Agricore United announced today that its operating performance for fiscal 2005 has materially improved across all business segments. This positive momentum has also contributed to a material improvement in the Company's balance sheet.

Agricore United's sales of crop nutrients, crop protection products and seed increased by $35 million to $192 million for the six months ended April 30, 2005, compared to the same period last year, and have continued to exceed prior year results to the end of May 2005. Grain shipments and livestock services sales also saw an increase for the six months ending April 30, 2005 with Agricore United handling 4.9 million tonnes, or 35 percent of industry grain shipments. In addition, the average margin per tonne on grain increased to $20.46 for the quarter compared to $18.78 per tonne for the same period last year.

Seed sales increased 18 percent to $37 million in the quarter, accounting for about 98 percent of seed sales during the first six months of the current year. Fertilizer tonnes sold in the latest quarter increased 20 percent over 2004. Average margins were consistent with the prior year.

Feed sales increased by 53,000 tonnes to 497,000 tonnes for the latest six months. As a result of increased tonnes sold and a 5 percent higher margin of $45 per tonne, gross profit from feed tonnes sold improved for the six months by $3 million to $22 million, reflecting the continued resiliency of the western Canadian livestock market. Profits from the Company's interest in The Puratone Corporation and its other livestock interests also improved significantly in the quarter and six months.

"A recent favourable ruling concerning hog duties, increasing slaughter capacity in Canada and improved access to world markets have helped the livestock industry and a similar favourable ruling from NAFTA concerning U.S. duties on Canadian wheat will hopefully assist the grain sector as well," said Brian Hayward, Chief Executive Officer. "An early start to the western Canadian growing season, good moisture levels and advanced seeding in Alberta and Saskatchewan improved the most recent quarter's results and bodes well for the balance of the growing season assuming sunny days ahead."

The balance sheet also improved substantially with overall funded debt decreasing $117 million to $580 million. The Company's weighted average trailing twelve-month leverage ratio based on net funded debt to capitalization improved from 46.3% last year to 43.2% at April 30, 2005. At the same time, the Company's unused short-term borrowing capacity increased $164 million to $198 million at April 30, 2005.

The Company's earnings before interest, taxes, depreciation and amortization for the six months increased $4.5 million to $18.3 million. Agricore United incurred a loss of $5.4 million ($0.13 per share) for the quarter compared to a loss of $17.7 million ($0.40 per share) for the same quarter last year. Operating General and Administrative (OG&A) expenses declined $1.8 million in the quarter, due to one time recoveries of $700,000 in hog duties and recoveries of provincial capital taxes and property taxes on port terminals in Thunder Bay. Cash flow provided by operations of $6.7 million for the quarter ($0.14 per share) improved by $17.6 million or $0.39 per share over the same period last year.

"Throughout all divisions of the company we are seeing positive trends in earnings and cash flow," said Hayward. "We continue to successfully manage those aspects of our business which we can directly control - namely margin, market share and costs."

Agricore United is one of Canada's leading agri-businesses. The prairie-based company is diversified into sales of crop inputs and services, grain merchandising, livestock production services and financial markets. Agricore United's shares are publicly traded on the Toronto Stock Exchange under the symbol "AU.LV".