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                                Monsanto Company
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                             MONSANTO LETTERHEAD
 
March 13, 1998
 
Dear Monsanto Shareowner,
 
We're well into our first full year as a life sciences company. This new era for
Monsanto is exciting, and, we believe, potentially highly rewarding. During the
last year, our core businesses have performed remarkably and have generated the
funds for major investments in growth that we believe will create even greater
future value for you.
 
Our commitment to long-term value creation is firm: We've increased Economic
Value Added (EVA) by more than $270 million since the start of 1995, when we
first began to use EVA as a key measurement of value. In those same three years,
total return on Monsanto shares was 247 percent, compared with 126 percent on
the Standard & Poor's 500 Index.
 
Two years ago, we put in place unique programs designed to provide outstanding
returns to shareowners before the company's management received any financial
gain from stock options. Those plans have produced the intended results. The
enclosed proxy statement shows significant gains in management compensation --
and shareowners rightly were rewarded first. We believe this type of
compensation plan is clearly more beneficial to shareowners than traditional
stock option plans.
 
We've now established a new program for purchased, premium options that reward
management for further increasing shareowner value. In the new plan, executives
can invest in the company by purchasing premium stock options, which will have
no value until the market price of your Monsanto shares has risen by 60 percent
from a base of just over $50 per share -- the price of Monsanto stock the day
these options were granted. Those who purchase premium stock options also will
receive a grant of additional premium-priced options that also will have no
value to management until shareowner value first increases by more than 50
percent.
 
For the third year, we have granted options to all Monsanto people to give
everyone a direct economic stake in our shareowners' success. More than 19,000
people who don't participate in existing option programs were granted 500
options in February 1998.
 
We're convinced there's enormous value to be gained from our work in the life
sciences. We're taking the necessary steps to motivate everyone at Monsanto to
create extraordinary returns for our shareowners.
 
                                      Sincerely,
 
                                      /s/ Robert B. Shapiro
 
                                      Robert B. Shapiro
                                      Chairman and Chief Executive Officer