SLC Agrícola S A : Release 1T24 versão ENG

GENERAL INFORMATION

Porto Alegre, May 08th, 2024 - SLC AGRÍCOLA S.A. (B3: SLCE3; ADR: SLCJY; Bloomberg: SLCE3BZ;

Reuters: SLCE3.SA) announces today its results for the fisrt quarter of 2024. The following financial and operating information is presented in accordance with International Financial Reporting Standards (IFRS). The information was prepared on a consolidated basis and is presented in thousands of Brazilian real, except where stated otherwise.

In this Earnings Release, the terms below will have the following meaning:

"1Q23 Published": means the data, based on the consolidated interim financial statements, that consider the operations of the Company and its subsidiaries for the first quarter of 2023 (January to March) before the reclassification of soybean and cotton seed, previously recorded in the other crops account, which occurred from 1Q23.

"1Q23 New": means the data, based on the consolidated interim financial statements, that consider the operations of the Company and its subsidiaries for the first quarter of 2023 (January to March) after the reclassification of soybean and cotton seed, previously recorded in the other crops account, which occurred from 1Q23.

"1Q24": means the data, based on the consolidated interim financial statements, that consider the operations of the Company and its subsidiaries for the first quarter of 2024 (January to March).

"HA": Horizontal Analysis; refers to the horizontal percentage variation between two periods.

"VA": Vertical Analysis; refers to the percentage share of the account over a given total.

Cotton seed: Seed of cotton intended for planting cotton crops

Cottonseed: Sub-product from the production of cotton used for manufacturing vegetable oil and animal feed.

Disclaimer

We make statements concerning future events that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our Management and on the information currently available to the Company. Forward-looking statements include information on our current plans, beliefs or expectations, as well as those of the Company's directors and executive officers. Forward- looking statements include information on potential or assumed operating results as well as statements that are preceded, followed by or include the words "believe," "may," "will," "continue," "expect," "project," "intend," "plan," "estimate" or sithdar expressions. Forward- looking statements and information provide no guarantee of performance. Because they refer to future events, they involve risks, uncertainties, and assumptions and as such depend on circumstances that may or may not occur. The Company's future results and creation of value for shareholders may differ significantly from the figures expressed or suggested in the forward-looking statements. Many factors that will determine these results and values are beyond our capacity to control or predict.

1

FINANCIAL HIGHLIGHTS

(R$ thd)	1Q23	1Q24	HA
Net Revenue	2,219,315	1,956,914	-11.8%
Gross Income	1,167,786	646,216	-44.7%
Gross Margin	52.6%	33.0%	-19.6 p.p
Operational Result	973,276	498,521	-48.8%
Operational Margin	43.9%	25.5%	-18.4 p.p.
Net Income	574,975	228,943	-60.2%
Net Margin	25.9%	11.7%	-14.2 p.p.
Adjusted EBITDA	989,955	704,223	-28.9%
Adjusted EBITDA Margin	44.6%	36.0%	-8.6 p.p.
Cash Flow	(442,556)	(195,749)	-55.8%

Invoiced Volume (tonnes)

Crops	1Q23	1Q24	Δ%
Cotton	50,790	77,030	51.7%
Cottonseed (cottonseed + cotton seed)	53,457	76,093	42.3%
Soybeans (commercial+seed)	605,885	507,626	-16.2%
Corn	59,476	29,252	-50.8%
Other Crops	7,503	13,021	73.5%
Cattle Herd (head)	3,471	6,602	90.2%

Gross Income by Crop - R$/tonnes

Crops	1Q23	1Q24	Δ%
Cotton	2,570	5,299	106.2%
Cottonseed (cottonseed + cotton seed)	679	169	-75.1%
Soybeans (commercial+seed)	1,443	588	-59.3%
Corn	441	180	-59.2%
Cattle Herd (1)	(557)	(614)	10.2%

(1)R$/head

Hedge Position - FX -4Q23 Earnings Release x 04.29.2024 Position

CROPS		02/26/2024			04/29/2024			Variation
SOYBEAN	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	99.6	68.4	-	100.0	86	30.4	0.4	17.6	30.4
R$/USD	5.3683	5.2238	-	5.3678	5.1908	5.1867	0.00	-0.03	5.19
Commitments %	-	15.6	-	-	3.9	44.3	0.0	-11.7	44.3
COTTON	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	96.2	34.7	-	99.8	60.0	11.1	3.6	25.3	11.1
R$/USD	5.5713	5.3857	-	5.5640	5.2786	5.3748	-0.01	-0.11	5.37
Commitments %	-	4.4	-	-	-	26.6	0.0	-4.4	26.6
CORN	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	99.6	59.3	-	100.0	59.1	-	0.4	-0.2	0.0
R$/USD	5.5758	5.3538	-	5.5768	5.3365	-	0.00	-0.02	0.00
Commitments %	-	3.4	-	-	-	32.4	0.0	-3.4	32.4

Hedge Position - Commodity - 4Q23 Earnings Release x 04.29.2024 Position

CROPS		02/26/2024			04/29/2024			Variation
SOYBEAN	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	100.0	58.1	-	100	71.1	21.3	0.00	13.00	21.30
USD/bu	14.25	12.62	-	14.25	12.46	11.97	0.00	-0.16	11.97
Commitments %	-	10.9	-	-	4.1	18.5	0.00	-6.80	18.50
COTTON	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	99.2	40.2	-	96.5	50.7	1.1	-2.70	10.50	1.10
USD¢/pd	90.79	85.92	-	88.34	86.4	86.66	-2.45	0.48	86.66
Commitments %	-	-	-	-	-	-	0.00	0.00	0.00
CORN	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25	2022/23	2023/24	2024/25
%	3.9	3.3	-	3.9	3.4	-	0.00	0.10	0.00
R$/bag	56.64	45.00	-	56.64	45.00	-	0.00	0.00	0.00
%	-	-	-	-	-	-	0.00	0.00	0.00
USD/bag	96.1	34.1	-	96.1	34.5	-	0.00	0.40	0.00
Commitments %	9.52	8.12	-	9.52	8.12	-	0.00	0.00	0.00

Inputs - 2024/25 Crop Year - % acquired

Fertilizers/Crop Protection	4Q23	1Q24	Δ%
Nitrogen	16.0%	53.0%	37.0%
Potassium Chloride	82.0%	75.0%	-7.0%
Phosphates	87.0%	91.0%	+4.0%
Crop Protection	-	18.4%	18.4%

2

OPERATIONAL HIGHLIGHTS

Planted Area 2023/24 crop year budget x forecast

Crop Mix	Planted Area	Planted Area (a)	Planted Area (b)	Share	Δ%
2022/23	2023/24 Budget	2023/24(1) Forecast	2023/24	(bxa)
	-------------------------- ha ------------------------	%
Cotton lint	162,243	187,464	188,725	28.8%	0.7%
1st crop	85,823	90,088	106,713	16.3%	18.5%
2nd crop	76,420	97,376	82,012	12.5%	-15.8%
Soybean (Commercial + Seed)	346,941	336,770	320,009	48.9%	-5.0%
Corn 2nd crop	137,585	103,436	95,157	14.5%	-8.0%
Other cropst	27,615	46,733	50,569	7.7%	8.2%
Total Area	674,384	674,403	654,460	100.0%	-3.0%

1. Weather factors may affect the planted area forecast.
2. Other Crops (Brachiaria Seed 12,046 ha, Crotalaria Seed 1,917 ha, Beans 3,509 ha, Sesame 2,746 ha, Pearl thdlet Seed 12,085 ha, Corn 1st crop 258 ha, Corn Seed 767 ha, Forage Turnip Seed 3,605 ha, Cattle Herd 3,606 ha, Sorghum 288 ha, Wheat 9,301 ha and Buckwheat Seed 441 ha) total 50,569 ha.

Crop Year 2023/24 Status

Cotton	Soybean	Cor 2		crop 2023/24
		nd
2023/24 crop year	2023/24 crop year		crop year
100%	100%			100%
	planted
planted	harvested

Planting and Harvesting Schedule

Yields for 2023/24 crop year Budget x 2023/24 Crop year Forecast

Crops	Budget	4T23	2023/24
	Earnings	Δ%	Δ%
	2023/24	Forecast
	Release	cxb	cxa
	(a)	(c)
	(b)
Cotton 1st crop	2,020	2,020	2,020	-	-
Cotton 2nd crop	1,869	1,869	1,869	-	-
Cottonseed (cottonseed + cotton seed)	2,410	2,410	2,410	-	-
Soybeans (comercial + seed)	3,948	3,432	3,276	-4.5%	-17.0%
Corn 2nd crop	7,580	7,580	7,580	-	-

Production Cost - R$/hectare - 2022/23 x 2023/24 crop year

Crops	2022/23 Budget	2023/24 Budget(1)	Δ%
Cotton 1st crop	15,163	13,205	-12.9%
Cotton 2nd crop	13,677	11,906	-12.9%
Soybeans (commercial + seed)	5,223	5,081	-2.7%
Corn 2nd crop	4,867	4,303	-11.6%
Total Average Cost	7,985(1)	7,177(1)	-10.1%

1. Weighted by the areas of the 2023/24 crop year, to avoid changes arising from variations in the product mix.

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CONTENTS
GENERAL INFORMATION	1
OPERATIONAL HIGHLIGHTS	3
MANAGEMENT'S LETTER TO OUR SHAREHOLDERS AND STAKEHOLDERS	5
MARKET OUTLOOK	7
OPERATIONAL PERFORMANCE 2022/23 CROP YEAR	7
FINANCIAL PERFORMANCE	9
FINANCIAL TABLES	19
OPERATIONAL DATA	19
LAND TABLES	19
EXHIBIT 1 - BALANCE SHEET: ASSETS	21
EXHIBIT 2 - BALANCE SHEET: LIABILITIES	22
EXHIBIT 3 - INCOME STATEMENT	23
EXHIBIT 4 - CASH FLOW STATEMENT	24

4

MANAGEMENT'S LETTER TO OUR SHAREHOLDERS AND STAKEHOLDERS

The 2023/24 crop year witnessed adverse weather conditions at the start of the cycle due to the El Niño phenomenon. During this period, the western region of Mato Grosso state was affected by below-average rainfall and high temperatures that hindered soybean development. The current soybean crop was fully harvested, with yield standing at 3,276 kg/ha, 17.0% lower than the budget and 1.1% higher than the national average (CONAB, April/2024).

The drought in the state of Mato Grosso, which affected soybean crop, did not have the same effect in other regions, demonstrating the resilience of the Company's portfolio due to its geographical diversification. The planting of second-crop cotton and corn has been completed, and these crops have good production potential and are expected to reach the budgeted yields.

Costs per hectare budgeted for the 2023/24 crop year registered an average decrease in Brazilian real of 10% compared to budgeted costs in the 2022/23 crop year, mainly reflecting the lower prices of our main inputs.

We advanced in our 23/24 hedge position. Considering the commitments, we hedged 75.2% of our soybean production, 37.9% of our corn production and 50.7% of our cotton production. At the same time, we took advantage of moments of appreciation of U.S. dollar to hedge the Foreign Exchange of our crops (details on Table 35).

Financial Highlights

Net Revenue ended the first quarter at nearly R$2 billion. Adjusted EBITDA was R$704 million, with EBITDA margin of 36%. Net Income came to R$228.9 million, a sharp decrease in relation to 1Q23, mainly due to the lower Gross Income from soybean, affected by the reduction in planted area, yield and prices.

Cash generation in the quarter was a negative R$196 million, mainly due to the lower revenue from soybean (volume and price) and payments made for the acquisition of inputs for the crop year. Despite the negative cash generation, the Net Debt/Adjusted EBITDA ratio ended the period at 1.31 times.

Investments in the period totaled R$110 million, allocated to the modernization of our machinery base (harvesters and planters), grain warehouses, buildings and, facilities (general renovations, irrigation project and solar panels).

At the Annual and Extraordinary Shareholders Meeting, held on April 29th, 2024, shareholders approved the distribution of R$389 million, equivalent to 50% of the adjusted net income of the Parent Company (R$24 million as interest on equity, paid in January 2024, and R$365 million as dividends, to be paid on May 15th, 2024). Based on the closing numbers of 2023, dividend yield is 4.7% per year.

Expansion of area, acquisition of inputs and hedge of 2024/25 crop year

According to the material fact disclosed on April 29th, 2024, we expanded our Joint Venture with Agro Penido (Pioneira Farm) by adding 18,700 physical hectares with planting potential (considering 2nd crops) of 30,734 hectares. The current Pioneira Farm agreement is valid until the 2027/28 crop year. With the Joint Venture expansion, the term of the two combined areas will be extended until the 2043/44 crop year. With this expansion, the new physical area will be 38,572 hectares, and the new planting potential of Pioneira Farm will be 64,286 hectares.

We have been acquiring inputs for the 2024/25 crop year, whose planting will begin in September 2024. We acquired 91% of phosphates, 75% of potassium chloride, 53% of nitrogen and 18% pesticides, taking advantage of market opportunities.

We started soybean sales for 2024/25 crop year and, considering our commitments, we reached 39.8% of estimated production. We have not hedged any other crops yet. We also took advantage of the strong U.S. dollar to lock the Foreign Exchange of our crops (details in Table 35).

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Appointment of Executive Officers

According to the Notice to the Market disclosed today, the following executive officers were appointed at the Board of Directors meeting held on May 8, 2024:

1. Alvaro Luiz Dilli Gonçalves, Chief HR, Sustainability and IT Officer as Statutory Executive Officer. Alvaro has been with SLC Agrícola for 37 years.
2. Roberto Acauan Junior so far Compliance and Legal Manager, appointed as Chief Sales and New Business Officer. Mr. Roberto Acauan has been with SLC Agrícola for 15 years now.

We thank our shareholders, employees and other stakeholders for their trust and remain firmly in the pursuit of excellent results!

The Management.

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MARKET OUTLOOK

Click here to download the market outlook pdf

OPERATIONAL PERFORMANCE 2022/23 CROP YEAR

The first quarter of 2024 was marked by the conclusion of planting operations on second-crop areas for corn and cotton and completion of soybean harvest.

Planted Area

On December 4th, 2023, the Company disclosed a Material Fact notice on the adjustment to its planted area due to adverse weather conditions that affected the beginning of the crop year. We made some changes during soybean planting that affected the planted area for first- and second-crop cotton, second-crop corn and other crops. These changes were: Reduction of 16,761 hectares of soybean, area initially intended for planting soybean and second-crop cotton, but where only first-crop cotton was planted since its margins are higher. Reduction of 8,310 hectares of second-crop corn due to the replanting of 19,000 hectares of soybean. As for the planted area mentioned in the Material Fact notice disclosed in December 2023, there was an increase of 5,563 hectares of millet seed from cover planting areas, which is considered in other crops, and there was a reduction of 1,500 hectares of corn second crop due to the planting window.

Table 1 - Planted Area by Crop 2022/23 vs. 2023/24 crop years -budget x forecast

	Planted Area	Planted Area (a)	Planted Area (b)	Share	Δ%
Crop mix	2022/23	2023/24 Budget	2023/24(1) Forecast	2023/24	(bxa)
	---------------------------------------	ha -------------------------------------	%
Cotton lint	162,243	187,464	188,725	28.8%	0.7%
Cotton lint 1st crop	85,823	90,088	106,713	16.3%	18.5%
Cotton lint 2nd crop	76,420	97,376	82,012	12.5%	-15.8%
Soybean (Commercial + Seed)	346,941	336,770	320,009	48.9%	-5.0%
Corn 2nd crop	137,585	103,436	95,157	14.5%	-8.0%
Other Crops (2)	27,615	46,733	50,569	7.7%	8.2%
Total Area	674,384	674,403	654,460	100.0%	-3.0%

1. Weather factors may affect the planted area forecast.
2. Other Crops (Brachiaria Seed 12,046 ha, Crotalaria Seed 1,917 ha, Beans 3,509 ha, Sesame 2,746 ha, millet seed 12,085 ha, Corn 1st crop 258 ha, Corn Seed 767 ha, Forage Turnip Seed 3,605 ha, Cattle Herd 3,606 ha, Sorghum 288 ha, Wheat 9,301 ha and Buckwheat Seed 441 ha) total 50,569 ha.

Yields

Table 2 - Produtividade Orçada Safra 2023/24

Yield (kg/ha)	2022/23 Crop Year	2023/24 Crop Year	2023/24 Crop Year	∆%	∆%
Achieved (a)	Budget (b)	Forecast (c)	(c ) x (a)	(c) x (b)
Cotton lint 1st crop	2,000	2,020	2,020	1.0%	0.0%
Cotton lint 2nd crop	2,037	1,869	1,869	-8.2%	0.0%
Cottonseed	2,491	2,410	2,410	-3.3%	0.0%
Soybean (Commercial + Seed)	3,904	3,948	3,276	-16.1%	-17.0%
Corn 2nd crop	7,708	7,580	7,580	-1.7%	0.0%

Commercial Soybean

The 2023/24 crop year was characterized by the El Niño phenomenon, which affected mainly western Mato Grosso state, with a sharp reduction in precipitation in October, November, and December. The current soybean crop was fully harvested, with yield of 3,276 kg/ha, 17.0% lower than budget and 1.1% higher than the national average (CONAB, April 2024).

Soybean Seed

Soybean processing began in January, and our current estimate of sales to third parties plus internal consumption for 2024 is 1,250,000 bags of soybean seeds, 22.5% more than last year.

Cotton Lint First Crop

The crop is currently evolving from the flowering stage to the cotton-boll development stage, and we expect to achieve the budgeted yield.

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Cotton Lint Second-Crop

The crop has been growing well and it is currently in the flowering stage. We expect to achieve the budgeted yield.

Cotton Seed

Cotton seed processing begins in July, and the estimate of sales to third parties plus internal consumption for 2024 is 143,318 bags, an increase of 10.3% from the previous year.

Corn Second Crop

The planting began in the last week of January 2024 following the progress in harvesting of early soybean varietals and the conclusion of second-crop cotton planting, and the area was concluded in the first half of March. The crop have the potential to reach the projected yield.

Production Costs 2023/24 Crop Year

Table 3 - Budgeted Costs 2023/24 Crop Year

				Average	Average
%	Cotton	Soybean	Corn	budget	budget
				2023/24	2022/23
Variable Costs	79.6	74.8	80.0	77.8	79.8
Seeds	10.1	15.2	21.5	13.2	11.1
Fertilizers	21.1	18.7	32.0	21.3	23.2
Chemicals	20.4	16.8	10.9	18.1	20.6
Air Spraying	2.3	1.4	1.6	1.9	1.6
Fuels and Lubricants	3.4	3.5	3.6	3.5	4.3
Labor	0.9	0.7	0.6	0.8	0.6
Ginning	9.7	3.0	2.4	6.4	6.3
Maintenance	4.3	4.1	3.3	4.1	4.0
Others	7.5	11.4	4.0	8.6	8.1
Fixed Costs	20.4	25.2	20.0	22.2	20.2
Labor	7.2	8.1	6.4	7.4	6.6
Depreciation and amortizations	4.6	6.5	4.6	5.3	4.4
Right-of-Use depreciation - Leasing	5.8	7.2	6.3	6.4	6.4
Others	2.8	3.4	2.7	3.0	2.8

Table 4 - Budget Production Costs in R$/ha 2023/24 crop year

Total (R$/ha)	Budget 2022/23	Budget 2023/24(1)	∆%
Cotton lint 1st crop	15,163	13,205	-12.9%
Cotton lint 2nd crop	13,677	11,906	-12.9%
Soybean (commercial + seed)	5,223	5,081	-2.7%
Corn 2nd crop	4,867	4,303	-11.6%
Total average cost	7,985(2)	7,177(2)	-10.1%

1. Figures may suffer changes by the end of cotton processing and the sale of grains.

1. Weighted by areas in the 2022/23 crop year to avoid impacts from changes in the product mix.

Costs per hectare budgeted for the 2023/24 crop year registered an average decrease in Brazilian Real of 10.1% compared to budgeted costs in the 2022/23 crop year, mainly reflecting lower prices of our main inputs. Currently, 59.0% of the costs are in U.S. dollar denominated (seeds, fertilizers, pesticides and leases), and have a strong correlation to commodity prices. In addition, the remaining part of production costs are linked to the Brazilian Real, that is, 41.0% being impacted by inflation.

Table 5 - Unitary Cost 2023/24 Crop Year

	Achieved	Achieved	Achieved	Budget Yield	Budget Cost	Budget Cost
	Cost	∆%
	Yield (Kg/ha)	Cost (R$/ha)	(Kg/ha)	(R$/ha)	R$/Kg
	(R$/Kg)	b x a
	2022/23	2022/23	2023/24	2023/24	2023/24 (b)
	2022/23 (a)
Cotton 1st crop	2,000	15,357	7.68	2,020	13,205	6.54	-14,8%
Cotton 2nd crop	2,037	14,161	6.95	1,869	11,906	6.37	-8.3%
Soybean (commercial + seed)	3,904	5,128	1.31	3,948	5,081	1.29	-1,5%
Corn 2nd crop	7,708	4,767	0.62	7,580	4,303	0.57	-8.1%

8

FINANCIAL PERFORMANCE

As from 4Q23, the Company began to classify soybean seed and cotton seed, previously registered under "Other crops," as follows: soybean seed (commercial soybean + soybean seed) and cottonseed (cottonseed + cotton seed).

Net Revenue decreased 11.8% in 1Q24 vs. 1Q23. Despite the 51.7% increase in cotton invoiced volume and 15.4% increase in unit price, the decrease in soybean revenue is notably higher. Soybean volume, and invoiced unit price, decreased due to the lower yield in 2023/24 vs. 2022/23 and the decline in soybean prices.

Table 6 - Net Revenue

	1Q23	1Q23	1Q24	HA
(R$ thd)	Published	New
Net Revenue	2,219,315	2,219,315	1,956,914	-11.8%
Cotton lint	431,466	431,466	744,518	72.6%
Cottonseed (cottonseed +cotton seed)	66,576	66,576	58,083	-12.8%
Soybean (comercial + seed)	1,486,236	1,486,226	929,602	-37.5%
Corn	65,879	65,879	20,973	-68.2%
Cattle Herd	14,818	14,818	28,515	92.4%
Others	8,915	8,925	5,246	-41.2%
Hedge income	145,425	145,425	169,977	16.9%

Table 7 - Volume Invoiced

	1Q23	1Q23	1Q24	HA
(Tonnes)	Published	New
Volume Invoiced	777,115	777,111	703,022	-9.5%
Cotton lint	50,790	50,790	77,030	51.7%
Cottonseed (cottonseed + cotton seed)	53,457	53,457	76,093	42.3%
Soybean (commercial + seed)	590,293	605,885	507,626	-16.2%
Corn	59,476	59,476	29,252	-50.8%
Other	23,099	7,503	13,021	73.5%

Table 8 - Volume Invoiced (heads)

(Heads)	1Q23	1Q24	HA
Volume Invoiced	3,471	6,602	90,2%
Cattle Herd	3,471	6,602	90,2%

The calculation of Variation in the Fair Value of Biological Assets (VFVBA) for soybean, cotton and corn crops reflects the estimated gross margin for these crops, at market value, less production costs and opportunity costs of owned land properties, related to crops undergoing significant biological transformation and products at the point of harvest. In relation to Cattle, VFVBA is calculated based on the market value of cattle on the reporting date.

Table 9 - Variation in Fair Value of Biological Assets

(R$ thd)	1Q23	1Q24	HA
Variation in Fair Value of Biological Assets	854,871	(140,763)	n.m.
Cotton lint	-	-	-
Cottonseed (cottonseed + seed)	-	-	-
Soybean (commercial + seed)	845,045	(136,295)	n.m.
Corn	2,123	-	n.m.
Cattle Herd	7,703	(4,468)	n.m.
Other	-	-	-

VFVBA for soybean is negative due to expectations of lower margins and a reduction in the planted area in 2023/24 vs. 2022/23. Cattle VFVBA is negative due to the decline in the estimate of lower prices.

Breakdown of Net Realizable Value of Agricultural Products

The calculation of the Net Realizable Value of Agricultural Products (NRVAP) reflects the changes in the estimated net price in comparison with the cost of production and changes in agricultural product inventories during the period, resulting from harvest and shipment. The price used for assessing the net realizable value is the average price between volumes sold and inventory volumes to be sold, less taxes, logistics expenses and other direct expenses necessary for the performance of agreements with clients.

As from 4Q23, to better demonstrate values, we report in a specific line the changes in Net Realizable Value of Agricultural Products (NRVAP). Until then, such amounts were recognized under Cost of Goods Sold (other crops). Below is the reclassification:

9