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Press Release

August 08, 2013

Press Release: August 07, 2013

The Board of Directors of SQM held a meeting today – Wednesday 7th of August 2013 - in order to discuss the information currently available in relation to the developments in the international Potassium Chloride markets.

As previously reported by SQM, the Russian Company “Uralkali” made an unexpected public announcement on July 30th of this year, communicating its decision to put an end to the sakes agreement it had with the Belarusian company “Belaruskali”. “Uralkali” also communicated its intention to increase its Potassium Chloride production and sales volumes in the future. These were all autonomous decisions taken by “Uralkali”, and SQM has no control or influence over said decisions.

The above events have had a significant impact on the price of shares of the major Potassium Chloride production and sales companies worldwide.  SQM’s share prices have also been affected.  SQM is a minor player in this market, and its sales represent less than 3% of world demand. SQM is not a member of any Potassium Chloride distribution associations at the international level.  Clearly, SQM has no capacity to affect or influence variations in the international prices of this product.

As of this date, it is not possible to provide a reliable estimate of the effects that Uralkali’s announcement will have on international prices of Potassium Chloride. It is therefore impossible to make a reliable estimate of the effects these events may have on SQM’s Financial Statements in the medium or long term. Without prejudice of the above, the Board also examined and confirmed the public information submitted by the Company to the Chilean Securities and Insurance Commission (Superintendencia de Valores y Seguros de Chile) and to the Chilean Stock Markets on August 6th of this year, which also evaluated the above.     

It is important to note that SQM has reported – in its Annual Report for 2012 and in its “Form 20-F Report” - that the prices of its products, especially Potassium Chloride – are determined mainly by international prices, which have been subject to considerable volatility in recent years.  The world supply of fertilizers, including the supply of products marketed by SQM, varies to a large degree on production volumes on the part of the major producers and their respective business strategies.  SQM cannot guarantee that prices and volumes of its products will not decrease in the future.

SQM will continue to monitor these events, and it expects to be able to provide additional information related to possible variations in the price of Potassium Chloride when it issues its Financial Statements on August 27th of this year.

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