Nufarm puts seeds and savings at the centre of its Ag One reset

Nufarm targets higher returns through a narrower portfolio

Nufarm Limited (ASX:NUF) is putting a sharper edge on its turnaround strategy, arguing that better returns will come from doing less in commodity products and investing more heavily where it has a defensible position. At its 28 September 2026 investor day, the crop protection and seeds group reaffirmed FY26 underlying EBITDA guidance of A$370 million to A$380 million, alongside positive free cash flow and leverage of approximately 2.0 times.

Chief executive Rico Christensen’s “Ag One” strategy centres on three moves: concentrate crop protection resources on higher-return segments, expand the seeds business and develop renewable oils through a capital-efficient model. Nufarm said the approach is intended to produce a structurally better-returning business, although the presentation’s full-year expectations remain preliminary and subject to audit.

A$50m savings program moves into delivery

The company reaffirmed its A$50 million cost-saving program, with a run-rate expected by the end of FY27 and the full benefit expected in FY28. About 60% of the savings is expected to come from cost of goods sold and 40% from selling, general and administrative expenses, while implementation cash costs are estimated at about A$15 million.

The program includes the closure of plants at Alsip in North America, Wyke Butyrics in the United Kingdom and Kwinana in Australia, alongside a streamlined European sunflower operation and faster SKU rationalisation. Nufarm also set targets of capital expenditure below A$200 million, positive free cash flow and return on funds employed above its weighted average cost of capital for FY26 to FY28.

Crop protection narrows its field of play

In crop protection, Nufarm plans to align investment and resources around cereals, soybean and trees, nuts and vines. The company estimates those three systems represent 46% of an US$80 billion global crop-protection market, with other crops retained where they support regional relevance and scale.

Nufarm’s near-term pipeline spans herbicides, fungicides, insecticides and biologicals, with management estimating a combined addressable market of about US$8 billion. The figures are management estimates, and the anticipated launch dates depend on country-by-country regulatory approvals and execution.

Seeds gets the growth capital while Omega-3 is staged

Seeds is being positioned as the group’s main engine for growth and returns. The business generated FY25 revenue of A$252 million, reported an 11% five-year revenue compound annual growth rate and an average EBITDA margin of 27% across FY23 to FY25, according to the presentation. Nufarm intends to direct further investment towards hybrid seeds, particularly in canola, sorghum and sunflower, while pursuing expansion opportunities in South America.

Renewable oils offers a more conditional opportunity. Nufarm said carinata would be expanded with bp under a modified and extended offtake arrangement, while its Omega-3 program has been resized to reduce near-term cash requirements. Future funding for Omega-3 will be tied to regulatory, production and commercial milestones, with spending increasing only if the path to attractive through-cycle returns becomes clearer.

Execution will test the strategy

The presentation gives shareholders a cleaner set of markers than a broad promise of transformation: deliver the savings, keep capital expenditure below A$200 million, generate positive free cash flow and lift returns above the cost of capital. Nufarm also said FY26 EBITDA was on track to grow by about 25%, while leverage falls from 2.7 times to approximately 2.0 times.

That combination depends on several moving parts at once, including plant closures, portfolio simplification, product launches and continued performance from Seeds. The next test is less about the ambition of Ag One than whether the operational changes translate into the cash generation and returns targets set for FY26 to FY28.