Agricore United today announced its first quarter results, noting that improved earnings led by higher grain shipments and feed sales were overshadowed by the timing effect of delayed sales of crop nutrients. As a result, the company's gross profit and net revenue from services for the three months ended January 31, 2006 decreased 2 percent over the same period last year and Agricore United's loss of $20.6 million ($0.46 loss per share) for the quarter was $2.2 million higher than the restated $18.4 million loss ($0.41 loss per share) for the same period one year ago.

Sales of crop inputs in the latest quarter decreased $19 million to $51 million as farmers responded to escalating fertilizer prices and low commodity prices by delaying purchasing decisions until a point in time closer to spring seeding. Due to the seasonal nature of the growing season in western Canada, the Company's crop input sales in the first quarter typically represent less than 10 percent of its annual sales of crop inputs.

"Good moisture conditions across western Canada will encourage maximum use of the productive capacity and the impact of significant crop growth last year indicates a need for fertilizer products this year," says Brian Hayward, Chief Executive Officer, Agricore United. "In addition, the combination of high rates of collection on last year's credit programs and the positive credit profile of the Company's farmer customers suggest that the delays in customer purchasing decisions are operational rather than financial, as farmers weigh final planting decisions against demand signals from the world commodity markets."

Sales of manufactured feed increased from 258,000 tonnes last year to 274,000 for the latest quarter. Feed margin per tonne also increased modestly and gross profit from non-feed sales was comparable to the prior year, resulting in a slight increase in gross profit to just over $14 million. The livestock sector continues to benefit from access to abundant feed ingredients and increased demand from domestic and world markets.

Grain movement improved in the quarter with Agricore United handling over 34 percent of the 8 million industry tonnes shipped compared to almost 35 percent of the 7 million tonnes shipped during the same period last year.
Commodity margins declined less than 4% compared to 2005, reflecting a change in the mix of grains and oilseeds shipped by the Company combined with lower oilseed margins on flax and Linola® and lower margins on peas due to the poor quality of the 2005 crop.

"Grain shipments are beginning to bounce back to levels reflective of the high volumes produced in 2004 and 2005," says Hayward. "The Canadian Wheat Board's (CWB) recent take-up of grain offered for sale by farmers and the steady delivery of non-CWB grains and oilseeds despite current commodity prices are reasons for increasing optimism about grain shipments over the balance of the fiscal year."

Agricore United is one of Canada's leading agri-business with headquarters in Winnipeg, Manitoba and extensive operations and distribution capabilities across western Canada. Agricore United uses its technology, services and logistics expertise to leverage its network of facilities and connect prairie-based agricultural customers to domestic and international customers and suppliers. The company's operations are diversified into sales of crop inputs and services, grain merchandising, livestock production services and financial services. Agricore United's common shares are traded on the Toronto Stock Exchange under the symbol "AU.LV".