Good morning, ladies and gentlemen, and welcome to the Second Quarter 2011 Earnings Release Conference Call for FMC Corporation. [Operator Instructions] Thank you. I'll now turn the conference over to Mr. Brennen Arndt. Mr. Arndt, please go ahead.

Thank you, and welcome, everyone, to FMC's Second Quarter 2011 Conference Call and Webcast. Joining me this morning are Pierre Brondeau, President, Chief Executive Officer and Chairman; Michael Wilson, President, Specialty Chemicals Group; and Kim Foster, Executive Vice President and Chief Financial Officer. Pierre will begin the call with a review of our second quarter performance. Michael will provide an in-depth review of the BioPolymer and Lithium businesses that comprise our Specialty Chemicals group. Kim will then report on our financial position, and Pierre will complete the call by providing our outlook for 2011 and by taking your questions. Our prepared remarks today will go a bit longer than typical as we have a number of important items to share with you. And joining Pierre, Michael and Kim for the Q&A session will be Milton Steele, President, Agricultural Products Group; and Mark Douglas, President, Industrial Chemicals Group. A reminder today that our discussion will include certain statements that are forward-looking and subject to various risks and uncertainties concerning specific factors that are summarized in FMC's 2010 Form 10-K, our most recent Form 10-Q and other SEC filings. This information represents our best judgment based on today's information. Actual results may vary based upon these risks and uncertainties. Our current 2011 outlook statement was issued this morning, which provides our guidance for the third quarter and full year 2011. We have posted this on our website available at fmc.com. Also on our website you will find a definition of certain non-GAAP financial terms we will refer to during today's call. They're under the heading entitled glossary of financial terms, as well as a reconciliation to GAAP of the non-GAAP figures we'll use today. So it's now my pleasure to turn the call over to Pierre Brondeau. Pierre?

Thank you, Brennan, and good morning, everyone. As you saw in our earnings release, we delivered a strong second quarter performance. All 3 operating segments achieved double-digit earnings increases. Demand across our businesses and diverse end markets continues to be very healthy, especially in rapidly evolving economies. We are seeing rich opportunities for organic growth in every business and in turn, we are making good progress advancing our target external growth initiative. Before we get into the quarter, I'd like to share with you our progress in achieving our Vision 2015 objectives. This is something I intend to do twice this year, at the midpoint of the year and at year end. As we begin the second half of 2011, I am pleased to report that we are ahead of plan toward realizing our Vision 2015 objectives. Let's look at the dashboard we used to measure our progress against the 5 key elements of our vision. First, growing our leadership positions. The original plan presented to you last December was that solid organic growth we would achieve sales of $4.2 billion by 2015. That was based on the rich pipeline of organic growth prospects across our business as we saw at that time. We now see even more opportunities for organic growth that should enable us to reach 2015 sales in the $4.5 billion to $4.6 billion range. Complementing our organic growth is an external growth strategy. We expect external growth initiatives. We raised our 2015 revenue to greater than $5 billion. We have a very focused disciplined strategy that includes both on M&A and product and technology acquisitions that reduces the risk normally inherent in external growth. We have now planned -- we have no plans to make transformational acquisitions or add a new business leg to our portfolio.…

Thank you, Pierre, and good morning, everyone. I'm pleased to be with you today report on the current performance and outlook for our Specialty Chemicals group. After updating you on our second quarter performance, I'll provide insights into the growth strategies we're employing in BioPolymer and Lithium to deliver on our contribution to Vision 2015. First, a review of second quarter performance. Revenue in Specialty Chemicals was $229 million, up 6% versus the year ago quarter. Despite capacity constraints in Lithium, driven by higher selling prices in all businesses and strong volume growth in pharmaceutical ingredients and lithium specialties. BioPolymer achieved record sales and earnings in the quarter. The pharmaceutical ingredients sales gains were realized in all product segments, while food ingredient sales were driven by dairy and beverage markets in Asia, particularly China. Lithium sales growth was led by butyllithium, serving pharmaceutical and chemical synthesis markets. Given our lithium capacity constraints, we have delivered top line growth this year by increasing sales of higher value downstream products like butyllithium at the expense of upstream primary compounds sold into lower value segments. Of course, we've been careful to protect market share in key primary growth segments such as energy storage. Segment earnings of $56 million were 10% higher than the prior year quarter as a result of the strong commercial performance despite higher raw material cost and higher weather-related operating cost in Argentina. The wettest weather conditions in a decade in Argentina presented operational challenges in the quarter. Heavy rain and snow, which washed out and blocked roads, created logistical challenges impacting production yields and costs. While we believe the worst of the winter weather is now behind us, we expect to experience further production inefficiencies in the third quarter due to lower second quarter brine production and dilution of…

Thanks, Michael, and good morning, everyone. Throughout the call this morning, you've heard examples of attractive organic growth opportunities across our businesses, and you've heard of our intend to fully capitalize on these opportunities. Based upon these opportunities, we intend to accelerate certain projects in soda ash, lithium and BioPolymer that were originally just outside the planning horizon of Vision 2015. As we reported on last quarter's call, this would increase capital spending by about $200 million to $400 million in the next 5 years. These expansions will add to the organic growth rate of our businesses within the Vision 2015 planning horizon and will provide returns comfortably in excess of our return on invested capital goal of 15% for the company. In fact, we have accelerated the spending on certain dimensions of these projects into 2011, an upward revision since our last conference call. This accelerated spending will add approximately $40 million to our 2011 capital forecast, raising our outlook for 2011 capital expenditures to $200 million. As Pierre reviewed in soda ash, we see continued demand growth across the next 5 years and beyond, particularly in export markets. Our Granger facility is now running well and ramping up to the full 500,000 tons per year rate by year end. Nonetheless, even with this Granger volume, the U.S. soda ash industry is forecast to remain supply constrained in 2011 and beyond. Given this favorable outlook, we've begun a process design and detailed engineering work for a second phase capacity addition at Granger. The intent of the second phase is to bring Granger capacity to 1.2 million tons per year by 2014. Our concept is to utilize the existing solution mining technology from our West Waco plant and the design of our second phase Granger expansion. This new design will…

Thank you, Kim. Regarding our outlook for the full year 2011, we have raised the midpoint of the range versus our previous outlook and now expect adjusted earnings of $5.60 to $5.80 per diluted share, a 15% increase over 2010 at the midpoint of the range. Our Agricultural Products segment expect to achieve its eighth straight year of record earnings, up approximately 10% versus a year ago, driven by strong market conditions across most region and the contribution of new and recently introduced products, while increasing spending on growth initiatives and absorbing higher raw material cost. As Michael outlined, Specialty Chemicals is expected to deliver its sixth straight year of record earnings, up approximately 10% led by the seventh straight year of record earnings in BioPolymer and enhanced by sales gain in Lithium Specialties, partially offset by increased spending on growth initiatives and higher raw material cost. In our Industrial Chemicals segment, we expect the highest earning growth, up approximately 30% driven by broad-based sales gain across soda ash and peroxygen and the continued favorable mix shift towards specialty peroxygen. Moving to our outlook for the third quarter of 2011. We expect adjusted earnings of $1.25 to $1.40 per diluted share, a 12% increase versus the year-ago quarter at the midpoint of the range. In Agricultural Products, we expect segment earnings to be leveled to the year ago, as growth in Latin America is offset by higher raw material costs, increased spending on target growth initiatives and lower North American sales due to less favorable weather conditions in the last year. In Specialty Chemicals, we project earnings to increase approximately 5% as higher volume and selling prices in BioPolymer and Lithium Specialties are partially offset by increased spending in growth initiative in BioPolymer, higher raw material costs and higher weather-related operating cost in our Argentina Lithium facility. In Industrial Chemicals, earnings are expected to be up approximately 30%, driven by higher selling prices in soda ash and peroxygen and the benefit of volume growth in soda ash export market. Based on our outlook for a 15% earnings growth for the full year and 12% earnings growth for the third quarter at the midpoints of their respective ranges, this is implying a very strong fourth quarter with earnings growth in excess of 20%. With the healthy demand we continue to see across our businesses, the diverse end markets we serve and our strength in a rapidly developing economy, we're comfortable with that fourth quarter outlook. With that, I thank you for your time and attention. I'll be happy to take your questions.

[Operator Instructions] Our first question is from Kevin McCarthy with Bank of America.

Would you comment on the current level of soda ash prices in China and also your view of manufacturing cost in China through the 2 primary synthetic production methods there, how are those trending?

Kevin, this is Mark. With regards to China, we're seeing prices at very high levels for the domestic market well in excess of $300 a metric ton. That's increased over the last few months and indeed, the last couple of quarters, as we've watched a number of the input costs increase, certainly for energy. I think a lot of people are aware of the energy restrictions in China that's occurred over the summer period. That's made prices move higher, we've seen input cost in terms of labor and other raw materials. So we have seen that ramp-up continuing. We've also seen a ramp-up for both technologies that are used, the how process and the Solvay process. Obviously, they're very different in terms of their input costs and also output given one methodology gives you a product you can sell into the fertilizer industry. So overall, we see those prices remaining high. We don't quite know where they'll go in the future given that there is capacity coming on in China in the fourth quarter. But certainly, from an export standpoint, we've seen prices stay high, and as you know, ANSAC has been following that activity.

Very good. If I may switch gears to Ag. Milton, I was wondering if you could comment on the joint venture that you've announced in Argentina. I generally think of FMC as having concentrated on Brazil, and at least on a relative basis, somewhat deemphasized Argentina over the years. Is that fair to say? And what has changed? Maybe you could talk about some of the upside opportunity that you see in making these investments?

Kevin, Milton. Thank you. Argentina, we've been selling in Argentina for many, many years but relative to Brazil, it’s been relatively small. We continue to believe or we do believe today that this is an important agricultural market, the second-largest in Latin America, and what we want to do is increase our market access capabilities. So we formed the joint venture with a local company, which will give us more distribution capabilities on the ground, and we expect to grow our business in this market significantly over the next 5 to 10 years.

Okay. And then finally, if I may, just a couple of financial questions for Kim. Kim, can you comment on why interest expense would've increased sequentially when net debt declined $141 million versus the first quarter? What is behind that please?

Yes, two things, Kevin. One is that the way that if you looked at the daily net debt levels throughout the second quarter, you'd see that the real drop literally happened in the last few days of the quarter, which was predominantly associated with the credit terms that the Ag business has. So while there was a drop, it really was only a few -- it happened in a few days. In addition, we had some short-term borrowings in Brazil, which have a higher interest rate. We borrow from 3 separate sources there, but on average, the interest rates there are probably 300 to 400 basis points higher than the U.S. So it's a mixture of both of those things.

Our next question comes from Mike Sison with KeyBanc.

In terms of soda ash expanding Granger in the second half of the year, could you just talk about a little bit the demand environment? There's some macro concerns out there, and I just wanted to sort of hear your perspective of sort of how demand is shaping up for that business and maybe the expansion. Is the expansion more maybe supply constrained elsewhere in the world that gives you the opportunity to expand there?

Mike, this is Mark. When you look at the world of soda ash, I think we have the world's lowest-cost facility in Wyoming, and that allows us to compete with synthetic soda ash primarily out of Asia. On the basis of the macro demand, flat glass, container glass, chemicals, detergents are all what drives soda ash. And as you can imagine, in rapidly developing economies, the overall consumption of soda ash is less compared to places like Western Europe and North America. So our export business is growing rapidly. That's where the Granger expansion is targeted, and quite frankly, we're competing very successfully against the synthetic producers. As I just said, their costs are increasing. So even with a demand on a macro level that may be choppy in some parts of the world, we are very, very confident that we'll be able to compete with synthetic producers anywhere in the world. Hence, the expansion of 500,000 tons, plus the next look for Granger, which will take us up to a potential 1.2 million tons, all of that targeted at the export markets.

Got it. And the startup costs for Granger, are those done?

Yes, pretty much so. I mean we had all the costs virtually in the second quarter. And now Granger, as Pierre said earlier, ramping up to full production.

Great. And then last question. Pierre, when you think about the fourth quarter, it's clearly going to be the stronger of the 2, the growth there has to be pretty exciting relative to the third quarter. What are the put and takes? It tends to be the most difficult quarter for chemicals to predict. Do you think visibility is still pretty good for you as you head into that quarter?

Yes. Actually, let me take, if you don't mind, an opportunity to talk a bit about our full year and third quarter and fourth quarter because we actually feel quite strong about the way the year is unfolding and we feel quite strong about the demand or positioning for our product. First, the third quarter, as you know, we are guiding with an EPS about -- if you take the midpoint of our guidance, so about 12% versus last year. And there is certainly a number which could be viewed as slightly below what a company like ours could be delivering in such a quarter but there is some very well-defined event which will be over in this quarter. First, we were talking about soda ash. That business has 2 things which are happening. First of all, you know that every 5 or 6 quarters, we move the longwall where we are mining. Last year, it was in Q2. This year, it's in Q3. And Granger, as much as the startup costs are being done, last year, operating with full staffing on the ramp-up capacity, so we have the cost of a full plant, but we are not producing at full capacity yet. That is about a $7 million impact on the quarter versus normal operations. We've talked about the 2 snowstorms and the yield issues we have in Lithium, we believe it's going to be an impact of about $3 million in the third quarter and then the weather in North America for Ag business, and we qualify that versus a normal quarter at about $5 million. So you put all of those elements together, which are very well defined. You're talking about a $15 million impact on the quarter. If you would add that number to what we are forecasting as earnings, you would have a year-on-year earnings growth for the third quarter, which would be comfortably above the 20%. So now moving on to the fourth quarter. Obviously, it proved, sequentially, the long haul, it will be done; Granger will be operating at full capacity; lithium, the yield issues will be behind us; and from an Ag standpoint, we get into the Brazil season, which we have no reason not to believe will be another very strong season for us. So if you look at the fourth quarter, it is pretty much a quarter which is shaping normally for our 2 business, Specialty and Ag, and shaping very strong for industrial because the one-off we talked about will be over, Granger will be at capacity and we have a very strong price situation. So the year looks well on target, maybe with the distribution across the 2 quarters, which is not your regular distribution, but we are quite comfortable with this forecast.

And we'll go to the Peter Butler with Glenhill Investments.

Where do you expect your tax rate to be in the second half and next year? And over the longer term, what direction is your tax rate going?

Peter, this is Kim. As far as 2011 go, and we're talking about the tax rate on adjusted earnings, we have guided that at 29%. We still believe it will stay at 29%, which is of course a mixture of higher domestic tax rates and lower foreign tax rates. As it relates to the future, now you're asking me to get into the mind of what's going on in Washington, D.C. and project what is going to happen from that perspective. What I can tell you from a modeling perspective is we looked out in Vision 2015, we assumed that we would be able to keep effective tax rate to about 29%.

Okay, okay, okay. And the other question I have is also financial, Kim. What is your company targeting for debt-to-market cap?

Debt-to-market cap. Peter, I'll have to go back and think about that for a second. So what we are targeting, how we're targeting to maintain our net debt is we're targeting to continue to maintain strong credit rating in the same credit rating that we have today, which gives us a leverage ratio of about one. And as you look at the Vision 2015 projections and why we said we could add an additional $1 billion of cash to return to shareholders or for growth is we are projecting to maintain that targeted debt leverage ratio of one. So that's actually how we've been planning and that's what driving our stock buyback here in the third quarter.

Our next question from Bill Young with ChemSpeak.

Back on soda ash. You emphasized how much of the growth you expected, predominantly in the export market. So 2 questions. Where do you stand now? What percentage of your soda ash is exported? And what might it be by your 2015 goal year? And also could you give us an idea on a percentage basis, how much your soda ash prices have increased 2011 versus 2010?

Bill, this is Mark. When you look at our total export versus domestic, we're just above 50% in terms of our export volume versus domestic, and that will continue to increase a couple of percentage points as we go through the remainder of the period. But to 2015, it'll be obviously higher than it is today, somewhere in the 50% to 55%, 60% range. Most of that expansion, as I said earlier, will go into the export market. In terms of overall pricing, your second point, we had -- if you remember back to the first quarter and late last year, we said our prices would be up in the single digits, mid-single digits to high single digits in terms of dollars per ton. Right now, we're looking at low single digits in terms of dollars per ton right across every ton that we sell.

And next we'll go to Rosemarie Morbelli with Gabelli & Company. Rosemarie Morbelli - Gabelli & Company, Inc.: Pierre, could you give us a little more details on the rich opportunities you see for organic growth?

Sorry, we couldn't hear the question. Rosemarie Morbelli - Gabelli & Company, Inc.: All right. Sorry. I was wondering if you could give us a little bit more detail on what you refer to as a rich opportunity for organic growth?

Actually, let me just make a quick correction. I think Mark said low single digits for pricing. It's low double digits. That's what we see for the year. In the script, I think we talked about 12% or something like that, so that's the number, low double-digit. I think we are seeing growth today in multiple places. First of all, as a company, we're seeing the same kind of growth rate in most of our businesses as we were forecasting like in Ag chemical, but there is a few places where the demand is strengthening and the pricing is positive. So we do have today a very strong demand and above what we are expecting in our food BioPolymer business for MCC and especially in China and Asia for dairy product, hence, the reason for which we are looking today at bringing on a new grassroot capacity in China. So that is a part of the company which is looking stronger from a growth standpoint than what we're expecting. The other one is Lithium. On Lithium, the endpoint is still the same as what we were seeing by 2020, but we are seeing, especially in China, a faster adoption of lithium battery for some heavy vehicles and small motorcycle and we see more of an impact in 2013 to 2015 that we were seeing before, which is accelerating the need for us to increase our capacity. Peroxygen, we are very successful with our move toward more specialty and it's also a place where we do have opportunities in the oil and gas field or in the food field, we are seeing more growth opportunities. So that's one of the reasons for which we're looking maybe at enhancing our capital spending by $200 million to $400 million because of all of those segments where we are seeing opportunities beyond what we had in 2015 plan. Rosemarie Morbelli - Gabelli & Company, Inc.: Did I understand properly, Pierre, you are actually increasing your CapEx expectations by an additional $200 million to $400 million from what you talked about during Vision 2015?

That's correct. We are more than increasing, I would say accelerating those -- our spending, which we would have to face at some point, but I think with the demand for MCC, the acceleration of the demand for Lithium and the robustness of our soda ash business, we are moving forward that spending. So from a spending rate standpoint, really $200 million to $400 million will be increased in between now and 2015 versus what we said at the last presentation of Vision 2015. Rosemarie Morbelli - Gabelli & Company, Inc.: And on lithium for battery applications. Have you seen a pickup already? Or I mean outside of the heavy vehicles in China, have you seen anything else going on regarding the regular vehicles that would be higher growth sooner than you expected for that particular category?

No, no. For the light vehicle, the passenger vehicle, we are still looking at significant change in demand by the 2016-2017 timeframe. I think there is a specific speed-up of the demand for the 2 types of vehicles I talked about, but that's the only place where we see a faster demand.

Our next question is from Laurence Alexander with Jefferies. Jeffrey Schnell - Jefferies & Company, Inc.: This is Jeff on for Laurence. Could you talk a little bit about your raw materials? How much raw material inflation did you experience in each segment and when do you expect raw material pressures to peak? And then also if you could quantify any gap between pricing and raw materials and when do you expect pricing to catch up?

Sure. Let me talk about the 3 business groups and how it impacts the company as a whole. We are seeing raw material inflation in our Specialty business, mostly on the BioPolymer side, and on our Ag business on pet chem product but also other products. So there is cost inflation on raw material we had since the beginning of the year and accelerating a bit in the second half, but we do have more than 100% coverage of that raw material price increase with our own cost increase, with our own price increase. So there is no impact on earnings of our Specialty and Ag business with raw material because we are just covering with price. On the industrial side, that is a positive price growth situation. We have very low inflation on raw material cost on the ICG side. And if you look at the low double-digit pricing increase this year, that is from stating into a $40 million, almost all of it going to the bottom line.

Our next question is from Dmitry Silversteyn with Longbow Research.

I just want to clarify. I heard it said a couple of different ways, so I just want to make sure I understand. The low double-digit price increase in soda ash, was that in percentage terms or in dollar-per-ton terms?

Dollar-per-ton terms, Dmitry.

Okay. I just thought I heard like a 12% number from Pierre, so that's what's caught my attention.

Yes. Sorry, dollar.

Okay, got it. Second question, as you look at adding capacity for Granger and taking it up to 1.2 million tons over the next couple of years, we've had an announcement from the #3 player in the U.S. that's thinking about, at least publicly thinking about adding capacity. I was wondering if that's kind of part of your thinking about the overall market size or market capacity in North America. And also, we've had about 6 months or so of Solvay operating outside of ANSAC umbrella in the export markets. Can you comment if you've observed any changes in behavior or price dynamics or contract negotiations or supply dynamics with Solvay being basically a third force now in the export markets?

Dmitry, this is Mark. I'll try to answer both of your questions there. In terms of somebody else expanding in North America, actually it confirms where we're going in terms of the quality of natural soda ash out of the U.S. and our ability to compete. We see in what we would call "ANSAC land" in terms of the next few years, roughly about 2.5 million tons of growth that can absorb natural soda ash. So what we have moving now is 0.5 million up to 1.2 million if we approve the second stage of Granger by the end of 2014. So as far as we're concerned, it makes sense that somebody else would look to expand as well. It reaffirms our position in terms of the world market. In terms of your second piece, I have really no comments on Solvay. I mean you can tell by our growth and our ability to get pricing that ANSAC is a very powerful force in soda ash, and we're very happy with our position, so I really have no comment on Solvay.

Okay, fair enough. Secondly, did I understand you correctly from the breakdown you gave in the Industrial Chemicals land that your North American volumes were down? Is that the right way to think about that? You said overall sales were up 4%, but I assume there was a lot of pricing mix in there.

Yes. No, demand is not down in North America. Demand is up in the very, very low single digits, but it's not down at this point.

Okay, all right. I guess I'm going to have to revisit that because you talked, like I said, you talked about North American sales being up 1%. So again, I mean I'm assuming there's some pricing in there, but maybe not.

Just one comment. 1% from North America, it's me who gave that number at the beginning of my script, maybe, but it was FMC-wide. So the entire company is up 1% in North America.

Very good, okay, very good. And then secondly, just talking about the peroxygen acquisition that you guys did in Europe and sort of the rationale behind it. I mean I understand that you're trimming some unattractive businesses in Spain and you're looking to expand your peroxygens or you're looking to, I guess, develop a global peroxygens business. At the end of the day, this is, I don't think you will disagree, this is not necessarily a market where you want to invest for growth and be more of a cash cow market to support growth in BioPolymers and crop protection. So within that context, can you comment on how attractive you see some of the Industrial Chemical niches? And should we not be surprised when we see you make acquisitions in this area?

Yes. Let me address that in the context of the total company. I think we are moving out of businesses where we are not competitive, which are not profitable, and that's the case of the percarbonate and that was the case of the phosphate business. Now we do have a growth strategy in Lithium, in BioPolymers and Ag. But we do also have a growth strategy in our Industrial Chemical. Now we all understand that the soda ash business is a supply-demand and cost situation. Now peroxygen is a very different story. Peroxygen, we are operating in a world where we are moving away from commodity into higher-margin specialty product in growing application, whether it's oil and gas, whether it's food application. Those are providing great opportunities for growth in the future. What is very critical for us to grow in the peroxygen is to have a global footprint for this business, so doing small acquisitions, which allow us to position a portfolio in growing segment in specialty high margin is very central to what we are planning to do.

Our next question is from John McNulty with Credit Suisse.

This is actually Alina Khaykin sitting in for John. Just a few questions. First, on the Lithium expansion, can you comment on how much of the $20 million to $25 million that you plan to spend is going to hit in 3Q and 4Q?

The all capital spending is hitting our cash flow for the $25 million in 2011. How much of the remaining spending, maybe Michael, you have the remaining spending in 2011? Or Kim?

Kim. Let me just, in a big picture way, and of course we disclosed this, we've spent a little short of $80 million in the first 6 months. And so when you think of $200 million, which is the forecast we gave for the full year, certainly, the majority therefore of that is backloaded and most of it is associated with the expansions that we've talked about, the Lithium expansion and the expansion at the studies we're doing at Granger and also the investment that we're doing in the Newark expansion. And let me turn it over to Michael to see if he'd like to add anything to that.

I don't have the spending for that project by quarter in front of me. I'm sure that's something we can get for John later.

Okay. And also actually, just one more question on the BioPolymer business or MCC expansion. Can you comment on how much you plan to spend for that in the second half of the year, when you're evaluating the additional MCC expansion?

I believe the number that's forecast for the second half for the Newark expansion is somewhere in the neighborhood of $5 million in 2011 spending. Again, the prior expansion in Cork has been completed. It's completed at the end of the first quarter, so this is an expansion that will mostly take place during the course of 2012.

The cost of the total expansion is about what? $15 million to $20 million?

It's in that neighborhood, yes.

Yes. If you think the $15 million to $20 million for Newark with about 25% of it being spent this year.

And next, going to Mike Harrison with First Analysis.

I was hoping, Michael, that you could maybe provide a little bit more detail on the weather issues in Argentina. I was just trying to get a better understanding, is the impact that you're seeing there, is it more cost-related in terms of snow impacting transportation or freight or anything like that? Or is it mostly volume related and related to the operations and the dilution of the brine ponds, et cetera? And then as you think about the impact you saw this quarter, should we expect that to worsen in the third quarter?

Mike, I think really the impacts are twofold, and they cover both areas they talked about. I mean the issues that we had during the second quarter from the heavy precipitation, and let me just put that in context, we've had more rainfall year-to-date in Argentina at the Salar than we normally have on an annual basis so, and it was compounded in the form, at least in 2 significant storms, that happened late, there were snowstorms that happened late in the second quarter. So the primary issues have been logistics-oriented from a standpoint that it's washed out roads, there's been road blockages occurring both between Pocitos in Argentina and the Salar and also for the route across the Andes to get product and to get raw materials and supplies from Antofagasta in Chile. So because of that, we did have lower efficiency, lower production during the second quarter. That kind of puts us behind the 8 ball, given the fact that we've been capacity constrained throughout the year anyway. So we think most of those issues are behind us with the weather. The supply lines are now open. We don't expect the ongoing logistics costs. But however, in order to maintain production in the second quarter, we pulled down the brine levels in the ponds fairly significantly, and we have to give the brine time to recover both in terms of solar evaporation. And then compounding that was the fact that the additional precipitation then dilutes the concentration of lithium in the brines, so you have a bit yet longer in order to get it concentrated to the usable concentration. So that's really the impact that we anticipate in the third quarter. The good news is, is that the demand is very strong, so as we get those brines to the right concentrations, we will process them and we fully expect to make up the volume then in the fourth quarter. And that's why I referenced the fact that effectively, this has an earnings shift effect of earnings from the third quarter to the fourth quarter.

And with respect to pricing in Lithium, I know you guys announced the price increase as it did Shemetal [ph]. Conspicuously absent there is SQM. Do you need SQM to follow on a price increase for lithium carbonate in order to make that successful?

I don't think it's absolutely necessarily given our supply-demand situation and the tightness of supply. Clearly, SQM is the large global leader in lithium carbonate. Their actions are relevant in the marketplace. But again, I think that's muted by the supply-demand situation. And just to provide a little detail for those, I mean, I think it was in June we announced the price increase in lithium carbonate as well as the other primary salts. In lithium carbonate, it was 20%, in the other salts, it ranged between 15% and 25%. And then yesterday, we announced a price increase in downstream products, including butyllithium, which in the neighborhood of 8%.

And then a question on the Ag business. I was just hoping to get a better understanding of how much North American volumes were down year-on-year. How much of that could you point to as the pull-through from Q1? And how much was related to the weather impact? And then should that weather impact actually worsen in terms of the impact on volumes as we look into Q3?

Yes. I'm going to ask Milton to comment because the second quarter for Ag was very strong and was significantly up in sales and earnings. So the second quarter, even if there were some shift into the first quarter and there were weather-related performance issues in North America, we benefited in the second quarter from the very strong performance in Asia, Europe and Latin America. So just on Ag, generally speaking, first quarter was very strong, second quarter was extremely strong, now third quarter is a place where we're going to get hit by the North American impact weather issue more before we get into the fourth quarter with a Latin America season, which we have more reason to believe will be strong. So the only issue around earnings, and we talked about the $5 million impact, we believe, versus normal weather would be only into the third quarter. So Milton, if you want to add?

Yes, Pierre, and Mike, I don't know if I can add much more. We sort of quantified what the impact will be in the third quarter. It has to do with some of our post-emergent herbicides and evaluation on cotton. As you know, Texas is probably in one-in-a-century drought and has lost a lot of cotton, there will be no need for defoliants. So we see this as weather-related and Pierre has put a quantification of that of around $5 million. I don't know what else I can add to that than has already been said.

And all in all, I mean we feel very good about the performance of the Ag business year-to-date, and we feel good in the fourth quarter and we have this third quarter where we rely more on North America with a better weather situation. But all in all, if you look on a full year basis, we're going to end up with a very strong year and the eighth year of record earnings for this business.

That will conclude the Q&A session. I'll turn it back to Mr. Brondeau for any closing remarks.

All right. Thank you very much, and thank you very much for staying with us beyond the time. We had a lot of things we wanted to share with you. We feel good about where we are. We feel strong about the rest of the year, and we hope you do too. Thank you very much, and we'll be in touch soon.

Ladies and gentlemen, this concludes the FMC Corporation Second Quarter 2011 Earnings Release Conference Call. You may now disconnect.