milwaukee, Wis., area. According to a report issued by the state of Wisconsin, more than 60 confirmed cases of E. coli 0157:H7 illnesses and the death of one child were linked to the outbreak. Excel was a supplier of meat products to Sizzler. It was alleged that an unopened Excel sirloin tri-tip product taken from one of the restaurants tested positive for the same strain of E. coli as that found in the affected patrons. Four consumer lawsuits are pending against Excel relating to this matter. There are a total of 11 plaintiffs among the four suits. Five of the plaintiffs claim an illness from food consumption at the restaurants. Six of the plaintiffs made consortium claims. In January 2002, Sizzler USA Franchise, Inc., filed a third-party complaint against Cargill and a cross claim against Excel. In May 2002, Excel prevailed on a motion for summary judgment and the state trial court dismissed the plaintiffs’ claims and the cross claim by Sizzler against Excel. The Wisconsin Court of Appeals reversed the trial court’s summary judgment in favor of Excel. The Wisconsin Supreme Court declined to hear the case. On March 22, 2004, the U.S. Supreme Court declined to hear a certiorari petition filed by Excel asking it to hear the appeal. Since the last report, several of the consumer suits have been settled for small amounts. One consumer suit and Sizzler’s lost profits suit is pending in state court. Three consumer suits are pending in federal court, two of which have a pending motion to remand.

On Dec. 14, 2000, Cargill Turkey Products initiated a voluntary nationwide recall of certain ready-to-eat poultry products manufactured at its Waco, Texas, facility to safeguard against possible Listeria contamination. Federal officials have indicated that 30 cases of illnesses, including four deaths and three miscarriages/stillbirths, are possibly linked to the products that were recalled. Three personal injury and/or wrongful death lawsuits were filed against Cargill related to this matter, each seeking unspecified damages. Two lawsuits were settled, leaving one consumer lawsuit pending against the company related to the recall.

Twenty-five current and former Cargill salaried employees, alleging systematic racial discrimination in employment, filed a lawsuit in U.S. District Court in Minnesota on Nov. 15, 2001. Although we are concerned when any of our employees feel unfairly treated, we strongly believe these allegations are false. The discovery period for class certification has been under way since Apr. 1, 2002. On Sept. 24, 2004, U.S. District Judge Donovan Frank, citing several breaches of the Minnesota Rules of Professional Conduct, ordered that Sprenger + Lang, the law firm representing the plaintiffs, be disqualified. Subsequently, the district court accepted Cohen, Milstein, Hausfeld & Toll, PLLC as successor counsel. The class has not been certified. Cargill expects a certification hearing to be scheduled by early 2006. On Nov. 23, 2004, the U.S. District Court ordered that Sprenger + Lang could work with successor counsel under certain conditions, and transfer specified documents to them. The court has requested that a Special Master review certain plaintiff and third party documents to determine whether certain Sprenger + Lang documents are “tainted” and unavailable to the Cohen, Milstein firm. Also, under the court’s order, Cargill is permitted to object to the inclusion of documents into evidence that it believes may have been tainted by Sprenger + Lang’s misconduct. Further, Sprenger + Lang may not discuss the merits of the case with successor counsel.

70 In May 2002, three cattle producers filed a lawsuit in the U.S. District Court in Nebraska against Excel seeking class action status for alleged violations of the Packers and Stockyards Act of 1921. The plaintiffs allege that Excel has depressed cattle prices through its procurement practices, including the alleged use of “captive supplies.” Plaintiffs seek remedies in the form of injunctive relief, declaratory relief, money damages and attorneys’ fees and costs. In July 2002, Excel filed a motion to dismiss or, in the alternative, to strike plaintiff’s complaint. Excel’s motion was granted with respect to the claims of conspiracy between Excel and Cargill. Discovery related to class certification has concluded. The parties have submitted briefs on the class issues. The Judge has issued a stay ruling in the lawsuit against Excel until the appeals process in the Pickett, et al. vs. Tyson Fresh Meats, Inc. case is complete. In April 2004, the judge in the Tyson case, who is also the judge in the lawsuit pending against Excel, overturned the jury verdict in favor of the plaintiffs in the Tyson case. In August 2005, the U.S. Eleventh Circuit Court of Appeals affirmed the lower court’s decision in the Tyson case to overturn the jury verdict, and plaintiffs in the Tyson case filed a Petition for Rehearing En Banc, which was subsequently denied. Plaintiffs in the Tyson case have indicated that they will seek review by the United States Supreme Court.

On June 18, 2005, the State of Oklahoma filed a water quality lawsuit against Cargill and other poultry integrators in the United States District Court for the Northern District of Oklahoma, related to alleged nutrient loading in certain Oklahoma and western Arkansas watersheds. Specifically, the lawsuit seeks damages and injunctive relief based upon the alleged adverse environmental impact of excess nutrients associated with the land application of poultry litter by the companies and contract growers. The parties were unsuccessful in mediating the claims. Answers from Cargill and the other defendants were filed in October. We are preparing experts and other discovery plans. The parties have also filed a Motion to Stay pending the results of a related lawsuit filed by the State of Arkansas against Oklahoma.

The outcome of any litigation is not predictable with certainty, or subject to the company’s control. However, it is the opinion of management that any ultimate liability in any known litigation against the company has been provided for, or will not have a material adverse effect on our consolidated financial condition or results of operations.

APPENDIX: ACCOUNTING POLICIES The following is a summary of key accounting policies and disclosures. Please refer to the audited financial statements for complete financials and footnote disclosures.

A. Application of Critical Accounting Policies 1. Basis of consolidation Our consolidated financial statements include the accounts of Cargill, Incorporated and more than 50-percent owned subsidiaries that we control by ownership of a majority voting interest as well as certain variable interest entities, where the company is the primary beneficiary and consolidation is required. Intercompany accounts and transactions are eliminated. Investments in companies where Cargill does not have control but has the ability to exercise significant influence (generally 20 percent to 50 percent ownership) are accounted for by the equity method. Other investments where the company is unable to exercise significant influence over operating and financial decisions are accounted for at cost.

2. Use of estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Although these estimates are based on knowledge of current events and actions expected to be undertaken in the future, actual results may ultimately differ from estimates.

3. Revenue recognition Cargill recognizes revenue from commodity or product sales when the goods are shipped or delivered depending upon when the customer has taken title and assumed the risks and rewards of ownership, prices are fixed or determinable and collectibility is reasonably assured. Additional revenue recognition policies for trading securities and derivatives and inventories are shown below.

71 4. Foreign currency translation We include gains and losses, resulting from translating at the current rate the financial statements of foreign subsidiaries whose functional currency is the local currency, in other comprehensive income.

Translation gains and losses of foreign subsidiaries operating in hyperinflationary economies and of foreign subsidiaries where the U.S. dollar is the functional currency are included currently in net earnings.

5. Pension plans Our company and subsidiaries have various pension plans covering most of our domestic employees and many of our foreign employees. Defined-benefit pension benefits are based on years of service and compensation. Unrecognized net gains or losses are amortized over the expected remaining service lives of employees. Pensions are funded in compliance with U.S. government regulations or local laws and practices.

In 2006, Cargill estimates we will contribute in the range of $200 to $300 million to our domestic and foreign pension plans. The company’s pretax pension expense for the six-month period ended Nov. 30, 2005, was $129 million, compared with $111 million in the same period last year.

6. Resale and repurchase agreements Securities purchased with agreements to resell (reverse repurchase agreements) and securities sold with agreements to repurchase (repurchase agreements) are treated as collateralized financing transactions and are recorded at the amount at which the securities were initially acquired or sold, including accrued interest. Interest income is recorded on reverse repurchase agreements and interest expense is recorded on repurchase agreements.

Our policy is to take delivery of securities purchased with agreements to resell, which are generally U.S. government or U.S. government agency securities. We have the ability to sell or repledge the securities. We monitor the market value of the securities to be resold daily and obtain additional collateral when deemed appropriate. Cargill offsets resale and repurchase agreements that meet the applicable netting criteria.

7. Trading securities and derivatives Cargill is engaged in the leveraged trading of a diverse group of securities and, accordingly, its trading securities and trading securities sold, not yet purchased are recorded on trade date at fair value. These instruments are marked to market with realized and unrealized gains and losses included in the determination of net earnings. Interest on trading securities sold, not yet purchased is netted against interest income and shown as Sales and Other Revenues in the consolidated statement of earnings.

We trade derivative instruments, including swaps, futures contracts, forward commitments, options and other similar types of contracts and commitments based on either interest rates or foreign exchange rates, as well as equity and commodity derivatives. These instruments are carried at their fair market value on the balance sheet. The fair market value of a significant portion of trading securities and derivatives, as described above, is determined from market prices quoted on public exchanges or based on management’s best estimate subject to independent price verification. New complex instruments may have immature or limited markets. As a result, the pricing models used for valuation may require significant estimates and assumptions. An insignificant amount of positions are valued in this manner.

Cargill has historically traded fixed income and other securities in a manner that generally limits risk with respect to the direction of changes in the prices of those securities. During the year ended May 31, 2004, Cargill restructured its capital markets trading business into Black River Asset Management LLC, a wholly owned global asset management company that provides institutional investors with alternative investment products. Black River has developed and marketed a number of private investment funds with differing investment strategies. During the year ended May 31, 2005, sufficient outside investments were received to reduce Cargill’s ownership in these funds to a noncontrolling interest. As a result, these Black River funds were deconsolidated primarily during the first quarter of fiscal 2005 and Cargill’s investment in the affiliated private investment funds is shown in the Investments and Advances line of the consolidated balance sheet. Cargill companies will continue to own and trade various financial securities to optimize Cargill’s financial position when opportunities arise. In each case, specific position and risk limits will be adopted by Cargill management.

In addition to trading activities, we utilize various types of derivative products (principally options, futures and interest rate and currency swaps) to hedge interest rate, currency and other market risks arising from certain assets and liabilities. Cargill values its derivative instruments in accordance with SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” as amended by SFAS 137 and SFAS 138.

72 8. Inventories Grain, cotton and other commodities for merchandising and oilseeds and other commodities for processing and products thereof are stated principally at market, adjusted for unrealized gains or losses on open cash contracts valued at market. Market is determined from market prices quoted on public commodity exchanges, adjusted for expected freight costs to normal delivery points and a price premium or discount to cover local supply and demand factors as estimated by management. The availability and market price of agricultural commodities are subject to wide fluctuations due to unpredictable factors such as weather, plantings, domestic and foreign government farm programs and policies, global production and other factors. We generally minimize the risk of market fluctuations by hedging those inventories with futures, cash, and foreign exchange contracts. Generally those contracts are valued at market and the resulting unrealized gains or losses are recognized currently in earnings. Dressed beef, poultry, salt and other products are valued at the lower of cost (last-in, first- out) or market. All other inventories are stated principally at the lower of cost or market.

9. Property, plant and equipment Property, plant and equipment are stated at cost and depreciated principally using the straight-line method over the estimated useful lives of the assets. We periodically evaluate the carrying value of these long-lived assets when events and circumstances indicate the carrying value may not be recoverable. If the carrying value is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds fair market value.

10. Income taxes Cargill and substantially all of our domestic subsidiaries are members of a group that files a consolidated federal income tax return. Federal income taxes or tax benefits are allocated to each company on the basis of its individual taxable income or loss and tax credits included in the return. Deferred income taxes are recognized for tax consequences of temporary differences by applying enacted statutory tax rates, applicable to future years, to differences between the financial reporting and the tax basis of existing assets and liabilities.

It is generally our policy to reinvest indefinitely unremitted earnings of foreign subsidiaries and corporate joint ventures, or to remit earnings only when the tax effect is minor. Accordingly, no provision has been made for income taxes that may be payable upon remittance of such earnings. Federal income taxes on any amounts remitted would be partly offset by foreign tax credits.

11. Goodwill and other intangible assets Business acquisitions are accounted for in accordance with SFAS 141, “Business Combinations,” with the purchase price allocated to the assets and liabilities acquired, including goodwill and other intangibles, based on their estimated fair values at the date of acquisition. Goodwill and intangible assets with indefinite lives are reviewed annually for impairment. Impairment assessments include comparing the fair value of a reporting unit with its carrying value, including goodwill. The assessments are performed using a variety of methodologies, including cash flow analysis, estimates of sales proceeds and appraisals. During the second quarter of fiscal 2005, Cargill merged its fertilizer business into The Mosaic Company, which generated goodwill of $2,379 million. Unamortized intangible assets other than goodwill at Nov. 30, 2005 and 2004 were $241 million and $93 million, respectively.

12. Investments and advances The investments and advances shown below include all nonconsolidated companies carried at equity. These include Brazilian and Canadian fertilizer companies, a U.S. steel company, numerous entities holding real estate and loan portfolios and other agricultural joint ventures.

As of May 31, 2005 2004 (In millions) Total assets ...... $8,171 $9,055 Debt obligations, nonrecourse to Cargill ...... 2,495 3,448 Debt obligations, recourse to Cargill ...... 185 450 Other liabilities ...... 2,132 2,270 Net assets ...... $3,359 $2,887

Equity in net assets ...... $1,491 $1,216

73 The debt obligations, with recourse to Cargill shown above, are supported by Cargill guarantees with terms equal to the related debt amounts, with maturities through 2021. No liability has been recorded related to these guarantees. The nonrecourse debt is collateralized by specific assets of the nonconsolidated companies and the lender does not have recourse to any other assets of Cargill.

13. Financial derivative instruments with off-balance sheet risk Cargill has a risk management group with staff in London, Singapore and Minneapolis that assists senior management in the identification, assessment and control of various risks. The company monitors its exposure to market and credit risks on a daily basis through a variety of financial and credit exposure calculations and reports. In addition, we have policies and procedures in place to support effective risk management and communication.

We utilize various types of derivative instruments to manage the interest rate, currency and other market risks associated with certain liabilities and assets such as trading securities, trading securities sold not yet purchased, loans, short-term borrowings and other debt.

Certain of our company’s trading securities have off-balance sheet risk of accounting loss, which may consist of market and/or credit risk, in excess of amounts recorded on the consolidated balance sheet. We utilize a variety of derivatives and off-balance sheet financial instruments to manage exposure to interest rate and other risks and to take trading positions. Financial instruments traded or utilized by Cargill, which involve varying degrees of credit and market risk, include derivatives, trading securities sold not yet purchased, and forward commitments.

On an ongoing basis, we manage the risk that counterparties might default on their obligations under derivative or cash instrument trades. To manage the level of credit risk, we enter into master netting arrangements whenever possible, obtain collateral when appropriate and monitor the size and maturity structure of the positions. We also monitor credit exposures, limit transactions with specific counterparties, and continually assess the creditworthiness of counterparties. Master netting arrangements incorporate rights of setoff that provide for the net settlement of certain contracts with the same counterparty in the event of default.

Market risk represents the potential loss due to the decrease in the value of a financial instrument caused primarily by changes in interest rates, foreign exchange rates, the prices of equities, commodities or the related indices. The level of market risk is influenced by the volatility and liquidity in the markets in which financial instruments are traded. Cargill seeks to control market risk by developing and refining hedging strategies that correlate price, currency and commodity movements of trading securities and the related hedges. In many cases, derivative financial instruments are used to hedge other on- and off-balance sheet transactions.

Trading securities sold, not yet purchased represent obligations of our company to deliver specified securities at a contracted price. These transactions result in off-balance sheet market risk as our ultimate obligation for trading securities sold, not yet purchased may exceed the amounts recognized in the consolidated balance sheet.

Financial futures, forward commitments and foreign currency contracts involve a commitment to purchase or sell securities, currencies or commodities at a future date at a predetermined price. Cargill enters into financial futures and foreign currency contracts to hedge against uncertainty in future interest rates, and security and currency values. When purchasing foreign currency denominated assets, issuing foreign currency denominated debt or having foreign net investments, Cargill subjects itself to changes in value as exchange rates move. These fluctuations are managed by entering into currency swaps and forwards.

Swap agreements generally involve the exchange of payment obligations on an underlying notional principal amount. Those transactions may expose our company to off-balance sheet risk associated with interest rate, foreign currency, commodity or equity price fluctuations. Cargill enters into either U.S. dollar or non-U.S. currency denominated interest rate swaps and generally uses these agreements to hedge interest rate-sensitive trading securities and borrowings.

Cargill enters into total return swap agreements to assume either interest rate, credit or equity price risk on the swap’s underlying assets or to pass the risk associated with the swap’s underlying assets to the counterparty. Total return swaps generally require one party to pay the other a rate of interest, generally a floating rate plus a spread, in return for payments equal to the return on an asset or a portfolio of assets.

74 For those swap contracts where Cargill assumes equity price risk, it can either be receiving an equity- based or interest-based return under the total return swap agreement. These derivatives are largely utilized to assume equity price risk without having ownership of the underlying equities or to pass the equity price risk to the total return swap counterparty. If risk is assumed, it may be hedged with other derivative instruments.

Credit default swaps are an agreement between two parties whereby one party pays the other a fixed coupon over a specified term. The other party makes no payment unless a specified credit event such as a default occurs, at which time a payment is made and the swap terminates. Cargill enters into credit default swaps either to assume or hedge credit risk.

As a writer of option contracts, we receive cash and, in return, may be obligated to purchase or sell to the holder a specific financial instrument under the terms of the contract. As a holder of option contracts, we pay cash and, in return, have the choice of whether or not to purchase or sell to the writer a specific financial instrument under the terms of the contract. Cargill enters into option contracts to hedge against uncertainty in future security and currency values and to capitalize on perceived market opportunities.

Cargill also purchases financial instruments created from the securitization of municipal bonds (municipal derivatives). These financial instruments are residual interests in special purpose entities sponsored by a third party. The return on the residual interests and changes in their market value varies inversely with market interest rates. Our returns are subject to significant leverage and as a result do not directly correlate with changes in market interest rates. Municipal derivatives, which may be considered alternative sources of financing and are off-balance sheet, totaled $210 million and $207 million at May 31, 2005 and 2004, respectively.

14. Short-term and long-term nonrecourse debt Short-term and long-term nonrecourse debt is issued by Mosaic and variable interest entities (VIEs). The Mosaic debt is not guaranteed or supported by Cargill or other consolidated subsidiaries. The VIE debt is collateralized by specific assets of the consolidated VIEs and the lender only has recourse to the assets of the entity collateralizing the loan. The lender does not have recourse to any assets of Cargill. VIEs are described more fully in Appendix B.1.

15. Lease commitments Cargill and its subsidiaries lease real property, barges, rail and other transportation equipment and various machinery and equipment under noncancellable operating lease agreements, extending through 2109. These include operating leases with certain shareholders under terms deemed to be the same as arm-length transactions, with future minimum lease payments of $41 million at May 31, 2005.

Rental expense for all operating leases, except ocean freight vessels, was $403 million in 2005 and $372 million in 2004. Rental expense for ocean freight vessels was $381 million in 2005 and $186 million in 2004. Cargill enters into purchase commitments for time on ocean freight vessels for the purpose of transporting agricultural and other commodities for the company and third-party customers. In addition, we sell time on these ocean freight vessels.

16. Contingencies and commitments Cargill and our subsidiaries have various legal actions, claims and proceedings pending against them including those arising from product defects, employment-related matters, patents and governmental regulations. Significant litigation is discussed in Section IV.C. Cargill has established reserves for matters in which losses are probable and can be reasonably estimated. Litigation is subject to uncertainties and the outcome of individual litigated matters is not predictable with assurance.

As of May 31, 2005, Cargill and our subsidiaries were contingently liable for guaranteed lease residuals of $80 million, and guaranteed obligations of third parties totaling $263 million. The guaranteed lease residuals relate to synthetic lease agreements for railcars and aircraft expiring through 2020. The leases are classified as operating leases and we have the option to purchase the railcars or aircraft at fixed amounts based on fair values or to have the assets sold. If sale proceeds were less than guaranteed fixed amounts, we would be obligated to pay for the deficiency in the proceeds. We have not recorded any liability related to the guaranteed lease residuals.

As of May 31, 2005, Cargill and our subsidiaries had outstanding letters of credit issued by banks for the purchase of commodities, margin deposit requirements, performance guarantees and other purposes totaling $436 million.

75 Cargill has approved capital expenditures affecting future periods for the purchase or construction of property, plant and equipment and for the acquisition of other businesses. As of May 31, 2005, those capital commitments totaled $1,203 million.

B. New Accounting Policies 1. Variable interest entities In January 2003, the FASB issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46), which requires certain variable interest entities (VIEs) to be consolidated. FIN 46 separates entities into two groups: (1) those for which voting interests are used to determine consolidation and (2) those for which variable interests are used to determine consolidation. An entity is considered to be a VIE when it has equity investors who lack the characteristics of a controlling financial interest, or the entity’s capital is insufficient to permit it to finance its activities without additional subordinated financial support. A VIE is consolidated by its primary beneficiary, which is the company that absorbs a majority of the VIEs expected losses, receives a majority of the VIEs residual returns, or both. Upon its original issuance, FIN 46 was effective immediately for VIEs created after Jan. 31, 2003, while the effective date for VIEs created prior to Feb. 1, 2003, was May 31, 2005.

In December 2003, the FASB issued a revision to FIN 46 (FIN 46R) to clarify some of the provisions of the original interpretation and to exempt certain entities from its requirements. FIN 46R provides special effective date provisions to enterprises that fully or partially applied FIN 46 prior to the issuance of the revised interpretation. Cargill has applied FIN 46 and FIN 46R to all entities and has consolidated VIEs with total assets of $4 billion as of Nov. 30, 2005.

2. Stock Based Compensation In December 2004, the FASB revised SFAS No. 123. SFAS No. 123R further defines the concept of fair market value as it relates to share-based payment transactions as compensation expense. The provisions of this statement will be effective for Cargill in fiscal 2007 and will not have a material effect on our consolidated financial position or results of operations. During fiscal 2003, Cargill adopted the fair value recognition provisions of SFAS 123, “Accounting for Stock-Based Compensation,” and selected the retroactive restatement method of adoption described in SFAS 148.

3. Foreign Earnings Repatriation In October 2004, The American Jobs Creation Act of 2004 (the Jobs Creation Act) was signed into law. The Jobs Creation Act includes a temporary incentive for U.S. multinationals to repatriate foreign earnings at an effective 5.25 percent tax rate. Such repatriations must occur in either an enterprise’s last tax year that began before the enactment date, or the first tax year that begins during the one-year period beginning on the date of enactment.

Our company is currently evaluating the details of the Jobs Creation Act, and as of Nov. 30, 2005, had not decided if we would repatriate foreign earnings under the act. Accordingly, the consolidated financial statements do not reflect any provision for taxes on the unremitted foreign earnings that might be remitted.

For the year ended May 31, 2005, compared with the year ended May 31, 2004

I. OVERVIEW Cargill, Incorporated, headquartered in Minneapolis, Minn., is an international provider of food, agricultural and risk management products and services with 124,000 employees in 59 countries. Founded as a grain warehousing and merchandising company in 1865, Cargill today is one of the largest, privately owned companies in the world. We are committed to using our knowledge and experience to collaborate with customers to help them succeed.

A. Corporate Organization Cargill reports results from operations in five segments: Agriculture Services, Origination and Processing, Food Ingredients and Applications, Risk Management and Financial, and Industrial. Our business units operate in four geographic regions: Asia Pacific, Europe/Africa, Latin America and North America.

76 B. Corporate Strategy By 2010, Cargill intends to be the recognized global leader in providing food and agricultural customers with solutions that help them succeed. The key elements of our strategy are depicted in the graph below.

In the initial years, we concentrated on aligning our businesses and organization, strengthening the company’s market position, gaining an understanding of customer solutions and improving our financial performance. Today, we are focusing on using our knowledge and experience to collaborate with customers to help them succeed.

As we continue Cargill’s strategic intent journey, we are emphasizing three elements: Š Providing supply chain solutions. This includes coordinating the global sourcing needs of food manufacturers and food service operators, as well as seeking to manage entire portions of customers’ supply chains. It also includes operating processing assets for customers that prefer to concentrate their resources on product development and marketing. Š Developing food applications solutions. This involves enhancing the functionality of existing products, combining ingredients into new products, developing convenience foods and applying technology to optimize food processing. Š The third element is developing health and nutrition solutions. This includes increasing crop and livestock yields and quality, and developing health-related solutions for humans pertaining to nutrients, wellness, disease resistance and therapeutics.

77 II. CONSOLIDATED REVIEW A. Financial Performance Reclassification: Certain fiscal 2004 amounts in this report were reclassified to conform with the current year presentation.

Consolidated summary of quarterly financial results

Three months ended May 31, May 31, Percent 2005 2004 increase (Dollars in millions) Earnings from continuing operations ...... $ 280 $ 173 62 Earnings (loss) from discontinued operations ...... (2) 22 — Cumulative effect of accounting change (FIN 46R) ...... (48) — — Net earnings ...... $ 230 $ 195 18

Sales and other revenues ...... $18,997 $17,641 8

In the fourth quarter: Cargill earned $280 million from continuing operations, an increase of $107 million, or 62 percent, from $173 million in the same period a year ago.

Fourth-quarter earnings in the Agriculture Services segment rose moderately on the diversified performance of Cargill Animal Nutrition globally and on the earnings contributions from Cargill AgHorizons in the United States and Canada. In the Origination and Processing segment, Grain & Oilseed Supply Chain businesses took advantage of continuing volatility in the freight and grain markets to edge ahead of last year’s fourth-quarter earnings. Results in the Food Ingredients and Applications segment, dampened by asset impairment charges incurred in the fourth quarter, were down significantly from the same quarter a year ago. Within this segment, several of Cargill’s beef and pork businesses outperformed last year’s fourth-quarter results. Risk Management and Financial segment results almost doubled from a year ago as Cargill Value Investment’s diverse investment portfolio generated sizable returns. Full production levels and high shipment volumes in the flat-rolled steel joint venture contributed to improved fourth-quarter results in the Industrial segment.

As noted in the section below labeled “New Accounting Policies—Variable interest entities,” Cargill partially adopted FIN 46R for certain special purpose entities (SPEs) as of May 31, 2005. The early adoption of FIN 46R resulted in the consolidation of SPEs with assets totaling $631 million. In accordance with the transition provisions of FIN 46R, Cargill recorded an after-tax loss of $48 million as a cumulative effect of accounting change in the consolidated statement of earnings in 2005.

Losses from discontinued operations were $2 million. That brought fourth-quarter net earnings to $230 million, an 18 percent increase from a year ago.

Fourth-quarter revenues reached $19 billion, up $1.4 billion, or 8 percent, from $17.6 billion in the same period a year ago. The revenue growth occurred in four of the five segments, and the fifth, the Origination and Processing segment, neared last year’s high level.

Consolidated summary of financial results

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Earnings from continuing operations ...... $ 2,070 $ 1,283 $ 1,034 Earnings from discontinued operations ...... 81 48 145 Cumulative effect of accounting change ...... (48) — 111 Net earnings ...... $ 2,103 $ 1,331 $ 1,290

Net earnings, excluding noncash net gain ...... $ 1,525 $ 1,331 $ 1,290

Sales and other revenues ...... $71,066 $62,907 $54,390 Cash flow from continuing operations ...... 3,196 2,976 2,532 Capital investments ...... 2,008 1,484 1,307

78 Full year: Cargill earned $1.53 billion in fiscal 2005, up 15 percent from the prior year. Cargill also realized a $578 million noncash net gain in the second quarter related to the formation of The Mosaic Company. Including the one-time gain, 2005 net earnings totaled $2.1 billion.

Revenues were $71.1 billion in fiscal 2005, an increase of $8.2 billion or 13 percent from last year. The improvement was broad based, with all segments reporting increased revenues for the year. It also reflected the consolidation of Mosaic’s sales in Cargill’s fiscal 2005 income statement.

B. Significant Developments 1. Acquisitions completed The following acquisitions were completed in the fourth quarter: Š The grain and protein meal trading business of Pagnan, an Italian grain company, was purchased on April 4, 2005. Š Frontier Agriculture, the 50-50 joint venture between Banks Cargill Agriculture and the Allied Grain unit of Associated British Foods, was completed on April 12, 2005. Š Cargill purchased nearly all of the shares in Romanian edible oil producer Olpo on May 18, 2005. Š Cargill purchased Citrico’s pectin business on May 25, 2005.

The following acquisitions were completed in the first quarter of fiscal 2006: On June 1, 2005, Cargill received approval from German regulatory authorities to purchase Schierstedter Schokoladefabrik, a small industrial chocolate facility in eastern Germany, from Ludwig Schokolade, a Cargill customer and a subsidiary of German food maker Krueger. The acquisition complements last year’s purchase of OCG Cacao and is expected to provide access to new customers in Central and Eastern Europe.

Cargill exercised its option to buy out The Hudson Companies’ interest in Cargill Custom Dressings, the joint venture formed in 2000 to expand value-added product offerings in dressings, sauces and mayonnaise. Cargill, the majority owner and managing partner, dissolved the partnership on June 1, 2005.

On June 7, 2005, Cargill acquired Portland, Ore.-based Integrated Bakery Resources, a provider of bakery product development services, premix systems, finished foods and related marketing services to U.S. and Canadian bakers and retailers. IBR focuses on the development, scale up and marketing of bakery products, including proprietary mixes for bakery products and premium varietal breads for retail distribution.

On June 27, 2005, Cargill purchased a part of Peking University Green Technology’s assets, which include intellectual properties related to the production, sales and marketing of food ingredient systems. The purchase allows Cargill to take advantage of PGT’s knowledge with respect to blending ingredients to achieve taste, texture and other attributes in food and beverage products. PGT was founded in 2000 with investment from Peking University.

Cargill purchased the remaining 50 percent shares in Finexcor, an Argentine beef processor and exporter on June 28, 2005. This follows Cargill’s previous acquisition of a 50 percent share in the fiscal 2004 fourth quarter, at which time options were put in place to buy the remaining portion. Finexcor owns and operates two plants in the provinces of Buenos Aires and Santa Fe that process a combined total of 350,000 head of cattle a year. The acquisition advances Cargill’s interest in participating in the South American beef industry, which is of strategic importance globally, and in increasing its role as a supplier to European and U.S. markets.

On July 1, 2005, Cargill acquired Nestlé’s whey production plant in Porto Ferreira in the state of São Paulo, Brazil. Cargill plans to sell the raw material produced at the Porto Ferreira plant to local food companies and to markets overseas. The purchase is expected to strengthen Cargill’s food ingredients presence in Brazil.

On July 19, 2005, Cargill acquired a sunflower seed crush plant in Kahovka, Ukraine, that was owned formerly by Chumak, a maker of some of Ukraine’s best-known food brands. Located in southern Ukraine, the facility is well situated to serve both domestic and export markets. Adding its capacity to that of Cargill’s larger crush plant to the east in Donetsk will give the company a leading market share. It also will enlarge Cargill’s presence in the Black Sea region, an area with significant agricultural potential.

79 2. Mosaic merger The Mosaic Company (NYSE: MOS) debuted as a publicly traded company on the New York Stock Exchange on Oct. 25, 2004. Created from the merger of Cargill’s fertilizer businesses and IMC Global, Mosaic is one of the world’s leading producers and marketers of crop nutrients. Headquartered in Plymouth, Minn., it has more than 8,000 employees in 15 countries serving customers in nearly 50 countries. Fredric Corrigan, a former Cargill executive vice president, is Mosaic’s chief executive officer and president. The company’s 11-member board of directors is chaired by Cargill Vice Chairman and CFO Robert Lumpkins, who serves in a nonexecutive capacity. Cargill is Mosaic’s single largest investor. As an independent company, Mosaic operates without credit support from Cargill.

3 Acquisitions announced On April 15, 2005, Cargill announced an agreement to acquire the beef processing and related assets of Ontario-based Better Beef, a family owned beef company that serves domestic and export markets. The agreed purchase includes a modern, 2,000 head of cattle a day slaughter and fabrication facility; Watson Foods, a 150,000 square foot plant devoted to ground beef and case-ready products; and Klunski Transport, a fleet of refrigerated trucks. In 2004, the company processed 500,000 head of cattle, with sales in excess of $600 million, which makes it the ninth largest beef processor in North America. The transaction, which is subject to regulatory approval, is expected to close in the first half of fiscal 2006.

4. Divestitures announced As announced June 22, 2005, Cargill reached a definitive agreement to sell the entire global business of Cargill Investor Services (CIS) to REFCO Group for $208 million in cash and future contingent cash payments of between $67 million and $192 million, based on the performance of the acquired operations.

REFCO is a leading provider of execution and clearing services for exchange-traded derivatives and one of the world’s largest independent derivative brokers. Serving institutional and retail clients, it operates in 14 countries and is a member of the principal U.S. and international exchanges. In addition to futures brokerage and global clearing, REFCO is a broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt and over-the-counter financial and commodity products.

The agreed sale is consistent with Cargill’s Strategic Intent principle that business units have access to the capital required to grow profitably. It provides the opportunity for CIS to become part of a leading company committed to growing its global franchise. Pending regulatory approval, the sale is expected to be completed in the first half of fiscal 2006.

C. Liquidity and Capital Resources Consolidated summary of cash flow

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Cash flow from continuing operations ...... $3,196 $2,976 $2,532 Cash flow from discontinued operations ...... 413 152 310 Total cash flow ...... $3,609 $3,128 $2,842 Capital investments: Property additions ...... $1,447 $1,011 $ 885 Business acquisitions, less cash received ...... 280 231 214 Investments in nonconsolidated companies and purchase of minority interests ...... 281 242 208 Total capital investments ...... $2,008 $1,484 $1,307

1. Cash flow Cash flow from continuing operations totaled $3.2 billion in fiscal 2005, an increase of $220 million or 7 percent from a year ago. The increase is a reflection of the company’s improved profitability. Cash flow from discontinued operations was $413 million. This included earnings generated by the operation of North Star Steel’s remaining steel assets prior to their sale to Gerdau Ameristeel on Nov. 1, 2004, and the proceeds from that sale.

80 In fiscal 2004, cash flow from continuing operations was $3 billion, an increase of $444 million or 18 percent from the prior year. Increased earnings, noncash charges and depreciation largely accounted for the change. Cash flow from discontinued operations included the sale of North Star Steel’s minimill in Michigan and earnings from other steel assets that were in the process of disposition.

2. Capital investments In fiscal 2005, Cargill drove business growth organically and through acquisitions, joint ventures and other alliances.

Property additions equaled $1.4 billion in fiscal 2005. Excluding the fertilizer business, base-level spending increased by $50 million, or 13 percent, to $446 million. These are expenditures that maintain or enhance existing capacity and facilities, and they reflect Cargill’s commitment to maintaining the company’s core assets and safety and environmental standards. Nonbase spending was directed primarily to increasing capacity, adding capabilities and upgrading technologies at existing facilities, as well as expanding existing capabilities in key geographies.

Business acquisitions, less cash received, were $280 million in fiscal 2005. Among the larger acquisitions were Seara, a major Brazilian poultry and pork processor; a global pectin business from Citrico; Nestlé Group’s cocoa processing facilities in England and Germany, and a hydrogenated oil processing plant in Brazil. Cargill and Parakh Foods formed a joint venture that combined the companies’ Indian vegetable oil businesses.

Business acquisitions, less cash received, were $231 million in fiscal 2004. Acquisitions included OCG Cacao, a supplier of industrial chocolate to the European food industry; The Duckworth Group, a UK-based flavor company; Comcereal Alexandria, a Romanian grain company; five animal feed companies, and a natural gas business in Canada. Cargill also purchased its former partner’s minority interest in the Florida-based citrus processing joint venture.

3. Debt In fiscal 2005, Cargill issued €500 million 10-year notes in the European bond market. The issuance was well received with subscriptions well in excess of the offering size.

Cargill’s total debt increased to $12.5 billion as of May 31, 2005, up 20 percent from $10.4 billion a year ago. The net increase of $2.1 billion resulted primarily from the consolidation of $2.6 billion in debt from The Mosaic Company and additional $322 million in debt from variable interest entities, all of which are nonrecourse to Cargill, as explained the section below labeled “New Accounting Policies – Variable interest entities.” Also explained in this section is the early adoption of FIN46R that requires consolidation of $592 million in additional debt from special purpose entities.

Offsetting the increase was a $1.1 billion decrease in debt related to Black River Asset Management, a global asset management company created in fiscal 2004 from a former Cargill business unit. Black River’s Global Multi-Strategy and Fixed Income funds, which are offered to qualified, third-party investors, were well subscribed. Both funds were deconsolidated from Cargill’s balance sheet by the first quarter of fiscal 2005. Excluding accounting changes and the deconsolidation Black River funds, net usage of recourse debt decreased by approximately $300 million.

Interest expense on short-term debt decreased by $72 million, or 38 percent, to $116 million for the year. The decline reflected a reduction in average short-term debt from the prior year. Interest expense on long-term debt increased by $185 million, or 66 percent, to $467 million for fiscal 2005. That included interest expense on nonrecourse debt for The Mosaic Company of $106 million since its formation on Oct. 22, 2004. In fiscal 2005, interest expense for nonrecourse debt of variable interest entities increased $73 million over the prior year.

Cargill’s syndicated committed credit facility was $3 billion on May 31, 2005. It is structured as a revolving line of credit, consisting of a $1.25 billion 364-day facility and a $1.75 billion 4-year facility. These credit lines, which are supplemented with additional bank lines as necessary, provide backup liquidity to the company’s commercial paper programs.

81 4. Credit rating Cargill’s credit ratings summary at May 31, 2005

Long-term Short-term Agency rating rating Outlook Standard & Poor’s ...... A+ A-1 Negative Moody’s Investors Service ...... A2 P-1 Stable Fitch Ratings ...... A+ F-1 Stable Dominion Bond Rating Service (DBRS) ...... A (high) R-1 (middle) Stable

III. SEGMENT REVIEW Reclassification: Certain fiscal 2004 and 2003 amounts in this section were reclassified to conform with the current year presentation.

Summary of earnings from continuing operations by segment (excluding noncash net gain related to formation of The Mosaic Company)

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Agriculture Services ...... $ 128.1 $ 86.0 $ 116.1 Origination and Processing ...... 418.4 465.6 357.6 Food Ingredients and Applications ...... 415.1 581.4 520.5 Risk Management and Financial ...... 521.0 382.7 354.5 Industrial ...... 224.0 4.6 50.5 Corporate and Other ...... (214.8) (237.4) (365.5) Total ...... $1,491.8 $1,282.9 $1,033.7

Earnings from continuing operations by segment

Summary of sales and other revenues to unaffiliated customers by segment

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Agriculture Services ...... $ 6,504.9 $ 5,317.5 $ 4,844.3 Origination and Processing ...... 23,516.3 23,470.8 18,976.9 Food Ingredients and Applications ...... 30,956.5 27,860.0 25,485.4 Risk Management and Financial ...... 3,440.0 2,336.1 1,902.6 Industrial ...... 5,100.5 2,929.0 2,321.3 Corporate and Other ...... 1,548.0 993.6 860.0 Total ...... $71,066.2 $62,907.0 $54,390.5

82 A. Agriculture Services Agriculture Services provides crop and livestock producers worldwide with customized farm services and products.

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Revenues ...... $6,504.9 $5,317.5 $4,844.3 Earnings ...... 128.1 86.0 116.1

Segment earnings were $128.1 million in fiscal 2005, an increase of $42.1 million from the prior year. In fiscal 2003, earnings included significant proceeds from vitamin litigation settlements. Excluding those settlements, this year’s results from ongoing operations reflected significant growth over the two-year period. Sales revenues increased $1.2 billion or 22 percent in 2005.

Drawing on its global diversification, Cargill Animal Nutrition boosted earnings in fiscal 2005. Its strengths in swine and aquaculture offset weakness in Asian poultry markets affected by avian influenza. This enabled the business to improve performance in Asia overall, especially in China and Vietnam. CAN’s prior purchase of the Agridea™ feed brand brought greater breadth to operations in Italy. In the United States, it focused on improving results from last year’s acquisition of Agway Feed & Nutrition.

Cargill AgHorizons Canada delivered record earnings as fourth-quarter sales of crop inputs made up for weather-related reductions in grain shipments earlier in the year. In the United States, AgHorizons put its market analysis, logistics and trading to good advantage alongside a big harvest. The business more than tripled earnings from the prior year. It also achieved record sales of ProPricing® marketing contracts, which offer farm customers an innovative mix of pricing mechanisms for their crops.

Banks Cargill Agriculture and a subsidiary of Associated British Foods formed Frontier Agriculture, a 50-50 joint venture owned by Cargill and ABF.

Renessen, the joint venture formed in 1999 with Monsanto, continued working toward commercialization. In fiscal 2005, it named a new chief executive officer and streamlined its organizational structure. Two projects—high-lysine corn and high-protein soy—are in the late stages of moving from development to commercialization. Slated for introduction in the next few years, they will be marketed to animal feeders under Renessen’s Mavera™ brand. The venture currently produces Mavera high-value corn in Argentina for export to Asia and other Latin American countries.

B. Origination and Processing Origination and Processing connects producers and users of grain, oilseeds and other agricultural commodities through origination, processing, marketing and distribution services.

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Revenues ...... $23,516.3 $23,470.8 $18,976.9 Earnings ...... 418.4 465.6 357.6

The segment earned $418.4 million, which was $47.2 million or 10 percent less than last year’s record results. The segment’s emphasis on risk management has resulted in four years of strong returns. Fiscal 2005 net revenues increased slightly on a small decrease in sales volume.

Cargill Grain & Oilseed Supply Chain posted strong earnings in a year of continuing volatility in the commodity and freight markets. Soybean crush margins were weak periodically, especially in Europe. An influx of money came into commodity markets from yield-seeking investors. Working as an integrated team of 11 business units, GOSC anticipated most of the major market swings and generated new income from providing customers with solutions. Its ocean transportation unit was ranked No. 1 globally in dry bulk freight by Risk magazine.

GOSC invested significantly in emerging markets. With South America’s rise to agricultural prominence, it opened a sixth soybean crush plant in Brazil and will start up a fourth facility in Argentina next year. In the Black Sea region, an area with great agricultural potential, it purchased nearly all of the shares in Olpo, a Romanian edible oil producer, and bought a sunflower seed crush plant in Ukraine in June 2005.

83 The business is expanding its oilseed crush capacity in Germany to serve growing demand for biodiesel. It also is preparing to produce biodiesel in Germany and the United States. It bought a grain and protein meal import and distribution business in Italy, which also improves access to the Balkan Peninsula. It assumed part ownership and operation of a soybean crush plant in Egypt.

Looking to Asia, where China is the world’s largest soybean importer and India the leading importer of edible oils, GOSC began building a soybean crush plant near Shanghai with joint-venture partner Uni-President Enterprises. It also formed a joint venture with Parakh Foods that combines the two companies’ Indian vegetable oil brands and refineries.

Cargill Sugar generated record earnings in an expansionary year. Origination in Brazil and distribution in Russia were strong. The business also started distributing sugar in India and Ukraine, and trading ethanol globally.

Earnings in Cargill Cotton were solid, though down from last year’s record as China, the world’s largest importer of cotton, trimmed its intake. Prices also weakened under the weight of record global production. The business bolstered results by anticipating lower prices and by expanding marketing activities with growers in Africa, Asia and the United States.

C. Food Ingredients and Applications Food Ingredients and Applications serves food makers, food service companies and retailers with food and beverage ingredients, meat and poultry products, and new food applications.

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Revenues ...... $30,956.5 $27,860.0 $25,485.4 Earnings ...... 415.1 581.4 520.5

Segment earnings declined $166.3 million or 29 percent from the previous year’s results, primarily due to asset impairment charges incurred in the fourth quarter. Despite this year’s decline, segment results have grown since fiscal 2002, in large part due to 2002’s purchase of European starch and sweetener company Cerestar and the upward trend in meat prices. Revenues increased by $3.1 billion, or 11 percent, to $31 billion in fiscal 2005.

1. Food ingredients Cargill’s food businesses in Europe were led by Cerestar Sweeteners, which edged ahead of last year’s record performance by increasing sales in the enlarged European Union and maintaining market share in Western Europe, where industry sales volume contracted overall.

Operating under a volume-limiting government quota, Cargill Starches & Sweeteners Turkey did not match last year’s record earnings, but it did outperform expectations. Cargill Starches & Sweeteners Russia is constructing an addition to its sweetener facility in Efremov for the production of wheat-based fructose. Although higher raw material costs squeezed margins and earnings, the business met expectations. Cerestar Global Industrial Starches also experienced higher raw material costs, which trimmed earnings from last year.

Though short of the record set a year ago, Cargill Cocoa generated strong earnings in another year disrupted by conflict in Ivory Coast. It kept operations on track and continued to attract premiums for its high- quality cocoa powders. The business purchased two cocoa processing facilities in England and Germany from the Nestlé Group, which exemplifies food makers’ desire to concentrate attention on brand marketing. OCG Chocolate increased sales volume in its first year as part of Cargill. In June 2005, it completed the purchase of a chocolate plant in eastern Germany.

A broad offering of oil and fat products enhanced earnings in Cargill Refined Oils Europe. The business is adding specialized capacity at two refineries in Belgium and the Netherlands. It also is building Cargill’s first vegetable oil refinery in Russia in Efremov, where Cargill Malt Eurasia is constructing a new malt plant. Improved sales volume and attention to operating excellence helped Cargill Bottled Oil Europe turn a profit.

Among the Latin American food businesses, Cargill Foods Venezuela experienced a sharp decline in earnings relative to the prior year’s record high. After last year’s political uncertainty, which kept other firms away, it saw full competition return to the marketplace, including from the public sector.

84 The weaker U.S. dollar and higher energy and ocean shipping costs held Cargill Cocoa Brazil’s earnings below last year, though sales were lifted by its Spectrum Line™ cocoa powders.

Cargill Starches & Sweeteners Brazil had a record year. It acquired J.M. Smucker’s Brazilian subsidiary, which makes fruit spreads, fillings and more. Purchasing a vegetable fat business and expanding its retail offerings helped Cargill Foods Brazil post an earnings increase.

Results in Cargill Dressings, Sauces and Oils North America were down moderately from last year’s record earnings. Its strong presence in helping food manufacturers reformulate their products to achieve a low trans fat profile while also maintaining texture, taste and shelf life brought higher premiums and volume from new product solutions.

Despite continued excess capacity in the industry, Horizon Milling improved profitability. It held margins and market share, and introduced a new product, GrainWise™ wheat aleurone, which allows food makers to add the nutritional benefits of whole grains without compromising taste or color.

Cargill Sweeteners North America’s sales of corn oil and Sweet Bran® specialty feed were strong and ethanol earnings were record high, but reduced consumption of high-fructose sweetened soft drinks and high energy costs diminished earnings in the sweetener product lines. Results overall were decreased significantly by asset impairments taken on two high-fructose facilities.

Although Cargill Acidulants increased glucosamine production and citric acid pricing improved somewhat, the business was not profitable. Cargill Malt Americas developed low-carbohydrate reformulations and increased production efficiency, but an asset impairment resulted in a fiscal 2005 loss. Cargill Dry Corn Ingredients successfully launched the MaizeWise™ line of whole-grain corn products. It had an asset impairment and did not turn a profit.

2. Meat products Cargill’s beef businesses completed a second year operating in a market disrupted by international trade restrictions related to bovine spongiform encephalopathy (BSE). In July 2005, a U.S. appellate court ordered the U.S.-Canada border reopened to the importation of Canadian cattle under 30 months of age. But Japan and South Korea, two of the biggest markets for U.S. beef, remain closed. Despite the diminution in export income, Cargill Beef held earnings close to last year. Cattle supplies were plentiful in Canada but in the United States the market was constrained by the combination of tight cattle supplies and ample availability of cheaper competing meats at retail.

Cargill Beef Australia had a record year as export markets sought new sources of beef supply. Cargill Pork also excelled, as strong export demand yielded better margins and volume. Both its swine production and supply agreements benefited from the demand-induced increase in hog prices.

Compared with last year’s record, softer domestic demand coupled with export limitations tempered earnings in Cargill Food Distribution. Cargill Taylor Beef, which slaughters culled dairy cattle, incurred a loss due to the inability to buy Canadian livestock and the impact of high milk prices, which encouraged producers to maintain or build herd size.

Cargill Value Added Meats and Cargill Case Ready both delivered significant turnarounds in profitability.

Furthering its global approach to the beef market, Cargill acquired full ownership of Finexcor, a leading Argentine beef processor and exporter. In Canada, it agreed to buy the processing and related assets of Better Beef, which serves domestic and export markets. The acquisition is expected to close in the first half of fiscal 2006.

3. Food service and retail products Cargill purchased a majority share of Brazilian poultry and pork processor Seara Alimentos in the third quarter, followed by the purchase of nearly all of the remaining shares outstanding in a public tender. Seara gives Cargill a substantial presence in one of the most competitive countries for poultry and pork origination and in key destination markets, particularly Europe and Japan. Collaborating with the Sun Valley businesses, Seara will pursue a higher-value mix of products for export.

85 With customers opting for value-added egg products, Sunny Fresh Foods delivered its 10th consecutive year of record earnings. The business expanded its cooked capacity and will do so again this fiscal year. Sun Valley Thailand’s emphasis on cooked poultry products also was key to its record performance. The lingering presence of avian influenza has kept export markets closed to raw product.

Sun Valley Foods Canada acquired Caravelle Foods, the leading supplier of frozen beef patties to the quick-service restaurant industry in Canada. Adding beef to its poultry lineup led to another year of earnings growth.

Improved poultry sales volume and attention to market coverage enabled Sun Valley Central America to increase earnings over last year.

Sun Valley Europe’s retail business performed well, but asset impairments and restructuring costs within the import and distribution business led to a year-end loss. The plant in Wales was closed. The joint venture with Brazil’s Sadia was dissolved after Cargill purchased Seara.

4. Food system design The eastward enlargement of the European Union and a stronger euro helped Cerestar Food & Pharma Specialties Europe almost match last year’s performance. Its strong market position in specialty products such as dextrose, modified starches and polyols was bolstered by additional production capacity. The North American Food & Pharma unit incurred a larger-than-anticipated loss, buffeted by long timelines for product development, higher energy and transportation costs, and an asset impairment on one of its facilities.

Cargill Health & Food Technologies grew profitable product lines such as plant sterols and fiber, and continued development of health-enhancing ingredients. This year’s absorption of the soy isolate product line weighed on results, as it sustained an inventory write-down and an asset impairment. Although H&FT was not profitable overall, performance improved over the prior year.

Despite growth in cocoa powder shipments, Wilbur Chocolate’s earnings were hurt by consumers’ waning desire for low-carbohydrate foods, which reduced demand for Wilbur’s sugar-free products.

Adding to its capabilities, the Cargill Food System Design platform purchased a pectin business. This citrus-derived texturizer contributes to the taste, texture and mouth feel of foods and beverages. In June 2005, it bought Integrated Bakery Resources, a provider of premixes and product development services to bakeries and food retailers. Acquired last year, Duckworth Flavors did not turn a profit due partly to a weather-induced decline in demand for soft drink flavors and compounds and frozen confectionery.

Three successive hurricanes struck Florida’s citrus-producing counties last summer, damaging the state’s orange and grapefruit crops. The subsequent fruit shortage forced Cargill Juice Beverage Applications North America to shut down two plants for the season, run the third at reduced capacity and suffer a loss for the year. Cargill Juice Beverage Applications Europe, Middle East and Africa increased earnings as it concentrated attention on creating flavors, compounds and blends for the beverage industry. As part of the shift to higher- value citrus applications, Cargill sold its orange juice operations in Brazil.

D. Risk Management and Financial Risk Management and Financial provides customers and Cargill with risk management and financial solutions in world markets.

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Revenues ...... $3,440.0 $2,336.1 $1,902.6 Earnings ...... 521.0 382.7 354.5

Segment earnings rose $138.3 million, or 36 percent, from the prior year. The diverse investments in this segment delivered three consecutive years of earnings growth.

Posting another outstanding year, Cargill Value Investment was the largest contributor to Cargill’s overall results. An investor and manager of credit-intensive assets, CVI’s performance was composed of balanced contributions from its corporate credit, real estate and loan portfolio businesses, with particular strength in the energy sector in Europe and North America, real estate in Europe, Japan and North America, and collections from U.S. consumer and residential loan portfolios.

86 Black River Asset Management, a global asset management company created from a former Cargill business unit, completed its first full year of operations. Its funds, which are offered to qualified, third-party investors, were well subscribed. The company continued to manage proprietary financial trading accounts for Cargill.

Earnings in Cargill Risk Management were moderately below last year’s record earnings, with balanced results from financial products that help agricultural producers, commercial hedgers and institutional investors manage their commodity price exposure.

Earnings in Cargill Petroleum were below last year’s record. Backed by improved analytics and insight from converging markets for coal, crude oil, electricity and natural gas, its European team captured new trading opportunities in choppy markets to deliver a strong performance. Cargill Power & Gas Markets’ profitability declined considerably as a solid performance in power trading was offset partially by difficulties in natural gas. Cargill Coal completed its first year of operations. It is rebuilding the company’s focus on this commodity.

Cargill Ferrous International approached last year’s record-setting performance. It capitalized on strong worldwide demand for steel and related raw materials during the first half of the year. As China’s steel consumption slowed in the fourth quarter, prices fell sharply, which trimmed year-end results.

As announced in June 2005, Cargill agreed to sell the entire global business of Cargill Investor Services to REFCO Group, a provider of execution and clearing services for exchange-traded derivatives. Pending regulatory approval, the deal is expected to close in the first half of fiscal 2006.

Ventures Cargill Ventures continued investing in high-growth companies involved in technologies that support global commerce, information management and product solutions related to Cargill’s business interests. In building its portfolio, Ventures collaborates with Cargill business units and technology development centers. Its operating loss was consistent with expectations.

E. Industrial The Industrial segment supplies customers with fertilizer, salt, steel and industrial uses for agricultural feedstocks.

May 31, May 31, May 31, 2005 2004 2003 (Dollars in millions) Revenues ...... $5,100.5 $2,929.0 $2,321.3 Earnings ...... 224.0 4.6 50.5

Segment earnings climbed to $224 million for the year. Last year’s results reflected a significant asset impairment charge in the Cargill Dow joint venture.

Cargill Deicing Technology delivered a second year of record earnings. It secured higher volumes and prices on public bids, kept production steady, reduced costs and positioned inventory well relative to regional demand. Cargill Salt also exceeded last year’s record, with sales volumes and prices led by its solar salt operations in Latin America.

Buoyed by strong demand from China for most of the year, North Star Steel ran at full production. Even though its remaining U.S. steel and wire assets were sold to Gerdau Ameristeel at midyear, North Star was one of the largest contributors to Cargill’s earnings in fiscal 2005. With the sale, Cargill has largely exited from steelmaking, although its 50 percent interest in the North Star BlueScope Steel joint venture was retained, and the steel processing business was merged into Ferrous International.

Cargill Industrial Oils & Lubricants turned a profit, aided by growth in its vegetable oil-based lubricants business and by managing volatility in linseed costs.

At midyear, Cargill acquired Dow Chemical’s 50 percent interest in Cargill Dow. Renamed NatureWorks, it now operates as a limited liability company wholly owned by Cargill. Although its groundbreaking technology has won awards and attracted customer and media attention, NatureWorks’ financial performance has lagged due to slower-than-anticipated market development. The company has focused on packaging applications and is working to increase volume and reduce costs.

The Mosaic Company was accretive to earnings and revenues in fiscal 2005.

87 IV. OTHER OPERATING MATTERS A. Mosaic Merger In accordance with a merger and contribution agreement with IMC Global, Inc (IMC) that became effective Oct. 22, 2004, Cargill contributed all of its fertilizer businesses into The Mosaic Company, a new publicly traded company. Concurrently, IMC merged into Mosaic. As a result of Cargill’s contribution and the IMC merger, Cargill received 66.5 percent of the shares of Mosaic and IMC shareholders received 33.5 percent of the shares of Mosaic. As required by generally accepted accounting principles, Cargill treated this transaction as a partial purchase (66.5 percent) of IMC and a partial sale (33.5 percent) of the fertilizer businesses. A gain of $606 million was recorded as a result of the partial sale of the fertilizer businesses. In accordance with the merger and contribution agreement, the fertilizer businesses were restructured prior to the merger date, which resulted in $28 million of merger-related costs.

B. Discontinued Operations On Nov. 1, 2004, Cargill sold its remaining steelmaking plants and wire manufacturing facilities to Gerdau Ameristeel. Earnings in these businesses were reported as discontinued operations for 2005 and 2004. Cargill retains a 50 percent interest in the Delta, Ohio-based North Star BlueScope steel joint venture, which is not included in discontinued operations. Net losses from dispositions of $26 million, net of tax, were included in discontinued operations in 2005. Net gains from dispositions, primarily the Michigan steel business, of $12 million, net of tax, were included in discontinued operations for fiscal 2004.

C. Business Disposals Business disposals during 2005 included orange juice assets in Brazil. Proceeds from disposals were $192 million with gains of $71 million, net of tax. Business disposals during 2004 included Cargill’s interest in a lysine joint venture. Proceeds from disposals were $82 million with gains of $32 million.

D. Asset Impairment Charges Cargill periodically evaluates the carrying value of long-lived assets, including goodwill and other intangible assets, when events and circumstances indicate the carrying value may not be recoverable. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value. Major impairments in fiscal 2005 consist primarily of food processing assets in the United States and Europe. Major impairments in fiscal 2004 included a business that produces plastics made with annually renewable resources, and certain food and food ingredient assets. Restructuring charges also were recorded to cover exit and employee severance costs related both to assets to be sold and assets to be held and used. In 2005, asset impairment charges totaled $194 million after tax, and, in 2004, were $153 million after tax.

E. Litigation Summary In July and August 2000, an outbreak of E. coli 0157:H7 occurred in two Sizzler chain restaurants in the Milwaukee, Wis., area. According to a report issued by the state of Wisconsin, more than 60 confirmed cases of E. coli 0157:H7 illnesses and the death of one child are linked to the outbreak. Excel was a supplier of meat products to Sizzler. It was alleged that an unopened Excel sirloin tri-tip product taken from one of the restaurants tested positive for the same strain of E. coli as that found in the affected patrons. Nine lawsuits are pending against Excel relating to this matter. There are a total of 25 plaintiffs among the nine suits. Twelve of the plaintiffs claim an illness from food consumption at the restaurants. Thirteen of the plaintiffs make consortium claims. In January 2002, Sizzler USA Franchise, Inc., filed a third-party complaint against Cargill and a cross claim against Excel. In May 2002, Excel prevailed on a motion for summary judgment and the state trial court dismissed the plaintiffs’ claims and the cross claim by Sizzler against Excel. The Wisconsin Court of Appeals reversed the trial court’s summary judgment in favor of Excel. The Wisconsin Supreme Court declined to hear the case. On March 22, 2004, the U.S. Supreme Court declined to hear a certiorari petition filed by Excel asking it to hear the appeal. Discovery in the lawsuits is continuing.

On Dec. 14, 2000, Cargill Turkey Products initiated a voluntary nationwide recall of certain ready-to-eat poultry products manufactured at its Waco, Texas, facility to safeguard against possible Listeria contamination. Federal officials have indicated that 30 cases of illnesses, including four deaths and three miscarriages/stillbirths, are possibly linked to the products that were recalled. Three personal injury and/or wrongful death lawsuits were filed against Cargill related to this matter, each seeking unspecified damages. Two lawsuits were settled, leaving one consumer lawsuit pending against the company related to the recall.

88 Twenty-five current and former Cargill salaried employees, alleging systematic racial discrimination in employment, filed a lawsuit in U.S. District Court in Minnesota on Nov. 15, 2001. Although we are concerned when any of our employees feel unfairly treated, we strongly believe these allegations are false. The discovery period for class certification has been under way since April 1, 2002. On Sept. 24, 2004, U.S. District Judge Donovan Frank, citing several breaches of the Minnesota Rules of Professional Conduct, ordered that Sprenger + Lang, PLLC, the law firm representing the plaintiffs, be disqualified. The district court subsequently, accepted Cohen, Milstein, Hausfeld & Toll, PLLC as successor counsel. The class has not been certified. Cargill expects a certification hearing to be scheduled by the end of 2005. On Nov. 23, 2004, the U.S. District Court ordered that Sprenger + Lang could work with successor counsel under certain conditions, and transfer specified documents to them. The court has requested that a Special Master review certain plaintiff and third party documents to determine whether certain Sprenger + Lang documents are “tainted” and unavailable to the Cohen, Milstein firm. Also, under the court’s order, Cargill is permitted to object to the inclusion of documents into evidence that it believes may have been tainted by Sprenger + Lang’s misconduct. Further, Sprenger + Lang may not discuss the merits of the case with successor counsel.

In May 2002, three cattle producers filed a lawsuit in the U.S. District Court in Nebraska against Excel seeking class action status for alleged violations of the Packers and Stockyards Act of 1921. The plaintiffs allege that Excel has depressed cattle prices through its procurement practices, including the alleged use of “captive supplies.” Plaintiffs seek remedies in the form of injunctive relief, declaratory relief, money damages and attorneys’ fees and costs. In July 2002, Excel filed a motion to dismiss or, in the alternative, to strike plaintiff’s complaint. Excel’s motion was granted with respect to the claims of conspiracy between Excel and Cargill. Discovery related to class certification has concluded. The parties have submitted briefs on the class issues. The judge has issued a stay ruling in the lawsuit against Excel until the appeal in the Pickett, et al. vs. Tyson Fresh Meats, Inc. case is decided. In April 2004, the judge in the Tyson case, who is also the judge in the lawsuit pending against Excel, overturned the jury verdict in favor of the plaintiffs in the Tyson case.

On June 18, 2005, the State of Oklahoma filed a water quality lawsuit against Cargill and other poultry integrators in the U.S. District Court for the Northern District of Oklahoma, related to alleged nutrient loading in certain Oklahoma and western Arkansas watersheds. The lawsuit seeks damages and injunctive relief based upon the alleged adverse environmental impact of excess nutrients associated with the land application of poultry litter by the companies and contract growers. The parties are mediating the claims.

The outcome of any litigation is not predictable with certainty, or subject to the company’s control. However, it is the opinion of management that any ultimate liability in any known litigation against the company has been provided for, or will not have a material adverse effect on our consolidated financial condition or results of operations.

APPENDIX: ACCOUNTING POLICIES The following is a summary of key accounting policies and disclosures. Please refer to the audited financial statements for complete financials and footnote disclosures.

A. Application of Critical Accounting Policies 1. Basis of consolidation Our consolidated financial statements include the accounts of Cargill, Incorporated and more than 50-percent owned subsidiaries that we control by ownership of a majority voting interest as well as certain variable interest entities, where the company is the primary beneficiary and consolidation is required. Intercompany accounts and transactions are eliminated. Investments in companies where Cargill does not have control but has the ability to exercise significant influence (generally 20 percent to 50 percent ownership) are accounted for by the equity method. Other investments where the company is unable to exercise significant influence over operating and financial decisions are accounted for at cost.

2. Use of estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Although these estimates are based on knowledge of current events and actions expected to be undertaken in the future, actual results may ultimately differ from estimates.

89 3. Revenue recognition Cargill recognizes revenue from commodity or product sales when the goods are shipped or delivered depending upon when the customer has taken title and assumed the risks and rewards of ownership, prices are fixed or determinable and collectibility is reasonably assured. Additional revenue recognition policies for trading securities and derivatives and inventories are shown below.

4. Foreign currency translation We include gains and losses, resulting from translating at the current rate the financial statements of foreign subsidiaries whose functional currency is the local currency, in other comprehensive income.

Translation gains and losses of foreign subsidiaries operating in hyperinflationary economies and of foreign subsidiaries where the U.S. dollar is the functional currency are included currently in net earnings.

5. Pension plans Our company and subsidiaries have various pension plans covering most of our domestic employees and many of our foreign employees. Defined-benefit pension benefits are based on years of service and compensation. Unrecognized net gains or losses are amortized over the expected remaining service lives of employees. Pensions are funded in compliance with U.S. government regulations or local laws and practices.

Cargill uses a March 1 measurement date for our domestic pension plans and various measurement dates for our foreign pension plans. Key components of the defined-benefit plans for domestic and foreign companies are as follows:

2005 2004 (In millions) Actuarial present value of benefit obligations: Vested benefit obligation ...... $3,423 $2,788 Accumulated benefit obligation ...... 3,808 2,903 Projected benefit obligation ...... 4,273 3,287 Plan assets at fair value ...... 3,158 2,401 Unfunded accumulated benefit obligation ...... (650) (502) Employer contributions ...... 248 403 Benefits paid ...... 153 126

In 2006, Cargill estimates we will contribute in the range of $200 to $300 million to our domestic and foreign pension plans.

The company’s pretax defined-benefit pension expense for fiscal 2005 was $186 million, compared with $173 million in fiscal 2004.

6. Resale and repurchase agreements Securities purchased with agreements to resell (reverse repurchase agreements) and securities sold with agreements to repurchase (repurchase agreements) are treated as collateralized financing transactions and are recorded at the amount at which the securities were initially acquired or sold, including accrued interest. Interest income is recorded on reverse repurchase agreements and interest expense is recorded on repurchase agreements.

Our policy is to take delivery of securities purchased with agreements to resell, which are generally U.S. government or U.S. government agency securities. We have the ability to sell or repledge the securities. We monitor the market value of the securities to be resold daily and obtain additional collateral when deemed appropriate. Cargill offsets resale and repurchase agreements that meet the applicable netting criteria.

7. Trading securities and derivatives Cargill is engaged in the leveraged trading of a diverse group of securities and, accordingly, its trading securities and trading securities sold, not yet purchased are recorded on trade date at fair value. These instruments are marked to market with realized and unrealized gains and losses included in the determination of net earnings. Interest on trading securities sold, not yet purchased is netted against interest income and shown as Sales and Other Revenues in the consolidated statement of earnings.

90 We trade derivative instruments, including swaps, futures contracts, forward commitments, options and other similar types of contracts and commitments based on either interest rates or foreign exchange rates, as well as equity and commodity derivatives. These instruments are carried at their fair market value on the balance sheet. The fair market value of a significant portion of trading securities and derivatives, as described above, is determined from market prices quoted on public exchanges or based on management’s best estimate subject to independent price verification. New complex instruments may have immature or limited markets. As a result, the pricing models used for valuation may require significant estimates and assumptions. An insignificant amount of positions are valued in this manner.

Cargill has historically traded fixed income and other securities in a manner that generally limits risk with respect to the direction of changes in the prices of those securities. During the year ended May 31, 2004, Cargill restructured its capital markets trading business into Black River Asset Management LLC (BRAM), a wholly owned global asset management company that provides institutional investors with alternative investment products. BRAM has developed and marketed a number of private investment funds with differing investment strategies. During the year ended May 31, 2005, sufficient outside investments were received to reduce Cargill’s ownership in these funds to a noncontrolling interest. As a result, these BRAM funds were deconsolidated during fiscal 2005 and Cargill’s investment in the affiliated private investment funds is shown in the Investments and Advances line of the consolidated balance sheet. Cargill companies will continue to own and trade various financial securities to optimize Cargill’s financial position when opportunities arise. In each case, specific position and risk limits will be adopted by Cargill management.

In addition to trading activities, we utilize various types of derivative products (principally options, futures and interest rate and currency swaps) to hedge interest rate, currency and other market risks arising from certain assets and liabilities. Cargill values its derivative instruments in accordance with SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” as amended by SFAS 137 and SFAS 138.

8. Inventories Grain, cotton and other commodities for merchandising and oilseeds and other commodities for processing and products thereof are stated principally at market, adjusted for unrealized gains or losses on open cash contracts valued at market. Market is determined from market prices quoted on public commodity exchanges, adjusted for expected freight costs to normal delivery points and a price premium or discount to cover local supply and demand factors as estimated by management. The availability and market price of agricultural commodities are subject to wide fluctuations due to unpredictable factors such as weather, plantings, domestic and foreign government farm programs and policies, global production and other factors. We generally minimize the risk of market fluctuations by hedging those inventories with futures, cash, and foreign exchange contracts. Generally those contracts are valued at market and the resulting unrealized gains or losses are recognized currently in earnings. Dressed beef, poultry, salt and other products are valued at the lower of cost (last-in, first- out) or market. All other inventories are stated principally at the lower of cost or market.

9. Property, plant and equipment Property, plant and equipment are stated at cost and depreciated principally using the straight-line method over the estimated useful lives of the assets. We periodically evaluate the carrying value of these long-lived assets when events and circumstances indicate the carrying value may not be recoverable. If the carrying value is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds fair market value.

10. Income taxes Cargill and substantially all of our domestic subsidiaries are members of a group that files a consolidated federal income tax return. Federal income taxes or tax benefits are allocated to each company on the basis of its individual taxable income or loss and tax credits included in the return. Deferred income taxes are recognized for tax consequences of temporary differences by applying enacted statutory tax rates, applicable to future years, to differences between the financial reporting and the tax basis of existing assets and liabilities.

It is generally our policy to reinvest indefinitely unremitted earnings of foreign subsidiaries and corporate joint ventures, or to remit earnings only when the tax effect is minor. Accordingly, no provision has been made for income taxes that may be payable upon remittance of such earnings. Federal income taxes on any amounts remitted would be partly offset by foreign tax credits.

91 11. Goodwill and other intangible assets Business acquisitions are accounted for in accordance with SFAS 141, “Business Combinations,” with the purchase price allocated to the assets and liabilities acquired, including goodwill and other intangibles, based on their estimated fair values at the date of acquisition. Goodwill and intangible assets with indefinite lives are reviewed annually for impairment. Impairment assessments include comparing the fair value of a reporting unit with its carrying value, including goodwill. The assessments are performed using a variety of methodologies, including cash flow analysis, estimates of sales proceeds and appraisals. During fiscal 2005, Cargill merged its fertilizer business into The Mosaic Company, which generated goodwill of $2,343 million. Unamortized goodwill at May 31, 2005 and 2004 was $2,900 million and $548 million, respectively. Unamortized intangible assets other than goodwill at May 31, 2005 and 2004 were $184 million and $87 million, respectively.

12. Investments and advances The investments and advances shown below include all nonconsolidated companies carried at equity. These include Brazilian and Canadian fertilizer companies, a U.S. steel company, numerous entities holding real estate and loan portfolios and other agricultural joint ventures.

2005 2004 (In millions) Total assets ...... $8,171 $9,055 Debt obligations, nonrecourse to Cargill ...... 2,495 3,448 Debt obligations, recourse to Cargill ...... 185 450 Other liabilities ...... 2,132 2,270 Net assets ...... $3,359 $2,887

Equity in net assets ...... $1,491 $1,216

The debt obligations, with recourse to Cargill shown above, are supported by Cargill guarantees with terms equal to the related debt amounts, with maturities through 2021. No liability has been recorded related to these guarantees. The nonrecourse debt is collateralized by specific assets of the nonconsolidated companies and the lender does not have recourse to any other assets of Cargill.

13. Financial derivative instruments with off-balance sheet risk Cargill has a risk management group with staff in London, Singapore and Minneapolis that assists senior management in the identification, assessment and control of various risks. The company monitors its exposure to market and credit risks on a daily basis through a variety of financial and credit exposure calculations and reports. In addition, we have policies and procedures in place to support effective risk management and communication.

We utilize various types of derivative instruments to manage the interest rate, currency and other market risks associated with certain liabilities and assets such as trading securities, trading securities sold not yet purchased, loans, short-term borrowings and other debt.

Certain of our company’s trading securities have off-balance sheet risk of accounting loss, which may consist of market and/or credit risk, in excess of amounts recorded on the consolidated balance sheet. We utilize a variety of derivatives and off-balance sheet financial instruments to manage exposure to interest rate and other risks and to take trading positions. Financial instruments traded or utilized by Cargill, which involve varying degrees of credit and market risk, include derivatives, trading securities sold not yet purchased, and forward commitments.

On an ongoing basis, we manage the risk that counterparties might default on their obligations under derivative or cash instrument trades. To manage the level of credit risk, we enter into master netting arrangements whenever possible, obtain collateral when appropriate and monitor the size and maturity structure of the positions. We also monitor credit exposures, limit transactions with specific counterparties, and continually assess the creditworthiness of counterparties. Master netting arrangements incorporate rights of setoff that provide for the net settlement of certain contracts with the same counterparty in the event of default.

Market risk represents the potential loss due to the decrease in the value of a financial instrument caused primarily by changes in interest rates, foreign exchange rates, the prices of equities, commodities or the related

92 indices. The level of market risk is influenced by the volatility and liquidity in the markets in which financial instruments are traded. Cargill seeks to control market risk by developing and refining hedging strategies that correlate price, currency and commodity movements of trading securities and the related hedges. In many cases, derivative financial instruments are used to hedge other on- and off-balance sheet transactions.

Trading securities sold, not yet purchased represent obligations of our company to deliver specified securities at a contracted price. These transactions result in off-balance sheet market risk as our ultimate obligation for trading securities sold, not yet purchased may exceed the amounts recognized in the consolidated balance sheet.

Financial futures, forward commitments and foreign currency contracts involve a commitment to purchase or sell securities, currencies or commodities at a future date at a predetermined price. Cargill enters into financial futures and foreign currency contracts to hedge against uncertainty in future interest rates, and security and currency values. When purchasing foreign currency denominated assets, issuing foreign currency denominated debt or having foreign net investments, Cargill subjects itself to changes in value as exchange rates move. These fluctuations are managed by entering into currency swaps and forwards. The majority of our financial futures and foreign currency contracts are cleared and held by clearing brokers that are affiliates of Cargill.

Swap agreements generally involve the exchange of payment obligations on an underlying notional principal amount. Those transactions may expose our company to off-balance sheet risk associated with interest rate, foreign currency, commodity or equity price fluctuations. Cargill enters into either U.S. dollar or non-U.S. currency denominated interest rate swaps and generally uses these agreements to hedge interest rate-sensitive trading securities and borrowings.

Cargill enters into total return swap agreements to assume either interest rate, credit, or equity price risk on the swap’s underlying assets or to pass the risk associated with the swap’s underlying assets to the counterparty. Total return swaps generally require one party to pay the other a rate of interest, generally a floating rate plus a spread, in return for payments equal to the return on an asset or a portfolio of assets.

For those swap contracts where Cargill assumes equity price risk, it can either be receiving an equity- based or interest-based return under the total return swap agreement. These derivatives are largely utilized to assume equity price risk without having ownership of the underlying equities or to pass the equity price risk to the total return swap counterparty. If risk is assumed, it may be hedged with other derivative instruments.

Credit default swaps are an agreement between two parties whereby one party pays the other a fixed coupon over a specified term. The other party makes no payment unless a specified credit event such as a default occurs, at which time a payment is made and the swap terminates. Cargill enters into credit default swaps either to assume or hedge credit risk.

As a writer of option contracts, we receive cash and, in return, may be obligated to purchase or sell to the holder a specific financial instrument under the terms of the contract. As a holder of option contracts, we pay cash and, in return, have the choice of whether or not to purchase or sell to the writer a specific financial instrument under the terms of the contract. Cargill enters into option contracts to hedge against uncertainty in future security and currency values and to capitalize on perceived market opportunities.

Cargill also purchases financial instruments created from the securitization of municipal bonds (municipal derivatives). These financial instruments are residual interests in special purpose entities sponsored by a third party. The return on the residual interests and changes in their market value varies inversely with market interest rates. Our returns are subject to significant leverage and as a result do not directly correlate with changes in market interest rates. Municipal derivatives, which may be considered alternative sources of financing and are off-balance sheet, total $210 million and $207 million at May 31, 2005 and 2004, respectively.

14. Short-term and long-term nonrecourse debt Short-term and long-term nonrecourse debt is issued by Mosaic and variable interest entities (VIEs). The Mosaic debt is not guaranteed or supported by Cargill or other consolidated subsidiaries. The VIE debt is collateralized by specific assets of the consolidated VIEs and the lender only has recourse to the assets of the entity collateralizing the loan. The lender does not have recourse to any assets of Cargill. VIEs are described more fully in the section below labeled “New Accounting Policies—Variable interest entities.”

93 15. Lease commitments Cargill and its subsidiaries lease real property, barges, rail and other transportation equipment and various machinery and equipment under noncancellable operating lease agreements, extending through 2109. These include operating leases with certain shareholders under terms deemed to be the same as arm-length transactions, with future minimum lease payments of $41 million at May 31, 2005.

Rental expense for all operating leases, except ocean freight vessels, was $403 million in 2005 and $372 million in 2004. Rental expense for ocean freight vessels was $381 million in 2005 and $186 million in 2004. Cargill enters into purchase commitments for time on ocean freight vessels for the purpose of transporting agricultural and other commodities for the company and third-party customers. In addition, we sell time on these ocean freight vessels.

16. Contingencies and commitments Cargill and our subsidiaries have various legal actions, claims and proceedings pending against them including those arising from product defects, employment-related matters, patents and governmental regulations. Significant litigation is discussed in Section IV.E. Cargill has established reserves for matters in which losses are probable and can be reasonably estimated. Litigation is subject to uncertainties and the outcome of individual litigated matters is not predictable with assurance.

As of May 31, 2005, Cargill and our subsidiaries were contingently liable for guaranteed lease residuals of $80 million, and guaranteed obligations of third parties totaling $263 million. The guaranteed lease residuals relate to synthetic lease agreements for railcars and barges expiring through 2020. The leases are classified as operating leases and we have the option to purchase the railcars or barges at fixed amounts based on fair values or to have the assets sold. If sale proceeds were less than guaranteed fixed amounts, we would be obligated to pay for the deficiency in the proceeds. We have not recorded any liability related to the guaranteed lease residuals.

As of May 31, 2005, Cargill and our subsidiaries had outstanding letters of credit issued by banks for the purchase of commodities, margin deposit requirements, performance guarantees and other purposes totaling $436 million.

Cargill has approved capital expenditures affecting future periods for the purchase or construction of property, plant and equipment and for the acquisition of other businesses. As of May 31, 2005, those capital commitments totaled $1,203 million.

B. New Accounting Policies 1. Variable interest entities In January 2003, the FASB issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46), which requires certain variable interest entities (VIEs) to be consolidated. FIN 46 separates entities into two groups: (1) those for which voting interests are used to determine consolidation and (2) those for which variable interests are used to determine consolidation. An entity is considered to be a VIE when it has equity investors who lack the characteristics of a controlling financial interest, or the entity’s capital is insufficient to permit it to finance its activities without additional subordinated financial support. A VIE is consolidated by its primary beneficiary, which is the company that absorbs a majority of the VIEs expected losses, receives a majority of the VIEs residual returns, or both. Upon its original issuance, FIN 46 was effective immediately for VIEs created after Jan. 31, 2003, while the effective date for VIEs created prior to Feb. 1, 2003, was May 31, 2005.

In December 2003, the FASB issued a revision to FIN 46 (FIN 46R) to clarify some of the provisions of the original interpretation and to exempt certain entities from its requirements. FIN 46R provides special effective date provisions to enterprises that fully or partially applied FIN 46 prior to the issuance of the revised interpretation. Cargill has applied FIN 46 and FIN 46R to all entities created after Jan. 31, 2003, and has consolidated VIEs with total assets of $1,908 million and $990 million as of May 31, 2005, and May 31, 2004, respectively. The VIEs include partnerships, corporations and trusts that acquire, hold, restructure and dispose of performing and non-performing loans and real estate assets sold by governmental agencies, financial institutions and others.

Under FIN 46R, the effective date for Cargill to consolidate VIEs acquired prior to February 1, 2003, was extended to fiscal year 2006. However, we chose early adoption of certain provisions of FIN 46R as of May 31,

94 2005 for all entities created prior to February 1, 2003 that are considered special purpose entities (SPEs). The VIEs considered to be SPEs include synthetic lease structures, trusts holding municipal bonds and the related beneficial interests issued thereon, and owner trusts created for leveraged leases. The early adoption of FIN 46R resulted in the consolidation of SPEs with total assets and debt totaling $631 million and $592 million, respectively. In accordance with the transition provisions of FIN 46R, Cargill recorded an after-tax loss of $48 million as a cumulative effect of an accounting change in 2005. Prior periods were not restated. VIEs acquired prior to Feb. 1, 2003, not considered to be SPEs with assets and debt totaling $1,390 million and $686 million, respectively, will require consolidation during 2006. The cumulative effect of adoption of these VIEs will not be material.

Cargill also holds variable interests in the form of loan and equity investments into a variety of VIEs of which the company is not the primary beneficiary. These VIE entities hold, restructure and dispose of performing and non-performing loans in real estate assets. Cargill’s total outstanding loan and equity method investment balances exposed to loss as a result of our involvement in these VIEs totaled $177 million and $284 million as of May 31, 2005.

2. Pension and Postretirement Plans In May 2004, the FASB issued FASB Staff Position (FSP) FAS 106-2, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003,” which the company will adopt during fiscal 2006. The adoption is not expected to have a material effect on our consolidated financial position or results of operations.

3. Stock Based Compensation In December 2004, the FASB revised SFAS No. 123. SFAS No. 123R further defines the concept of fair market value as it relates to share-based payment transactions as compensation expense. The provisions of this statement will be effective for Cargill in fiscal 2007 and will not have a material effect on our consolidated financial position or results of operations. During fiscal 2003, Cargill adopted the fair value recognition provisions of SFAS 123, “Accounting for Stock-Based Compensation,” and selected the retroactive restatement method of adoption described in SFAS 148.

4. Foreign Earnings Repatriation In October 2004, The American Jobs Creation Act of 2004 (the Jobs Creation Act) was signed into law. The Jobs Creation Act includes a temporary incentive for U.S. multinationals to repatriate foreign earnings at an effective 5.25 percent tax rate. Such repatriations must occur in either an enterprise’s last tax year that began before the enactment date, or the first tax year that begins during the one-year period beginning on the date of enactment.

Our company is currently evaluating the details of the Jobs Creation Act and as of May 31, 2005, had not decided if we would repatriate foreign earnings under the act. Accordingly, the consolidated financial statements do not reflect any provision for taxes on the unremitted foreign earnings that might be remitted.

95 DIRECTORS

Cargill, Inc. has operated as a privately-owned business since its founding in 1865. Descendants of the founding families still maintain a majority interest in the Company. All the equity of Cargill, Inc. is owned by members of the Cargill, Inc. and MacMillan families, the ESOP trustee and members of the Company’s senior management.

As of the date of this Base Prospectus, the following are directors of Cargill, Incorporated whose business address is at 15615 McGinty Road West, Wayzata, MN 55391-2398:

Within the Company Outside the Company Michael H. Armacost ...... Director, Cargill, Incorporated Stanford University Shorenstein Distinguished Fellow Former President, Brookings Institution F. Guillaume Bastiaens ...... Vice Chairman, Cargill, Incorporated Martha MacMillan Bennett ...... Director, Cargill, Incorporated Susan M. Cargill ...... Director, Cargill, Incorporated Arthur D. Collins, Jr...... Director, Cargill, Incorporated Chairman and Chief Executive Officer, Medtronic, Inc. S. Curtis Johnson ...... Director, Cargill, Incorporated Chairman, JohnsonDiversey, Inc. Richard M. Kovacevich ...... Director, Cargill, Incorporated Chairman and Chief Executive Officer Wells Fargo & Company Robert L. Lumpkins ...... Vice Chairman, Cargill, Incorporated William B. MacMillan ...... Director, Cargill, Incorporated John H. MacMillan IV ...... Director, Cargill, Incorporated Gregory R. Page ...... President and Chief Operating Officer, Cargill, Incorporated David W. Raisbeck ...... Vice Chairman, Cargill, Incorporated Warren R. Staley ...... Chairman of the Board and Chief Executive Officer, Cargill, Incorporated Lucy C. MacMillan Stitzer ... Director, Cargill, Incorporated Michael W. Wright ...... Director, Cargill, Incorporated Former Chairman SUPERVALU Inc.

There are no potential conflicts of interest between the directors of the Company and their duties to the Company that would be material with respect to the issuance of Notes.

96 TAXATION CERTAIN UNITED STATES FEDERAL TAX CONSIDERATIONS TO UNITED STATES ALIENS

The following is a summary of certain United States Federal tax consequences of the acquisition, ownership and disposition of Notes by original purchasers of Notes who are United States Aliens as defined under Section 9(a)(iii). This summary is based on existing United States Federal income and estate tax law, which is subject to change, possibly retroactively. This discussion does not discuss all aspects of United States Federal taxation that may be relevant to a particular holder in light of its personal investment circumstances or to holders subject to special treatment under the United States Federal income tax laws (including certain financial institutions). Prospective investors are urged to consult their tax advisors regarding the United States Federal tax consequences of acquiring, holding and disposing of any Notes, as well as any tax consequences that may arise under the laws of any foreign, state, local or other taxing jurisdiction.

Special United States Federal tax considerations applicable to the particular terms of a Tranche may be described in more detail in the applicable Final Terms.

Circular 230 Legend Any discussions of United States Federal tax matters set forth in this Base Prospectus were written to support the promotion and marketing by the Issuer and the Dealers of the Notes. Such discussions were not intended or written to be legal or tax advice to any person and were not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any tax-related penalties that may be imposed on such person. Each person considering an investment in the Notes should seek advice based on its particular circumstances from an independent tax advisor.

General Under present United States Federal income and estate tax law and subject to the discussion of backup withholding below: (a) payments of interest (including any original issue discount) on any Note, Receipt or Coupon to any United States Alien will not be subject to United States Federal income or withholding tax, provided that (1) the holder does not actually or constructively own 10% or more of the total combined voting power of all classes of stock of the Issuer entitled to vote, (2) the holder is not (i) a foreign tax exempt organization or a foreign private foundation for United States Federal income tax purposes, (ii) a bank receiving interest pursuant to a loan agreement entered into in the ordinary course of its trade or business, or (iii) a controlled foreign corporation that is related to the Issuer through stock ownership, (3) such interest payments are not effectively connected with the conduct of a United States trade or business of the holder, and (4) such interest is not contingent on the Issuer’s profits, revenues, or changes in the value of its property (“Contingent Interest”); (b) a holder of a Note who is a United States Alien will not be subject to United States Federal income tax on gain realized on the sale, exchange, retirement or other disposition of a Note, unless (1) such holder is an individual who is present in the United States for 183 days or more during the taxable year and certain other requirements are met, or (2) the gain is effectively connected with the conduct of a United States trade or business of the holder; (c) if interest on the Note or Coupon is exempt from withholding of United States Federal income tax under the rules described above, the Notes will not be included in the estate of a deceased United States Alien for United States Federal estate tax purposes.

Contingent Interest will generally be subject to withholding tax of 30% unless it is reduced by an applicable tax treaty.

Backup Withholding and Information Reporting In the case of payments of interest to United States Aliens, Treasury regulations provide that backup withholding at the applicable statutory rate and certain information reporting will not apply to such payments with respect to which either the requisite certification has been received or an exemption has otherwise been established, provided that neither the Issuer nor its payment agent has actual knowledge that the holder is a

97 United States person or that the conditions of any other exemption are not in fact satisfied. Under Treasury regulations, these information reporting and backup withholding requirements will apply, however, to the gross proceeds paid to a United States Alien on the disposition of the Notes or Coupons by or through a United States office of a United States or foreign broker, unless the holder certifies to the broker under penalties of perjury as to its status as a United States Alien. Information reporting requirements, but not backup withholding, will also apply to a payment of the proceeds of a disposition of the Notes or Coupons by or through a foreign office of a United States broker or foreign brokers with certain types of relationships to the United States. Neither information reporting nor backup withholding will generally apply to a payment of the proceeds of a disposition of the Notes or Coupons by or through a foreign office of a foreign broker not subject to the preceding sentence.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be refunded or credited against the United States Alien’s United States Federal income tax liability, provided that the required information is furnished to the Internal Revenue Service.

In compliance with United States Federal tax laws and regulations, the Notes may not be offered or sold during the forty day period following the completion of the distribution to a person who is within the United States (or its possession) or to a United States person other than (i) certain financial institutions located outside the United States which agree in writing to comply with the requirements of section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder, (ii) the United States office of exempt distributors, or (iii) United States offices of international organizations or foreign central banks. Also, United States Federal tax laws and regulations require that Notes not be delivered within the United States and that interest with respect to the Notes is payable only outside the United States and its possessions. Each Dealer has agreed that, during the forty day period following the completion of the distribution of any Tranche of Notes, it will not offer or sell any Notes to a person who is within the United States or its possessions to a United States person other than certain financial institutions or other persons described above. See “Subscription and Sale”.

Each Note with a maturity of over 183 days will bear the following legend: “Any United States person who holds this obligation will be subject to limitations under United States income tax laws, including the limitations provided in sections 165(j) and 1287(a) of the Internal Revenue Code.”

The provisions referred to in the legend generally provide that any United States person who holds a Bearer Note, with certain exceptions, will not be allowed to deduct any loss sustained on the sale, exchange or other disposition of such Bearer Note, and will be subject to tax at ordinary income rates (as opposed to capital gain rates) on any gain recognized on such sale, exchange or other disposition.

Each Note with a maturity of 183 days or less will bear the following legend: “By accepting this obligation, the holder represents and warrants that it is not a United States person (other than an exempt recipient described in section 6049(b)(4) of the Internal Revenue Code and regulations thereunder) and that it is not acting for or on behalf of a United States person (other than an exempt recipient described in section 6049(b)(4) of the Internal Revenue Code and the regulations thereunder)”.

Terms used in this sub-section have the meanings given them by the U.S. Internal Revenue Code of 1986, as amended, and the regulations thereunder.

98 LUXEMBOURG TAXATION

The following is a summary of certain material Luxembourg tax consequences of purchasing, owning and disposing of the Notes, Receipts and Coupons. It does not purport to be a complete analysis of all possible tax situations that may be relevant to a decision to purchase, own or deposit the Notes, Receipts or Coupons. Prospective purchasers of the Notes, Receipts or Coupons should consult their own tax advisers as to the applicable tax consequences of the ownership of the Notes, Receipts or Coupons, based on their particular circumstances. This summary does not allow any conclusions to be drawn with respect to issues not specifically addressed. The following description of Luxembourg tax law is based upon the Luxembourg law and regulations as in effect on the date of this Base Prospectus and is subject to any amendments in law later introduced, whether or not on a retroactive basis.

Terms and expressions as used in this summary have the meaning attributed to them under Luxembourg domestic tax law.

Tax Residency As used herein, a Luxembourg Noteholder, Receiptholder or Couponholder is respectively a beneficial owner of Notes, Receipts or Coupons, who is, for Luxembourg income tax purposes: (a) an individual, resident in Luxembourg; or (b) a corporation (société de capitaux), which has its registered office or its principal place of business in Luxembourg.

Non-residents (i.e., not defined as a Luxembourg Noteholder, Receiptholder or Couponholder) may be subject to Luxembourg income tax, under specific Luxembourg tax provisions.

A Noteholder, Receiptholder or Couponholder will not become resident, or be deemed to be resident, in Luxembourg by reason only of the holding of the Notes, Receipts or Coupons, or the execution, performance, delivery and/or enforcement of the Notes, Receipts or Coupons.

Taxation of the Noteholders, Receiptholders and Couponholders Withholding tax

Taxation of Luxembourg non-residents Under Luxembourg tax law currently in effect and subject to the application of the Luxembourg laws dated June 21, 2005 (the “Laws”) implementing the European Council Directive 2003/48/EC on the taxation of savings income (the “Directive”) and several agreements concluded between Luxembourg and certain dependant territories of the European Union, there is no withholding tax on payments of interest (including accrued but unpaid interest) made to Luxembourg non-resident Noteholders, Receiptholders or Couponholders. There is also no Luxembourg withholding tax, upon repayment of the principal or, subject to the application of the Laws, upon redemption or exchange of the Notes, Receipts or Coupons.

Under the Laws, a Luxembourg based paying agent (within the meaning of the Directive) is required since July 1, 2005 to withhold tax on interest and other similar income (including reimbursement premium received at maturity) paid by it to (or under certain circumstances, to the benefit of) an individual resident in another Member State or a residual entity in the sense of article 4.2. of the Directive (“Residual Entities”), established in one Member State of the European Union unless the beneficiary of the interest payments elects for an exchange of information. The same regime applies to payments to individuals or Residual Entities resident in any of the following territories: Netherlands Antilles, Aruba, Guernsey, Jersey, the Isle of Man, Montserrat and the British Virgin Islands.

The withholding tax rate is initially 15%, increasing steadily to 20% and to 35%. The withholding tax system will only apply during a transitional period, the ending of which depends on the conclusion of certain agreements relating to information exchange with certain other countries.

In each case described here above, responsibility for the withholding of such tax will be assumed by the Luxembourg paying agent.

99 Taxation of Luxembourg residents Under the Luxembourg law of December 23, 2005 (the “Law”), payments of interest or similar income made since January 1, 2006 (but accrued since July 1, 2005) by a paying agent established in Luxembourg to or for the immediate benefit of an individual beneficial owner who is a resident of Luxembourg may be subject to a withholding tax of 10%. Such withholding tax will be in full discharge of income tax if the beneficial owner is an individual acting in the course of the management of his/her private wealth.

Income Taxation

Taxation of Luxembourg non-residents Noteholders, Receiptholders and Couponholders who are non-residents of Luxembourg and who do not hold the Notes, the Receipts or the Coupons through a permanent establishment or a permanent representative in Luxembourg are not liable to pay any Luxembourg income tax, whether they receive payments of interest (including accrued but unpaid interest), or payments upon redemption, repayment of principal or exchange of the Notes, Receipts or Coupons, or realize capital gains on the sale of any Note, Receipt or Coupon.

Non-resident corporate Noteholders, Receiptholders and Couponholders which have a permanent establishment or a permanent representative in Luxembourg, to which the Notes, Receipts and Coupons are attributable, must include, depending on the nature of the Notes, Receipts and Coupons, any interest received or accrued, as well as any reimbursement premium received at maturity or any gain realized on the sale, disposal or redemption of Notes, Receipts and Coupons, in their taxable income for Luxembourg income tax assessment purposes. The same inclusion applies to individuals, acting in the course of the management of a professional or business undertaking, who have a permanent establishment or a permanent representative in Luxembourg, to which the Notes, Receipts or Coupons are attributable. Taxable gains are determined as being the difference between the sale, repurchase or redemption price and the lower of the cost or book value of the Notes, Receipts or Coupons sold or redeemed.

Taxation of Luxembourg residents—General Noteholders, Receiptholders or Couponholders who are residents of Luxembourg must include any interest or Coupon received in their taxable income. These holders will not be liable to any Luxembourg income tax on repayment of principal of the Notes or Receipts.

Taxation of Luxembourg resident individuals An individual Noteholder, Receiptholder or Couponholder, acting in the course of the management of his/ her private wealth, is subject to Luxembourg income tax in respect of interest received, redemption premiums or issue discounts under the Notes, Receipts or Coupons, except if a withholding tax has been levied on such payments in accordance with the Law.

Luxembourg resident individual Noteholders, Receiptholders or Couponholders are not subject to taxation on capital gains upon the sale of the Notes, Receipts or Coupons, unless this sale precedes the acquisition of the Notes, Receipts or Coupons, or the Notes, Receipts or Coupons are disposed of within six months of the date of their acquisition. Upon a sale, redemption or exchange of the Notes or Receipts, individual Luxembourg resident Noteholders or Receiptholders must, however, include the portion of the sale, redemption or exchange price corresponding to accrued but unpaid interest in their taxable income insofar as such accrued but unpaid interest is indicated separately in the agreement.

Taxation of Luxembourg resident companies Luxembourg resident companies (sociétés de capitaux) must include in their taxable income the difference between the sale, redemption or exchange price (including accrued but unpaid interest) and the lower of the cost or book value of the Notes, Receipts or Coupons sold, redeemed or exchanged.

Treatment of Luxembourg resident companies benefiting from a special tax regime Noteholders, Receiptholders or Couponholders which are holding companies subject to the amended law of July 31, 1929 or undertakings for collective investment subject to the amended law of December 20, 2002 are

100 tax exempt entities in Luxembourg, and are thus not subject to any Luxembourg tax (i.e., corporate income tax, municipal business tax and net wealth tax) on income received on the Notes, Receipts or Coupons or gains realized upon their transfer or redemption.

Net Wealth Tax Since January 1, 2006, net wealth tax has been abolished for resident and non-resident individual taxpayers.

Luxembourg net wealth tax will not be levied on Noteholders, Receiptholders or Couponholders other than individual taxpayers, unless (a) such Noteholders, Receiptholders or Couponholders, are Luxembourg residents other than a holding company governed by the amended law of July 31, 1929, an undertaking for collective investments governed by the amended laws of 20 December 2002, a securitisation company governed by the law of March 22, 2004 on securitisation or a company governed by the law of June 15, 2004 on venture capital vehicles; or (b) the Notes, Receipts or Coupons are attributable to an enterprise or part thereof which is carried on in Luxembourg through a permanent establishment or a permanent representative.

Other Taxes There is no Luxembourg registration tax, stamp duty or any other similar tax or duty payable in Luxembourg by the Noteholders, Receiptholders or Couponholders as a consequence of the issuance of the Notes, Receipts or Coupons, nor will any of these taxes be payable as a consequence of a subsequent transfer, repurchase or redemption of the Notes, Receipts or Coupons.

There is no Luxembourg value added tax payable in respect of payments in consideration for the issuance of the Notes, Receipt, or Coupons or in respect of the payment of interest or principal under the Notes, Receipts or Coupons or the transfer of the Notes, Receipts or Coupons. Luxembourg value added tax may, however, be payable in respect of fees charged for certain services rendered to the Company, if for Luxembourg value added tax purposes such services are rendered or are deemed to be rendered in Luxembourg and an exemption from Luxembourg value added tax does not apply with respect to such services.

Under present Luxembourg tax law, in the case where a Noteholder, Receiptholder or Couponholder is a resident for tax purposes of Luxembourg at the time of his death, the Notes, Receipts or Coupons are included in his taxable estate for inheritance tax purposes. Gift tax may be due on a gift or donation of Notes, Receipts or Coupons, if the gift is recorded in a Luxembourg deed.

101 EUROPEAN UNION SAVINGS DIRECTIVE

Under the European Union Council Directive 2003/48/EC on the taxation of savings income, each Member State of the European Union is required to provide to the tax authorities of another Member State details of payments of interest (or similar income) paid by a Paying Agent within its jurisdiction to an individual resident in that other Member State. However, for a transitional period, Belgium, Luxembourg and Austria are instead required (unless during that period they elect otherwise) to operate a withholding system in relation to such payments (the ending of such transitional period being dependent upon the conclusion of certain other agreements relating to information exchange with certain other countries) unless the beneficiary opts for the exchange of information. A number of non-European Union countries and territories, including Switzerland, have adopted similar measures (a withholding system in the case of Switzerland).

102 SUBSCRIPTION AND SALE

Notes may be sold from time to time by the Issuer to any one or more of ABN AMRO Bank N.V., Credit Suisse Securities (Europe) Limited, Deutsche Bank AG, London Branch, Goldman Sachs International, Merrill Lynch International and Morgan Stanley & Co. International Limited (the “Dealers”). Notes may also be sold by the Issuer directly to institutions who are not Dealers. The arrangements under which Notes may from time to time be agreed to be sold by the Issuer to, and purchased by, Dealers are set out in the second amended and restated dealership agreement dated February 9, 2006 (as supplemented and/or modified and/or restated from time to time) (the “Dealership Agreement”) and made between the Issuer and the Dealers. Any such agreement will, inter alia, make provision for the form and terms and conditions of the relevant Notes, the price at which such Notes will be purchased by the Dealers and the commissions or other agreed deductibles (if any) payable or allowable by the Issuer in respect of such purchase. The Dealership Agreement makes provision for the resignation or termination of appointment of existing Dealers and for the appointment of additional or other Dealers either generally in respect of the Program or in relation to a particular Tranche of Notes.

United States of America The Notes have not been and will not be registered under the Securities Act, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except in certain transactions exempt from the registration requirements of the Securities Act. Terms used in the preceding sentence have the meanings given to them by Regulation S under the Securities Act.

Each Dealer has agreed and each further Dealer appointed under the Program will be required to agree that, except as permitted by the Dealership Agreement, it will not offer, sell or deliver Notes, (i) as part of their distribution at any time or (ii) otherwise until forty days after the completion of the distribution of the relevant Tranche of which such Notes are a part, as determined and certified to the Fiscal Agent or the Issuer by the relevant Dealer (or, in the case of a sale of a Tranche of Notes to or through more than one Dealer, by each of such Dealers as to Notes of such Tranche purchased by or through it, in which case the Fiscal Agent or the Issuer shall notify each such Dealer when all such Dealers have so certified) within the United States or to or for the account or benefit of U.S. persons, and such Dealer will have sent to each dealer to which it sells Notes during the distribution compliance period relating thereto a confirmation or other notice setting forth the restrictions on offers and sales of the Notes within the United States or to or for the account or benefit of U.S. persons.

In addition, until forty days after the commencement of the offering of Notes comprising any Tranche, any offer or sale of Notes within the United States by any dealer (whether or not participating in the offering) may violate the registration requirements of the Securities Act if such offer or sale is made otherwise than in accordance with an available exemption from registration under the Securities Act.

Notes in bearer form are subject to U.S. Federal income tax law requirements and may not be offered, sold or delivered within the United States or its possessions or to U.S. persons, except in certain transactions permitted by U.S. Federal income tax regulations. Each Dealer has agreed that it will have in effect, in connection with the offer and sale of the Notes during the restricted period relating thereto, procedures reasonably designed to ensure that its employees or agents who are directly engaged in selling the Notes are aware that the Notes cannot be offered or sold during such restricted period to a United States person or a person within the United States. Terms used in the preceding sentence have the meanings given to them by the United States Internal Revenue Code of 1986, as amended, and the regulations thereunder.

United Kingdom Each Dealer has represented, warranted and agreed that: in relation to any Notes having a maturity date of less than one year from the date of issue, (a) it is a person whose ordinary activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of its business and (b) it has not offered or sold and will not offer or sell any Notes other than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or who it is reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of their businesses where the issue of Notes would otherwise constitute a contravention of section 19 of the FSMA by the Company (i) it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Market Act 2000 (the “FSMA”)) received by it in connection with the issue or sale of any Securities in circumstances in which Section 21(1) of the FSMA

103 would not, if the Issuer was not an authorized person, apply to the Issuer; and (ii) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Securities in, from or otherwise involving the United Kingdom.

Japan The Notes have not been and will not be registered under the Securities and Exchange Law of Japan (the “Securities and Exchange Law”). Each Dealer has agreed and each further Dealer appointed under the Program will be required to agree that it will not offer or sell any Notes, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with the Securities and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan.

General Unless otherwise stated in the applicable Final Terms, no action has been taken by the Company that would permit an offer to the public of the Notes or possession or distribution of this Base Prospectus or any other offering material in any jurisdiction where action for that purpose is required. Accordingly, each Dealer has agreed and each further Dealer appointed under the Program and each other Purchaser will be required to agree that it will comply with all applicable laws and regulations in force in any jurisdiction in which it purchases, offers or sells Notes or possesses or distributes this Base Prospectus or any other offering material and will obtain any consent, approval or permission required by it for the purchase, offer or sale by it of Notes under the laws and regulations in force in any jurisdiction to which it is subject or in which it makes such purchases, offers or sales and the Company shall have no responsibility therefor.

With regard to each Series, the relevant Purchaser will be required to comply with such other additional restrictions as the Company and the relevant Purchaser shall agree and as shall be set out in the applicable Final Terms.

104 SUMMARY OF PRINCIPAL DIFFERENCES BETWEEN US GAAP AND IFRS

The financial information incorporated by reference herein has been prepared and presented in accordance with United States Generally Accepted Accounting Principles (U.S. GAAP). Certain differences exist between U.S. GAAP and International Financial Reporting Standards (IFRS), which might be material to the financial information incorporated herein by reference. The items described below summarise certain differences between U.S. GAAP and IFRS that may be material. The Issuer has not prepared a complete reconciliation of its consolidated financial statements and related footnote disclosures between U.S. GAAP and IFRS, and has not quantified such differences. Accordingly, no assurance is provided that the following summary is complete. Potential investors should consult their own professional advisors for an understanding of the differences between U.S. GAAP and IFRS, and how those differences might affect the financial information herein.

U.S. GAAP IFRS

Presentation of Financial Statements Extraordinary income items are permitted to be Extraordinary items are not permitted under any presented under certain rare and restrictive circumstances. circumstances. Changes in accounting policy are presented Prior to 1st January 2006 when the Issuers adopt retrospectively through restatement, while changes FAS 154, Accounting Changes and Error in accounting estimate are presented prospectively. Corrections, changes in accounting policy are IFRS prohibits the use of the equity method to presented using a cumulative catch-up adjustment, account for investments in subsidiaries in the parent- while changes in accounting estimate are presented company financial statements, and minority interest prospectively. is presented in equity. U.S. GAAP permits the use of the equity method In extremely rare cases, IFRS provides management when accounting for investments in subsidiaries in with the option of electing not to apply a prescribed the parent-company financial statements. For standard if it is concluded that compliance would be consolidated subsidiaries, minority interest is so misleading that it would conflict with the presented outside of equity in the mezzanine section objective of the financial statements set out in the of the balance sheet. IFRS framework. No such guidance is provided in U.S. GAAP. Property, Plant and Equipment U.S. GAAP requires tangible fixed assets to be IFRS allows tangible fixed assets to be recorded at recorded at depreciated historical cost, as adjusted depreciated historical cost or a “revalued amount.” for impairment losses, if applicable. The revalued amount is the fair value at the date of revaluation less subsequent accumulated Depreciation on property, plant and equipment must depreciation and impairment losses. Entities must be recorded on a systematic basis over the estimated choose either the cost model or the revaluation useful life of an asset. Prior to 1st January, 2006 model as an accounting policy and apply the chosen when the Issuers adopt FAS 154, Accounting policy to an entire class of property, plant and Changes and Error Corrections, a change in equipment. depreciation method is considered to be a change in accounting principle. A change in the estimated Depreciation on property, plant and equipment must useful life of an asset is considered to be a change in be recorded on a systematic basis over the estimated accounting estimate. useful life of an asset, reflecting the pattern in which the asset’s benefits are consumed. A change in depreciation method or estimated useful life is considered to be a change in accounting estimate.

105 U.S. GAAP IFRS

Intangible Assets and Goodwill Goodwill is not amortised, but is tested for Goodwill is not amortised, but is tested for impairment annually or more frequently if events or impairment annually or more frequently if events or changes in circumstances indicate it may be changes in circumstances indicate it may be impaired. The impairment test is a two-step process impaired. The impairment test is a one-step process performed at the reporting unit level. If the carrying performed at the cash generating unit. The cash value of a reporting unit, including goodwill, generating unit is tested for impairment by exceeds its fair value, then the goodwill is tested to comparing the carrying amount of the unit, including measure for a possible impairment loss. The goodwill, with its recoverable amount, which is the impairment test involves comparing the implied fair higher of the fair value less costs to sell or the value value of the goodwill with the carrying amount. in use. Intangible assets other than goodwill with indefinite An impairment charge can be reversed for an asset lives are not amortised, but are tested for impairment other than goodwill but only if there has been a annually or more frequently if events or changes in change in the estimates used to determine the asset’s circumstances indicate they may be impaired. The recoverable amount since the last impairment loss impairment test involves comparing the estimated was recognised. fair value of the intangible assets of a reporting unit, as determined using discounted future cash flows, to the carrying amount of such assets to determine if a write-down is required. The reversal of an impairment charge is prohibited. Impairment For assets other than those with indefinite lives, U.S. For depreciable or amortisable assets other than GAAP requires a three-step impairment review those with indefinite lives, IFRS mandates a process, but are tested for impairment annually or two-step process that requires the reporting entity to more frequently if events or changes in consider first whether indicators of impairment are circumstances indicate impairment. Under this present and, if they are, to compare the asset’s method, recoverability is initially tested by carrying amount with its recoverable amount. The comparing the estimated sum of the undiscounted recoverable amount is defined as the higher of an cash flows attributable to the asset against its asset’s fair value less costs to sell and its value in carrying amount. Only if the asset fails this use. The value in use calculation involves recoverability test will the amount of the impairment discounting the expected future cash flows to be be calculated by comparing the asset’s carrying generated by the asset to their net present value. amount to its fair value. Under U.S. GAAP, the An impairment charge may be reversed for an asset reversal of an impairment charge is prohibited, other than goodwill only if there has been a change except for certain long-lived assets held for sale. in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized.

106 U.S. GAAP IFRS

Provisions and Contingencies U.S. GAAP dictates that the most likely outcome IFRS requires that an expected value calculation be within a given range must be accrued, unless no used, which considers each possible outcome along value is more likely than another. In this case, the with its associated probability of occurrence. If a minimum amount in the range is recognised. single obligation is being measured, the consideration of outcomes other than the most likely U.S. GAAP permits a recorded provision to be result could lead to a higher or lower provision discounted only where the amount of the liability value. and the timing of payments are fixed or reliably determinable, or where the obligation is a fair value In most circumstances, IFRS requires that the time obligation. value of money be taken into account when making a provision assessment. In general, restructuring charges are recorded when management has committed itself to a detailed exit IFRS places substantial emphasis on recognising plan. However, not all costs within the plan are restructuring costs associated with an exit plan as a automatically recognised. Instead, each cost is whole, rather than on the recognition of individual examined individually to determine when it will be liabilities. For this reason, restructuring charges incurred. In addition, a number of liabilities could potentially be recorded earlier under IFRS associated with an exit plan, excluding employee standards than under U.S. GAAP. termination costs, are recognised when incurred, which could lead to later recognition than provided for under IFRS. Taxation Special exemptions from providing deferred tax are IFRS allows for an exemption from the requirement allowed for certain transactions, including leveraged to provide for deferred tax on the initial recognition leases and most undistributed earnings of foreign of an asset or liability in a transaction that is not a subsidiaries. Conversely, U.S. GAAP does not allow business combination and does not affect accounting for an exemption from the requirement to provide or taxable profit. Deferred tax assets are recognised for deferred tax on the initial recognition of an asset only if realization of the tax benefit is probable. In or liability in a transaction that is not a business addition, both deferred tax assets and liabilities are combination and does not affect profit. always classified as non-current. A valuation allowance is required for deferred tax IFRS requires recognition of a deferred tax asset or assets when it is more likely than not that the asset liability in relation to temporary differences that will not be realised. Furthermore, both deferred tax arise on foreign non-monetary assets that are assets and liabilities are classified as either current measured at an historic exchange rate in the or non-current based upon the classification of the reporting entity’s functional currency, but whose tax underlying asset or liability. base is in the foreign currency. Recognition of a deferred tax liability or asset for IFRS requires the effect of a change in tax laws to be differences related to assets that are translated from shown in the current year income statement, except the local currency into the functional currency using to the extent that it relates to items whose deferred historical exchange rates are prohibited when those tax movements were previously recognised directly differences arise either from changes in exchange into equity. rates or indexing for tax purposes. A deferred tax movement resulting from a change in tax law is recognised in income in the current period, whether or not any portion of the movement relates to items originally charged to equity.

107 U.S. GAAP IFRS

Pension Costs Under U.S. GAAP, pension cost represents the net While the general approach to pension accounting is of income and expenses related to a pension plan’s similar under IFRS as compared to U.S. GAAP, assets and obligations. Plan assets are measured at several differences still exist. While U.S. GAAP fair value and the pension obligation is determined does not stipulate a particular actuarial method, by an actuarial valuation, which is required annually. IFRS requires that the projected unit credit method must be used. In addition, IFRS requires that past Actuarial gains and losses may be recognized service costs, arising from a change in benefits, be immediately or amortised over remaining working recognised immediately if the rights are fully vested, lives of participating employees. At a minimum, a or on a straight line basis over the period until the net gain or loss in excess of 10% of the greater of extra benefits are vested if they do not vest the defined benefit obligation or the fair value of the immediately. In contrast, U.S. GAAP requires plan assets at the beginning of the year must be recognition over the remaining service life. recognised or amortised. IFRS also mandates that plan assets be measured at A minimum liability must be recognised equal to the fair value as of the balance sheet date, while U.S. amount by which a plan is underfunded, excluding GAAP permits the use of a market-related value, projected future salary increases. which can be measured up to three-months prior to the balance sheet date. Share-Based Payment U.S. GAAP allows for two methods of accounting IFRS requires that an expense be recognised based for expense recognition related to share-based upon the fair value for the share-based payment compensation to employees, including fair value at given for goods or services, including employee grant date or intrinsic value at grant date, which is services. generally zero for at-the-money stock options. Companies that utilise the intrinsic value method are required to disclose the impact as if they accounted for stock-based compensation at fair value.

108 GENERAL INFORMATION

Authorization The establishment of the Program was authorized by resolutions of the Boards of Directors of Cargill, Inc., Cargill Global and Cargill Asia Pacific adopted on December 13, 1996, December 13, 1996 and December 12, 1996 respectively. Previous updates of the Program were authorized by resolutions of the Boards of Directors of Cargill, Inc., Cargill Global and Cargill Asia Pacific adopted on January 15, 1999, January 19, 1999 and January 20, 1999, respectively and on December 17, 1999, December 21, 1999 and December 14, 1999 respectively. The 2000 update of the Program was authorized by resolutions of the Board of Directors of Cargill, Inc. on October 16, 2000. The 2001 update of the Program was authorized by resolutions of the Board of Directors of Cargill, Inc. on October 22, 2001. The 2002 update of the Program was authorized by resolutions of the Board of Directors of Cargill Inc. on October 25, 2002. The 2003 update of the Program was authorized by resolutions of the Executive Committee of the Board of Directors of Cargill, Inc. on November 19, 2003. The 2004 update of the Program was authorised by resolutions of the Board of Directors of Cargill, Inc. on November 16, 2004. The current update of the Program was authorized by resolutions of the Executive Committee of the Board of Directors of Cargill Inc. on February 7, 2005. The Issuer has obtained or will obtain from time to time all necessary consents, approvals and authorizations in connection with the issue and performance of the Notes.

Listing Application has been made to the CSSF to approve this document as a base prospectus. Application has also been made to the Luxembourg Stock Exchange for Notes issued under the Program as described in this Base Prospectus to be admitted to trading on the Luxembourg Stock Exchange’s regulated market and to be listed on the Luxembourg Stock Exchange. The Luxembourg Stock Exchange has allocated the number 12453 to the Program for listing purposes.

Documents Available From the date of this document and, for so long as Notes are capable of being issued under the Program and/or remain outstanding, copies of the following documents will, when published, be available from the principal office of the Issuer and from the specified offices of the Fiscal Agent, the Paying Agent in Luxembourg (free of charge) and the other Paying Agents: (i) the constitutional documents of the Issuer;

(ii) the consolidated audited financial statements of the Issuer in respect of the financial years ended May 31, 2005 and 2004;

(iii) the most recently published consolidated and non-consolidated (if any) audited annual financial statements of the Issuer and the most recently published interim quarterly financial statements of the Issuer;

(iv) the Dealership Agreement and the Issue and Paying Agency Agreement, (which contains the forms of the Temporary Global Notes, the Permanent Global Notes, the Definitive Notes, the Receipts and the Coupons and the Talons);

(v) a copy of this Base Prospectus;

(vi) any future prospectuses, supplementary prospectus information memoranda and supplements including Final Terms (save that (a) a Final Terms relating to unlisted Notes will only be available for inspection by a holder of such Note and such holder must produce evidence satisfactory to the Issuer or Paying Agent, as the case may be, as to the identity of such holder and (b) Final Terms relating to Notes listed on the Luxembourg Stock Exchange will only be available from the Luxembourg Paying Agent) to this Base Prospectus and any other documents incorporated herein or therein by reference; and

(vii) in the case of each issue of listed Notes subscribed pursuant to a subscription agreement (or equivalent document), the subscription agreement (or equivalent document) save that a subscription agreement (or equivalent document) relating to Notes listed on the Luxembourg Stock Exchange will only be available from the Luxembourg Paying Agent.

109 (viii) in addition, copies of this Base Prospectus, each Final Terms relating to Notes which are admitted to trading on the Luxembourg Stock Exchange’s regulated market and each document incorporated by reference are available on the Luxembourg Stock Exchange’s website at www.bourse.lu.

Clearing Systems The Notes have been accepted for clearance through Euroclear and Clearstream, Luxembourg. The appropriate Common Code and ISIN for each Tranche allocated by Euroclear and Clearstream, Luxembourg will be specified in the relevant Final Terms. If the Notes are to clear through an additional or alternative clearing system the appropriate information will be specified in the relevant Final Terms. Transactions will normally be effected for settlement not earlier than two days after the date of the transaction.

The address of Euroclear is 1 Boulevard du Roi Albert II, B-1210 Brussels, Belgium and the address of Clearstream, Luxembourg is 42 Avenue JF Kennedy, L-1855 Luxembourg, Luxembourg.

Significant or Material Change There has been no significant change in the financial or trading position of the Issuer since February 9, 2006, and there has been no material adverse change in the financial position or prospects of the Issuer since the date of the last financial year end of the Issuer.

Recent Developments On January 31, 2006 the judge handling the Refco bankruptcy proceedings ruled that the Exclusivity Agreement could be assigned to Man Financial as a stand alone agreement without payment of cure amounts. Cargill is evaluating its options which include appealing the decision and/or pursuing its arguments in the state court litigation that the Exclusivity Agreement is not enforceable and if enforceable, that Man Financial’s damages must be proven and are considerably less than the $66 million withheld.

Litigation Save as disclosed on pages 70 to 71 and 88 to 89 herein, neither the Issuer nor, as the case may be, any subsidiary of the Issuer (whether as defendant or otherwise) is, or has been, engaged in any governmental, legal, arbitration, administrative or other proceedings, the results of which might have or have had during the last twelve months a significant effect on the financial position or profitability of the Issuer nor is the Issuer aware of any such proceedings which are pending or threatened.

Auditors The consolidated financial statements of the Company as of and for each of the years in the two-year period ended May 31, 2005 included in this Base Prospectus have been audited by KPMG LLP, independent auditors, as set forth in their report thereon appearing elsewhere herein. The independent auditors’ report contains an explanatory paragraph regarding the Issuer’s change in its method of accounting for certain variable interest entities in 2005 and the change in its method of accounting for derivative contracts held for trading purposes in 2004. KPMG LLP is a member of the American Institute of Certified Public Accountants and is regulated by the U.S. Public Company Accounting Oversight Board.

Post-Issuance Information The Issuer does not intend to provide any post-issuance information in relation to any assets underlying issues of Notes under the Program.

110 INDEX TO F PAGES

Consolidated Financial Statements May 31, 2005 and 2004 ...... F-2 - F-35 Independent Auditors’ Report from KPMG LLP, dated August 5, 2005 ...... F-3 Consolidated Balance Sheet ...... F-4 Consolidated Statement of Earnings ...... F-5 Consolidated Statement of Cash Flows ...... F-6 Consolidated Statement of Stockholders’ Equity ...... F-7 Notes to Consolidated Financial Statements May 31, 2005 and 2004 ...... F-8 - F-35 Six Month End Figures for November 30, 2005 and November 30, 2004 (unaudited): Consolidated Balance Sheet ...... F-36 Consolidated Statement of Earnings ...... F-37 Consolidated Statement of Cash Flows ...... F-38 Consolidated Statement of Stockholder’s Equity ...... F-39

F-1 CARGILL, INCORPORATED AND SUBSIDIARIES

Consolidated Financial Statements May 31, 2005 and 2004

F-2 Independent Auditors' Report

The Board of Directors Cargill, Incorporated:

We have audited the accompanying consolidated balance sheet of Cargill, Incorporated and subsidiaries as of May 31, 2005 and 2004 and the related consolidated statements of earnings, cash flows, and stockholders' equity for the years then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Cargill, Incorporated and subsidiaries as of May 31, 2005 and 2004, and the results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 1 to the consolidated financial statements, in 2005, the Company changed its method of accounting for certain variable interest entities and, in 2004, the Company changed its method of accounting for derivative contracts held for trading purposes.

August 5, 2005

F-3 Cargill, Incorporated and Subsidiaries CONSOLIDATED BALANCE SHEET At May 31 2005 2004 (In millions) ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,171 1,103 Short-term investments 184 246 Securities purchased with agreements to resell 1,613 2,259 Trading securities 6,813 13,424 Accounts receivable, notes receivable and accruedincome, less allowances of$207 in 2005 and$224 in 2004 7,830 10,109 Inventories 8,667 7,921 Other 1,674 2,092 TOTAL CURRENT ASSETS 27,952 37,154 OTHER ASSETS Investments and advances 2,523 1,947 Goodwill 2,900 548 Other 3,258 2,363 8,681 4,858 PROPERTY Owned property, plant and equipment 20,117 15,409 Property under capitalleases 223 302 Construction in progress 891 619 21,231 16,330 Less accumulated depreciation and amortization 9,604 8,646 NET PROPERTY 11,627 7,684 TOTAL ASSETS $ 48,260 49,696 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Short-term debt $ 3,449 4,565 Short-term debt, non-recourse 348 -- Securities sold with agreements to repurchase 1,929 5,475 Trading securities sold, not yet purchased 4,859 7,967 Accounts payable and accrued expenses 10,006 11,331 Accruedincome taxes 792 836 TOTAL CURRENT LIABILITIES 21,383 30,174 OTHER LIABILITIES Long-term debt 5,711 5,369 Long-term debt, non-recourse 2,988 456 Deferredincome taxes 1,057 491 Other deferredliabilities 2,947 1,844 TOTAL LIABILITIES 34,086 38,334 MINORITY INTERESTS IN SUBSIDIARIES 1,922 871 STOCKHOLDERS' EQUITY Capital stock 3 3 Additional paid-in capital 39 139 Retained earnings 12,260 10,555 Unearned ESOP compensation (232) (272) Accumulated other comprehensive income 182 66 TOTAL STOCKHOLDERS' EQUITY 12,252 10,491 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 48,260 49,696 The accompanying notes are an integral part of the consolidated financial statements.

F-4 Cargill, Incorporated and Subsidiaries CONSOLIDATED STATEMENT OF EARNINGS

Year Ended May 31 2005 2004 (In millions)

Sales and other revenues $ 71,066 62,907

Cost of sales and other revenues 63,423 56,010

Gross profit 7,643 6,897

Expenses and other income Selling, general and administrative expenses 3,693 3,278 Depreciation and amortization of property 1,161 1,001 Interest on long-term debt 467 282 Interest on short-term debt 116 188 Restructuring and asset impairment charges 264 229 Gain on fertilizer merger (606) -- Other expense, net 138 24

Earnings from continuing operations of consolidated companies before income taxes 2,410 1,895 Income tax expense 524 565 Net earnings from continuing operations of consolidated companies 1,886 1,330

Add equity in net earnings of nonconsolidated companies 358 118

Deduct minority interests in net earnings of consolidated subsidiaries (174) (165)

Net earnings from continuing operations 2,070 1,283

Discontinued operations, net of income taxes 81 48 Cumulative effect of accounting change for FIN 46R (48) --

NET EARNINGS $ 2,103 1,331

($ Per Share) Basic net earnings per share $ 9.36 5.76 Diluted net earnings per share $ 9.03 5.61

The accompanying notes are an integral part of the consolidated financial statements.

F-5 Cargill, Incorporated and Subsidiaries CONSOLIDATED STATEMENT OF CASH FLOWS Year Ended May 31 2005 2004 (In millions) CASH FLOWS FROM OPERATING ACTIVITIES Net earnings$2,103 1,331 Minority interests in net earnings of consolidated subsidiaries 174 165 Noncash items included in earnings: Equity in net earnings of nonconsolidated companies, net of dividends 5 67 Depreciation and amortization of property 1,161 1,001 Gain on fertilizer merger (606) -- Restructuring and asset impairment charges 264 229 Earnings of discontinued operations, net of income taxes (81) (48) Deferred income taxes (37) 45 Cumulative effect of accounting change 48 -- Other, net 165 186 Total cash from continuing operations 3,196 2,976 (Increase) decrease in securities purchased with agreements to sell (59) 1,040 Decrease (increase) in trading securities 2,342 (4,377) Decrease (increase) in accounts receivable, notes receivable and accrued income 1,750 (4,250) (Increase) in inventories (191) (1,505) (Decrease) increase in securities sold with agreements to repurchase (2,391) 2,557 Increase in trading securities sold, not yet purchased 96 378 (Decrease) increase in accounts payable and accrued expenses (625) 4,402 (Increase) in other current assets and liabilities (347) (45) Other, net 28 120 Net cash provided by operating activities of continuing operations 3,799 1,296 CASH FLOWS FROM INVESTING ACTIVITIES Additions to property (1,447) (1,011) Investments in businesses acquired, less cash acquired (280) (231) Investments in nonconsolidated companies (304) (223) Purchase of minority interests, less cash acquired 23 (19) Total capital investments (2,008) (1,484) Net proceeds from property and business disposals 235 341 Net investments in loan portfolios and real estate (471) (542) Net investments in affiliated private investment funds (141) (222) Other, net (100) (112) Net cash used by investing activities of continuing operations (2,485) (2,019) CASH FLOWS FROM FINANCING ACTIVITIES Net (payments on)proceeds from short-term debt (2,069) 1,400 Net proceeds from short-term debt non-recourse 101 -- Proceeds from long-term debt 906 1,186 Proceeds from long-term debt non-recourse 1,160 393 Payments on long-term debt (254) (1,063) Payments on long-term debt nonrecourse (814) (107) Dividends paid to stockholders (301) (229) Dividends paid to minority interests in subsidiaries (252) (30) Capital stock transactions, net (311) (624) Other, net 175 106 Net cash (used) provided by financing activities of continuing operations (1,659) 1,032 Net cash provided by discontinued operations 413 152 INCREASE IN CASH AND CASH EQUIVALENTS 68 461 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 1,103 642 CASH AND CASH EQUIVALENTS AT END OF YEAR $ 1,171 1,103 The accompanying notes are an integral part of the consolidated financial statements.

F-6 Cargill, Incorporated and Subsidiaries CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (In millions)

Accum. Other Unearned Compre- Total Add'l. Compre- ESOP hensive Stock- Capital Paid In hensive Retained Compen- Income holders' Stock Capital Income Earnings sation (Loss) Equity Balance at May 31, 2003 $ 3 142 9,995 (313) (155) 9,672 Shares issued -- 22 ------22 Shares reacquired -- (71) (559) -- -- (630) Comprehensive income: Net earnings -- -- $ 1,331 1,331 -- -- 1,331 Other comprehensive income: Foreign currency translation adjustments -- -- 85 -- -- 85 -- Unrealized gain on securities -- -- 48 -- -- 48 -- Unrealized gain on cash flow hedges -- -- 26 -- -- 26 -- Minimum pension liability adjustment -- -- 62 -- -- 62 -- Other comprehensive income -- -- 221 ------221 Comprehensive income -- -- $ 1,552 ------Stock based compensation -- 35 ------35 Tax benefit on ESOP dividends -- -- 17 -- -- 17 Tax benefit on stock option exercises -- 10 ------10 Tax benefit on stock grants -- 1 ------1 Amort. of unearned ESOP compensation ------41 -- 41 Cash dividends -- -- (229) -- -- (229) Balance at May 31, 2004 $ 3 139 10,555 (272) 66 10,491 Shares issued -- 21 ------21 Shares reacquired -- (200) (117) -- -- (317) Comprehensive income: Net earnings -- -- $ 2,103 2,103 -- -- 2,103 Other comprehensive income: Foreign currency translation adjustments -- -- 182 -- -- 182 -- Unrealized loss on securities -- -- (15) -- -- (15) -- Unrealized loss on cash flow hedges -- -- (1) -- -- (1) -- Minimum pension liability adjustment -- -- (50) -- -- (50) -- Other comprehensive income -- -- 116 ------116 Comprehensive income -- -- $ 2,219 ------Stock based compensation -- 29 ------29 Tax benefit on ESOP dividends -- -- 20 -- -- 20 Tax benefit on stock option exercises -- 49 ------49 Tax benefit on stock grants -- 1 ------1 Amort. of unearned ESOP compensation ------40 -- 40 Cash dividends -- -- (301) -- -- (301) Balance at May 31, 2005 $ 3 39 12,260 (232) 182 12,252

The accompanying notes are an integral part of the consolidated financial statements.

F-7 Cargill, Incorporated and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 31, 2005 and 2004

(1) Summary of Significant Accounting Policies Significant accounting policies followed in preparing the consolidated financial statements are summarized below.

Nature of Business The Company is engaged in the international marketing and processing of agricultural, industrial and financial commodities. Operating in 59 countries worldwide, the Company markets its products principally in four geographic regions: Asia/Pacific, Europe, Latin America and North America.

Basis of Consolidation The accompanying consolidated financial statements include the accounts of Cargill, Incorporated and all more than 50% owned subsidiaries that we control by ownership of a majority voting interest as well as certain variable interest entities, where the Company is the primary beneficiary and consolidation is required. Intercompany accounts and transactions are eliminated. Investments in companies where the Company does not have control, but has the ability to exercise significant influence (generally 20-50% ownership), are accounted for by the equity method. Other investments where the Company is unable to exercise significant influence over operating and financial decisions are accounted for at cost.

Variable Interest Entities In January 2003, the FASB issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46), which requires certain variable interest entities (VIEs) to be consolidated. FIN 46 separates entities into two groups: (1) those for which voting interests are used to determine consolidation and (2) those for which variable interests are used to determine consolidation. An entity is considered to be a VIE when it has equity investors who lack the characteristics of a controlling financial interest, or the entity’s capital is insufficient to permit it to finance its activities without additional subordinated financial support. A VIE is consolidated by its primary beneficiary, which is the company that absorbs a majority of the VIEs expected losses, receives a majority of the VIEs residual returns, or both. Upon its original issuance, FIN 46 was effective immediately for VIEs created after January 31, 2003, while the effective date for VIEs created prior to February 1, 2003 was May 31, 2005.

In December 2003, the FASB issued a revision to FIN 46 (FIN 46R) to clarify some of the provisions of the original interpretation and to exempt certain entities from its requirements. FIN 46R provides special effective date provisions to enterprises that fully or partially applied FIN 46 prior to the issuance of the revised interpretation. The Company has applied FIN 46 and FIN 46R to all entities created after January 31, 2003 and has consolidated VIEs with total assets of $1,908 million and $990 million as of May 31, 2005 and May 31, 2004, respectively. The VIEs include partnerships, corporations and trusts that acquire, hold, restructure and dispose of performing and non-performing loans and real estate assets sold by governmental agencies, financial institutions and others. (Continued)

F-8 Cargill, Incorporated and Subsidiaries

Variable Interest Entities (Cont.) Under FIN 46R, the effective date for the Company to consolidate VIEs acquired prior to February 1, 2003, was extended to fiscal year 2006. However, the Company early adopted certain provisions of FIN 46R as of May 31, 2005 for all entities created prior to February 1, 2003 that are considered special purpose entities (SPEs). The VIEs considered to be SPEs include synthetic lease structures, trusts holding municipal bonds and the related beneficial interests issued thereon, and owner trusts created for leveraged leases. The early adoption of FIN 46R resulted in the consolidation of SPEs with total assets and debt totaling $631 and $592 million, respectively. In accordance with the transition provisions of FIN 46R, the Company recorded an after-tax loss of $48 million as a cumulative effect of an accounting change in 2005. Prior periods were not restated. VIEs acquired prior to February 1, 2003 not considered to be SPEs with assets and debt totaling $1,390 and $686 million respectively, will require consolidation during 2006. The cumulative effect of adoption of these VIEs will not be material.

The Company also holds variable interests in the form of loan and equity investments into a variety of VIEs of which the Company is not the primary beneficiary. These VIE entities hold, restructure and dispose of performing and non-performing loans and real estate assets. The Company’s total outstanding loan and equity method investment balances exposed to loss as a result of its involvement in these VIEs totaled $177 and $284 million respectively, as of May 31, 2005.

Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Although these estimates are based on knowledge of current events and actions expected to be undertaken in the future, actual results may ultimately differ from estimates.

Revenue Recognition The Company recognizes revenue from commodity or product sales when the goods are shipped or delivered depending upon when the customer has taken title and assumed the risks and rewards of ownership, prices are fixed or determinable and collectibility is reasonably assured. Additional revenue recognition policies for trading securities and derivatives and inventories are shown below.

Foreign Currency Translation Gains and losses resulting from translating the financial statements of foreign subsidiaries, whose functional currency is the local currency, at the current rate are included directly in other comprehensive income.

Translation gains and losses of foreign subsidiaries operating in hyperinflationary economies and foreign subsidiaries where the U.S. dollar is the functional currency are included in net earnings cur- rently. Net foreign currency transaction and translation gains and losses included in net earnings were a $35 million gain in 2005 and $4 million loss in 2004.

(Continued)

F-9 Cargill, Incorporated and Subsidiaries

Cash and Cash Equivalents Cash equivalents consist of short-term, highly liquid investments with original maturities of 90 days or less.

Short-term Investments

Short-term investments include highly liquid investments with original maturities greater than 90 days, but less than one year.

Margin Accounts

The Company holds cash and securities owned by its brokerage customers as collateral for margin accounts. The amount of these securities, which is not reflected in the consolidated balance sheet, totaled $2,442 million and $2,274 million at May 31, 2005 and 2004, respectively.

Net Earnings Per Share

Basic earnings per share is determined by dividing net earnings by the weighted average number of shares outstanding. Shares outstanding include Common, ESOP Common, Management and Retiree stock. In computing diluted earnings per share, the weighted average number of shares outstanding are increased to include additional shares from the assumed exercise of stock options and the issuance of shares from stock grants. The number of additional shares is calculated by assuming stock grants are issued and options were exercised and that the proceeds from exercises were used to acquire shares at the average fair market value during the reporting period.

Pension and Postretirement Plans

The Company and its subsidiaries have various pension and postretirement benefit plans covering most of its domestic employees and many of its foreign employees. Pension benefits are based on years of service and compensation. Unrecognized net gains or losses are amortized over the expected remaining service lives of employees. Pensions are funded in compliance with U.S. gov- ernment regulations or local laws and customs.

In May 2004, the FASB issued FASB Staff Position (FSP) 106-2, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003,” which the Company will adopt during 2006. The adoption is not expected to have a material effect on the Company’s consolidated financial position or results of operations.

Resale and Repurchase Agreements

Securities purchased with agreements to resell (reverse repurchase agreements) and securities sold with agreements to repurchase (repurchase agreements) are treated as collateralized financing transactions and are recorded at the amount at which the securities were initially acquired or sold, including accrued interest. Interest income is recorded on reverse repurchase agreements and interest expense is recorded on repurchase agreements.

It is the Company’s policy to take delivery of securities purchased with agreements to resell, which are generally U.S. government or U.S. government agency securities. The Company has the ability to sell or re-pledge the securities. The Company monitors the market value of the securities to be resold daily and obtains additional collateral when deemed appropriate. The Company offsets resale and repurchase agreements that meet the applicable netting criteria.

(Continued)

F-10 Cargill, Incorporated and Subsidiaries

Trading Securities and Derivatives

The Company is engaged in the leveraged trading of a diverse group of securities and, accordingly, its trading securities and trading securities sold, not yet purchased are recorded on trade date at fair value. These instruments are marked to market with realized and unrealized gains and losses included in the determination of net earnings. Interest on trading securities sold, not yet purchased is netted against interest income and shown as “sales and other revenues” in the consolidated statement of earnings.

Derivative instruments, including swaps, futures contracts, forward commitments, options and other similar types of contracts and commitments based on either interest rates or foreign exchange rates, as well as equity and commodity derivatives, are traded by the Company and are carried at their fair market value as either trading securities or trading securities sold, not yet purchased. The fair market value of almost all trading securities and derivatives, as described above, is determined from market prices quoted on public exchanges or based on management’s best estimate subject to independent price verification. New complex instruments may have immature or limited markets. As a result, the pricing models used for valuation may require significant estimates and assumptions. An insignificant amount of positions are valued in this manner.

During the year ended May 31, 2004, the Company restructured its capital markets trading business unit into Black River Asset Management LLC (BRAM), a global asset management company that provides institutional investors with alternative investment products. BRAM has developed and marketed a number of private investment funds with differing types of investment strategies. During the year ended May 31, 2005, Cargill became a minority investor in BRAM as sufficient outside investments were received to reduce the Company’s ownership to a non- controlling interest. As a result, these BRAM funds were deconsolidated during 2005 and Cargill’s investment in the affiliated private investment funds is shown in the “investments and advances” line on the consolidated balance sheet. The impact of deconsolidation to the May 31, 2004 consolidated balance sheet would have been a reduction of approximately $6 billion in total assets and total liabilities. BRAM continues to manage some proprietary accounts for the Company that remain consolidated. In addition, at May 31, 2005, one Cargill-sponsored fund with third-party investors remains consolidated due to Cargill’s controlling ownership.

In addition to its trading activities, the Company utilizes various types of derivative instruments (principally options, futures and interest rate and currency swaps) to hedge interest rate, currency and other market risks arising from certain of its assets and liabilities. The Company values its derivative instruments in accordance with SFAS 133, "Accounting for Derivative Instruments and Hedging Activities" as amended by SFAS 137 and SFAS 138. The statement requires that all derivative instruments be recognized in the balance sheet at fair value with changes in such fair values recognized immediately in earnings unless specific hedging criteria are met. Effective changes in the fair value of derivatives designated as cash flow hedges and net foreign currency investment hedges are recorded in accumulated other comprehensive income. Amounts are reclassified from accumulated other comprehensive income when the underlying hedged item impacts net earnings and all ineffective changes in fair value are recorded currently in net earnings. Changes in the fair value of derivatives designated and effective as fair value hedges are recorded in earnings and are offset by corresponding changes in the fair value of the hedged item.

(Continued)

F-11 Cargill, Incorporated and Subsidiaries

Inventories

Grain, cotton and other commodities for merchandising and oilseeds and other commodities for processing and products thereof are stated principally at market, adjusted for unrealized gains or losses on open cash contracts valued at market. Market is determined from market prices quoted on public commodity exchanges, adjusted for expected freight costs to normal delivery points and a price premium or discount to cover local supply and demand factors as estimated by management. The availability and market price of agricultural commodities are subject to wide fluctuations due to unpredictable factors such as weather, plantings, domestic and foreign government farm programs and policies, global production and other factors. The Company generally minimizes the risk of market fluctuations by hedging these inventories with futures, cash, and foreign exchange contracts. Generally these contracts are valued at market and the resulting unrealized gains or losses are recognized currently in earnings. Dressed beef, poultry, salt and other products are valued at the lower of cost (last-in, first-out) or market. All other inventories are stated principally at the lower of cost or market.

Property, Plant and Equipment

Property, plant and equipment are stated at cost and depreciated principally using the straight-line method over the estimated useful lives of the assets. The company periodically evaluates the carrying value of these long-lived assets when events and circumstances indicate the carrying value may not be recoverable. If the carrying value is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds fair market value.

Income Taxes

The Company and substantially all domestic subsidiaries are members of a group, which files a consolidated Federal income tax return. Federal income taxes or tax benefits are allocated to each company on the basis of its individual taxable income or loss and tax credits included in the return. Deferred income taxes are recognized for tax consequences of temporary differences by applying enacted statutory tax rates, applicable to future years, to differences between the financial reporting and the tax basis of existing assets and liabilities.

It is generally the policy of the Company to reinvest unremitted earnings of foreign subsidiaries and corporate joint ventures indefinitely, or to remit earnings only when the tax effect is minor. Accordingly, no provision has been made for income taxes that may be payable upon remittance of such earnings. The cumulative amount of unremitted earnings at May 31, 2005, is approximately $4,872 million. Federal income taxes on any amounts remitted would be partly offset by foreign tax credits.

In October 2004, the American Jobs Creation Act of 2004 (the “Jobs Creation Act”) was signed into law. The Jobs Creation Act includes a temporary incentive for U.S. multinationals to repatriate foreign earnings at an effective 5.25 percent tax rate. Such repatriations must occur in either an enterprise’s last tax year that began before the enactment date, or the first tax year that begins during the one-year period beginning on the date of enactment.

(Continued)

F-12 Cargill, Incorporated and Subsidiaries

Income Taxes (cont.) FASB Staff Position 109-2, “Accounting and Disclosure Guidance for the Foreign Earnings Repatriation Provision within the American Jobs Creation Act of 2004” (“FSP 109-2”), indicates that the lack of clarification of certain provisions within the Jobs Creation Act and the timing of the enactment necessitate a practical exception to the SFAS No. 109, “Accounting for Income Taxes,” requirement to reflect in the period of enactment the effect of a new tax law. Accordingly, an enterprise is allowed time beyond the financial reporting period of enactment to evaluate the effect of the Jobs Creation Act on its plan for reinvestment or repatriation of foreign earnings. FSP 109-2 requires that the provisions of SFAS No. 109 be applied as an enterprise decides on its plan for reinvestment or repatriation of its unremitted foreign earnings.

The Company is currently evaluating the details of the Jobs Creation Act and as of May 31, 2005, had not decided if it would repatriate foreign earnings under the Act, and accordingly, the consolidated financial statements do not reflect any provision for taxes on the unremitted foreign earnings that might be remitted.

Stock Options As discussed more fully in the footnote titled “Stock-Based Compensation Plans,” the Company uses the fair value recognition provisions of SFAS 123 and expenses the value of stock options over the vesting period. In December 2004, the Financial Accounting Standards Board (FASB) revised SFAS 123. SFAS 123R further defines the concept of fair market value as it relates to share-based payment transactions as compensation expense. The provisions of this statement will be effective for the Company in 2007 and will not have a material effect on the Company’s consolidated financial position or results of operations.

Goodwill and Other Intangible Assets Business acquisitions are accounted for in accordance with SFAS 141, “Business Combinations,” with the purchase price allocated to the assets and liabilities acquired, including goodwill and other intangibles, based on their estimated fair values at date of acquisition. Under SFAS 142, “Goodwill and Other Intangibles Assets,” goodwill and intangible assets with indefinite lives are not amortized, but are reviewed annually for impairment or upon the occurrence of trigger events. Impairment charges of $22 million were recognized in 2005. Impairment assessments include comparing the fair value of a reporting unit with its carrying value, including goodwill. The assessments are performed using a variety of methodologies, including cash flow analysis, estimates of sales proceeds and appraisals. During fiscal 2005, Cargill merged its fertilizer business into The Mosaic Company (Mosaic), which generated goodwill of $2,343 million. Unamortized goodwill at May 31, 2005 and 2004 was $2,900 million and $548 million, respectively. Unamortized intangible assets other than goodwill at May 31, 2005 and 2004 were $184 million and $87 million, respectively.

Reclassifications Certain 2004 amounts have been reclassified to conform with the current year presentation.

(Continued)

F-13 Cargill, Incorporated and Subsidiaries

(2) Trading Securities Trading securities and trading securities sold, not yet purchased, are carried at market value and include the following:

2005 2004 (In millions) Trading securities: Foreign issued securities $ 471 1,032 United States government and agency securities 4,689 10,377 Common and preferred stocks 575 855 Corporate and other issuer debt 1,078 1,160 $6,813 13,424

Trading securities pledged as collateral for securities sold with agreements to repurchase were $5,532 million and $7,319 million at May 31, 2005 and 2004, respectively.

2005 2004 (In millions) Trading securities sold, not yet purchased: Foreign issued securities $ 18 456 United States government and agency securities 4,784 7,008 Common and preferred stocks 5 291 Corporate and other issuer debt 52 212 $4,859 7,967

As of May 31, 2005 and 2004, respectively, the Company has taken delivery of $5,143 million and $3,910 million of collateral pursuant to the securities purchased with agreements to resell. The Company subsequently delivered all of this collateral to counterparties to settle contracts for trading securities sold, not yet purchased.

(3) Inventories A summary of inventories follows: 2005 2004 (In millions) Grain, cotton and other commodities for merchandising $1,821 2,150 Oilseeds and other commodities for processing and products thereof 2,318 2,396 Dressed beef, poultry, salt and other products 645 764 Food and food ingredients, livestock, energy products, fertilizer and other products 3,445 2,401 Advances on purchases 661 580 Less advances on sales (223) (370) $8,667 7,921

Inventories would have been $160 million and $163 million higher at May 31, 2005 and 2004, respectively, had the Company valued its last-in, first-out inventories using the first-in, first-out method.

(Continued)

F-14 Cargill, Incorporated and Subsidiaries

(4) Acquisitions, Merger and Disposals

Acquisitions The Company’s major acquisitions during 2005 included a Brazilian poultry processing business and a European food ingredient business. Acquisitions during 2004 included European chocolate and flavorings businesses, and a Canadian natural gas business. Acquisitions completed during fiscal 2005 generated goodwill of $71 million. During fiscal 2005, goodwill was reduced by $68 million for recognition of acquired tax loss carryforwards, impairments and other adjustments. The final purchase price allocations for 2004 acquisitions were completed during 2005 when the third party valuations were finalized and resulted in an increase to goodwill of $1 million. The operating results of businesses acquired are included in the consolidated statement of earnings from dates of acquisition. A summary of the fair values of assets acquired and liabilities assumed at the date of acquisition is as follows:

2005 2004 (In millions) Cash and cash equivalents $ 34 37 Other working capital items 8 50 Property 370 193 Goodwill 71 133 Long-term debt and capital leases (73) (43) Net other liabilities (63) (102) Total purchase price $ 347 268

Merger Effective October 22, 2004, based upon a merger and contribution agreement with IMC Global, Inc. (IMC), Cargill contributed all of its fertilizer businesses into Mosaic, a new publicly traded company. Concurrently, IMC merged into Mosaic. As a result of Cargill’s contribution and the IMC merger, the Company received 66.5 percent of the shares of Mosaic and IMC shareholders received 33.5 percent of the shares of Mosaic. As required by generally accepted accounting principles, Cargill treated this transaction as a partial purchase (66.5 percent) of IMC, recorded at fair value, and a partial sale (33.5 percent) of the fertilizer businesses. A gain of $606 million was recorded as a result of the partial sale of the fertilizer businesses. In accordance with the provisions of the merger and contribution agreement, the Company restructured the fertilizer businesses prior to the merger date and incurred $28 million of merger-related expenses.

For accounting purposes, the purchase price deemed paid for IMC was based on an average of the closing prices of IMC common and preferred stock for the two days before and two days after announcing the merger agreement on January 27, 2004. In addition to the price of the stock, the total purchase price of approximately $1.7 billion also includes the fair value of IMC stock options and direct costs related to the merger.

The purchase price was allocated to the fair value of the assets acquired and liabilities assumed. An outside appraisal firm was engaged to assist in determining the fair value of the long-lived, tangible and the identifiable intangible assets.

(Continued)

F-15 Cargill, Incorporated and Subsidiaries

(4) Acquisitions, Merger and Disposals (cont.)

A summary of the Cargill fertilizer business balance sheet before the merger compared to the balance sheet of Mosaic after the merger is shown below:

Mosaic Fertilizer After Before Merger Merger (In millions) Current assets $1,448 764 Other assets 467 347 Property 3,934 930 Goodwill 2,343 - Total assets $8,192 2,041

Current liabilities $ 997 392 Long-term debt and capital leases 2,273 30 Other liabilities 1,603 232 Minority interests 1,287 10 Equity 2,032 1,377 Total liabilities and equity $8,192 2,041

Disposals The Company’s business disposals during 2005 included its international juice business. Proceeds from disposals were $192 million with gains of $71 million, net of tax. Disposals during 2004 included its interests in a lysine joint venture. Proceeds from disposals were $82 million with gains of $32 million.

(5) Foreign Operations

The following summarizes amounts included in the accompanying consolidated financial statements for operations located outside the U.S., before elimination of intercompany accounts with domestic companies.

2005 2004 (In millions) Working capital $ 3,930 3,813 Net other assets 6,751 4,683 10,681 8,496 Less minority interests 1,014 798 Equity in net assets $ 9,667 7,698 Equity in net earnings $ 1,030 1,465

(Continued)

F-16 Cargill, Incorporated and Subsidiaries

(6) Investments and Advances

A summary of investments and advances is as follows: 2005 2004 (In millions) Nonconsolidated companies carried at equity: Investments $1,491 1,216 Advances 335 382 Companies carried at cost 104 127 Investments in affiliated private investment funds 593 222 $2,523 1,947

The summarized financial information shown below includes all nonconsolidated companies carried at equity. These companies include Brazilian and Canadian fertilizer companies, a U.S. steel company, numerous entities holding real estate and loan portfolios, and other agricultural joint ventures. 2005 2004 (In millions) Sales and other revenues $10,193 7,923 Net earnings $ 865 249 Equity in net earnings $ 358 118

Cash $ 502 574 Financial instruments 652 1,130 Accounts receivable 992 944 Inventories 962 811 Loans receivable 684 531 Real estate investments 1,660 2,631 Other assets 629 443 Property, plant and equipment 2,090 1,991 Total assets 8,171 9,055

Debt obligations, non-recourse to Cargill 2,495 3,448 Debt obligations, recourse to Cargill 185 450 Other liabilities 2,132 2,270 Net assets $ 3,359 2,887

Equity in net assets $ 1,491 1,216

The debt obligations, with recourse to Cargill shown above, are supported by Cargill guarantees with terms equal to the related debt amounts, with maturities through 2021. No liability has been recorded related to these guarantees. The non-recourse debt is collateralized by specific assets of the nonconsolidated companies and the lender does not have recourse to any other assets of the Company.

(Continued)

F-17 Cargill, Incorporated and Subsidiaries

(7) Property

The components of property are summarized below:

2005 2004 (In millions) Owned property, plant and equipment at cost: Land $ 596 525 Mineral reserves 2,942 84 Buildings 4,564 4,092 Machinery and equipment 11,193 10,407 Transportation equipment 822 301 $20,117 15,409 Property under capital leases: Land, improvements and buildings $ 95 116 Machinery and equipment 107 165 Transportation equipment 21 21 $ 223 302 Accumulated depreciation and amortization: Owned property, plant and equipment $ 9,459 8,478 Property under capital leases 145 168 $ 9,604 8,646

Capitalized interest on major construction projects was $8 million during 2005 and $3 million during 2004.

(8) Short-term Debt

Short-term debt consists of the following:

2005 2004 (In millions) Commercial paper $1,058 3,271 Notes payable to banks 671 737 Other 566 300 Current portion of long-term debt, obligations under capital leases and guarantee of ESOP debt 1,154 257 $3,449 4,565

Cash paid for interest on short-term and long-term debt, recourse and non-recourse, was $663 million and $468 million in 2005 and 2004, respectively.

(Continued)

F-18 Cargill, Incorporated and Subsidiaries

(9) Long-term Debt

Long-term debt consists of the following: 2005 2004 (In millions) Senior notes and debentures: 3.625%, due 2009 $ 498 497 4.375%, due 2014 477 442 6.125%, due 2034 246 246 6.25%, due 2006 750 750 6.3%, due 2009 249 246 6.375%, due 2013 522 525 6.875%, due 2036 99 99 7.25%, due 2037 90 90 7.28%, $5 million due annually 2006 to 2024 95 100 7.375%, due 2026 174 174 7.5%, due 2027 149 149 8.89%, due 2022 100 100 8.93%, due 2025 100 100 9.25%, due 2016 100 100 9.25%, $5 million due annually 2006 to 2020 75 80 10.02%, $5 million due annually 2006 to 2019 70 75

U.S. Medium Term Notes: 3.268% to 7.5%, due in various installments to 2029 972 968

European Medium Term Notes: .373% to 6.1%, due 2007 263 50 4.5%, due 2015 617 -

Industrial Revenue Bonds: 3.00% to 6.375%, due in various installments to 2028 203 189

Synthetic leases 474 -

Other 21 65

Obligations under capital leases 90 124

Guarantee of ESOP debt 127 158

Obligations of foreign subsidiaries 304 299 6,865 5,626 Less current portion 1,154 257 $5,711 5,369

Annual maturities of long-term debt are $397 million in 2007, $321 million in 2008, $892 million in 2009, $82 million in 2010 and $4,019 million thereafter.

(Continued)

F-19 Cargill, Incorporated and Subsidiaries

(10) Short-term and Long-term Debt, Non-recourse

Short-term and long-term debt, non-recourse is issued by Mosaic and Variable Interest Entities (VIEs). The Mosaic debt is not guaranteed or supported by Cargill or other consolidated subsidiaries. The VIE debt is collateralized by specific assets of the consolidated VIEs and the lender only has recourse to the assets of the entity collateralizing the loan. The lender does not have recourse to any other assets of the Company. VIEs are described more fully in Note 1 under the section titled, “Variable Interest Entities.” The non-recourse debt has interest rates ranging from 0% to 22%. Annual maturities of long-term debt, non-recourse are $389 million in 2007, $507 million in 2008, $517 million in 2009, $75 million in 2010 and $1,500 million thereafter.

(11) Lease Commitments

The Company and its subsidiaries lease real property, barges, rail and other transportation equipment and various machinery and equipment under noncancellable operating lease agreements, extending through 2109. These include operating leases with certain shareholders under terms deemed to be the same as arms-length transactions, with future minimum lease payments of $41 million at May 31, 2005. Future minimum lease payments are as follows:

Years ending Operating May 31 leases (In millions)

2006 $ 362 2007 275 2008 169 2009 107 2010 80 Later years 442

Total minimum lease payments $1,435

Rental expense for all operating leases, except ocean freight vessels, was $403 million in 2005 and $372 million in 2004. Rental expense for ocean freight vessels was $381 million in 2005 and $186 million in 2004. The Company enters into purchase commitments for time on ocean freight vessels for the purpose of transporting agricultural and other commodities for the Company and third-party customers. In addition, the Company sells time on these ocean freight vessels.

(Continued)

F-20 Cargill, Incorporated and Subsidiaries

(12) Capital Stock

The following summarizes transactions in the Company’s capital stock: Shares Amount Issued Outstanding (In millions) Preferred stock 5% cumulative, $50 par value; 400,000 shares authorized: Balance at May 31, 2003, 2004 and 2005 199,095 -- $ -- Special preferred stock 5% cumulative, $50 par value; 10,000 shares authorized: Balance at May 31, 2003, 2004 and 2005 6,000 6,000 $ 0.3 Common stock $.01 par value; 480,000,000 shares authorized: Balance at May 31, 2003 360,561,600 209,872,745 $ 2 Acquired for treasury -- (8,890,543) -- Balance at May 31, 2004 360,561,600 200,982,202 2 Acquired for treasury -- (559,502) -- Balance at May 31, 2005 360,561,600 200,422,700 $ 2 ESOP common stock $.01 par value; 100,000,000 shares authorized: Series A ESOP common stock; 25,000,000 shares designated: Balance at May 31, 2003 23,175,023 19,203,493 $ 0.2 Acquired for treasury -- (514,037) -- Balance at May 31, 2004 23,175,023 18,689,456 0.2 Acquired for treasury -- (713,336) -- Balance at May 31, 2005 23,175,023 17,976,120 $ 0.2 Series B ESOP common stock; 10,000,000 shares designated: Balance at May 31, 2003, 2004 and 2005 579,350 579,350 $ --

(Continued)

F-21 Cargill, Incorporated and Subsidiaries

(12) Capital Stock (Cont.)

Shares Amount Issued Outstanding (In millions) Management stock $.01 par value; 64,200,000 shares authorized: Balance at May 31, 2003 21,570,085 3,286,628 $ -- Acquired for treasury -- (647,415) -- Issued from treasury under employee compensation plans -- 697,168 -- Balance at May 31, 2004 21,570,085 3,336,381 -- Acquired for treasury -- (1,463,587) -- Issued from treasury under employee compensation plans -- 1,540,986 -- Balance at May 31, 2005 21,570,085 3,413,780 $ -- Retiree stock $.01 par value; 14,300,000 shares authorized: Balance at May 31, 2003 2,002,995 1,043,198 $ -- Acquired for treasury -- (315,256) -- Issued from treasury 356,973 -- Balance at May 31, 2004 2,002,995 1,084,915 -- Acquired for treasury -- (531,269) -- Issued from treasury 693,486 -- Balance at May 31, 2005 2,002,995 1,247,132 $ -- Special management stock $.01 par value; 700,000 shares authorized: Balance at May 31, 2003, 2004 and 2005 -- -- $ --

(13) Dividends on Capital Stock

The Company generally pays quarterly cash dividends on its Capital Stock. The annual amounts of dividends paid per share are as follows:

2005 2004 ($ Per Share) Special preferred $2.50 2.50 Common 1.18 .84 ESOP common 1.18 .84 ESOP common preference 1.89 1.89 Management 1.18 .84 Retiree 1.18 .84

(Continued)

F-22 Cargill, Incorporated and Subsidiaries

(14) Stock Based Compensation Plans

Effective June 1, 1996, the Company implemented a Stock Option Plan (Plan) to encourage stock ownership and provide greater incentive for key management employees and officers through the granting of options to purchase shares of Management Stock. The Plan provides for the granting of options at fair market value on the date of grant. Options may be exercised after three years and expire either seven or ten years from the grant date.

A summary of stock option activity under the Plan is as follows:

Wtd. Avg. Shares Exercise Price Balance at May 31, 2003 23,658,759 $39.25 Options granted 3,409,070 55.27 Options forfeited/expired (10,836) 47.58 Options exercised (4,101,330) 36.66 Balance at May 31, 2004 22,955,663 42.09 Options granted 3,390,343 76.13 Options forfeited/expired (32,000) 57.08 Options exercised (4,911,233) 37.43 Balance at May 31, 2005 21,402,773 48.53

The following table summarizes information about the Plan at May 31, 2005:

Options Outstanding Options Exercisable Wtd. Avg. Remaining Wtd. Avg. Wtd. Avg. Range of Contractual Exercise Exercise Exercise Prices Shares Life Price Shares Price $32.26 to $34.00 467,963 1.0 $32.37 467,963 $32.37 34.01 to 35.50 3,218,339 4.7 34.95 3,218,339 34.95 35.51 to 38.00 2,004,278 3.9 35.70 2,004,278 35.70 38.01 to 40.00 4,373,548 5.0 38.87 4,373,548 38.87 40.01 to 54.00 4,414,632 4.6 49.01 1,501,362 44.17 54.01 to 59.00 3,307,670 7.8 54.26 199,200 54.25 59.01 to 69.00 2,510,650 9.0 69.00 2,500 69.00 69.01 to 95.00 1,105,693 10.0 90.87 - - $32.26 to $95.00 21,402,773 5.8 $48.53 11,767,190 $37.94

Using the Black-Scholes option-pricing model, the weighted average minimum fair value of options granted was estimated based on weighted average assumptions as follows:

2005 2004 Weighted average fair value $11.22 $6.03 Risk free interest rates 4.22% 3.32% Expected lives 6.84 years 7.46 years Expected dividend yield 1.59% 1.56%

(Continued)

F-23 Cargill, Incorporated and Subsidiaries

(14) Stock Based Compensation Plans (Cont.)

The Company uses the fair value recognition provisions of SFAS 123 “Accounting for Stock-Based Compensation” to account for the Plan. In accordance with the provisions of SFAS 123, $30 million and $36 million was recorded for stock-based compensation expense under the Plan in 2005 and 2004, respectively. In addition, stock options exercised or exercisable for cash by a certain group of retired or terminated employees require recognition of compensation expense based upon the current fair market value of the underlying stock. This compensation expense was $25 million and $31 million in 2005 and 2004, respectively.

The Company implemented a Cash Performance Option Plan effective June 1, 1996. Like stock options, the cash performance options offer participants a chance to share in the Company’s growth through options that are tied to the Company’s performance. Participants receive the cash equivalent of any appreciation in Management stock between the time the cash options are awarded and the time they are exercised. Cash options may be exercised after three years and expire five years from the grant date. Cash performance option expense was $168 million in 2005 and $141 million in 2004. SFAS 123 requires recognition of compensation expense for variable award plans over the vesting periods of such plans, based upon the current fair market value of the underlying stock.

During 1998, the Company initiated a Stock Grant Program (Program). The purpose of the Program is to retain and motivate certain top executives of the Company. The Program provides for grants that vest in three to five years and some have a performance requirement. Shares granted and outstanding under the program were 985,619 and 914,548 for May 31, 2005 and 2004, respectively. Stock grant expense was $4 million in both 2005 and 2004, respectively. SFAS 123 requires recognition of compensation expense for grants of stock over the vesting period based on the grant- date fair value.

In addition to the Cargill Stock Option Plan, Mosaic sponsors one share-based compensation plan. The Mosaic Company 2004 Omnibus Stock and Incentive Plan (Mosaic Plan), which was approved by shareholders and became effective October 20, 2004, permits the grant of new share options and shares to its employees for up to 10 million shares of Mosaic common stock. The Mosaic Plan provides for grants of stock options, restricted stock, and a variety of other stock-based awards. At May 31, 2005, the Mosaic Plan has option grants outstanding for 9,876,243 shares, of which 8,983,780 were exercisable, with a weighted average exercise price of $17.86. All of the exercisable options were carried forward from the predecessor plan of IMC Global and became fully vested and convertible into an equal number of options to acquire Mosaic stock. The weighted average grant date fair value of the options granted during the year was calculated at $7.34 using the Black-Scholes option-pricing model assuming a 6 year expected life, 46% volatility, and a 3.56% risk-free interest rate. Mosaic uses the fair value recognition provisions of SFAS 123 “Accounting for Stock-Based Compensation” to account for the Plan with $1 million being recorded for stock- based compensation expense in 2005.

(Continued)

F-24 Cargill, Incorporated and Subsidiaries

(15) Pension and Other Postretirement Benefits

The Company and its subsidiaries have various pension plans covering most of their domestic employees and many of their foreign employees. Benefits are based on years of service and compensation. Pensions are funded in compliance with U.S. government regulations or local laws and practices.

Plan assets are held in trust and consist mainly of equity and debt securities. Equity securities include Cargill common stock, which represents 3% and 2% of total plan assets for 2005 and 2004, respectively. The Company’s retirement plan asset allocation for 2005 and 2004 and target allocations for 2005 are as follows:

Target Plan Assets Allocation 2005 2004 2005 Asset Category: Equity securities 57% 58% 55% Debt securities 30% 35% 20% Real estate 3% 3% 10% Other assets 10% 4% 15% Total 100% 100% 100%

The Company’s investment policies and strategies governing defined benefit plan assets are designed to maximize long-term returns within prudent risk parameters. The investment objective for the plans is to achieve a return in excess of a market index weighted in accordance with asset allocation policy. Periodic asset-liability studies are conducted for the Company’s major plans to determine the optimal long-term allocation to broad asset categories given each plan’s liability structure. In addition, the Company has established target allocation ranges to ensure that the objectives of both the Company and plan participants are met. Within asset categories, consideration is given to balancing the portfolio among strategy, style and other factors that affect investment returns.

Plan assets are managed by third-party professional investment firms that are bound by precise mandates and are measured against specific benchmarks. Several managers are permitted to use derivative securities. Derivatives are used as a cost effective alternative to owning a security or to rebalance the portfolio in accordance with asset category targets. In these instances, only highly liquid exchange-traded futures contracts are used, and cash balances must be maintained at a level equal to the notional exposure of the derivatives to avoid leverage in the portfolio. Derivative securities are also used to hedge currency risk of foreign investments.

The expected rate of return assumption on plan assets is based on long-term actual portfolio results, historical and forward-looking returns for the asset categories represented in the portfolio, and the plan’s current and expected asset allocation. Forward-looking returns will consider current factors such as inflation and the current level of interest rates. Peer group and portfolio manager surveys are used to assess the reasonableness and appropriateness of the return assumption.

(Continued)

F-25 Cargill, Incorporated and Subsidiaries

(15) Pension and Other Postretirement Benefits (Cont.)

The Company uses a March 1 measurement date for its domestic pension plans and various measurement dates for its foreign pension plans. The key components of the defined benefit plans for domestic and foreign companies are as follows:

2005 2004 (In millions) Actuarial present value of benefit obligations: Vested benefit obligation $3,423 2,788 Accumulated benefit obligation 3,808 2,903 Projected benefit obligation 4,273 3,287 Plan assets at fair value 3,158 2,401 Unfunded accumulated benefit obligation (650) (502)

Recognized on the consolidated balance sheet: Net (accrued) prepaid pension cost (63) 36 Additional minimum liability (705) (626) Net accrued pension cost $ (768) (590) Components of defined benefit pension expense: Service cost $108 92 Interest cost 203 164 Expected return on plan assets (192) (143) Net amortization 67 60 Net periodic defined benefit pension cost 186 173 Defined contribution and multiemployer plans 34 26 Total retirement plan expense $220 199 Employer contributions $248 403 Plan participant contributions 14 10 Benefits paid 153 126 Weighted average assumptions used to determine benefit obligations: Discount rate 5.4% 5.7% Rate of increase in compensation levels 3.7% 3.1% Expected long-term rate of return on assets 7.4% 7.4% Weighted average assumptions used to determine net periodic pension cost: Discount rate 5.7% 5.9% Rate of increase in compensation levels 3.7% 3.3% Expected long-term rate of return on assets 7.4% 7.3%

In 2006, the Company estimates it will contribute in the range of $200 to $300 million to their domestic and foreign pension plans.

(Continued)

F-26 Cargill, Incorporated and Subsidiaries

(15) Pension and Other Postretirement Benefits (Cont.)

In addition to providing pension benefits, the Company and certain subsidiaries provide health care and some life insurance benefits for certain retired employees. In 1993, the Company adopted SFAS 106 that requires the expected cost of retiree health benefits to be charged to expense during the service lives of employees. The initial accumulated postretirement benefit obligation of $202 million is being amortized over 20 years. The Company uses a measurement date of May 31 for its primary U.S. postretirement benefit plan. The accumulated postretirement benefit obligation for the unfunded plans at May 31, 2005 and 2004 was $523 million and $428 million, respectively.

2005 2004 Weighted average assumptions used to determine benefit obligations: Discount rate 5.7% 6.0% Health care cost trend rate assumed 9.5% 10.5% Ultimate health care cost trend rate 5.0% 4.9% Year that the rate reaches the ultimate trend rate 2011 2011

Weighted average assumptions used to determine net postretirement cost: Discount rate 5.9% 6.4% Health care cost trend rate assumed 10.6% 9.7% Ultimate health care cost trend rate 5.0% 4.9% Year that the rate reaches the ultimate trend rate 2011 2010

Postretirement benefit expense was $40 million and $34 million in 2005 and 2004, respectively. The accrued postretirement cost was $434 million and $299 million at May 31, 2005 and 2004, respectively. A 1% increase in the health care cost trend rate assumption would not have had a material impact on the accumulated postretirement benefit obligation or the expense for the year. Plan participant contributions were $7 million and $7 million, and benefits paid were $27 million and $23 million in 2005 and 2004, respectively. There are no significant company contributions expected to the postretirement plan for 2006.

During 2004, the FASB issued FASB Staff Position 106-2, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003” (“FSP 106-2”). FSP 106-2 provides accounting guidance with respect to the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the “Act”) signed into law in December 2003. The Act introduced a prescription drug benefit under Medicare known as “Medicare Part D.” The Act also established a federal subsidy to sponsors of retiree health care plans that provide a benefit that is at least actuarially equivalent to Medicare Part D. The Company will recognize the benefit of the Act beginning in 2006 and it will not have a material effect on the Company’s consolidated financial position or results of operations. Any measures of the accumulated postretirement benefit obligation or net periodic postretirement benefit expense in the Company’s financial statements do not reflect the effect of the Act.

(Continued)

F-27 Cargill, Incorporated and Subsidiaries

(15) Pension and Other Postretirement Benefits (Cont.)

Following are expected pension and postretirement benefit payments for the next five years and in the aggregate for the five fiscal years thereafter: Year ending May 31 Pension Postretirement (In millions) 2006 $ 150 37 2007 157 38 2008 166 40 2009 175 41 2010 185 41 Next five years (aggregate) 1,105 197

(16) Employee Stock Ownership Plan In February 1992, the Company established an Employee Stock Ownership Plan (ESOP). The ESOP borrowed $691 million from outside lenders and $39 million from the Company. The loan proceeds were used to purchase approximately 17% of the Company's outstanding common stock. The ESOP then exchanged the common stock for 23,175,023 shares of ESOP common stock with a value of $31.522 per share. The Company is obligated to make annual contribution and dividend payments to the ESOP sufficient to repay the ESOP's loan, including interest. The ESOP common stock pays a regular dividend equal to the dividend on common stock, $1.18 per share in 2005, and a preference dividend of $1.89 per share for 15 years. After 15 years, the ESOP common stock will have the same value and earn the same dividends as common stock. The Company's guarantee of the ESOP debt was recorded as long-term debt and an unearned ESOP compensation amount was recorded as a reduction of Stockholders' Equity on the Consolidated Balance Sheet. The debt is repayable in various installments through 2010 with interest rates varying from 8.37% to 8.42%. The ESOP currently covers almost all U.S. non-union employees and allocates shares to employees as a substitute for certain pension and retiree health care benefits and as a 50% match on 401(k) contributions up to 6%. ESOP expense of $1 million and $8 million included in net earnings for 2005 and 2004, respectively, was determined based on the shares-allocated method.

(17) Income Taxes U.S. and foreign income tax expense is made up of the following components: 2005 2004 (In millions) United States, primarily Federal: Current $ 52 122 Deferred 23 23 Foreign: Current 509 398 Deferred (60) 22 $524 565

(Continued)

F-28 Cargill, Incorporated and Subsidiaries

(17) Income Taxes (Cont.)

The effective tax rate is different from the statutory U.S. Federal income tax rate for the following reasons: 2005 2004 U.S. statutory rate 35.0% 35.0% Impact of foreign operations .2 (2.3) Extraterritorial benefit/Foreign Sales Corporation (.9) (1.2) Reduction of valuation allowance (3.5) - Gain on fertilizer merger (8.8) - State and local income taxes .5 .4 Tax exempt income (.4) (.5) Additional taxes (credited)/provided (.2) 1.1 Other (.2) (2.7) 21.7% 29.8%

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: 2005 2004 (In millions) Deferred tax liabilities: Depreciation and amortization $1,706 723 Leases 80 260 Total deferred tax liabilities 1,786 983 Deferred tax assets: Accruals 1,065 927 Tax loss carryforwards 709 489 Capital loss carryforwards 195 - Tax credits 142 102 Total deferred tax assets 2,111 1,518 Valuation allowance (951) (582) Total deferred tax assets 1,160 936 Net deferred tax liabilities $ 626 47

The Company's tax returns for the years 2002 to 2004 are being audited by the Internal Revenue Service. Certain issues related to audits for 1989 to 2001 are in appeals. Although the eventual outcome of these audits and appeals is not determinable, the Company has paid or provided amounts it believes are sufficient for any liabilities that may arise from these tax claims.

At May 31, 2005, the Company has net operating loss carryforwards, capital loss carryforwards and tax credits of approximately $2,019 million, $513 million and $381 million, respectively, including $1,136 million of preacquisition net operating loss carryforwards, $513 million of capital loss carryforwards and $141 million of tax credits. Of the total net operating loss carryforwards, $1,409 million expires in various years through 2024 and $610 million is available indefinitely. The majority of the capital loss carryforwards expire in 2007. The majority of the tax credits are being carried back or do not expire.

(Continued)

F-29 Cargill, Incorporated and Subsidiaries

(17) Income Taxes (Cont.) In 2005, the merger of Mosaic added $436 million to the valuation allowance, offset by a reduction in the valuation allowance for foreign tax credits. Cash paid for income taxes was $774 million and $305 million in 2005 and 2004, respectively.

(18) Financial Derivative Instruments with Off-Balance-Sheet Risk

The Company has a risk management group with staff in London, Singapore, and Minneapolis that assists senior management in the identification, assessment and control of various risks. The Company monitors its exposure to market and credit risks on a daily basis through a variety of financial and credit exposure calculations and reports. In addition, the Company has a range of policies and procedures in place to support effective risk management and communication.

The Company utilizes various types of derivative instruments to manage the interest rate, currency and other market risks associated with certain liabilities and assets such as trading securities, trading securities sold not yet purchased, loans, short-term borrowings and other debt.

Certain of the Company's trading securities have off-balance-sheet risk of accounting loss, which may consist of market and/or credit risk, in excess of amounts recorded on the consolidated balance sheet. The Company utilizes a variety of derivatives and off-balance-sheet financial instruments to manage its exposure to interest rate and other risks and to take trading positions. Financial instruments traded or utilized by the Company, which involve varying degrees of credit and market risk, include derivatives, trading securities sold, not yet purchased, and forward commitments.

The Company, on an ongoing basis, manages the risk that counterparties to either derivative or cash instruments might default on their obligations. To manage the level of credit risk, the Company enters into master netting arrangements whenever possible, obtains collateral when appropriate and monitors the size and maturity structure of the positions. The Company also monitors credit exposures, limits transactions with specific counterparties, and continually assesses the creditworthiness of counterparties. Master netting arrangements incorporate rights of setoff that provide for the net settlement of certain contracts with the same counterparty in the event of default.

Market risk represents the potential loss due to the decrease in the value of a financial instrument caused primarily by changes in interest rates, foreign exchange rates, the prices of equities, commodities, or the related indices. The level of market risk is influenced by the volatility and liquidity in the markets in which financial instruments are traded. The Company seeks to control market risk by developing and refining hedging strategies that correlate price, currency and commodity movements of its trading securities and the related hedges. In many cases, derivative financial instruments are used to hedge other on- and off-balance-sheet transactions.

Trading securities sold, not yet purchased represent obligations of the Company to deliver specified securities at a contracted price. These transactions result in off-balance-sheet market risk as the Company's ultimate obligation for trading securities sold, not yet purchased may exceed the amounts recognized in the consolidated balance sheet.

(Continued)

F-30 Cargill, Incorporated and Subsidiaries

(18) Financial Derivative Instruments with Off-Balance-Sheet Risk (Cont.)

Financial futures, forward commitments and foreign currency contracts involve a commitment to purchase or sell securities, currencies or commodities at a future date at a predetermined price. The Company enters into financial futures and foreign currency contracts to hedge against uncertainty in future interest rates, and security and currency values. When the Company purchases foreign currency denominated assets, issues foreign currency denominated debt or has foreign net investments, it subjects itself to changes in value as exchange rates move. These fluctuations are managed by entering into currency swaps and forwards. The majority of the Company's financial futures and foreign currency contracts are cleared and held by clearing brokers who are affiliates of the Company.

Swap agreements generally involve the exchange of payment obligations on an underlying notional principal amount. These transactions may expose the Company to off-balance-sheet risk associated with interest rate, foreign currency, commodity or equity price fluctuations. The Company enters into either U.S. dollar or non-U.S. currency denominated interest rate swaps and generally uses these agreements to hedge interest rate-sensitive trading securities and borrowings.

The Company enters into total return swap agreements to assume either interest rate, credit, or equity price risk on the swap’s underlying assets or to pass the risk associated with the swap’s underlying assets to the counterparty. Total return swaps generally require one party to pay the other a rate of interest, generally a floating rate plus a spread, in return for payments equal to the return on an asset or a portfolio of assets.

For those swap contracts where the Company assumes equity price risk, it can either be receiving an equity-based or interest-based return under the total return swap agreement. These derivatives are largely utilized to assume equity price risk without having ownership of the underlying equities or to pass the equity price risk to the total return swap counterparty. If risk is assumed, it may be hedged with other derivative instruments.

Credit default swaps are an agreement between two parties whereby one party pays the other a fixed coupon over a specified term. The other party makes no payment unless a specified credit event such as a default occurs, at which time a payment is made and the swap terminates. The Company enters into credit default swaps either to assume or hedge credit risk.

As a writer of option contracts, the Company receives cash and, in return, may be obligated to purchase or sell to the holder a specific financial instrument under the terms of the contract. As a holder of option contracts, the Company pays cash and, in return, has the choice of whether or not to purchase or sell to the writer a specific financial instrument under the terms of the contract. The Company enters into option contracts to hedge against uncertainty in future security and currency values and to capitalize on perceived market opportunities.

(Continued)

F-31 Cargill, Incorporated and Subsidiaries

(18) Financial Derivative Instruments with Off-Balance-Sheet Risk (Cont.)

The Company also purchases financial instruments created from the securitization of municipal bonds (municipal derivatives). These financial instruments are residual interests in qualifying special purpose entities sponsored by a third party. The return on the residual interests and changes in their market value varies inversely with market interest rates. The Company’s returns are subject to significant leverage and as a result do not directly correlate with changes in market interest rates. Municipal derivatives which may be considered alternative sources of financing and are off-balance sheet total $210 million and $207 million at May 31, 2005 and 2004, respectively.

The notional or contractual amount of derivatives provide a measure of the volume of the Company’s involvement in these types of transactions and may not represent the amounts subject to market risk or the future cash requirements under certain of these instruments. A summary of the notional or contractual amounts of these instruments, excluding those considered as alternative sources of financing, is as follows:

At May 31 2005 2004 (In millions) Financial futures and forward commitments Commitments to purchase $ 2,083 1,456 Commitments to sell 1,581 1,830 Foreign currency contracts Commitments to purchase 3,592 3,369 Commitments to sell 4,661 3,977 Interest rate swap agreements Fixed rate payor 2,292 3,190 Variable rate payor 2,221 2,281 Credit default swap agreements 578 1,019 Commodity and basis swap agreements 24,842 17,803 Total return swap agreements Equity based payor 3 304 Interest based payor - 390 Option contracts written Commitments to purchase 2,700 2,414 Commitments to sell 675 900 Option contracts held Commitments to purchase 1,017 1,379 Commitments to sell 1,640 2,599

(Continued)

F-32 Cargill, Incorporated and Subsidiaries

(19) Net Earnings Per Share The following is a reconciliation of basic net earnings per share to diluted net earnings per share for the years ended May 31, 2005 and 2004. Shares outstanding include Common, ESOP common, Management and Retiree stock. 2005 2004 (Shares in millions) Basic net earnings per share $ 9.36 5.76 Average shares outstanding - basic 224.7 230.9 Shares from assumed stock option exercises and issuance of stock grants 8.2 6.2 Adjusted average shares outstanding - diluted 232.9 237.1 Diluted net earnings per share $ 9.03 5.61

Componets of basic and diluted net earnings per share are as follows: 2005 2004 ($ Per Share) Basic net earnings per share Continuing operations $ 9.21 5.55 Discontinued operations .36 .21 Cumulative effect of accounting change (.21) - Net earnings $ 9.36 5.76

Diluted net earnings per share Continuing operations $ 8.89 5.41 Discontinued operations .35 .20 Cumulative effect of accounting change (.21) - Net earnings $ 9.03 5.61

(20) Fair Value of Financial Instruments Trading securities and trading securities sold, not yet purchased are carried at fair value. The carrying amount of cash and cash equivalents, short-term investments, short-term debt and other current assets and liabilities approximates fair value due to the short maturity of these instruments. The fair value of long-term debt and long-term debt, non-recourse was determined by using interest rates currently available for issuance of debt with similar terms and remaining maturities. The amounts at May 31, 2005, are summarized below: Amount Fair Value (In millions) Long-term debt $5,711 6,216 Long-term debt, non-recourse $2,988 3,035

(Continued)

F-33 Cargill, Incorporated and Subsidiaries

(21) Accumulated Other Comprehensive Income

Components of accumulated other comprehensive income/(loss) consist of the following:

Balance Balance Balance May 31, 2004 May 31, 2005 May 31, 2003 Change 2004 Change 2005 (In millions) Foreign currency translation adjustments $ 314 85 399 182 581 Unrealized gain/(loss) on securities 2 48 50 (15) 35 Unrealized gain/(loss) on cash flow hedges (68) 26 (42) (1) (43) Minimum pension liability adjustment (403) 62 (341) (50) (391) Accumulated other comprehensive income/(loss) $ (155) 221 66 116 182

(22) Contingencies and Commitments Contingencies The Company and its subsidiaries have various legal actions, claims and proceedings pending against them including those arising from product defects, employment-related matters, patents and governmental regulations. The Company has established reserves for matters in which losses are probable and can be reasonably estimated. Litigation is subject to uncertainties and the outcome of individual litigated matters is not predictable with assurance. However, after discussion with counsel, it is the opinion of management, that any ultimate liability in these matters has been provided for or will not have a material adverse effect on the Company’s consolidated financial position or results of operations.

The Company and its subsidiaries are contingently liable for guaranteed lease residuals of $80 million, and guaranteed obligations of third parties totaling $263 million. The guaranteed lease residuals relate to synthetic lease agreements for railcars and barges expiring through 2020. The leases are classified as operating leases and the Company has the option to purchase the railcars or barges at fixed amounts based on fair values or to sell the assets. If sale proceeds were less than guaranteed fixed amounts, the Company would be obligated to pay for the deficiency in the proceeds. The Company has not recorded any liability related to the guaranteed lease residuals.

Commitments

The Company and its subsidiaries have outstanding letters of credit issued by banks for the purchase of commodities, margin deposit requirements, performance guarantees and other purposes totaling $436 million.

The Company has approved capital expenditures aggregating $1,203 million, at May 31, 2005, for the purchase or construction of property, plant and equipment and for the acquisition of other businesses.

(Continued)

F-34 Cargill, Incorporated and Subsidiaries

(23) Restructuring and Asset Impairment Charges

The Company periodically evaluates the carrying value of long-lived assets, including goodwill and other intangible assets, when events and circumstances indicate the carrying value may not be recoverable. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value. Major impairments during 2005 consist primarily of food processing assets in the United States and Europe. Impairments during 2004 include a business which produces plastics made with annually renewable resources and certain food and food ingredient assets. Restructuring charges were also recorded to cover exit and employee severance costs related both to assets to be sold and assets to be held and used. The total amount of restructuring and asset impairment charges was $264 and $229 million before tax and $194 and $153 million after tax in 2005 and 2004, respectively.

(24) Discontinued Operations

In 2005, steel plants and a wire business in the United States were sold. Earnings on these businesses are reported as discontinued operations for 2005 and 2004 in the consolidated statement of earnings. Income taxes related to discontinued operations were $56 million in 2005 and $25 million in 2004. Net losses from dispositions of $26 million, net of tax, are included in discontinued operations in 2005. Net gains from dispositions, primarily the Michigan steel business, of $12 million, net of tax, are included in discontinued operations for 2004. Assets of $405 million that were sold in 2005, consist primarily of inventory and property, plant and equipment.

(25) Sale of Cargill Investor Services

In June 2005, the Company reached an agreement to sell its global Cargill Investor Services commodity brokerage business unit to REFCO Group Ltd., LLC. The transaction is expected to close in 2006, and will result in a net gain.

(Continued)

F-35 CARGILL, INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET November 30, 2005 and November 30, 2004 (In Millions) Unaudited AT NOVEMBER 30 A S S E T S 2005 2004 CURRENT ASSETS Cash and cash equivalents $ 974 900 Short-term investments 345 894 Securities purchased with agreements to resell 42 2,543 Trading securities 2,036 8,259 Accounts receivable, notes receivable, and accrued income, net 9,046 8,224 Inventories 8,170 7,420 Other current assets 1,842 1,697 TOTAL CURRENT ASSETS 22,455 29,937 OTHER ASSETS Investments and advances 2,311 2,405 Goodwill 3,027 2,982 Other assets 4,435 2,798 TOTAL OTHER ASSETS 9,773 8,185 PROPERTY Owned property, plant & equipment 20,525 18,654 Property under capital leases 223 286 Construction in progress 1,295 867 22,043 19,807 Less accumulated depreciation and amortization 10,087 9,095 NET PROPERTY 11,956 10,712 TOTAL ASSETS $ 44,184 48,834 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Short-term debt $ 4,506 2,910 Short-term debt, non-recourse 416 232 Securities sold with agreement to repurchase 193 4,584 Trading securities sold, not yet purchased 175 4,478 Accounts payable and accrued expenses 10,312 8,814 Accrued income taxes 853 919 TOTAL CURRENT LIABILITIES 16,455 21,937 OTHER LIABILITIES Long-term debt 5,411 6,172 Long-term debt, non-recourse 3,466 2,714 Deferred income taxes 1,001 1,201 Other deferred liabilities 2,670 2,598 TOTAL LIABILITIES 29,003 34,622 MINORITY INTERESTS IN SUBSIDIARIES 2,150 1,992 STOCKHOLDERS' EQUITY Capital stock 3 3 Additional paid-in capital -- 121 Retained earnings 13,038 11,906 Unearned ESOP compensation (211) (252) Accumulated other comprehensive income 201 442 TOTAL STOCKHOLDERS' EQUITY 13,031 12,220 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 44,184 48,834

Certain fiscal 2005 balance sheet accounts have been reclassified to conform with the current year presentation. The Consolidated Balance Sheet has been prepared from the books and records of the Company including interim estimates that have not been subjected to external audit verification. In my opinion, the Consolidated Balance Sheet is fairly stated and in conformity with accounting principles generally accepted in the United States of America.

January 12, 2006 Date Corporate Vice President and Controller

F-36 CARGILL, INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENT OF EARNINGS Six Months Ended November 30, 2005 and November 30, 2004 (In Millions) (Unaudited) Six Months Ended 11/30/05 11/30/04

Sales and other revenues $ 37,548 34,751 Cost of sales and other revenues 33,142 31,033 Gross Profit 4,406 3,718 Expenses and other income: Selling, general and administrative expenses 1,943 1,804 Depreciation and amortization of property 650 531 Interest on long-term debt 306 189 Interest on short-term debt 145 101 Restructuring and asset impairment charges 37 -- Gain on fertilizer merger -- (632) Other (income) expense, net (154) 6 Earnings from continuing operations of consolidated companies before income taxes 1,479 1,719 Income tax expense 503 387 Net earnings from continuing operations of consolidated companies 976 1,332 Add equity in net earnings of nonconsolidated companies 128 180 Deduct minority interests in net earnings of consolidated subsidiaries (105) (99) Net earnings from continuing operations 999 1,413 Discontinued operations, net of income tax expense -- 94 NET EARNINGS $ 999 1,507

The Consolidated Statement of Earnings has been prepared from the books and records of the Company including interim estimates that have not been subjected to external audit verification. In my opinion, the Consolidated Statement of Earnings is fairly stated and in conformity with accounting principles generally accepted in the United States of America.

January 12, 2006 Date Corporate Vice President and Controller

F-37 CARGILL, INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS Six Months Ended November 30, 2005 and November 30, 2004 (In Millions) (Unaudited)

Six Months Ended 11/30/05 11/30/04 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $ 999 1,507 Minority interests in net earnings of consolidated subsidiaries 105 99 Noncash items included in earnings: Equity in net earnings of nonconsolidated companies, net of dividends 92 (49) Depreciation and amortization of property 650 531 Restructuring and asset impairment charges 37 -- Gain on fertilizer merger -- (632) Earnings of discontinued operations, net of income taxes -- (94) Deferred income taxes 10 (58) Other, net (179) 120 Total cash from continuing operations 1,714 1,424 Decrease (Increase) in securities purchased with agreements to sell 1,565 (989) Decrease in trading securities 4,515 1,060 (Increase) decrease in accounts receivable, notes receivable and accrued income (1,177) 1,094 Decrease in inventories 544 869 (Decrease) increase in securities sold with agreement to repurchase (1,713) 235 (Decrease) in trading securities sold, not yet purchased (4,674) (295) Increase (decrease) in accounts payable and accrued expenses 754 (1,613) (Increase) in other current assets and liabilities (571) (872) Other, net (379) 332 Net cash provided by operating activities of continuing operations 578 1,245 CASH FLOWS FROM INVESTING ACTIVITIES: Additions to property (792) (493) Investments in businesses acquired, less cash received (388) (6) Investments in nonconsolidated companies (77) (77) Purchase of minority interests, less cash acquired (34) (5) Total capital investments (1,291) (581) Net proceeds from property and business disposals 244 184 Net investments in loan portfolios and real estate (277) (162) Net investments in affiliated private investment funds 48 (121) Other, net (16) (204) Net cash used by investing activities of continuing operations (1,292) (884) CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from (payments on) short-term debt 1,068 (1,679) Net (payments on) proceeds from short-term debt, non-recourse (18) 96 Proceeds from long-term debt 44 848 Proceeds from long-term debt, non-recourse 395 143 Payments on long-term debt (228) (93) Payments on long-term debt, non-recourse (309) (90) Dividends paid to stockholders (161) (151) Dividends paid to minority interests in subsidiaries (30) (71) Capital stock transactions, net (147) (65) Other, net (97) 71 Net cash provided (used) by financing activities of continuing operations 517 (991) Net cash provided by discontinued operations -- 427 (DECREASE) IN CASH AND CASH EQUIVALENTS (197) (203) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,171 1,103 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 974 900

Certain fiscal 2005 cash flow accounts have been reclassified to conform with the current year presentation. The Consolidated Statement of Cash Flows has been prepared from the books and records of the Company including interim estimates that have not been subjected to external audit verification. In my opinion, the Consolidated Statement of Cash Flows is fairly stated and in conformity with accounting principles generally accepted in the United States of America.

January 12, 2006 Date Corporate Vice President and Controller

F-38 Cargill, Incorporated and Subsidiaries CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY Six Months Ended November 30, 2005 and 2004 (In Millions) (Unaudited)

Accum. Unearned Other Total Add'l. Compre- ESOP Compre- Stock- Capital Paid In hensive Retained Compen- hensive holders' Stock Capital Income Earnings sation Inc./(Loss) Equity

Balance at May 31, 2004 $ 3 139 10,555 (272) 66 10,491 Shares issued -- 4 ------4 Shares reacquired -- (52) (15) -- -- (67) Comprehensive income: Net earnings -- -- $ 1,507 1,507 -- -- 1,507 Other comprehensive income: Foreign currency translation adjustments -- -- 425 -- -- 425 -- Unrealized loss on securities -- -- (47) -- -- (47) -- Unrealized loss on cash flow hedges (2) -- -- (2) -- Other comprehensive income -- -- 376 ------376 Comprehensive income $ 1,883 Stock based compensation -- 15 ------15 Tax benefit on ESOP dividends -- -- 10 -- -- 10 Tax benefit on stock option exercises -- 14 ------14 Tax benefit on stock grants -- 1 ------1 Amort. of unearned ESOP compensation ------20 -- 20 Cash dividends -- -- (151) -- -- (151)

Balance at November 30, 2004 $ 3 121 11,906 (252) 442 12,220

Balance at May 31, 2005 $ 3 39 12,260 (232) 182 12,252 Shares issued -- 13 ------13 Shares reacquired -- (81) (70) -- -- (151) Comprehensive income: Net earnings -- -- $ 999 999 -- -- 999 Other comprehensive income: Foreign currency translation adjustments -- -- 18 -- -- 18 -- Unrealized loss on securities -- -- (3) -- -- (3) -- Unrealized gain on cash flow hedges 4 -- -- 4 -- Other comprehensive income -- -- 19 ------19 Comprehensive income $ 1,018 Stock based compensation -- 12 ------12 Tax benefit on ESOP dividends -- -- 10 -- -- 10 Tax benefit on stock option exercises -- 16 ------16 Tax benefit on stock grants -- 1 ------1 Amort. of unearned ESOP compensation ------21 -- 21 Cash dividends -- -- (161) -- -- (161)

Balance at November 30, 2005 $ 3 -- 13,038 (211) 201 13,031

The Consolidated Statement of Stockholders' Equity has been prepared from the books and records of the Company including interim estimates that have not been subjected to external audit verification. In my opinion, the Consolidated Statement of Stockholders' Equity is fairly stated and in conformity with accounting principles generally accepted in the United States of America.

January 12, 2006 Date Corporate Vice President and Controller

F-39 THE ISSUER

Cargill, Incorporated 15615 McGinty Road West Wayzata, MN 55391-2399

DEALERS

ABN AMRO Bank N.V. Credit Suisse Securities (Europe) Limited 250 Bishopsgate One Cabot Square London EC2M 4AA London E14 4QJ

Deutsche Bank AG, London Branch Goldman Sachs International Winchester House Peterborough Court 1 Great Winchester Street 133 Fleet Street London EC2N 2DB London EC4A 2BB

Merrill Lynch International Morgan Stanley & Co. International Limited Merrill Lynch Financial Centre 25 Cabot Square 2 King Edward Street Canary Wharf London EC1A 1HQ London E14 4QA

FISCAL AGENT, PRINCIPAL PAYING AGENT AND CALCULATION AGENT

Citibank, N.A., London 21st Floor, Citigroup Centre Canada Square Canary Wharf London, E14 5LB

PAYING AGENTS

The Bank of New York Fortis Banque Luxembourg S.A. Avenue des Arts 35 50 Avenue J.F. Kennedy Kunstlaan L-2951 Luxembourg B1040 Brussels

LEGAL ADVISERS

To the Issuer as to U.S. Law To the Arrangers/Dealers as to U.S. Law Gretchen Banks Sidley Austin Cargill, Inc. Woolgate Exchange 15615 McGinty Road West 25 Basinghall Street Wayzata, MN 55391-2398 London EC2V 5HA

AUDITORS

To Cargill, Inc. KPMG LLP 4200 Wells Fargo Center 90 South Seventh Street Minneapolis, MN 55402

LUXEMBOURG LISTING AGENT

Dexia Banque Internationale à Luxembourg 69, route d’Esch L-1470 Luxembourg Printed by RR Donnelley 58966