Good morning, welcome to the Yara Capital Markets Day, a big highlight in the IR calendar. My name is Thor Giæver. I guess I know many of you in the audience. Safety first at Yara. There are no drills planned, so in the unlikely event of an emergency, you will be guided. There are guides around here. The exits, there's one at the rear and there's one to your right where you came in. The program, if we can get the next slide, for today is on the screen. I won't spend much time on it, but as you can see, we'll start off with the strategy. Our CEO will take you through that. We will look at how we're driving value growth in the markets, and that will be Terje Knutsen and Lair Hanzen.
We will be taking you through improving our operations, Tove Andersen and Lars Røsæg. Yves Bonte will update us on our portfolio review. We'll then come back to Lars Røsæg with capital allocation and returns, and Svein Tore will round things off at the end. Let's just get started with another short film, where we go into the strategy.
[Presentation]
Thank you, Thor, and good morning to all of you. Really great to see so many of you here. We're really excited about today's presentation and hope that it meets or even exceeds your expectations. Let's get started. Yara's strategy is to be the crop nutrition company for the future. The main focus of the presentation here today is on this strategy, and in particular on the strategic execution to deliver improved returns as a focused company. We're working along three main lines to lift returns. It's improvement, value, and growth. In addition, and as part of our strategic focus on crop nutrition, we have decided to evaluate an IPO of our industrial nitrogen businesses. We'll come back to all these points at some depth in this presentation.
In 1898, scientist Sir William Crookes gave a speech right here in London. He said, "England and all civilized nations stand in deadly peril of not having enough to eat." He added, "It is the chemist who must come to the rescue to the threatened communities." He said that because yields were falling as a result of traditional farming, the soil was being depleted of its nutrients and not able to cope with the population growth. One key here is to harvest nitrogen. Did you know that 78% of the air that you breathe is nitrogen? It isn't available to plants. They can't absorb it from air. They need it in fixed form in the soil. Scientists all over the world were working on this issue, how to harvest or extract that nitrogen.
It was the Norwegian scientist, Kristian Birkeland, who cracked the code five years later, inventing the electric arc process to extract nitrogen from the air, and that was the start of Yara. Yara and fertilizer's contribution to the world goes far beyond growing food. It has saved lives, and more lives, in fact, than any other human innovation to date. Fertilizer has provided us with more arable land, and it has allowed farming in places previously not considered suitable for farming. As the world population grows, it is critical to have fertilizer to support that. Going forward, we need to grow more with less. During the next 40 years, the world needs to produce the same amount of food as we have produced in the last 4,000 years in total.
What's more, the agriculture sector represents roughly 1/4 of global greenhouse gas emissions and accounts for 70% of the fresh water consumption on an annual basis. The footprint of agriculture needs to be reduced significantly, both with regards to emissions, but also with regards to resource use. Technology will play an important role in this, as precision fertilizer application is a key to increasing yield per input provided. We also now need to look at the food production in totality, from consumption of food all the way back to distribution, production, and mining operations to make sure that we have efficiency, that we have the right quality, and traceability is in place. Yara is in a unique position to respond to these targets.
You can see several example of that throughout this presentation today and on the screen right here, covering everything from our product portfolio and also to our on-field presence, as well as digital farming solutions, which we will come back to later on in the presentation. Our strategy is evolving to meet and create value from fundamental changes taking place in the agriculture sector. After a number of years of focusing on growth through M&A and production expansions, we have now shifted our focus. This shift started in 2016 with a focus on operational improvement, evolved further in 2017 with the launch of our digital farming unit, and was consolidated in the year 2018 with our updated strategy and strategic priorities. Our updated strategy is about providing and developing the best crop nutrition solutions for the future.
Fundamentally, our strategy is about delivering sustainable crop nutrition solutions to the farmers while delivering a superior return on our capital. Our strategy is built around three strategic priorities, advance operational excellence, where the Yara Improvement Program is a key element. Create scalable solutions, which is based around driving premium product growth and building profitable global food chain partnerships, and then drive innovative growth, which is focused on scaling up digital farming and growing profitable businesses linked to decarbonization and circular economy. Yara has evolved over time, not only in assets and products, but increasingly in distribution and fertilizer application knowledge. This evolution allows us to offer farmer-centric solutions. Which is a complete package of products, knowledge, and services, which is unique in our industry. We operate in an integrated business model with our production, as well as our Sales and Marketing organizations working together in a global system.
Let me give you an example of how the integrated model provides continuous feedback loop for value creation. Our fertigation product line has historically been a high-premium solution for combining soluble specialty fertilizer into watering systems for greenhouses. Based on feedback from farmers, we saw the potential for a much larger fertigation market in the open field sector, if we could solve the challenge to develop a lower cost, higher volume solution. We took this challenge back to our production plants, and after testing at several of our plants, we came to the conclusion that the Uusikaupunki plant in Finland could deliver such a solution. We are now in the process of launching this new product range called YaraRega, creating a whole new market, a whole new revenue stream, and thanks to this innovative collaboration between our different units in the integrated business model.
Our business model sets us apart in our industry and allows us to consistently deliver high-quality products, knowledge, and tools that optimize farmers' yields, and thereby profitability. Within production, we primarily create value from systematic productivity improvements across our 28 sites. Our global sourcing strength provides attractive raw material prices. To put it in perspective, only China and India buy more phosphate and potash than Yara on an annual basis. Our infrastructure and logistical margin is driven through almost 200 distribution points to ensure scale and also lower freight cost. An example of how we create value through the distribution chain is in Thailand. Here, we doubled our EBITDA by switching to selling directly to 150 retailers rather than using one importer. Our knowledge margin can also be seen in our stable NPK premiums and high-value solutions enabled by digital.
Altogether, our integrated model enables consistent value through premium products over time and represents a strong foundation to create scalable solutions also going forward. Our business model and position is unique within the fertilizer sector, especially our geographic presence with our complete crop nutrition solutions. Most other major fertilizers are production-focused with limited in-market presence and farmer interaction. The players with market presence do not have a global reach. I would like to highlight our 870 sales agronomists and our 9,000 fully branded retail outlets as assets that set us apart from our competitors. We are committed to ensure that Yara is a safe environment, both for our employees and our partners, and we strive to get to zero accidents.
Safety and strong operations go hand in hand, and this is our DNA, and I think it demonstrates the power of an aligned workforce with a unified way of working through Safe by Choice. We have also key commitments to drive diversity and engagement and compliance. Our people processes are closely linked to Yara's overall strategy. Yara's people strategy connects our people and organizational priorities together. The goal is to attract, develop, and retain people. We're committed to utilize the feedback that we get from our employees through regular surveys to implement improvements to make Yara a better and a safer place to work. Through these regular employee surveys, we measure our engagement level continuously to know that we're moving in the right direction. We're currently at 77% on employee engagement, which is above the global norm of 67%, while the high-performing norm is at 74%.
Our target now is to reach and to maintain an engagement index above 80% by year 2025, which is well above the high-performing norm. It's our strong belief that diversity is a key enabler in order to solve the difficult challenges that the world is facing. We have a very strong starting point in Yara. We have 84 different nationalities, and the cultural diversity that comes with it. We have a huge long-term opportunity to improve our gender diversity. At the end of 2018, women represented 21% of Yara's workforce, and we have initiated activities at all levels and in all regions in order to increase diversity and ensure inclusion. For the past 15 years, Yara has almost eliminated emissions from nitrous oxide, a highly potent greenhouse gas, through installment of patented catalyst technology developed by Yara.
90% of Yara's nitrous oxide emissions have been cut by this technology, equal to 15 million tons of CO2 emissions, which have been reduced then every year. Yara produced nitrates have a carbon footprint about 1/3 below the global average for nitrogen fertilizer. With the current target for CO2 emission reduction targets, Yara is building on an already industry-leading performance. Yara is also working to increase nutrient use efficiency within agriculture, and field studies do confirm that better yield, better profitability, and lower carbon footprint can be achieved with balanced fertilizer application compared to traditional practices. Finally, Yara innovates with a purpose, and we believe profitability goes hand-in-hand with sustainability across the whole value chain, from raw materials to end consumer.
Circular economy and Decarbonize Yara are two newly established units and are our preparations for the future where we expect carbon neutrality, that will be a license to operate. As mentioned already, this presentation is in particular about strategic direction and in particular on strategic execution to deliver improved returns. We aim to reach more than 10% return on invested capital over the cycle, and the remainder of this presentation will illustrate how we aim to achieve this. We have a clear target of reaching a return on invested capital of 10%, and we will now take you through how to achieve that. We're a farmer-centric company, we'll start on the ground and in the field with the solutions that are applied. Now I'll hand over to EVP of Sales and Marketing, Terje Knutsen.
Thank you, Svein Tore, and a very good morning to all of you. In this section, we will describe the main components of the Sales and Marketing strategy and how, in very practical terms, we drive value. Most of the presentation will be around how we increase what we call the knowledge margin. I would like to start with this slide showing the very wide network of owned and rented terminals that we have around the world. That is a very important building block, an enabler to bring that knowledge margin. It brings us closer to the end user. It brings supply security, allowing us also to optimize the product flows and also give us flexibility to take out productivity gains in our production system.
We have more than 200 infrastructure points, that really is an important part of the value chain, but also something that clearly sets us apart from competition. If we take a step back, over the last five to seven years, the ag fundamentals have weakened. Crop prices have been declining. Here shown coffee, corn, and wheat. We have been in a supply-driven situation also on fertilizers, meaning that fertilizer prices have come down, but they have actually come down less than crop prices. That means that there has been an extra pressure on farmer profitability. If we look at how we in Sales and Marketing run our operation and try to get financial performance, it's obviously linked to the value of the yield. When that value comes down, the ability to take out a premium comes under some pressure.
This we have seen particularly in Europe with our nitrates, but it is partly compensated with much more robust markets, in the higher value segments. Sales and marketing EBITDA for the last years have therefore been at a lower level compared to 2015. The trend has partly been mitigated by our farmer-centric strategy, which we now will go through. After launching that farmer-centric strategy, we have grown the premium products by 1.4 million tons. It should also be mentioned that as our supply flexibility, in the short and medium term is limited, a very important part of this is to allocate products from lower-paying segments to higher-paying segments. In fact, all of this growth has come outside of Europe. The growth is less than we anticipated in 2015. We have had an annual growth of 3.5%, but that is twice the growth of the market as such.
As such, we think this is a satisfactory result. The strategic target for 2025 is to grow the premium volume to 17 million tons. That means basically that we continue the annual growth that we have had over the last three years. This growth will partly be enabled by optimizing our existing production system, optimizing the inventory, but also taking in more sourcing of products from other producers that choose to use Yara as their distributor. Our farmer-centric strategy with a very crop-focused solution stays very firm, but we are sharpening it, and we want to focus more on value versus volume. It has gone from asset to product, focusing on crop, and now we are moving more towards solutions. There are five key factors that will enable us to deliver value. First, the product portfolio. To accelerate the growth of higher value products like micronutrients and fertigation products.
Continue to focus on the high-value crop segments. We start to see that product and crop is not enough. We need to move this to deliver more holistic solutions, where we go beyond the product and where we incorporate tools and services, responding really on the farmers' needs and deliver a value to them. We do that by partnering with food chain companies and also continue to build our digital farming capability. I will go through each of these steps in the next coming slides. If we start with the product dimension. Yara is known for our compound NPKs and nitrates. The YaraMila, YaraBela range of products, that is where we have a big chunk of our value today. Our portfolio is much more than this. We are increasingly entering into product of higher value.
We have products like mentioned by Svein Tore in the fertigation segment, meaning that you incorporate the fertilizer into an irrigation water, the YaraRega, YaraTera. We have increased focus on foliar applied micronutrients, which means that you spray the nutrients onto the crop. The YaraVita range. We are growing fast with something we call PROMICRO where we coat basically standard fertilizer with also micronutrients. This year we have launched our range of biostimulants, which are products that will help the uptake of nutrients and tolerance stress. These are more advanced products, capital intensive, less capital intensive, but intensive on knowledge. If we take an example of YaraVita, it is a product range that really adds value to growth. It represented 6% of the Sales and Marketing contribution in 2018 or equal to $100 million.
We have seen and we will continue to grow that, which means that it will have a relatively higher share. Why is a product like this interesting? Well, it is high margin and again, limited capital investments. It is knowledge intensive. What do we mean by that? It is important to have application knowledge. It is important to have knowledge about the specifics of the crops and the nutrients, and adapt to the farmer needs to provide a higher yield and better quality of the crop. It is also interesting because these are products that do not only fit to the high-value crop segments, the fruit and veg, but these are products that we can apply into extensive crops, meaning that it has a much bigger scalability.
They are interesting because we have a proven track record of growing these products, 55% from 2015 to 2018, and an annual growth of 16%. We have today two plants, one in U.K., and a new one in Brazil that was opened in April 2018. New capacity will follow the further growth with India as a key market. Our strategic target is that we will deliver 100 million units of YaraVita by 2025. The next dimension of the product is crop. We cannot create value unless the farmer wins. Therefore, we are very focused on delivering a real benefit to the farmer. If we take avocado in Mexico as an example, Mexico is a market where we have a good position, both in extensive and higher value crops. We sell around 640,000 tons in Mexico.
Avocado is as such a niche, 180,000 hectares, which has a consumption of 75,000 ton of fertilizer, of which we supply 30,000 tons. By demonstrating that we can deliver a very significant benefit to the farmer versus the input that needs to be invested in the crop, we can grow this, our ambition is to grow this concrete example, and doubling it in Mexico. We are in 60 countries around the world, we have many niche crops like this, and we will continue to focus and deliver value through applying a product and a knowledge to drive the growth of such crops. As I said, product and crop is maybe not enough anymore. We are starting to build real solutions.
If I take an example of what we call the Protein Path by Yara, this is an example from Europe, where the protein level in milling wheat and malting barley is coming down in Europe. There is a demand for increased protein level by companies like Barilla, Heineken, AB InBev. They are in demand of raw materials that can deliver them the protein level they need. We are in a position that we can combine knowledge and products to give them that, and to guarantee farmers a level of protein. We compose with different product solutions at the different crop stages, but we more and more add now into, in our digital solutions, building in precision into the concept, so that we are sure that we apply what is really needed to deliver that protein.
If you take a German farmer, he might have around EUR 300 per hectare profit. The value of the protein addition could be EUR 100 and close to EUR 40 on top of that. Our margin on nitrates is around EUR 33 in fourth quarter 2018 per hectare of nitrates, which means that we have a sizable amount that can be shared between the farmer and us. That brings us over to the food companies, and why we engage now with the major food companies. There is a need for healthy food. There is a need for quality food. There is an increased need of traceability along that value chain. In general, the food companies need to demonstrate sustainability. We are positioned in a good place to leverage on that trend. They are looking for companies that have global reach, but also that have local relevance.
Again, that's exactly what we can offer. For us, there are two main reasons for engaging in this. One is obviously that we can commercialize the knowledge we have, and create business with selected global companies. The other is that we constantly try to shorten the value chain. These main companies, they have access to contract farmers, which gives us an opportunity to reach a much bigger audience. Our ambition here is to grow from presently around 300,000 tons that go via the food chain companies, directly or indirectly, to 2 million tons by 2025. One of the innovation initiatives we have is around circular economy. This is a response clearly to a trend, asking for smarter use and also reuse of the planet's resources. We think that that is much more than just responding to an environmental concern.
This is a model where resource security is important, and we have started to work on this with water treatment companies, for instance, where we have entered a partnership with Veolia, and we have several projects on how we can use nitrogen and phosphate recycle, and explore new ways of generating value streams for us. We participate in several funded projects and also R&D programs. Digital farming is becoming a very important additional element to our offering. Basically, helping the farmer to capture a value that technology can bring. The value generation comes through three main streams. It is clearly supporting our fertilizer business growth, where precision farming can help us to create pull of our existing product range. We also see that we are able to deliver standalone solutions, where the solutions are being brought to market as a standalone.
Maybe more interesting and even more important in the longer term, is our ability to create new business models when we now start to get much more data than we have ever had before. This is the less mature area, but has a big potential. We think here we can attract other players outside the business. It could be insurance companies, it could be, again, traceability through that food chain. With our presence on the field and the data gathering we now get, we are quite sure, and we have clear ideas on how we can drive that going forward. With this as a backdrop, we will now provide a status on the progress for our digital farming strategy. At the Capital Markets Day last year, we presented the strategy, and we have since been working very hard to have a fast progress in this area.
We see five key success factors. One year ago, we asked ourselves whether we could prove to ourselves that we could build strong digital capability. Can we simply attract the right talent and build global capacity to meet our ambition? Can we innovate industry-leading digital services? Can we quickly grow user adaptation and make sure that the farmers actually use what we deliver? Can we scale it up and also find value creation models? Last but not least, we were very aware from the very beginning that this is a transition that we cannot do alone. Can we attract other players, leading players, to build a sustainable solution for the future that can provide value? We think we have been able to have a very good progress on these critical enablers. We will now look and go through a little bit each one of them.
The foundation for every digital business lies in the talent we can attract. We have been able to attract people from world-leading technology companies. We have today a very strong team of competencies that we certainly did not have a year ago, combined with the competencies that we have in-house in Yara. I would like to mention that the mission vision has been extremely important to attract very high-level talent. Feeding the world and protect the planet is attractive for the younger generation. They want to have a purpose, and if they can add technology with a purpose, they like working for a company like Yara. Farming is a local business. We have chosen to establish four regional hubs. That means that we quickly can test out ideas and get real feedback from different settings, different realities for the farmers.
We have chosen to do this in-house, not through expensive acquisitions. We are now also gradually, not shifting, but adding to innovation the capacity to grow and commercialize the solutions we have. Can we innovate? We have brought to market now four, or I have example here of four of the solutions. Atfarm, it's a satellite-based business-enabled precision fertilization tool. We have developed YaraIrix, where we turn the smartphone into a precision tool where they can optimize the N fertilization, the nitrogen fertilization. We have YaraConnect, where we have a system that we connect with our dealers and sub-dealers and create loyalty programs to increase interest and also channel our knowledge. We have Yara Ayra, which is where we take soil and leaf analysis and turn that into very personalized, field-specific advice for the farmers.
All of this has been developed in a very short period of time in several markets. Speed and scale is important in digital. I think we have seen very encouraging results. We have launched our tools now in 15 countries, and we think we have a fundament to grow this faster going forward. Our ambition is to have more than 10 million hectares under management in 2020. We are very aware that only value-creating business is sustainable. Again, we have prioritized scale, but we are already working hard on pilots and how we can commercialize our offering. We have, for instance, subscription-based services with Yaralrix , where the farmers pay a monthly fee for having our app. We have Yara Ayra, where they pay a hectare fee to get personalized crop nutrition advice. In 2019, we have generated $15 million digitally enabled revenue through our digital farming solutions.
Our ambition here is that we are in a positive EBITDA from digital farming in 2022. No company can do this alone, as I said from the very outset, we have been searching and been clear that we need to do this in partnerships. We are actually very proud that IBM and Yara has come together to build a strong platform going forward. This has created quite a lot of attention in the industry, and I think it is a proof that we are doing something which is being seen as very interesting in the marketplace.
It is clearly a strategic partnership where we unite two quite different capabilities, IBM with their capabilities both in innovation, but also in data management, AI, et cetera, and where we come from a point where we have knowledge around crop nutrition, but also where we have the feet on the ground and can connect with the users of this. The first joint teams are already working together, both in Europe and in Singapore, we plan to quickly broaden this cooperation going forward. The IBM connection has also brought us into the Food Trust, this is a digital ecosystem, you could say from farm to fork, where we get connected even all the way down to the end consumer, where you have participation of key food companies and other players along the value chain.
Our role is to cover the farm and the field part of the food production system. Again, a necessity if you want to have transparency through that value chain, all the way from production to the table of the consumer. Back in mid 2017, we decided to scale up our digital farming business. We saw that really as a necessity to be the crop nutrition company for the future. We had a strong belief that we needed to participate, and not only participate, but drive this development in agriculture. We think we have had good progress, but we are not alone. There are many trying now to position themselves in this area. Why do we think we will succeed in this? We have more than 800 agronomists and sales representatives in many countries around the world.
That means that we can bring the knowledge back to us and prioritize the resources where we see that there is a real need. We are really linked with the reality of the market. In addition, we have key agronomic knowledge, which enables us to fill digital tools with real content and things that matters for the user. If you compare us with a digital startup, we can bring really holistic solutions that we combine different elements into good solutions. We have the global reach, and therefore the ability to scale up. Last but not least, we have proven that we are seen as an attractive company, an attractive brand. It's more and more important for a farmer to be introduced to digital through something which that farmer trusts. They trust the Yara brand, and that opens doors for us to access also with our digital solutions.
That completes a little bit the strategic picture. We are, as you know, in many markets around the world. They are different and have different dimensions, different crop mix, different size of the market, growth potential is different, and the structure of the farming sector is different. We have to optimize this. We have basically three kinds of markets. We have markets where we already have critical mass, but where we see an opportunity to optimize and sharpen our position even further. An example for such market would be Brazil. Lair Hanzen will present Brazil in a short moment. We have markets where we are small today, but where we see a very clear possibility to grow. India is such a case where we want to invest to grow.
We have also markets where we see that we do not have the critical mass, and we struggle to find a way to penetrate those markets in a good way. Some of these markets we are now reviewing and evaluating alternative go-to-market strategies. Very quickly on India. Extremely interesting market, where the agricultural landscape is truly changing, and that gives opportunities for growth. Prime Minister Modi, he has set the target that farm profitability should double by 2022. That is not possible unless there are regulatory developments, taking in digital technologies and introducing new product opportunities, and this is exactly what a company like Yara can bring. With the Babrala acquisition, we have also gotten a strong foothold in the north of India, and we see clear untapped potentials for our solutions, especially the YaraVita range of micronutrients that I presented earlier.
This has also led us to update the business case that we have ahead of the Babrala acquisition. At that time, we saw 130 kilotons potential for premium products in 2023. We have updated that to 200 kilotons, and we have also increased our target for YaraVita products from 2 million to 5.2 million units. This is given the present regulatory structure in India. If the regulatory structure would change, this would obviously open up new opportunities and significantly bigger potentials. With this, I will hand over to Lair Hanzen, who will take us through Brazil, which again is an example of a market where we have critical mass, but where we see possibility to optimize further.
Thank you, Terje, and good morning, everyone. One of the reasons that makes some of you guys think actually to go to India is what we have done in Brazil. I will show you a little bit what we have been doing and what we want to do further in Brazil. Brazil is also a very large, a very complex, import-dependent commodity fertilizer market, very much, so with similar complexity. We have been in Brazil now. Our first acquisition there was 19 years ago when we really started to grow in Brazil. Through a series of acquisitions and brownfields and greenfields, organic growth, we have really established a relevant position in Brazil, where we gained 20%-25% market share, establishing a leading position in distribution.
We got a very nice footprint in Brazil. Most importantly, apart from the channels into the market, we have the most recognized brand today in Brazil, which is really the platform for further growth in Brazil. Since then, we have been growing a lot in Brazil following the market, but we have especially been growing in the premium sector, as you can see here, that the relative share of the premium products in Brazil has been growing a lot. Since the Bunge acquisition, for instance, which was our big step in distribution in Brazil in 2013, we have tripled that volume in premium products in Brazil. If we go back nine years in Brazil, we were doing about 100,000 tons of premium products, and we have now in 2018 crossed the 2 million tons and driving fast towards 3 million tons of premium products in Brazil.
Brazil is still very much a commodity market, 35 million tons, import dependent, very complex market, very long lead time. You need a lot of infrastructure on the ground, so it's very difficult for a commodity player to have sustainable return on investments as the capital. It's a very capital-intensive business. After such a steep and fast growth as we had in Brazil, it's now the natural time that we optimize the machine by all means in Brazil. That basically means that we want to do more of premium, which really pays off. We want to optimize especially the commodities part of it. It's basically driving value over volume. Probably on the premium side, as Terje said, we want to drive both volume and value, and on the commodity side, that means basically that we will drive value over volume.
If we take one example, we have Terje mention the YaraVita. This is the micronutrient foliar range that we have. It suits very well into Brazil because of the concept. We can apply that both for high-value crops. This is low volume, high margins, fruits and vegetables, for instance. We can also apply it in the low-value crops, which is big volumes and probably lower value. For instance, soybeans in Brazil, which is the most important crop in Brazil. Here, if we go back, you can see the growth there on the right. Again, if we go back some eight years, we were navigating around 1 million units in Brazil, and we decided to grow. We have here adopted a different strategy than we have done on the solid part of fertilizer in Brazil. On the solid part, we have basically done M&A.
Here, we decided that we should build on our fantastic product portfolio range that we already had and our knowledge and our market access in Brazil. We have decided to do it ourselves. What you can see the results here, we are now passing already. We have multiplied that business by a factor of 20. We are over 20 million units. As Terje said, the ambition is to grow on a Yara level to 100 million liters, and Brazil will continue to have that share of 40%. This is a state-of-the-art unit in Sumaré, São Paulo. We opened last year, and it's this unit. It's prepared to bring us to the leadership position also in the foliar market in Brazil. We are so far well in our targets for that business.
If we take another dimension and we look at it from a crop perspective, and if you look into coffee here. Coffee is very important in Brazil. Brazil is the number one producer and number one exporter of coffee in the world. One third of the coffee of the world is produced in Brazil. Here we have the program, NossoCafé, our coffee. Here what we do is we go for a much more holistic approach, focused on, if you want, make the farmer happy, make him smile. What we do is we go in with a complete approach, pre-planting until post-harvest, where pre-planting, we literally using all our portfolio and all our knowledge, we prepare the ground for him to have a good harvest. We bring in now the partners also from the barter transactions from the food chain, partnerships.
Pre-planting, it's the nutrition company, Yara, it is the farmer, and it's the food chain company where he secures financing, where he secures the offtake, and where he secures the nutritional package to grow that plant properly. During the growth of the plant, we come in with all the digital tools that Terje has shown, and when we optimize that. By the time of the harvest, all that he has to do is to harvest the good results. What happens during that, he has everything secured. The only thing he needs to do is really care about the yield and the premium and the quality which will drive a premium. That's what we do with our premium products here. Of course, it's a win-win for everyone.
As explained before, the food chain, they are looking very much about the security of supply, which they get before planting, the quality, and not the least, the traceability. We, of course, we participate in all of that, which is very good for us as a business, but especially the farmer. We can make a difference for him, that pays back to everyone. This, of course, it doesn't drop from sky. This is a very intensive approach, that is where invest our money into knowledge, as Terje explained. If you take the case of coffee in Brazil, we have over 60 people, specialists, agronomists, R&D professionals, that are fully dedicated to this type of programs that we run, for instance, in Brazil. This is 1,200 events per year, tackling 15,000 stakeholders from the different channels.
If we multiply that by all that we do in Brazil, we do as we speak here today, that is 30 events happening in Brazil. It's 8,000 events per year that we do with our over 300 agronomists that we have on the ground in Brazil to drive value. Of course it pays off. Here you see this is just a snapshot of what happened in coffee, in premium products that we put into coffee. 2018, as you know, was the worst year in the decade in coffee. We are now recovering well and will continue this stair growth of our premium volumes into the coffee segment. These partnerships that we have developed, bringing the financial aspect of it and closing this loop with the farmer, has proven to be very positive alliances for everyone involved here.
We will continue to sharpen our position in Brazil after this growth that we had in Brazil, we call that strategy Premium First, Commodity Right. It means basically, as you see in the upper part of the graph, that we will proportionally grow much more the premium segments in Brazil. It might sound high numbers, but Brazil, with such a big market, actually in absolute numbers, this is possible, and we have shown that it can be done. We will streamline our commodity business in Brazil. That means that we will dedicate our agronomists much more to do demand generation in premium products and less on commodities. We will dedicate our portfolio of assets more to that.
We will dedicate our time in working on the upper part here and making sure as this is very much a price play, that we are competitive here, and that also means that we are willing to sacrifice volumes in commodity whenever that makes sense. We are not planning to step out of commodities. It's needed in our portfolio, but the focus will definitely be on the upper part, and we will kind of have it swinging here according to the profitability we can generate with the machine we have in Brazil. That's why we call this Premium First, Commodity Right. I invite Terje now then to do his concluding remarks on the Sales and Marketing part.
Just to round off this section and repeat a little bit of the messages we have given. We think to really stay relevant to you as investors, but also clearly to the food sector and the food value chain, we will continue to grow the premium products, and we will grow them at a speed that outpaces the growth in commodity deliveries. We will continue to focus on the high-value crop segments, where our offering can give a higher and better margin. We will develop digital tools either as a standalone or, as we have explained, as a part of our crop solution. We think by doing all of this, we will not only fulfill Yara's mission of responsibly feeding the world and protecting the planet, we also think that this will enable us to increase margins and realize a valuable growth.
I will end this with showing a short video on sustainable solutions. Thank you.
[Presentation]
Thanks to Terje and Lair. A lot of people think about agriculture as something traditional, old-fashioned, and it isn't. It's really high-tech industry, where technology is not only an advantage, but I believe prerequisite if we are to meet our targets. I believe that Yara has an excellent position and also set of actions to deliver and take part in that and to create growth in our markets. However, without the right production assets and operations, there are limits to how much we can succeed in the market. I will now hand over to Tove Andersen, EVP of Production, who will show how we're improving returns within production. It's over to you then, Tove.
Thank you, Svein Tore, and good morning, everyone. My top priority as the Head of Production is safe and reliable operations. The only way we can achieve that is through really driving a culture of continuous improvement. What I will present to you today is how we utilize that to then improving our operations with a focus on really getting value of our growth investments. In Yara, we have invested significantly in increasing our production footprint over the last years. We have done that through expansions, new builds, and M&A activities. In total, we have invested approximately $3 billion, which will give us additional 6.1 million tons by 2022. As you will see from the bar here, the focus has been on premium products, to add premium products into our portfolio to really support our farmer-centric strategy.
It's NPK, CN, nitrates, and urea with sulfur. The commodity urea that we have added is linked to our acquisition in India, the Babrala acquisition, where we got an excellent production facility, but also access to one of the most important agricultural markets in the world. The P product that we are adding is linked to our Salitre project in Brazil, which will give us a really significant improvement in our cost position on P products versus the imported products. We have experienced some ramp-up issues on selected projects. This will impact some of the volumes that we will deliver in this year and next year. These are temporary issues, and we are confident that we will deliver the full value potential, as outlined here in 2022. Let's look a bit on the portfolio of our expansions.
On the expansion side, we have the NPK expansions in Uusikaupunki and Porsgrunn. They are all up and running according to design. We have the TN expansion in Köping. We are still experiencing some technical challenges in Köping. The plant has demonstrated to run at 100% over a period. We are confident that when we get solved the current issues that we are experiencing, that we will at least be able to run this as well at designed capacity. If you look at the new builds, that is TN plant in Pilbara, Australia, and the ammonia plant in Freeport. As previously communicated, we are experiencing construction issues with critical equipment in the TN plant in Pilbara. The plant is currently running at reduced capacity at 80%.
We plan to take the plant down over the summer due to the repair work that is required during the autumn. By first half next year, that plant will also be up and running at 100%. The Freeport plant has been running very well the last couple of months. It's been running consistently now at 110% of design capacity for that period. The M&As, Babrala in India and Cubatão plant in Brazil, are both delivering according to the business cases for those acquisitions. That leaves us with three projects still in execution. The Sluiskil value add, Salitre, and Rio Grande consolidation project. You will be able to see here on the graph what are the volumes that these expansions will add to our portfolio and when we expect to have the full earning potentials delivered. I'm not going to go through that in detail.
I thought I would just give some comments around the Sluiskil project. The Sluiskil project was actually partly a continuity investment. We had to do repairs to continue running that part of the plant. We used that opportunity to really strengthen one of our core assets by adding value- added urea with sulfur to the portfolio, replacing the commodity prills. When the plant is fully up and running, we will have 210,000 tons of additional urea plus S capacity. The plant is expected, from a technical perspective, to be fully up and running on that in the autumn. It is producing today on urea prills. This will be a flexible plant, we can use it both for the urea S plus for a normal commodity urea.
The market ramp-up of the sales of the urea plus S will take some time. We expect then the full earnings from this expansion project to be realized by 2022. As this graph illustrates, we have been through a period with very high activity level on large and medium-sized projects. We are now coming down to a normalized level. Our focus currently is really about finalizing the execution of the projects that we are running, after that, really harvest from these investments that we have made. We will have a strict capital discipline going forward. We don't expect to see the same activity level as we've had for the last five years in the near future. Over to operations. I said in my introduction that our focus is to drive a culture of continuous improvement.
We have a Yara Productivity System that we have rolled out to all our production plants. That is really the foundations for all the improvements that we are working on in the production segment. However, this year, in addition to this bottom-up improvement initiatives that we're running, we have two focus areas from the central. That is about improving turnarounds and improving reliability, where we are then running central initiatives. I assume you know that turnarounds are legal requirements that we have on inspections of critical equipment at certain intervals. We use that as an opportunity to do maintenance, repair maintenance work, and also to do small upgrades of the plant, small investments. These projects are huge projects. Typically, it's $50 million-$100 million.
It could last for a month, plus/minus. We will have several thousand contractors working at our sites 24/7 during this period. As you will see from this illustration here, we have experienced significant losses linked to our turnarounds. This is partly because that they have been delayed. They take longer than planned, so the plant is out of operation for longer, but also because we have seen that we have had issues at startup or after startup. It's a huge potential to be captured if we can run these better. What we are doing is that we are using our continuous improvement tools to really investigate the reasons for all the turnarounds we've had, why did we have delays, what were things that we can take as learnings, deploy that learnings into the new turnarounds.
We are also updating our best practice handbook, our governance model, and competence in this area. It works. Belle Plaine is a good example of that. The turnaround we had in Belle Plaine last year was a really good turnaround. It was a step-up change compared to the turnaround they had previously. It was a huge turnaround, $73 million of investment as part of that. How did they then achieve it? They achieved it by really utilizing best practices in a really good planning. We also pulled resources, both from other sites and the central team, to support the turnaround. It was really executed well according to the scope that was designed.
They were able then to deliver this turnaround on budget and on schedule, but also with a very good quality in the sense that the plant has been running very well after the turnaround. We have been able then to increase the capacity of that plant with 66,000 tons, which then represent an annual value of approximately an annual profit, additional profit of approximately $15 million. The other focus area then, as part of our continuous improvement effort from the center is reliability, and this is about how to avoid unplanned shutdowns. It's not that we are bad in this area. We have some of the most reliable fertilizer plants in the industry. Actually, we have the most reliable ammonia plant as part of our portfolio.
There is a big variation when you look at the assets that we have, and we still have too many unplanned shutdowns. The focus here is about how can we reduce the likelihood for those to happen. We approach that from two angles. We look at recurring problems that have occurred several times at the plant, using best practice tools, different ways of doing root cause problem-solving, pulling together a cross-functional team to address it to make sure that we don't have a recurring problem. Then we try to predict for a plant what is the things that might happen. To predict that, we are utilizing our global scale.
We are looking at all the reliability issues we have had at all our 28 sites throughout the world, categorizing them into different categories, and see what are the likely things that might go wrong, so that we can take in one plant, learn from the other plants, so that we avoid that they will experience something that another plant have had before. The third thing we are working in this area is digital solutions. To use digital tool to also then increase reliability of our production assets. By doing that, we will reduce the probability of these unplanned shutdowns going forward. I thought we'd talked about our ambition to become climate neutral. We have had a huge reduction in our CO2 footprint the last 15 years. We do have the ambition that we should be carbon neutral by 2050.
As an important stepping stone, we have put up a target now for 2025, that we should reduce our own CO2 footprint further with 10%. There will be many different initiatives to achieve this, but the two key levers is about increasing energy efficiency of our plants and its abatement solutions, typically catalysts linked to our nitric acid plants. It will require investments, and we indicate that this will require an investment level of $200 million-$450 million over this period. The good thing is that these are profitable investments. At the same time as we are reducing our carbon footprint, we are also improving our cost position. Then to work towards our long-term goal about being climate neutral, we have established a new unit called Decarbonize Yara.
In this unit, we have brought together all the initiatives that we're running in this area, the resources and the competence we have in this area into one unit, so that we have a forceful team that can really drive this with energy. This unit is not only about Decarbonize Yara, but it's also about looking at the business opportunities this provides. In Yara we believe sustainability also is about business and creates real business opportunities. In this space, that might be that you find customer segments that are willing to pay additional to get a green fertilizer, or it might be new segments. For example, natural carbon capture in the forest by fertilizing the forest. To give you a complete example of one of the initiatives that we are running, we put up here the Pilbara plant and the Pilbara initiative.
This is a cooperation with ENGIE, the concept is that ENGIE will then invest in a solar park in Australia. We will take the electricity from the solar to produce hydrogen through electrolysis. This hydrogen will be injected into our existing facility in Australia, which will mean that a portion of the ammonia that we are producing there will be green ammonia, carbon-free ammonia. Also as part of this initiative, we're not looking at it only from a production angle, but also we are talking with industrial customers and food companies to see is there a willingness to then pay a premium for this kind of product. The project is currently in feasibility study, and it's a very interesting project that will give us valuable learnings in our road towards carbon neutrality in 2050, and to support our vision and mission. By that, I conclude my section.
Thank you.
Thank you, Tove. The improvement that we've seen in the production segment has been a backbone of our strategy in the past three years, it's good, Tove, to see that there's still plenty more to come in that area. I think that's a great foundation as we now are looking at expanding our Yara Improvement Program. I'll just hand straight over to you, Lars. The floor is yours.
Good morning, all. I have the pleasure of speaking to you today about both the Yara Improvement Program and later about capital allocation. Both levers essential to improving the returns from Yara to its investors. The Yara Improvement Program was launched as a direct response to the weakening markets, combined with significant capital expenditures a few years back. Three years later, we know that that was the right thing to do. We've delivered more than $320 million of sustainable EBITDA benefits and $160 million of one-off benefits. It has changed the way we operate as a company. In our plants, 10 sites have set production records in the last 12 months, and we have reduced fixed costs per ton by 5%. IT costs per user are down 20%, and we realized 750,000 tons of volume improvements.
We've also demonstrated that safe operations are profitable operations with the 2018 TRI rate being 65% lower than two years ago for the plants and mines, and with several sites setting all-time low records. Our improvement program has been a decisive factor in balancing investments and weak markets. The improvement program, it's not about PowerPoint or Excel models. It is about real people making real change, generating real profits. It is about reducing fixed cost in Siilinjärvi, in Finland, where production and maintenance work on improving the scheduling of work, which is reducing the contractors required by nearly 40%. It is about optimizing packaging in Brazil, for example, through reducing the thickness of the inner lining of the big bags, ensuring the same product quality. These examples substantiate why we are comfortable and ready to take the next step. Today, we are therefore announcing an extended improvement program.
It will make our production returns higher. It will make our cost base leaner and our capital management smarter. With this new program, we're building on the achievements of the past while simplifying through a clear focus on distinction between these three levers, an increased focus on cost efficiencies, and focus on the underlying value drivers. The new program will be more about driving the improvements and reporting on the improvements in the underlying value drivers. It will be less about quantifying those through a fixed margin point in the past, like we had on the previous program with the 2015 reference. This way, we ensure a transparent tracking of our performance on what drives our underlying net present value, easily available for valuation at concurrent market prices.
However, if we were to continue with the same baseline, the new program would represent a 70% increase on a like-for-like basis, expanding the program from 2020 to 2023. In addition, targeting further reductions in working capital. As I mentioned, the new program is divided into three clear buckets with clear KPIs. One significant change in this new program is a much larger focus on what we can fully control ourselves, namely our fixed cost base. We believe we must accelerate the improvements in our cost base. We commit to doing so. Higher is about getting more for less. It is about more volumes with less energy consumption being the major cost driver in our production. Leaner is about reducing our overhead significantly, optimize our operating model in smaller markets, beating inflation across our organization, as we're already demonstrating in large parts of our operation.
Smarter is about instilling a stronger capital discipline and awareness, also around working capital, also across our commercial organizations. These KPIs are fully aligned with the mindset and the priorities of our operating units, securing tracking and action plans in full synchronization. Jointly, these three pillars is expected to yield an EBITDA improvement of $600 million, compared to 2018, and a working capital improvement of $300 million. Let's deep dive into higher. By further leveraging the Yara Productivity System, as Tove has described, we expect improvements of 640,000 tons of ammonia and 700,000 tons of finished product on top of volumes from the growth projects. In order to succeed with this, we need to strengthen our efforts in reducing turnarounds as well as the frequency of major outages like Tove discussed earlier.
To achieve the ambitions, we do not expect material CapEx, but the normalized maintenance and safety investment level of around $800 million, largely in line with what we've seen over the past years. As communicated in Q4 and Q1, our growth projects are fully committed to reaching their intended capacity. However, we've had certain challenges in a delayed ramp-up, as Tove has explained. You will find full details about the link between the old and the new program as to that regard in the appendix to today's material. As these projects near completion, tracking their effects in isolation is difficult and could, in some cases, lead to suboptimal decisions. Therefore, going forward, we will report on the total volume improvements in tons for our asset base, driving accountability to the totality, and better reflecting the underlying improvements in the value of our assets.
We will also adjust these numbers for turnarounds and market optimization effects to drive full alignment with accretive business decisions to our capital returns. The rollout of the Yara Productivity System has increased the energy improvement ambitions across our production portfolio, leading to higher targets. We have chosen to use energy efficiency for ammonia production as the KPI we will track and monitor, as ammonia represents 80% of the total improvement potential. Energy improvements in urea and in the rest of the plants represent an annual improvement target by 2023 of $10 million compared to 2018. Underlying factors are pushing our fixed costs upwards. Firstly, our fixed cost base is subject to inflationary pressure, estimated to an average of 2.5% annually going forward. Secondly, new initiatives often require upfront investments in resources reported as fixed costs.
Thirdly, we are continuously shifting our portfolio towards more premium products, which yields higher margins, but often also requires increased sales efforts. Going forward, we will need to pursue several activities to keep fixed costs fixed in nominal terms and thus mitigate these factors. The actions we are undertaking include optimizing the market footprint, streamlining our central overhead cost structure, as well as continuing our journey to implement a continuous improvement culture. For example, in our head office functions, initiatives to reduce the cost base and headcount are already initiated. In total, these actions will lead to a real improvement in fixed costs of $300 million, or an annual fixed cost saving of an average of 2.5%, making sure that we address the totality of our cost base. Smarter working capital management to release $300 million. We will optimize working capital management by several levers.
It includes reducing inventory, it includes optimizing our business models, it includes deploying commercial toolkits with a higher focus on payment terms. It will be a key focus also from the corporate finance function to monitor and drive such improvements. Combined, these levers will, versus a 2018 baseline, lead to a reduction in working capital by 12%, representing a capital improvement of $300 million. I should add here that the number at the end of 2018 of 102 days was a significant improvement on previous quarters. We will measure this KPI on a rolling 12-month basis to eliminate seasonal fluctuations. The new targets for the Yara Improvement Program represents a natural extension to the existing 2020 targets for the same categories as we have also tracked previously.
In the appendix to our presentation, as I mentioned, you will find a detailed overview of how the expanded targets match and exceeds those of the past Yara Improvement Program, how the new capacity from our growth projects contribute to these. Needless to say, these will be key KPIs for us to report on going forward. This program will deliver substantial savings. In total, it will drive our volumes to 9 million tons of ammonia and 24 million tons of finished product by the end of 2023. We will improve energy efficiency by 4% and fixed costs by $300 million. In addition, we expect $300 million of capital improvements from smarter working capital management. One-off costs are estimated in the area of $100 million-$150 million, including restructuring costs. We will revert on the exact estimates and the phasing of these numbers.
Starting Q2, we will report on the performance of these underlying KPIs towards our targets. I would, in that context, also like to remind the audience that, as has also been the case so far, performance on such KPIs will likely vary intra quarters, while the underlying trend will continue to confirm the realization of the targets set out, building on the already achieved sustained EBITDA earnings improvements. I can't wait to get back to talk about capital allocation, but I'm told I'm not allowed to do that before a little bit later. With that, I round off this part of the presentation.
Thank you, Lars. I guess, however experienced you are with digesting slides, I think it's time for a very well-deserved coffee break now. We'll meet again in approximately 40 minutes at 10:50 A.M. We'll start by presenting our plans to evaluate an IPO for our industrial nitrogen businesses. Thank you very much.