Welcome to Corteva Agriscience second quarter 2025 earnings call. Please note that this call is being recorded. After the speaker's prepared remarks, there will be a question- and- answer session. If you'd like to ask a question during that time, please press star followed by one on your telephone keypad. Thank you. I'd now like to hand the call over to Kim Booth, Vice President, Investor Relations. You may now go ahead, please. Good morning and welcome to Corteva's second quarter and first half 2025 earnings conference call. Our prepared remarks today will be led by Chuck Magro, Chief Executive Officer, and David Johnson, Executive Vice President and Chief Financial Officer. Additionally, Judd O’Connor, Executive Vice President, Seed Business Unit, and Robert King, Executive Vice President, Crop Protection Business Unit, will join the Q&A session. We have prepared presentation slides to supplement our remarks during this call, which are posted on the Investor Relations section of the Corteva website and through the link to our webcast. During this call, we will make forward-looking statements, which are our expectations about the future. These statements are based on current expectations and assumptions that are subject to various risks and uncertainties. Our actual results could materially differ from these statements due to these risks and uncertainties, including but not limited to those discussed on this call and in the risk factors section of our reports filed with the SEC. We do not undertake any duty to update any forward-looking statements. Please note in today's presentation, we'll be making references to certain non-GAAP financial measures. Reconciliations of the non-GAAP measures can be found in our earnings press release and related schedule, along with our supplemental financial summary slide deck available on our Investor Relations website. It's now my pleasure to turn the call over to Chuck. Thanks, Kim. Good morning, everyone, and thanks for joining us. We plan to update you today on our second quarter and first half performance, share our expectations for the second half of this year, and provide some early thoughts on 2026. In the second quarter, Corteva delivered top and bottom line growth and more than 200 basis points of Operating EBITDA margin expansion. For both the quarter and the half, we saw net improvement in price, volume, and cost versus the same period last year. This should tell you two things. First, there is strong demand for our proprietary technology as our growth platforms continue to deliver. Second, our operational excellence initiatives are creating value. In fact, we exceeded our 2025 net cost improvement target in the first half alone, allowing us to raise our full-year target to $450 million from $400 million. Seed continued its impressive performance in the first half of the year, with 280 basis points of Operating EBITDA margin expansion and pricing gains in most regions. The volume improvement we delivered in North America made a significant contribution to Seed's first half results. We also feel confident that we delivered healthy branded share gains in both corn and soybeans. This is a testament to the Pioneer business model and the strength of our product portfolio. Our outperformance in North America was also visible in our first half out-licensing results, where we achieved a $70 million benefit in net royalties versus prior year, exceeding our own expectations of a $65 million net benefit for the full year. Turning to our crop protection business, as the results make clear, our technology remains critical to farmer productivity. Our global operations are also becoming more efficient, which contributed to over 350 basis points of Operating EBITDA margin expansion for the half. Productivity and deflation benefits, as well as volume gains, drove the largest improvements in crop protection's solid first half performance. The volume improvement was most significant in Brazil, where we saw strong applications on additional planted area, as well as expansion in our direct sales channel. Although the industry is expected to be about flattish overall for the year, our crop protection business continues to navigate a competitive market, and we expect low to mid-single-digit pricing headwinds in the second half of the year. However, it's worth noting that this is now our fifth consecutive quarter of crop protection volume gains, with double-digit volume growth in the second quarter. We are confident we have the right channel strategy and that pricing remains the key constraint to the industry getting back to its normal low single-digit organic growth rate. For Corteva as a whole, we remain on track for double-digit bottom line growth and meaningful margin improvement. In fact, as you saw from our announcement, as a result of our record first half performance and derisk expectations of modest growth in the second half, we are raising the midpoint of our full-year Operating EBITDA guidance to $3.8 billion, a $100 million improvement versus what we guided last quarter. We're also providing a favorable update on free cash flow expectations and forecasting a full-year conversion rate of about 50%. David will go into more detail on all of this in a moment, including our latest views on tariffs and how these updates fall within our 2027 financial framework. Turning now to the market outlook. Overall, ag fundamentals remain mixed. Demand for grains and oilseeds continues to grow as farmers prioritize top-tier seed and crop protection technologies to maximize their yields. However, overall crop prices and margins have moderated. The U.S. mix shift from soybeans to corn played out as expected, and corn futures reflect the fact that crop condition ratings have been running above five-year averages. Time will tell, but the market is certainly expecting a record harvest in the U.S. We all know that the technology keeps getting better, and farmers know how to produce more every year. What is just as important is that global production continues to keep pace with record-setting global consumption, so much so that the stocks-to-use ratio for corn is expected to remain below historical averages, even considering this year's big crop. We're getting close to harvest here in North America, and opening up global markets to allow for trade of these critically needed crops would help American farmers continue to feed the world. Regarding ag policy, we're seeing positive signals on the biofuels front. Corn ethanol in Brazil now accounts for 20% of the country's total ethanol production. In the U.S., the EPA's 2026 renewable fuel standard proposal should spur additional demand for soybeans. On gene editing, we remain optimistic that policy proposals in the EU for this critically important technology will pass by the end of the year. We're also encouraged by the fact that the new tax bill includes several changes that provide additional support for farmers in this very important industry. Finally, a few comments on 2026. It's still early, and we need to see how the full year plays out, but we remain constructive on our views for growth next year, and we are on a path that would keep us well within our 2027 framework, which was set last November. We feel good about what we can control, investing and executing on our growth platforms, as well as delivering meaningful royalty, productivity, and cost benefits on a year-over-year basis. We'll also provide more detail on our views of 2026 on our third quarter earnings call in November. In the meantime, we will continue to deliver top-tier technology that gives farmers a competitive edge in achieving higher yields and greater sustainability in every acre they plant. With that, let me turn it over to David for more detailed insight into our financial results and outlook. Thanks, Chuck, and welcome everyone to the call. Let's start on slide six, which provides the financial results for the quarter and a half. Sales and Operating EBITDA for both the quarter and a half were up versus prior year and better than our latest estimate, driven by a strong finish to North American season and continued execution on controlling the controls. Briefly touching on the quarter, organic sales were up 7% compared to prior year, with gains in both seed and crop protection. Pricing for the quarter was up 1%, with gains in seed partially offset by continued pressure in crop protection. Second quarter volumes were up 6%, with seed gains in nearly every region and double-digit crop protection volume growth led by Latin America. Top line growth and meaningful cost improvement translated into Operating EBITDA growth of 13% in the quarter and 215 basis points of margin expansion compared to prior year. Focusing on the half, organic sales were up 5% over last year, again with growth in both seed and crop protection. A continuation of the price-for-value strategy, along with increased corn acres and market share gains in North America, drove seed price and volume gains of 3% and 2% respectively. Crop protection price was down 2% and a half, as expected, driven by competitive market dynamics, mostly in Brazil. Crop protection volume was up 8%, with gains in nearly every region. Notably, new products and biologicals delivered double-digit volume gains compared to prior year. Operating EBITDA was up 14% over prior year. Operating EBITDA margin of nearly 31% was up about 300 basis points, driven by organic sales growth coupled with significant benefits from lower input costs and productivity. Moving on to slide seven for a summary of the first half Operating EBITDA performance. Operating EBITDA was up more than $400 million to just over $3.35 billion. Price and mix, volume gains, and cost benefits more than offset currency headwinds. Seed continues to make progress on its path to royalty neutrality with about $70 million in reduced net royalty expense. This improvement was driven by increased out-licensing income in North American corn and lower royalty expense in soybeans. Seed and crop protection combined to deliver more than $400 million in productivity and cost benefits, including lower seed commodity costs, raw material deflation, and continued productivity action. In the first half, SG&A was up compared to prior year, driven by higher commissions, compensation expense, and bad debt. This increased investment in R&D aligns with our target and is on track to reach 8% of sales for the full year. As expected, currency was a roughly $150 million headwind on EBITDA, driven by the Turkish Lira and Canadian Dollar. Both seed and crop protection had an impressive first half performance and delivered double-digit EBITDA growth and meaningful margin expansion over prior year. With that, let's go to slide eight and transition to the updated outlook for the year. Our updated 2025 guidance reflects the strength of our first half execution and continued confidence in delivering the second half. We now expect Operating EBITDA in the range of $3.75- $3.85 billion, representing 13% growth at the midpoint. This increase is driven by broad-based organic sales momentum and incremental cost improvement benefits. While the majority of cost actions were realized in the first half, we anticipate continued gains in the back half. As a result, we now expect Operating EBITDA margin expansion of approximately 150 basis points, reaching the upper end of our prior range. We're also raising our operating EPS guidance to $3- $3.20 per share, up 21% at the midpoint versus last year. This reflects stronger EBITDA performance and lower than expected net interest expense. Finally, we are increasing our free cash flow guidance to approximately $1.9 billion, with a cash conversion rate of about 50%. This improvement is primarily driven by earnings growth and lower cash taxes from recent legislation. We're keeping an eye on a few items as we head into the second half, specifically farmer economics and liquidity, as they influence the amount of prepaid deposits we receive in the fourth quarter. Let's turn to slide nine to walk through the key drivers of our first half performance and the setup for the second half of the year. In the first half, we delivered strong execution across both seed and crop protection. North America's seed performance was particularly strong, supported by increased corn acreage, market share gains, and favorable weather. We saw low single-digit price gains in seed, while crop protection pricing was down modestly, reflecting ongoing competitive dynamics. We captured meaningful benefits from controllable levers, namely productivity actions and raw material cost savings, which more than offset SG&A increases tied to commissions, compensation, and bad debt. Currency remained a headwind, primarily driven by Turkish Lira and Canadian Dollar. Looking ahead to the second half, our assumptions remain consistent with what we shared in May. We expect corn acreage to increase in both Brazil and Argentina, supporting volume growth in both businesses. Volume growth in crop protection is expected to remain strong, particularly in new products and biologicals. On pricing, we anticipate low single-digit gains in seed and low to mid-single-digit declines in crop protection. That said, the magnitude of cost and productivity benefits will moderate in the second half as we lap the deflationary impacts we saw in the second half of 2024 on crop protection. Finally, we expect a currency headwind from the Brazilian Real due to hedge impacts. Our first half, second half Operating EBITDA split is expected to be aligned with our historical average. As a reminder, we anticipate a typical seasonal earnings pattern, with a third quarter Operating EBITDA loss at least as large as what we saw last year, and all second half earnings delivered in the fourth quarter. This is after dialing in an expectation that crop protection second half EBITDA will be down high single digits due to an exceptionally strong second half in the prior year. Overall, we still remain on track for mid-single-digit growth in the second half. With that, let's go to slide 10 and summarize the key takeaways. First, while we still have half of the year left to go, we delivered a strong first half ahead of expectations. Organic sales growth was driven by our leading North America corn portfolio and broad-based volume growth for crop protection. We delivered over $400 million in cost savings from lower seed and crop protection raw material costs, along with productivity actions. The combination of organic sales growth in both business units, $70 million in net royalty improvement, and enhancements in our product mix contributed to about 300 basis point margin expansion over the prior year. Given our strong first half performance and continued confidence in the second half, we've raised our full-year 2025 outlook across all key financial metrics. We also remain on track for $1 billion of share repurchases in 2025. We also announced a nearly 6% increase in the annual dividend, our fifth consecutive annual increase, consistent with our dividend growth strategy. Combined, this translates to roughly $1.5 billion of cash returned to shareholders during 2025, a testimony to the strength of our balance sheet and cash flow outlook. With that, let me turn it back to Kim. Thanks, David. Now let's move on to your questions. I would like to remind you that our cautions on forward-looking statements and non-GAAP measures apply to both our prepared remarks and the following Q&A. Operator, please provide the Q&A instructions. Now opening the floor for a question- and- answer session. If you'd like to ask a question, please press star followed by one on your telephone keypad. Please limit your one question to one question only. Your first question comes from the line of Vincent Andrews of Morgan Stanley. Your line is now open. Thank you and good morning, everyone. Just sort of distilling the prepared comments down, it seems like there are four sort of items for the back half that are really factoring into your forecast and that you have sort of a focal point on. One would just be the tough crop protection comp and the negative pricing in Brazil, and obviously Brazil is a big part of the back half. It seems like, and I'd like to hear more about the seed acreage expectations for the back half and how much you think they can be up year- over- year. Then on a cash flow perspective, the prepays and whether they come in, and obviously what happens with that fact. If you put all that together, is that sort of how you're thinking about the range of outcomes in the back half and whether you're at the low end or the high end and potentially above the high end? Yes, good morning, Vincent. This is David. Yeah, pretty much I think you summed it up pretty well. I mean, when we look at the year- over- year in the back half, I just remind everyone that I know you know this, but our back half typically is only 12% or 13% of our entire EBITDA for the year. This year we have it kind of lined up very much in line with what we've done in prior years. When you look at the plus minus on crop protection, they did have a very strong second half last year. We're lapping that. We're also lapping some of the cost deflation we already saw in the second half of last year. As you mentioned, the price declines. We also have the FX impact, which is a little bit 2/3 of 70% allocated to crop protection, just given their product flows. Regarding acreage, I don't know, Judd, if you want to pick up the acreage for seed. Yeah, Vincent, I think it's fair to say we're looking at mid-single-digit acreage increases for summer, which will start going into the ground here in October, as well as as we move into Safrinha, which a big portion of those Safrinha orders that'll go into the ground in 2026 will be realized here at the end of 2025 from a revenue recognition standpoint when growers take possession. We also see a little bit of a rebound, mid-single digits. We're confident about maybe a little more in Argentina, coming off the down acres that we saw in 2024 and the first part of 2025. Should be in a strong position acreage-wise and planted area-wise, I should say hectare-wise and planted area-wise in Latin America. Next question comes from the line of Joel Jackson of BMO. Your line is now open. Hi, good morning. Thanks for the update. I want to start with the free cash flow conversion or the free cash flow guidance. Obviously, on the $100 million EBITDA raise, you're upping free cash flow by $300 million. The conversion's better. Talk about what's going on specifically there. The second question is, $100 million, you know, EBITDA increase here. You sort of alluded to a little bit about 2026. Some of that, can we assume you may have gotten in 2026? The The $100 million boost here? Maybe just think about how you think about if you borrow, not borrow, but got a little early advance on some earnings in 2026. Okay, yeah, we'll have David talk about it. I'll do the cash flow. I can come back and give you perspectives on 2026. Right, so you know if we look at where we are right now with cash generation through the first half, we are $900 million ahead of last year. We expect, as you mentioned, the free cash flow somewhere around the $1.9 billion. The adjustment to the overall guide is really twofold. One is our earnings increase that we increased the midpoint of our guide. Also, with the new tax legislation, we are expecting less cash taxes in 2025. That represents about a 4% uplift in our overall conversion rate. When you end up adding those two factors together, we're now expecting about a 50% conversion rate for the year of $1.9 billion. I will remind everyone that in the way that looks on our balance sheet is not that we're accumulating cash on the balance sheet. It really represents itself in lowering our needs for borrowing more CP. In the first half, you'll see that we borrowed a lot less commercial paper, resulting in lower interest expense. That's one of the major drivers of our overall first half EPS increase. I also reminded everyone that our $1.9 billion is very much dependent on our cash credit mix at the end of the year. We have dialed in a number that's very similar to past years. As you know, we'll keep an eye on that as we progress through the fourth quarter. Yeah, and Joel, it's Chuck. Talking about 2026, it's a little early. I would say right to your question, though, there's been no pull forward from 2026 into 2025. I'll just take everybody back to the financial framework we set last November on an EBITDA basis. We're trying to deliver a $1 billion increase over three years. This guide range now at when we moved it from $3.7 billion - $3.8 billion from a midpoint perspective, we're right within that framework. If you look at the levers that we're pulling to create that $1 billion, they're the same things we've always talked about. They're the three primary growth platforms. You're seeing really good growth in seed out-licensing, our biologicals business, and our crop protection new products. They're delivering, they delivered a little bit more across the board in the first half. We feel good about the next 2-3 years. Cost and productivity, which is really, I think, one of the main headlines for this first half. Both the crop protection business and the seed business almost equally are pulling every productivity lever they can. We've got a multi-year program. As you know, we're looking at kind of restructuring assets and crop protection. We're really looking at the production and automation of our seed production. You can see for the first half, $400 million, we've raised that now to $450 million for the full year. If you look at what we need to deliver through 2027, it's about $700 million of the $1 billion is going to come out of this bucket. If we're at $450 million, we're feeling very, very good about that. You put it all together and I'd say I'm pretty happy with the first half performance. I think when you think about the second half, it's less relevant for us, but we need to get through Latin America, specifically Brazil. The order books are looking very, very good. I think our cost setup in seed particularly is great for the second half Latin America, and it's going to come down to crop protection pricing, but we're well within the framework for the next two years. The next question comes from the line of Chris Parkinson of Wolfe Research. Your line is now open. Thank you so much for taking my question. It seems the U.S. seed price cards are already trickling out from you in certain cases and some of your competitors, and it seems like it's indicating low single digits for both corn and soy, maybe a little bit healthier on the corn side. Could you just discuss kind of the pricing strategy into the end of the season and also how those embed and how your expectations on a preliminary basis would embed the ramps of both Vorceed and PowerCore, just given your confidence in those launches as well? Thank you. Go ahead, Judd. Okay, thanks, Chris. This is Judd. As we are launching price cards, you've probably seen some of our brands are in the market. We certainly see some competitors in the market as well. A couple of things from a North America perspective. One, mix is in mix improvement with Vorceed and PowerCore. Number two, germplasm performance and the fact that we've continued to bring genetic gain and new hybrids into the lineup that allows us to leverage more price, and farmers are more than willing to share in that as we bring higher levels of productivity. There's a little bit of organic price lift in there as well. The combination of those will get us to low single digits. That may be about where we were in 2025, maybe a little more dependent on how the year plays out, but we feel very good about what 2026 looks like from a pricing opportunity in our mix. Yeah, and maybe Chris, just a couple of other comments. If you look at the first half for seed, right, EBITDA is up $250 million, 11%, with 280 basis points of margin enhancement. We're seeing market share gains in corn and soybean, which we're already number one in both of those technologies. You start thinking about just this business is firing on all cylinders. When you add to the mix, which gets us most exciting, is the growth of the out-licensing and the potential for that, right? We've already sized that in corn and soybeans around the world, primarily in North America, Latin America. It's a $4 billion opportunity. We're a relatively small player. We've said we would be royalty neutral by 2028. Really exciting things happen post-2028 as we get more licensing income because we have more freedom to operate for our technology. I think we're on this really interesting strategic pivot when it comes to seed where we're not in-licensing technology as much as we're out-licensing technology. That's sort of the long-term goal for this business. Your next question comes from the line of Kevin McCarthy of Vertical Research Partners. Your line is now open. Yes, thank you and good morning. I wanted to unpack the crop protection volume a little bit. I appreciate the details that you provide on slide 17. In particular, I want to dive into fungicides, which was up 40%. Can you help us understand how much of that was market-related versus your ramp of picolinamide products? I think you're still ramping on Inatreq to some degree and a more recent launch of Adavelt would be the first part of the question. Looking ahead to next year, you entered into a partnership recently with FMC for Fluindapyr. Maybe talk about what that might mean for Corteva in fungicides next year. Go ahead, Robert. Yeah, thank you. When you look at fungicides for the first half, we had a good half. I'll take you back to 2023 where prices really started falling. We decided not to participate in some of the business there due to really low margins. Our strategy has been to take out cost and to begin to change our overall footprint and network. That's working for us. This is a good example of that where we now went back into the market at acceptable returns with our On Mera brand. We've been able to get back in the market there in Brazil. That's been the big uptick of fungicides for us in the first half here, our strategy playing out and we're in the market with good volume there. Looking now to the back half of the year and into the future, we did do a deal with our partner FMC or a competitor FMC for a brand Forcivo. It is going to be a new three-way fungicide that we've not participated in this market before in North America corn. It gives us a premium product to be able to position with our overall portfolio. We have a very good two-way approach, but this now gives us a top tier as well. This is exciting for us in the fact that we think we can scale this and we'll be able to get on a lot more acres to give our farmers more choices as we look forward in our overall portfolio there with fungicides. It's exciting times as we begin to bring some of these new products to market for crop protection. Thank you. Next question comes from the line of Frank Mitsch of Fermium Research. Your line is now open. Good morning and congratulations on a very strong quarter driven partly by share gains. I was wondering if you could opine on what your expectations were for share gains in both corn and soy. I wonder to what extent, you know, given the fact that we are looking at a potential record harvest in corn, obviously that's driving the price of the commodity lower. Chuck, how do you feel about what impact that may have on 2026 corn acres? Yeah, why don't we have Judd talk about performance and the share gains, and then I'll come back and talk about the market. Very good. Thanks for the question, Frank. From a share gain perspective, we still have to get to the final numbers in terms of where we landed with acres. It does feel like the number we have out there with USDA at 95 makes sense. If you look at what our volume is versus where we believe acres are planted, we've picked up share in both corn and soy. Very, very strong performance on the soy side with not only our Z Series beans and our Pioneer brand, but our regional anchor brand is performing very, very high. We are providing our licensees with some of the very best germplasm and product performance in the industry on soy. When you think about PowerCore, performance again has allowed us to continue to pick up share. We've clearly taken a leadership position in the above and below ground protected market. Our doubles or above ground performance has been exceptional. We're excited. Maybe one other piece, our retail partners with Brevant and the initiative and strategic plant play that we had in terms of entering that retail space with a premium brand has had tremendous success as well, and they picked up some share here in 2025. Feel good about where we're at, Chuck. Yeah, and then Frank on the fundamentals. If you think about what's happening, it's another year of record demand in terms of consumption for grains and oil seeds, and we've had very good production. Production is keeping up with demand, which is good. Stocks to use around the world, especially if you look at corn, it's tight, even though the market is expecting a big crop from the U.S. and a big crop from Lat Am. It's pretty interesting because you've got relatively low crop pricing today, but the stocks to use are not going up. Any wobble here when it comes to either total production or even China buying behavior, because right now they're not really buying a lot of product yet, this could actually go the other way and you could see even further strength in the ag fundamentals. We're watching it very carefully. It's a little early to call 2026, but if you look at the futures price today, it would be a flip of a coin, right? What the prevailing thinking is, and we would agree with this, is that you're probably going to see slightly less corn area and probably slightly more soybean area. The U.S. is going to plant 180 million acres of both. I think what the determining factor will be, of course, will be economics at the time. We also have to watch the trade discussions that are happening right now, and geopolitics will play into this because we do need some trade routes to open up, particularly for soybeans. That will weigh on farmers' planting decisions as we get through harvest and into next year. Time will tell, but that's our current thinking today, Frank. Next question comes from the line of David Begleiter of Deutsche Bank AG. Your line is now open. Thank you. Good morning. Hey Chuck, just on CP pricing, can you talk to what you're seeing in terms of the price of Chinese and Indian generics? Overall, are you seeing CP pricing in the back half get any worse or just more stabilized here? Thank you. Yeah, why don't I have Robert talk a little bit about what he's seeing in the markets, and then I'll come back with just a few high-level comments on the CP market generally. Go ahead, Robert. Sure, David. CP pricing, as you've seen, you know, we think we'll finish the full year at low single digits. Second half, we're really focusing a lot on Brazil. I'll take you to, before we get to that, just the first half. You know, pricing in all regions was relatively flat with the exception of Brazil. The second half of our business is primarily Latin America. Brazil is a big piece, so we're watching this. Imports are up a little bit in Brazil, but we're seasonally high, headed into the season. The channel is full as expected. Ample supply. With the economics in the area, we're continuing to have pricing pressures with competition as well. It's an area that we're watching. Yet, as you look at the year- over- year, as we approach 2026, quarter- to- quarter or quarter- over- quarter, the pricing improves. It is not as much of a decrease as it has been in the past, and we think it continues to get better as we move forward. I'm still bullish on it a little bit because I do think that pricing does continue to get better as supply tightens up and as exports out of China continue to be stable. From From a pricing standpoint, they are low, but they're stable. Those are signs of movement in the right direction. Chuck, something to add? Yeah, so look, David, if you think about the CP market fundamentals overall, we all know it's a well-supplied market, but it is improving. The overall market, at least the way we're looking at it, is slowly improving. In most of the major markets, the destocking is well behind us. We said that last quarter, I think. We're seeing the channels, all channels, be very healthy. We're watching pricing very, very carefully. In most major markets, it has stabilized. In some markets, pricing is starting to go up after several years of declines. Robert called out, you know, Brazil is probably the area where we have the most concern. It's probably the most competitive market in the world right now when it comes to CP. Obviously, when we dialed our thinking into our guide, we said that the second half pricing will probably be down low to mid-single digits in Brazil. The early signs, if you look at sort of the leading indicators, China generic pricing for four quarters now in a row, the pricing is stable. It's no longer going down for almost a year, which I think is great. Production in China, the inventory in China is actually improving as well. There's less products that are being exported. All of that leads me to believe that 2026 should be better than 2025. We don't have a great insight until we get through the first or the second half in Latin America. We'll update the market as we learn more. That's our thinking right now with the CP ag fundamentals. Our next question comes from the line of Jeffrey Zekauskas of JPMorgan. Your line is now open. Thanks very much. Two-part question. Can you talk about how tariffs have affected your supply chains, that is, with different tariff issues arising? What are you doing different in terms of sourcing and in terms of shipping? For David, inventories really look like they're in pretty good shape, where year- over- year they're down $600 million, and they were down sharply in the first quarter. By the end of the year, do you think your inventories will be much lower than they were last year? I'll take the first part of that one. Talk a little bit about what we're doing from a supply network to work through these challenges. I think as you look at the overall supply chain for Corteva, recall that we've started in on this strategy a few years ago to improve our resiliency. In doing that, we've been working on increasing our multi-sourcing, and as you know, this is not a fast process with regulatory requirements. As you move a source, you have to get it registered, and it does take some time. We're making great progress there. From a tariff standpoint, we've been able to navigate the water so far. The impact is, I'm going to call it minimal from an overall standpoint. That's really because our supply chain teams have been hard at work well in advance of this. I'd like to say we're that smart, but we were ahead of this before it ever started. We're in a pretty good position from a multi-sourcing standpoint. We don't see a big issue right now as it stands from what we know today. I think we're in a pretty good position to manage these things as we move forward. Jeff, regarding inventory, yes, thanks for pointing out the fact that we are in a very good trajectory so far this year. We do expect the back half of the year to add some working capital. We've had a really good run so far in the first half of this year, but by the second half, we expect inventories to be around flat to prior year, maybe down slightly from where we were in 2024. Next question comes from the line of Richard Garchitorena of Wells Fargo. Your line is now open. Great, thanks for taking my question. Chuck, given the strong first half of the year and the race to fully your guide, I was curious your thoughts in terms of where do you think the market has really surprised you since the Investor Day and since you set the targets for this year? You talked about the progressing ahead of schedule on the net royalties as well as on the cost side. Any chance we could see a pull forward in terms of those targets? You mentioned $700 million in cost. Can we get there sooner than originally thought? Same question in terms of the net royalty neutrality target of 2028. Can we get there ahead of time? Thanks. Yeah, good questions, Richard. Look, on the net royalty, we've already pulled it forward, right? It was end of decade 2030, now it's 2028. We're feeling very confident around that timeline, and I think that the first half performance would be reflective of that at that timeline. From an overall market and what has surprised us, I think we've all kind of been focused on the growth platforms the way we've outlined them. If you've heard me talk before, I'm a big believer in controlling our controllables. The growth platforms are what we can control. The new products, I think, are performing well in crop protection. The out-licensing, there just seems to be a lot of interest in the major markets to have another set of technology in licensors' hands. I think that that's really good. We're going to go as fast as we possibly can. We've already pulled some of that, I think, forward a little bit. When you start thinking about the other surprising area, though, it is crop protection. When I look at this year's market being flat, our business is going to be up. I think that is some of the hard work that Robert just described, which is on the cost and productivity front. Where I think we've probably seen the market in crop protection be at the low end for a little longer than we all expected, even though I just said it is getting better and we believe it is getting better, I think we've been able to find ways to offset that with the levers we can pull, namely on cost and productivity, and then leaning into the strengths of our technology. The formula is pretty boring, but it's one that has worked for us and will continue. When I look at the targets, all I'll say is that there's a wide range there and we feel comfortable that we're well within that range today. We'll continue to update you as we learn more through the business operations. Our next question comes from the line of Kristen Owen of Oppenheimer. Your line is now open. Hi, good morning. Thank you for taking the question. I wanted to ask a little bit about your second half seed assumptions. Just as we're shifting to Brazil in this half, you mentioned order books are looking healthy. Can you maybe articulate a little bit more on some of the velocity of those order books? Specifically on your seed assumptions, it does look like the price expectations are maybe down a little bit more. I think previously you were low to mid-single digits, now we're plus low single digits. Just off that easy con, help us understand the moving pieces around seed pricing in the back half. Thank you. Hi Kristen, this is Judd. Thanks for the question. For the seed business, the second half is really all about Latin America. A couple of things going on there. Let me start with Argentina. We've got some product that shifted out of the first half into the second half as Argentinian growers have gotten to a just-in-time type purchase pattern. Credit has been somewhat of an issue, and with currency more stabilized, you can see the Argentinian farmer just buying closer to when they actually need it versus there had been a few years where they were purchasing well in advance where their need was because of some currency hedge. We feel good about area recovery. We feel good about our current position. Full transparency, our product portfolio in Argentina is not where we want it to be today. We've made great progress, but it's going to take us another year or two to bring products through the pipeline. We feel good about what we've got coming, but the team is doing a great job of finding their way on the right acre where we can perform for farmers. We've got a little bit of a gap we're working on. If we move to Brazil, if you look at the summer crop, we've got right at 90% of the orders in hand. We're sitting almost 40% of orders in hand for Safrinha, which is unusually well ahead of pace for this point in time. As far ahead as we've ever been for whatever reasons, we've got growers committing up front for product that they're going to plant in January. We feel good about that. Low single digits feels about right from a pricing perspective. It's a very, very, very competitive market. Two months ago, there was a really strong corn position with local market prices and demand. That's softened a bit, but it's still very good. We expect mid-single digit increases in summer acres as well as Safrinha acres. Maybe one point to add, we've seen summer acres or summer planted area declining for a number of years, the last decade or so. It's just now that we're starting to see that planted area increase for summer crop as well. Good picture. Now we have to execute. Thanks for your question. Next question comes from the line of Aleksey Yefremov of KeyBanc Capital Markets. Your line is now open. Thanks. Good morning. You mentioned some upwards movement in terms of generic products in China and somewhat restricted production there. Are you seeing any interest in your products as an alternative to China generics, maybe somewhere else in the world? Yeah, Aleksey, thanks for the question. When you think about China, there's a few things going on here. First, let's go back to a little bit of where we had a lot of excess production. I believe what Chuck's referring to there is we feel like production is tightening up, getting back to more in balance, moving in that direction. As far as the exports go, most of it is impacting Latin America right now. We are starting to see a little bit into Eastern Europe, but it's manageable and not that much different than normal. It just has a little more noise because of just the climate of the world. Primarily, it's a Latin America phenomenon. Asia has always been a big generic market, so it's nothing new there. Our focus is really on Latin America. The other regions are about normal, and we don't see any big disruptors happening in those regions. I think the one key thing to call out is we don't go head-to-head with the generics. We don't have to. We have different customer bases, and usually the customers that we're selling to, we have a direct model, as you know. We rely on that a lot. The customers that we're selling to want differentiated technology. What the generics do, though, is they provide the floor. If the floor is stable, that helps everybody. It is less of a competitive issue for us and a substitution of product. It helps to understand sort of the overall health of the market. Question comes from the line of Matthew DeYoe of Bank of America. Your line is now open. Thanks. Good morning. I have two. The first is I can guess what your answer is going to be here, but would you say you benefited at all from the absence of Dicamba this year? You know your thoughts on the potential return next year, given some new registrations maybe moving through the pipe. As we look at the margin in crop protection, year- over- year, it's pretty impressive, and you discussed a lot of the productivity benefits are resonating here. If we think about how that margin should translate to 3Q, can we keep a lot of this traction, or are there going to be givebacks here, depending on mix? Okay, let's start with Judd for Dicamba. Okay, thank you, Matthew. Maybe just a few comments. EPA did take an action here at the end of July. There's a 30-day comment period on a potential return of a Dicamba label. We'll see how that goes, how restrictive the label is or not, and if that'll be available for growers. Let me just put up maybe a sidebar coming here. We advocate for growers having all the tools that they need to be productive and manage their crop. That being said, if you think about how Enlist E3 and Enlist entered the market, we were making big penetration and market share gains while Dicamba was still labeled. When we lost the label for Dicamba, I'm sure that there was a bump there to some degree, but we still had Dicamba-resistant beans that were going in the ground and just choosing different herbicide packages. I guess we don't have any big concerns that a Dicamba label returning is going to have any material impact that we're going to have to deal with. Germplasm still matters and is a really big deal. Our performance in our germplasm on the soy side is best in class, best in the industry right now in North America. I think that all of our brands and licensees would agree with that. We're sitting again just north of 65% penetration with Enlist. Heavy weed control season with all the rains that we had and multiple flushes of weeds. We believe that our spray rate is still 70% or above. We'll see when the market research shakes out on that, but probably more than you wanted for the Dicamba answer. We feel like we're in a strong position. We can compete well going into 2026 and beyond. Next question comes from the line of Patrick. Go ahead, Robert. Answer the crop protection margin question. On the CP margin, let's talk a little bit about how we see us tracking to the 2027 deliverables and what that looks like. First of all, if you recall last year, we put more money on the table from a cost reduction standpoint. To deliver by 2027, we'll be in the neighborhood of $300 million. That work is continuing. As you build out the margins, we are continuing to get to a capital-light, lower manufacturing cost base than what we've been in the past. We think that continues to help us with margins as we move forward into the future. As I said before, a lot of work was started there early, and we're continuing that as we look forward. The other thing I think about when I talk about margins for this business is really our growth platforms of new products and biologicals. Keep in mind that when you think about our differentiated portfolio, we're about 2/3, a little over 2/3 differentiated in our portfolio. What that means for us is in that part of our portfolio, our gross margin is somewhere about 15% above our overall average. That gives us good uplift. That's where our technology lies. As Chuck talked earlier, there is a lot of demand for our technology. Farming is getting harder. The farmers need more tools to be able to combat all the things they're seeing. There's a lot of resistance growing in weeds. Pests are increasing, especially in Latin America. It's getting more intense. There are new things showing up. I'll talk you to a couple of things that we're going to be launching. Haviza, soybean rust product that'll be launching in Brazil. This is a major market for us. We think this is a blockbuster molecule that will peak out around $500 million as peak revenue. We're bringing new technology over the next few years. Reklemel, another one that we just launched, but we just got permitting for it in California. This is a nematicide that is novel from the standpoint that it is selective with the bad nematodes and keeps all the good things in the soil. Again, new technology that adds value on the farm that is helping not only our margins, but it's helping the farmers in their returns as they grow. Biologicals, this is one really can't talk enough about from a standpoint of where are we going in the future of ag. Today it's about 10% of the overall market of the world. We think it will grow up to around 25%- 30% over the next decade. Keep in mind, this is a part of the business that's growing faster and has higher margins because of just the value it puts on the farm when you begin to use this in the right way. Our portfolio makeup is advantageous to us from a margin standpoint as we progress. As we begin again to keep taking costs out, we think we're in a really good position as we walk into the second half and then on to 2027. Hope that helps. Comes from the line of Patrick Cunningham of Citi. Your line is now open. Hi, good morning. Just on the realization of COGS benefits from seed commodity cost deflation, how sizable has that benefit been in the first half of 2025? Should that still be a sizable benefit in 2026 given the direction of grain prices? Thanks, Patrick. It's David. I would say that we're slightly ahead in total for our net cost improvement in seed, and some of that is definitely the commodity impact. I think we'll remind everyone that that commodity runs through our P&L over a 2-3 year period. It has to do with commodity hedges and our inventory positions and so on. If you step back and think about the $700 million net impact for a three-year plan, half of that being seed, I would say that that lines up pretty well and gives us a little bit more confidence in that plan for the next 2-3 years. Our final question comes from the line of Edlain Rodriguez of Mizuho. Your line is now open. Thank you. Good morning, everyone. Chuck, you've been involved in all aspects of the crop market. Your insights here are really appreciated. There's clearly a disconnect between crop prices and input costs, right? How does that disconnect get corrected? Will there have to be a correction in input prices? Related to your company, how can seed prices continue to move up in that environment? Yeah, good morning, Edlain. I wouldn't say there's a huge disconnect. Look, we watch farmer margins very carefully. Today, I'd say if you just take the U.S. farmer and say the Brazilian farmer, they're operating in a market that they've seen many, many times before in their history, right? We have relatively low crop prices. If they own their land, they're still quite profitable. If they're renting land, margins are quite thin. In some cases, depending on productivity, they could be negative. They will farm like that all day long. I just spent most of the spring season traveling through Argentina, Brazil, Canada, and of course, through the U.S. Every farmer that I talked to wanted more of our technology, especially when it comes to seed technology. They need the yield when things are this tight. They really need the yield. It could be the difference between being profitable and not being profitable with a few bushels per acre. As long as we have the price for value, in other words, we bring genetic gain to the farm. That's our promise to the farmer, right? If you buy our new products, yes, they may cost you more, but you're better off financially. It's a very simple process. I'm actually very hopeful that we will just continue with this strategy because farmers are asking for it. In fact, I'd say farmers want us to take the returns from our seed and put it back into our R&D pipeline. They know that that's not free. I think we've got a great view here. Do we all wish that crop pricing was a little higher? Absolutely. Like I said, I've got a view today that the fundamentals of this business are actually stronger than the crop pricing. What the market is expecting is a huge crop. The trade uncertainty is also weighing on the futures price. We'll know a lot more, I think, in the next quarter or two. With the consumption continuing to increase, I think that over time, this thing will normalize. I haven't met one farmer that doesn't plan to increase their production and productivity over my travels this year. Hopefully, that helps. That concludes our question- and- answer session. I'd now like to hand the call back to Kim Booth for final remarks. Great. That's the end of our call. We thank you for joining and for your interest in Corteva, and we hope you have a safe and wonderful day. Thank you for attending today's call. You may now disconnect. Goodbye.