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NOTICE TO THE MARKET
São Martinho and Rumo Logística Announce the 2nd Phase of the Logistics Service Agreement

São Paulo, January 18, 2011 - São Martinho S.A. (BM&FBovespa: SMTO3), one of Brazil’s largest sugar and ethanol producers, and Rumo Logística S.A. (“Rumo”), specialized in sugar and grains logistics services which is indirectly controlled by Cosan S.A. Indústria e Comércio (BM&FBovespa: CSAN3), announce the 2nd phase of a logistics and services agreement involving sugar storage, transshipment and rail freight services.

The agreement will be effective from the 2011/12 harvest through the 2019/20 harvest and may be renewed between the parties. In 2011 São Martinho S.A. will invest approximately R$30 million in the “Usina São Martinho” unit in order to i) construct a warehouse with a capacity of 60,000 tonnes of sugar to be used by Rumo, and ii) modernize access from the mill to the Pradópolis yard, increasing the transshipment capacity to up to 2 million tonnes of sugar per year.

When the investments are completed, as of the 2012/13 harvest: (i) Usina São Martinho and Rumo will provide sugar transshipment and storage services for third parties at its Terminal; and (ii) Rumo will transport up to 650,000 tonnes of sugar for São Martinho, in addition to the third-party volume mentioned above.

Rumo will be responsible for any adaptations to the rail transport system necessary for the fulfillment of the transport and transshipment commitments, as already predicted in its investment plan.

Rumo will also grant São Martinho the option to hire static storage capacity at its terminals at the Port of Santos in volumes and conditions to be determined for each harvest year.

This partnership confirms the commitments of São Martinho and Cosan, through Rumo, to continually pursue greater efficiency and cost reductions in the sugar export process.

To see the PDF file, click here.

Contacts - Investor Relations

São Martinho S.A.
João Carvalho do Val, Chief Financial and Investor Relations Officer
Felipe Vicchiato, Investor Relations Manager
Phone: + 55 11 2105-4100
Email: ri@saomartinho.ind.br
IR Website: www.saomartinho.ind.br/ir

COSAN S.A. Indústria e Comércio
Marcelo Martins, Chief Financial and Investor Relations Officer
Luiz Felipe Jansen, Investor Relations Manager
Phone: +55 11 3897-9797
Email: ri@cosan.com.br
IR Website: www.cosan.com.br/ir

About São Martinho
São Martinho S.A. is one of Brazil‘s largest sugar and ethanol producers. The group should reach an annual crushing capacity of 14.0 million tonnes in the 2010/11 harvest as a result of the investments made during the 2009/10 harvest. The group produces sugar and ethanol at its three mills, the Iracema Unit, São Martinho Unit and Boa Vista Unit. www.saomartinho.ind.br/ir

About Rumo
Rumo Logística is the world’s leading logistics player in sugar exports. A member of the Cosan Group, it specializes in sugar and grain logistics and has a static storage capacity of more than 400,000 tonnes of bulk sugar and 55,000 tonnes of bagged sugar, as well as five transshipment terminals in the interior of São Paulo state. Rumo’s facilities in the Port of Santos have an annual shipment capacity of 10 million tonnes of sugar. www.cosan.com.br/rumo