Listed: TSX, NYSE Symbol: POT SASKATOON, SK, July 27 /PRNewswire-FirstCall/ -- Potash Corporation of Saskatchewan Inc. (PotashCorp) announced today that Canpotex Limited, the offshore marketing company for Saskatchewan potash producers, and Sinofert, a leading fertilizer enterprise in the People's Republic of China (PRC), have reached an agreement for shipments to China covering the August to December 2006 shipping period. The agreement calls for a base price increase of US $25.00 per tonne over the 2005 contract price. Because of the late settlement, the short shipping period and the unknown impact of both of these factors on Chinese demand, the tonnages under the contract and the shipping schedule itself are to be finalized in an evolving manner over the remainder of 2006. Both parties will put forth mutual best efforts at meeting the content and the spirit of the existing Memorandum of Understanding(1) between the two companies, which governs potash market share in China. "This agreement is a continuation of the strong and mutually beneficial partnership between Canpotex and Sinofert," said Bill Doyle, President and Chief Executive Officer of PotashCorp. "We are pleased that a significant price increase has been put in place for this year, which essentially has five shipping months remaining. Given depleted potash stocks at the consumer level around the world, we look forward to strong demand for the balance of this year and through 2007." PotashCorp owns one-third of Canpotex and, under a pro rata agreement with allocation of sales and costs based on proportionate share of Saskatchewan potash capacity, is entitled to supply Canpotex with 55.8 percent of its potash. PotashCorp also owns 20 percent of Sinofert, one of the largest importers of fertilizer products in the PRC in terms of import volume. Sinofert is the largest distributor of these products and is also a major producer of phosphate-based fertilizer products. It has 14 branch offices and 1,036 sales centers as part of an extensive distribution network that provided products to 76 percent of total sown lands in China. Potash Corporation of Saskatchewan Inc. is the world's largest fertilizer enterprise producing the three primary plant nutrients and a leading supplier to three distinct market categories: agriculture, with the largest capacity in the world in potash, third largest in phosphate and fourth largest in nitrogen; animal nutrition, with the world's largest capacity in phosphate feed ingredients; and industrial chemicals, as the largest global producer of industrial nitrogen products and one of only three North American suppliers of industrial phosphates. (1) See news release dated August 7, 2003 titled 'PotashCorp Announces New China Potash Memorandum of Understanding' This release contains forward-looking statements. These statements are based on certain factors and assumptions as set forth in this release, including foreign exchange rates, expected growth, results of operations, performance and business prospects and opportunities. While the company considers these factors and assumptions to be reasonable, based on information currently available, they may prove to be incorrect. A number of factors could cause actual results to differ materially from those in the forward-looking statements, including, but not limited to: fluctuations in supply and demand in fertilizer, sulfur, transportation and petrochemical markets; changes in competitive pressures, including pricing pressures; risks associated with natural gas and other hedging activities; changes in capital markets; changes in currency and exchange rates; unexpected geological or environmental conditions; and government policy changes. Additional risks and uncertainties can be found in our 2005 annual report to shareholders and in filings with the U.S. Securities and Exchange Commission and Canadian provincial securities commissions. Forward-looking statements are given only as at the date of this release and the company disclaims any obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. In the case of guidance, should subsequent events show that the forward-looking statements released herein may be materially off- target, the company will evaluate whether to issue and, if appropriate following such review, issue a news release updating guidance or explaining reasons for the difference. DATASOURCE: Potash Corporation of Saskatchewan Inc. CONTACT: Betty-Ann Heggie, Senior Vice President, Corporate Relations, Phone: (306) 933-8521, Fax: (306) 933-8844, E-mail: , Web Site: http://www.potashcorp.com/

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