Good day, and welcome to the Bunge Limited Second Quarter 2017 Earnings Release and Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Mr. Mark Haden of Investor Relations. Please go ahead.

Thank you, Allison, and thank you, everyone, for joining us this morning. Before we get started, I want to inform you that we've prepared a slide presentation to accompany our discussion. It can be found in the Investors section of our website at bunge.com under Investor Presentations. Reconciliations of non-GAAP measures disclosed verbally on this conference call to the most directly comparable GAAP financial measures are posted on our website in the Investors section. I'd like to direct you to slide 2 and remind you that today's presentation includes forward-looking statements that reflect Bunge's current views with respect to future events, financial performance and industry conditions. These forward-looking statements are subject to various risks and uncertainties. Bunge has provided additional information in its reports on file with the SEC, concerning factors that could cause actual results to differ materially from those contained in this presentation and encourages you to review these factors. Participating on the call this morning are Soren Schroder, Chief Executive Officer; and Thom Boehlert, Chief Financial Officer. I'll now turn the call over to Soren.

Thanks, Mark, and thank you, everybody for joining us. The second quarter was profitable across all segments with good performance in Foods and Sugar, but overall below expectations as Agribusiness lagged well behind its historical range. Oil did well globally with important customer wins and growth in added value. We're building a leading platform in B2B oils globally, a market segment that continues to grow at 3% per annum and with increasing opportunities for Bunge to differentiate in the eyes of customers and consumers. Milling offset some of the gains in Food & Ingredients, significantly lower flour demand combined with increased competition from the unusually large domestic wheat crop in Brazil weighed on both volumes and margins. In Mexico, volumes were on track but margins were compressed as higher wheat prices were difficult to translate into flour in local currency. We built the powerful milling footprint, which will be a differentiating advantage for Bunge and we're confident that the business will be better in the second half of the year as market conditions improve and some of the actions we're taking go into effect. Our Sugar Milling business performed well and with most of our production hedged and favorable weather, we're on track to meet our financial targets for the year. Agribusiness was the challenge and warrants a look back. How could record crops and strong demand translate into multi-year squeeze on margins? I'll try to summarize. In Brazil, industry soybean export programs were committed too early in the year and expectation that the large and mostly unsold crop would be sold in heavy selling pressure during harvest. Take-or-pay commitments were made throughout the industry with freight and terminal providers to support the large export programs. Commodity prices dropped during harvest, farmers held back selling and used all means to…

Thank you very much, Soren, and good morning everybody. Let's turn to the earnings highlights on slide 4. Reported second quarter earnings per share from continuing operations were $0.48 compared to $0.81 in the second quarter of 2016. Adjusted earnings per share were $0.17 in the first quarter versus $0.79 in the prior year. Total segment EBIT in the quarter was $73 million versus $205 million in the prior year and, on an adjusted basis, segment EBIT was $79 million. The Agribusiness had a weak second quarter with EBIT of $18 million compared to $180 million in the second quarter of 2016. This resulted from a $54 million decrease in oilseeds and a $108 million decrease in grains. Global crush volumes were slightly higher than in the comparable quarter for the prior year, but the increase was more than offset by weaker margins. Margins were negatively impacted by slow farmer selling in South America and ample supplies of soy meal. Results were also negatively impacted by $11 million of mark-to-market hedging losses in the quarter compared to a mark-to-market gain of $40 million in the same period a year ago. Softseed volumes were slightly higher than the comparable quarter last year, but the increase was more than offset by weaker margins. Higher volumes reflected an increase in our crush capacity in the Ukraine. Margins were lower because of tightness of seed supply in Canada and Europe, weaker oil demand in Russia and lower imports into China. The decrease in grains was primarily the result of weaker results in origination and distribution, while volume increased primarily in the U.S., margins remained under pressure in South America and in destinations with customers only covering short-term needs. Overall, Agribusiness results were lower than the comparable period last year primarily, as weaker margins and…

Thank you. We will now begin the question-and-answer session. And our first question will come from Ann Duignan with JPMorgan. Please go ahead.

Yes. Good morning.

Hello, Ann.

My question I think this morning because you get good color on the Agribusiness is around Sugar. Can you talk about how we should be thinking about Sugar EBIT into 2018, given that you were hedged in 2017?

Yeah, I would say, roughly in the same range, maybe a slight reduction depending on how forex and Sugar prices turn out for the balance of the year, but the recent change in the COFINS tax regime in Brazil is certainly an upside in ethanol pricing, that could compensate for a slightly lower New York 11. So roughly the same range for next year, but it's a little bit too early to tell.

Okay. I appreciate that. And then, you did mention variable compensation. Have you lowered your outlook for accrual for variable comp for 2017? And if so, how much has that impacted your financial outlook?

Yeah. I don't have that number in front of me, but we adjust that on an ongoing basis.

So, it would be a positive for 2017?

Yeah. It would be, sure.

Yeah.

Yeah. I mean...

Okay. I'll get back in line.

...all else equal, right. Yeah.

All else equal. Yeah.

Yeah.

Okay. And maybe I can follow-up offline, I appreciate it.

Sure.

I'll get back in line. Thank you.

Our next question will come from Adam Samuelson with Goldman Sachs. Please go ahead. Adam Samuelson - Goldman Sachs & Co. LLC: Yes. Thanks. Good morning.

Good morning. Adam Samuelson - Goldman Sachs & Co. LLC: Maybe first starting on the outlook on soy crush. Certainly, I think the downturn and the weakness that you see in the market year-to-date and even in persisting into the third quarter is far worse than we would have thought 6 months, 9 months, 12 months ago. Can you talk about some of the residual competition from feed wheat, the residual competition from other competing proteins, the demand outlook, is it really just a basis issue on beans in Brazil and Argentina; just help me think about the pieces and the path to getting these margins right side up by the fourth quarter, all the while board crush hasn't been that bad?

Right. Okay, yeah, that's a lot to answer. But I'll try. I think the feed wheat impacts on meal demand in rations is behind us. Wheat prices have rallied significantly and you can see the changes in formulation. The impact on corn and ethanol by-products DDGS is probably more of an issue. But also that is probably peaking. China is the biggest variable in that equation having essentially prohibited or stopped imports of the material back a while ago. And that amount of DDGS has backed up into the global trade system and even domestic consumption in the U.S., and that has eaten on the fringes of soybean yield demand, but I think that is also now more or less fully digested. Overall, protein demand for feed remains very strong whether it is in Asia, Southeast Asia, domestically in the U.S., so the baseline is healthy. It's really a matter of how the industry adjusts run rate to match with meal demand at the moment. We still have an industry that when everything runs at full speed, can produce more than the market needs. We're gradually eating our way towards a better capacity utilization, but when everything runs at full speed, we produce too much, and that is what's happened in South America the first six months of the year, which is what I was trying to illustrate earlier on. That the industry went far too fast in anticipation of a much more willing farmer selling, and as a result, we have built a couple of million tons of soybean meal inventories, partly at the origin, partly at destination, that is weighing on margins. And we have to consume or eat our way into that through more discipline and reduced crush rates over the next – really the next quarter…

Yeah, I don't think it will mean any increase in capital from Bunge side, and we have continued with our, let's say, Fertilizer marketing and barter activities in Brazil even after we sold the business in a partnership with Yara. So, that's working very well, we would like to step that up and we would like to create similar structures with other input providers and we are doing that, but it is more of in the formal basis, I think there is room to do something more structural on that front, but it would not imply Bunge committing more capital, it's simply connecting the dots to the farmer. And coupling that up with risk management tools which we have that would allow the farmer to move his crops during harvest and still retain upside, whether it's from forex, whether it's from global prices post-harvest so that the farmer doesn't have to sit with the physical inventory for extended periods of time, and would hopefully help create more liquidity and more fluidity as harvest progresses. There are many things we can do and we are doing them in pockets. So, this is not something that is entirely new for us, but we feel that we can step it up and sort of create a new and enhanced approach to origination with all those things bundled together. Adam Samuelson - Goldman Sachs & Co. LLC: Okay. I appreciate the color. I'll pass it on. Thanks.

Sure.

Our next question will come from Heather Jones with Vertical Group. Please go ahead.

Good morning. Thanks for taking the question. First, just a detail-ish question. Clearly this environment has been very much in flux and so on, nobody holds you to this, but based upon your view of the outlook right now, when you say weighted to Q4 for both the Food & Ingredients and Agribusiness, are we looking at something like three-quarters of your second half performance will be in Q4, I mean is it that heavily weighted?

Agri is the big question mark obviously. If we talk about Food & Ingredients and Sugar alone, I would say it's probably a 60%-40% split between the two quarters. Ag can really be, I wouldn't say, all over the place, but it's probably about the same proportion at this point, two-thirds in the fourth quarter and one-third in the third quarter, but it can change very quickly. We know that August and September are the months where a lot of origination takes place for new crop in South America. So, many things can trigger a sudden acceleration, let's say in Agribusiness, we still have a good part of the growing season in front of us in soybeans in the U.S., the crop is not made yet. So lot of things can change. I mean, even from early July to now, the environment has changed quite a bit. The first two weeks of July were fantastic and the last two weeks have been more meager. It's very volatile frankly in Agribusiness. So, we're confident that we'll get the bump in earnings. The structural margins should be there, we have a lot of pent-up selling left in South America, and a good U.S. crop, but exactly how that part flows, remains to be seen. I would say, two-thirds/one-third is probably the best guess at this point.

Okay. Thank you. And secondly, if we assume that, countervailing duties are imposed in the U.S. upon Argentina, Indonesia by diesel imports, and also the EU reduces its duties on Argentina ex imports so those start flowing there again, what is your best estimate or what that means for North American crush margins because to meet the mandate and all, there seems like there would have to be a really, really dramatic increase in domestic biodiesel production which would seemingly have a very significant impact on crush margins. So, one, what is your best estimate what that would mean? And secondly, if the EU reduces its duties and Argentine biodiesel starts flow into the EU, that would seem to mitigate some of this impact on Argentina for you guys. So, just wondering, if you could hypothesize for us, just to get a sense of what that kind of scenario would look like for you guys?

Yeah, I think you're right. There will be a net positive to U.S. crush, both canola and soy crush in this mix, not easy to estimate exactly how big it would be and when the impact would be felt. Will it be this year or will it be next year? Part of it would probably be this year. Net-net between Argentina and the U.S., I will say a small positive, but not a game changer, $10 million, $20 million, something like that. And in Europe, you're right, a re-emergence of the flow of Argentina to Europe would be a positive for the Argentine biodiesel industry. We're also invested in European biodiesel so that would take the opposite side of that. That's probably a net neutral. But if you add it all up together, the best case at this point would be a modest plus for us and the size of the impact in this year depends on when these changes come into effect, but I don't think it is material difference.

But you said, I think I heard the number. So it sounds like you would think maybe $10 million net to positive to Bunge on a full-year basis?

$10 million to $30 million, somewhere in that range.

$10 million to $30 million? Okay. All right. Thank you.

Okay.

Our next question will come from Farha Aslam with Stephens. Please go ahead.

Hi. Good morning.

Good morning, Farha.

Can we talk about your Milling business? Historically, it's one of your more stable businesses but this year, Milling was cut in half in terms of expectations. Could you share with us kind of the consumer outlook in both Mexico and Brazil and perhaps when that could recover?

Yes, happy to. In Brazil, which is really where the biggest change has been, we are seeing signs both in terms of unemployment and also retail sales that the economy in all likelihood has bottomed out. So, the impacts at the consumer end should be positive going forward. But in the meantime, we have seen a fairly dramatic cut in consumption of flour-based products, whether it is through food processor sales or whether through foodservice or even household consumption and that'll take some time to recover, 13% unemployment rate is not small. So, I think it'll be with a lag that we see the improvement in flour consumption in Brazil and probably don't expect any real impact until early next year. The thing that has weighed on Brazilian Milling margins as much as the this decrease in overall consumption has been the size of the domestic crop. We had a very large and high-quality domestic crop this past year, which we don't think will repeat itself and that allowed many of the smaller and very fragmented mills in the Southern part of Brazil to compete and send – and market flour into the Central part of Brazil and even to the North, and that pressured margins in our business, which is mostly based on imported week. We think that will change, as we run out of full crop wheat stocks towards the end of this year. So, I think the real impacts on an improvement in Brazil is probably not to be seen until the first quarter next year, although we do expect the sequential improvement from the first half into the second half but sort of getting back to more normal run rates of earnings, we're probably talking 2018. In Mexico, it's not so much a matter of per capita consumption as it has been difficulties in translating the higher wheat prices and the weak currency into higher flour prices in the domestic market. That's taking longer than we expected but I would think that by the fourth quarter, it will be back to the normal run rate. So Mexico should be back to where it was where it should be by the first quarter of next year. So the second half will be better than the first half in Milling, but it won't be back to the historical run rate. We will have to wait until the first quarter of 2018 for that.

That's helpful. And then, you have added in your prepared remarks that consolidation is needed, and you believe it's going to be the regional leadership. Could you share with us some more color on consolidation, and how that regional leadership would work?

Well, I think we have some examples in the last couple of years, but really if you look back at our history, it goes much longer. Many of our activities in Argentina, for example, are in joint partnership, the same in Paraguay. Last year, we formed a joint venture with Amaggi in Brazil, which in many ways accomplishes a type of consolidation by sharing common assets. We did the same with Wilmar in Asia this past year, and we're looking to do more things like that where it's really a win-win, a quick win-win in a fairly straight forward way to achieving rationalization and better utilization of existing assets in all the regions, including the U.S. So those are examples of what I am talking about. They can take any shape and any size as far as I'm concerned, and we're out looking for them and discussing with them on an ongoing basis.

And do you think you can get to kind of what you think is a normalized run rate of profitability without further large consolidation in Agribusiness, or you actually have capacity taken out to address this oversupply situation?

Yeah. We believe we can do that. And we believe soy crush in particular has some very strong fundamentals that should start showing themselves as we get into 2018. So, we're very convinced about that. But the Competitiveness Program that we have initiated now is a way to accelerate towards that goal. It's self-help in a period where the industry is not behaving as we think it should. Although the fundamentals, medium-term, long-term are very favorable. So, we believe that that will be accelerated towards the earnings growth that we all have in mind.

Great. Thank you very much.

Our next question will come from Vincent Andrews with Morgan Stanley. Please go ahead. Vincent Stephen Andrews - Morgan Stanley & Co. LLC: Hi. Thanks, everyone. So, is there sort of a sweet spot range of soy prices and BRL/USD exchange rates that you guys should have identified anticipating a large inflow of farmer selling? Has it been that dynamic that you sort of can look at your screen and see that intersection and expect the flows to improve. And if so, could you help us with a rough range, just so we can sort of be able to monitor that?

I can give you a range the way it is right now, but with the caveat that it could very well change, in all likelihood it would change. But the combination of, let's say, a dollar/real between BRL 2.25 and BRL 2.35 and soybean prices in Chicago above $10 is what created the last big movement that we saw early in July, and it was quite significant and farmers are very responsive in that range at the moment. The other thing that's important is the barter ratio, so the ratio of prices between crops and fertilizer and crop protection and so forth, is actually pretty reasonable. It's better within the last four years. So, when farmers make their planting decisions now in September, they will be looking at a favorable relationship between inputs and crop prices, even if the soya price or the local price is not reflecting the range that I just gave you. So, it's a relative value play of inputs to outputs and that's why we are convinced that we will see another big crop planted in South America and Brazil on even a small amount of growth, even if the current price isn't so sexy, so to speak. Those are the two things to keep in mind. The barter ratio and then there are some triggers in the combination of futures and exchange rate that generate big movements and they are, as I just told you now. That may change as we get towards the end of the year. And I think in particular, as the world becomes, let's say, comfortable with the size of the U.S., crop and the outlook, maybe those ranges will ratchet down a little bit, but that's where we are right now. Vincent Stephen Andrews - Morgan Stanley & Co. LLC: Okay, and just as a follow-up, I think your commentary is interesting on going out and sort of improving the relationship with farmers and maybe wonder, do you think the part of the objective is going to be, as we try to get the farmer to sell on a more regular basis. I mean, do you think you will narrow sort of your range of margin outcomes? In other words you might give us some of the upside in the super tight market, but you might reduce the probability of scenarios like this and ultimately find yourself in a tighter more predictable per ton margin range if you're able to execute some type of better sort of more regular flow of products?

Yeah. I mean, we look at it. I mean, we are in this with the farmer and the farmer has always been as important of a customer to us any of our downstream customers, we look at it that way. And we need to find ways that satisfy the requirements of the farmer and at the same time, allows us to run an efficient operation, earning a reasonable margin that gives us return. And I think that is possible to do with all the various things that we are able to bundle in front of the farmer now and with the use of technology. That should be our objective and it is our objective to sort of reinvent the way that we go to market with the farmer overtime. Each region will be a little bit different but it is a big priority for us. And as we do that, you could take out some of the volatility that we've seen and maybe the way you described the upside is a little bit less but it's more stable. But I think it will always remain very volatile that part of the business. But having gone through this past period, it is certainly healthier for the industry and I think even for the farmer to the extent that it's possible to combine inputs and maybe some of the risk management products that a larger portion of the crop is somehow committed through the system, whether it's through export or through crush before you get into the season so the system is not so subject to the various types of volatilities, whether it is exchange rates or Chicago or even logistics and you don't get the disruptions and the stop and go that we've seen this past year. So that would be an objective, no doubt. Vincent Stephen Andrews - Morgan Stanley & Co. LLC: Okay. Thank you very much.

Our next question will come from Ken Zaslow with Bank of Montreal. Please go ahead.

Hey good morning, everyone.

Hi, Ken.

This may not be a 100% fair question, but I figured I'd give it a shot.

Sure.

In December, you put together your vision for Bunge for the second time. The first time you did it, kind of fell short or did not meet expectations. The new plan is not off to the stronger start. Can you talk about the potential to revisit – to reach your plan, and how did they play out in 2018? You are less confident in how you're developing the plan, and we see noticeable changes in 2018 and can you frame 2018 for us?

Well, there's no lack of confidence in our plan, and the plan we presented in December is intact. The headwinds we faced in the first half of this year have been industry headwinds, and we've, of course, had our proportionate of share of that given our exposure to South America. I think it's all reasonably explainable. But the long-term dynamics of soy crush, which is the one big pillar, is absolutely intact, and I have no doubt about that. And that will – you will see that as we get to the end of the year, and into next. And our commitment to growing our Food & Ingredients business is complete. We've seen great success and improvement in our Global Oils business, which is the one that is more tightly connected with the rest of the Bunge network, with crush and origination, very confident that we can grow that in a significant way. And then we have the competitiveness program, which we have started orchestrating already back at the end of last year, and it's taken shape now as a means to accelerate or at least create a buffer in the period of times where we may be falling short on expectations because of industry headwinds. So, all of that combined gives me great confidence that we're on the right track. As for 2018, I would prefer to hold those comments until the third quarter, but clearly in Food & Ingredients, we would expect a significant improvement from where we are today as milling recovers, oil has done what we expected it to, and a return to more normalized Agribusiness types of earnings, but the range of that, I think is a little bit too early to predict given that we haven't completed the U.S. crop yet, so I'll save that for Q3.

Okay. And my – another question is, again, probably not in the fairness category, but I'll give a try. How do you value Bunge stock particularly given the noise around it as well as your performance? How do you think about how you think of the value of Bunge stock?

Well, I won't give you a number, Ken. But we have and our board has a very good sense of intrinsic value of Bunge based on obviously our own plans and various methodologies of deriving value. One thing we all agree on is that it's undervalued relative to its potential. So, I'll leave it at that.

Okay. Thank you.

Our next question will come from Sandy Klugman with Vertical Research Partners. Please go ahead.

Thank you. Good morning. Could you provide some color on what you're seeing for the soy seed crush. You had some dry conditions in Canada and Dakota and wet conditions in Europe that could impact the canola harvest. And I was wondering how this impacts the outlook?

I think that's all considered within the range that we have given. We have a very large canola crop in the ground, I think it's a record and had ample moisture early in the season now combined with some dryness. It's hard to tell whether we take the yields down a little bit, but overall, it's going to be a very large crop, and likely as large if not larger than last year. And in Europe, Poland where we are exposed to the big crushing activity, and Germany as well, have already had a nice rebound in canola and rapeseed production. So the combined rapeseed, canola crop is up significantly from last year, and that should be favorable as we get into the end of the third quarter and the fourth quarter for sure. Sunseed production on the other hand is down a little bit from the prior year, but last year was an all-time record. I think we're off 1 million tons, but still a very large crop in historical terms. And I'd say the outlook for margins in Hungary and in the Black Sea are favorable.

Okay. Thank you. And then I just want to clarify, how much of the benefit for the competitiveness program are factored into the 2017 revised segment guidance, and how should we think about the allocation by segment?

Tom?

The expectations for 2017 is fairly modest, about $15 million, and it's not actually fully baked into the forecast yet, but it is small. Going into 2018, we expect to realize $100 million, and into 2019, $180 million. So we really start to pick up steam into the next year based on the indirect spend programs that we'll implement over the balance of this year, and then further into 2019, as we start to implement the organizational changes over the course of the next year.

Thank you very much.

Our next question will come from David Driscoll with Citi. Please go ahead.

Great. Thank you and good morning.

Hi, David.

I had two questions. The first one is pretty simple, straight forward. Sale of the company, is this something that is actually possible or – at any price or is it just fundamentally against kind of the desires of management and the board of directors? Just curious on what you can tell us here given, obviously, the news flow during the quarter?

Yeah. I mean, it's fairly simple in the sense that myself and the board takes all responsibility towards shareholders very seriously and of course we will evaluate the best path and that's it. So there's no entrenchment if that's what you refer to.

That's exactly what I'm referring to. Just wanted to ask because I get asked that question repeatedly. And then the next question I get asked and this is going to build on a lot of that's going on the call here, but I want to ask it in a certain way. So you were clearly very positive at the Analyst Day, and then I would just state the obvious for you guys, but maybe not so obvious for some investors listening. This is the biggest Agribusiness company in South America. So I mean, just fundamentally, how does a giant sophisticated industry including Bunge get caught so short on basis in South America, just misjudges so enormously? I mean, it's has been very, very rare. I mean I've gone through, you know I've covered you since you became public, to see two really disappointing quarters in a row. I mean, I can't remember a time in recent history where we've seen that. So there's all these really specific answers you guys are giving about farmer selling and so forth, and I'm just curious like; number one, do you really find like Bunge's performance in the quarter acceptable, given how big and important a player it is? And then, what changed in the years? When I did this company back in 2002-2003 advances to farmers and the fertilizer barter transactions were a really big deal in South America, and I think it gave you a lot of assurances that you would have crop come the harvest. But something feels off here, but we'd love just to hear your kind of big picture thoughts, your opinion on the performance of the business to date, what you expect out of it and what changed?

Well, that's lot of questions in one question, David. But I think to start out with, are we happy with the performance, are we satisfied with the performance in the first couple of quarters? And the answer is, no, we're not. I think we didn't make any mistakes. The margin environment was what it was, but we are obviously not satisfied. I think the one thing that is different in this last six months as opposed to prior periods is that the entire industry got on the wrong side of, let's say, the expected farmer selling and the record crop, but I don't think it was an issue of being short the basis as you referred to it. It was really more being short against other types of commitments, whether it was logistics, terminals. The system was set up for a large and aggressive movement that really didn't take place. But it wasn't related to risk management, which your question would imply. So, I think it was an industry issue. Everybody got caught on the wrong side and didn't have time to catch up, and I would say the role that we should play in this, is to adjust when the markets demanded. So, I think one thing that I alluded to, especially as it relates to crush, where we have a fairly important presence globally, is that we have to be perhaps more agile and more aggressive in proactively adjusting crush rates when we see things panning out differently and anticipate it, and that is something that we are working hard on, and we are actually doing, but there could be perhaps more agility in that equation, that's what the role of a leader should be, and we have to perhaps play that role more forcefully.

Well, thank you so much. I'll pass it along.

Ladies and gentlemen, this will conclude our question-and-answer session. I would like to turn the conference back over to Mr. Mark Haden for any closing remarks.

Great. Thank you, Allison, and thank you, everyone for joining us again this morning.