OREANDA-NEWS. On 08 August 2008 following the announcement made by JSC Uralkali on August 4, 2008 about the price of 3500 RUR for the production of NPK-fertilizers for Russian agricultural producers, the Company released the following additional information for the purposes of clarification:

Uralkali sells potassium chloride on the Russian market through direct sales to customers and through auctions. Uralkali’s total sales volume in the Russian market is about 450 thousand tons per year (not including auctions sales), representing less than 10% of the company’s total sales.

In March 2008, Uralkali and the Federal Antimonopoly Service of the Russian Federation (FAS) agreed the formula for setting prices for potassium chloride in the domestic market. This formula links domestic prices to a certain minimum export market price (currently - FOB China), while adjusting for certain export costs. Following the extension of price for potassium chloride in China, Uralkali’s domestic price, in accordance with the above formula, was increased as of July 1, 2008, to around 12,000 RUR per ton.

In addition, Uralkali has undertaken to supply part of its production at 3,000 RUR per ton (for direct supplies for Russian agricultural producers) and at 3,500 RUR per ton (for supplies to "Eurochem" and "Phosagro" for the production of NPK-fertilizers for Russian agricultural producers).

In H2 2008 Uralkali plans to supply about 220 thousand tons of potassium chloride (not including auctions sales) to a number of consumers in the Russian market, as follows:

- price around 12,000 RUR per ton - about 120 thousand ton of potassium chloride (for NPK-producers and industrial consumers)

- price 3,500 RUR per ton - about 90 thousand ton of potassium chloride (for NPK-producers for the production of NPK-fertilizers for Russian agricultural producers)

- price 3,000 RUR per ton - about 10 thousand ton of potassium chloride (for direct supplies for Russian agricultural producers)

As agreed with FAS, Uralkali is obliged to sell no less than 10% of its domestic sales through auctions. In January-July 2008 Uralkali has sold 110,5 thousand ton of potassium chloride through auctions. The price at the auction of 30.07.2008 was 12200 RUR per ton.

Uralkali believes that the increase in its domestic prices starting from July 1, 2008, will improve the Company’s financial performance, while maintaining prices of 3,000 RUR and 3,500 RUR for part of deliveries to the benefit of Russian agricultural producers, will contribute to the development of Russia’s agricultural sector.