UNITED STATES SECURITIES AND EXCHANGE
COMMISSION

Washington, D.C. 20549



Form 10-Q



|☑ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the
Quarterly Period Ended March 31, 2017

OR



|☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

Commission
File Number 1-10351



Potash Corporation of Saskatchewan Inc.

(Exact name of registrant as specified in its charter)



|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Canada                                                         |  | N/A                                 
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)
|122  1st Avenue South
Saskatoon, Saskatchewan, Canada         |  | S7K 7G3                             
|(Address of principal executive offices)                       |  | (Zip Code)                          

306-933-8500

(Registrants telephone number, including area code)



Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.

Yes  ☑    No  
☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web
site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).

Yes  ☐    No  
☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and
emerging growth company in Rule 12b-2 of the Exchange Act.



|                        |  |   |  |                                               |  |                           |  |  |   | 
|----------------------- |  | - |  | --------------------------------------------- |  | ------------------------- |  |  | - | 
|Large accelerated filer |  | ☑ |  |                                               |  | Accelerated filer         |  |  | ☐ | 
|Non-accelerated filer   |  | ☐ |  | (Do not check if a smaller reporting company) |  | Smaller reporting company |  |  | ☐ | 
|                        |  |   |  |                                               |  | Emerging growth company   |  |  | ☐ | 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).

Yes  ☐    No  
☑

As at March 31, 2017, Potash Corporation of Saskatchewan Inc. had 840,007,355 Common Shares outstanding.









---

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Condensed Consolidated
Statements of Income

|          |  |                                                      |  | 
|--------- |  | ---------------------------------------------------- |  | 
|Unaudited |  | In millions of US dollars except as otherwise 
noted

|                                                |  |                            |             |   |      |   |             |  
|----------------------------------------------- |  | -------------------------- | ----------- | - | ---- | - | ----------- | -
|                                                | 
|                                                |  | Three Months EndedMarch 31 |            
|                                                |  | 2017                       |             |   | 2016 |  
|Sales (Note 2)                                  |  | $                          | 1,112       |   |      | $ | 1,209       |  
|Freight, transportation and distribution        |  |                            | (133        | ) |      |   | (133        | )
|Cost of goods sold                              |  |                            | (711        | ) |      |   | (842        | )
|Gross Margin                                    |  |                            | 268         |   |      |   | 234         |  
|Selling and administrative expenses             |  |                            | (50         | ) |      |   | (53         | )
|Provincial mining and other taxes               |  |                            | (34         | ) |      |   | (31         | )
|Share of earnings of equity-accounted investees |  |                            | 39          |   |      |   | 19          |  
|Dividend income                                 |  |                            | 8           |   |      |   |            |  
|Other expenses (Note 3)                         |  |                            | (10         | ) |      |   | (10         | )
|Operating Income                                |  |                            | 221         |   |      |   | 159         |  
|Finance costs                                   |  |                            | (59         | ) |      |   | (52         | )
|Income Before Income Taxes                      |  |                            | 162         |   |      |   | 107         |  
|Income taxes (Note 4)                           |  |                            | (13         | ) |      |   | (32         | )
|Net Income                                      |  | $                          | 149         |   |      | $ | 75          |  
|Net Income per Share                            |  |                            |             |   |      |   |             |  
|Basic                                           |  | $                          | 0.18        |   |      | $ | 0.09        |  
|Diluted                                         |  | $                          | 0.18        |   |      | $ | 0.09        |  
|Weighted Average Shares Outstanding             |  |                            |             |   |      |   |             |  
|Basic                                           |  |                            | 839,911,000 |   |      |   | 837,118,000 |  
|Diluted                                         |  |                            | 840,211,000 |   |      |   | 837,811,000 |  

(See Notes to the Condensed Consolidated Financial Statements)



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|LOGO |  | LOGO |  | LOGO



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|  | 
|1 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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Condensed Consolidated Statements of Comprehensive Income



|          |  |                           |  | 
|--------- |  | ------------------------- |  | 
|Unaudited |  | In millions of US dollars

|                                                                        |  |                             |     |   |      |   |    |  
|----------------------------------------------------------------------- |  | --------------------------- | --- | - | ---- | - | -- | -
|                                                                        | 
|                                                                        |  | Three Months Ended March 31 |    
|(Net of related income taxes)                                           |  | 2017                        |     |   | 2016 |  
|Net Income                                                              |  | $                           | 149 |   |      | $ | 75 |  
|Other comprehensive income                                              |  |                             |     |   |      |   |    |  
|Items that have been or may be subsequently reclassified to net income: |  |                             |     |   |      |   |    |  
|Available-for-sale
investments1                                         |  |                             |     |   |      |   |    |  
|Net fair value gain during the period                                   |  |                             | 33  |   |      |   | 1  |  
|Cash flow hedges                                                        |  |                             |     |   |      |   |    |  
|Net fair value loss during the period 2                                 |  |                             | (5  | ) |      |   | (6 | )
|Reclassification to income of net loss 3                                |  |                             | 8   |   |      |   | 15 |  
|Other                                                                   |  |                             | 3   |   |      |   | 1  |  
|Other Comprehensive
Income                                              |  |                             | 39  |   |      |   | 11 |  
|Comprehensive
Income                                                    |  | $                           | 188 |   |      | $ | 86 |  

1Available-for-sale investments are comprised of shares in Israel Chemicals Ltd., Sinofert Holdings Limited and other.

2 Cash flow hedges are comprised of natural gas derivative instruments and treasury lock derivatives and were
net of income taxes of $3 (2016  $3).

3 Net of income taxes of $(5) (2016  $(8)).

(See Notes to the Condensed Consolidated Financial Statements)



LOGO



|                                                            |  |  
|----------------------------------------------------------- |  | -
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 2



---

Condensed Consolidated Statements of Cash Flow



|          |  |                          
|--------- |  | -------------------------
|Unaudited |  | In millions of US dollars



|                                                                                      |  |                             |      |   |      |   |      |  
|------------------------------------------------------------------------------------- |  | --------------------------- | ---- | - | ---- | - | ---- | -
|                                                                                      |  | Three Months Ended March 31 |     
|                                                                                      |  | 2017                        |      |   | 2016 |  
|Operating Activities                                                                  |  |                             |      |   |      |   |      |  
|Net income                                                                            |  | $                           | 149  |   |      | $ | 75   |  
|Adjustments to reconcile net income to cash provided by operating activities (Note 5) |  |                             | 144  |   |      |   | 206  |  
|Changes in non-cash
operating working capital (Note 5)                                |  |                             | (70  | ) |      |   | (93  | )
|Cash provided by operating
activities                                                 |  |                             | 223  |   |      |   | 188  |  
|Investing Activities                                                                  |  |                             |      |   |      |   |      |  
|Additions to property, plant and equipment                                            |  |                             | (133 | ) |      |   | (246 | )
|Other assets and intangible assets                                                    |  |                             | 1    |   |      |   |     |  
|Cash used in investing
activities                                                     |  |                             | (132 | ) |      |   | (246 | )
|Financing Activities                                                                  |  |                             |      |   |      |   |      |  
|Finance costs on long-term debt obligations                                           |  |                             | (1   | ) |      |   | (2   | )
|Proceeds from short-term debt obligations                                             |  |                             | 21   |   |      |   | 336  |  
|Dividends                                                                             |  |                             | (82  | ) |      |   | (313 | )
|Issuance of common shares                                                             |  |                             | 1    |   |      |   | 20   |  
|Cash (used in) provided by financing
activities                                       |  |                             | (61  | ) |      |   | 41   |  
|Increase (Decrease) in Cash and Cash Equivalents                                      |  |                             | 30   |   |      |   | (17  | )
|Cash and Cash Equivalents, Beginning
of Period                                        |  |                             | 32   |   |      |   | 91   |  
|Cash and Cash Equivalents, End of
Period                                              |  | $                           | 62   |   |      | $ | 74   |  
|Cash and cash equivalents comprised of:                                               |  |                             |      |   |      |   |      |  
|Cash                                                                                  |  | $                           | 44   |   |      | $ | 16   |  
|Short-term investments                                                                |  |                             | 18   |   |      |   | 58   |  
|                                                                                      |  | $                           | 62   |   |      | $ | 74   |  

(See Notes to the Condensed Consolidated Financial Statements)



LOGO



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|- |  | -----------------------------------------------------------
|  | 
|3 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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Condensed Consolidated Statements of Changes in Equity



|          |  |                          
|--------- |  | -------------------------
|Unaudited |  | In millions of US dollars



|                                                                      |  |               |       |  |                    |   |     |                                                       |  |   |                                                               |  |  |       |      |   |                                                    |   |     |                  |  |   |              |   |  |   |       |   |  |   |       |  
|--------------------------------------------------------------------- |  | ------------- | ----- |  | ------------------ | - | --- | ----------------------------------------------------- |  | - | ------------------------------------------------------------- |  |  | ----- | ---- | - | -------------------------------------------------- | - | --- | ---------------- |  | - | ------------ | - |  | - | ----- | - |  | - | ----- | -
|                                                                      |  |               |       |  |                    |   |     | Accumulated Other Comprehensive (Loss) Income         |  |   |                                                               |  |  |       |     
|                                                                      |  | Share
Capital |       |  | ContributedSurplus |   |     | Net
unrealized gain onavailable-for- sale
investments |  |   | Net (loss)
gain on derivatives
designated as cash
flow hedges |  |  | Other |      |   | Total
Accumulated Other
Comprehensive (Loss)Income |   |     | RetainedEarnings |  |   | TotalEquity1 |  
|Balance  December 31, 2016                                           |  | $             | 1,798 |  |                    | $ | 222 |                                                       |  | $ | 43                                                            |  |  | $     | (60  | ) |                                                    | $ | (8  | )                |  | $ | (25          | ) |  | $ | 6,204 |   |  | $ | 8,199 |  
|Net income                                                            |  |               |      |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   | 149   |   |  |   | 149   |  
|Other comprehensive income                                            |  |               |      |  |                    |   |    |                                                       |  |   | 33                                                            |  |  |       | 3    |   |                                                    |   | 3   |                  |  |   | 39           |   |  |   |      |   |  |   | 39    |  
|Dividends declared                                                    |  |               |      |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   | (84   | ) |  |   | (84   | )
|Effect of share-based compensationincluding issuance of common shares |  |               | 2     |  |                    |   | 1   |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   |      |   |  |   | 3     |  
|Shares issued for dividend reinvestment plan                          |  |               | 2     |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   |      |   |  |   | 2     |  
|Balance  March 31,
2017                                              |  | $             | 1,802 |  |                    | $ | 223 |                                                       |  | $ | 76                                                            |  |  | $     | (57  | ) |                                                    | $ | (5  | )                |  | $ | 14           |   |  | $ | 6,269 |   |  | $ | 8,308 |  
|Balance  December 31, 2015                                           |  | $             | 1,747 |  |                    | $ | 230 |                                                       |  | $ | 77                                                            |  |  | $     | (117 | ) |                                                    | $ | (10 | )                |  | $ | (50          | ) |  | $ | 6,455 |   |  | $ | 8,382 |  
|Net income                                                            |  |               |      |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   | 75    |   |  |   | 75    |  
|Other comprehensive income                                            |  |               |      |  |                    |   |    |                                                       |  |   | 1                                                             |  |  |       | 9    |   |                                                    |   | 1   |                  |  |   | 11           |   |  |   |      |   |  |   | 11    |  
|Dividends declared                                                    |  |               |      |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   | (210  | ) |  |   | (210  | )
|Effect of share-based compensationincluding issuance of common shares |  |               | 28    |  |                    |   | (7  | )                                                     |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   |      |   |  |   | 21    |  
|Shares issued for dividend reinvestment plan                          |  |               | 7     |  |                    |   |    |                                                       |  |   |                                                              |  |  |       |     |   |                                                    |   |    |                  |  |   |             |   |  |   |      |   |  |   | 7     |  
|Balance  March 31, 2016                                              |  | $             | 1,782 |  |                    | $ | 223 |                                                       |  | $ | 78                                                            |  |  | $     | (108 | ) |                                                    | $ | (9  | )                |  | $ | (39          | ) |  | $ | 6,320 |   |  | $ | 8,286 |  

1 All equity transactions were attributable to common
shareholders.

(See Notes to the Condensed Consolidated Financial Statements)



|                                                            |  |  
|----------------------------------------------------------- |  | -
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 4



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Condensed Consolidated Statements of Financial Position



|          |  |                                                     |  | 
|--------- |  | --------------------------------------------------- |  | 
|Unaudited |  | In millions of US dollars except as otherwise noted



As at

March 31,
2017


December 31,2016AssetsCurrent assetsCash and cash equivalents

$
62


$
32Receivables


530



545Inventories (Note 6)


824



768Prepaid expenses and other current assets


54



491,470



1,394Non-current assetsProperty, plant and equipment


13,229



13,318Investments in equity-accounted investees


1,213



1,173Available-for-sale
investments


973



940Other assets


251



250Intangible assets


175



180Total Assets

$
17,311


$
17,255 (See Notes to the Condensed Consolidated Financial Statements)


March 31,2017


December 31,2016LiabilitiesCurrent liabilitiesShort-term debt and current portion of long-term debt

$
905


$
884Payables and accrued charges


704



772Current portion of derivative instrument liabilities


43



411,652



1,697Non-current liabilitiesLong-term debt


3,707



3,707Derivative instrument liabilities


50



56Deferred income tax liabilities


2,452



2,463Pension and other post-retirement benefit liabilities


458



443Asset retirement obligations and accrued environmental costs


635



643Other non-current
liabilities and deferred credits


49



47Total Liabilities



9,003



9,056Shareholders EquityShare capital (Note 7)


1,802



1,798Contributed surplus


223



222Accumulated other comprehensive income (loss)


14



(25
)Retained earnings


6,269



6,204Total Shareholders
Equity


8,308



8,199Total Liabilities and
Shareholders Equity

$
17,311


$
17,255 (See Notes to the Condensed Consolidated Financial Statements)






LOGO



|  |  |                                                            
|- |  | -----------------------------------------------------------
|  | 
|5 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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Notes to the Condensed Consolidated Financial Statements

For the Three Months Ended March 31, 2017



|          |  |                                                    
|--------- |  | ---------------------------------------------------
|Unaudited |  | In millions of US dollars except as otherwise
noted

1. Significant Accounting Policies

Basis of Presentation



With its subsidiaries, Potash Corporation of Saskatchewan Inc. (PCS)  together known as
PotashCorp or the company except to the extent the context otherwise requires  forms a crop nutrient and related industrial and feed products company. These unaudited interim condensed consolidated financial statements
(interim financial statements) are based on International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS), and have been prepared in accordance with International Accounting
Standard (IAS) 34, Interim Financial Reporting. The accounting policies and methods of computation used in preparing these interim financial statements are consistent with those used in the preparation of the companys
2016 annual consolidated financial statements.


These interim financial statements include the accounts of PCS and its subsidiaries; however, they do not include all
disclosures normally provided in annual consolidated financial statements and should be read in conjunction with the companys 2016 annual consolidated financial statements. In managements opinion, the interim financial statements include
all adjustments necessary to fairly present such information. Interim results are not necessarily indicative of the results expected for any other interim period or the fiscal year. These interim financial statements were authorized by the audit committee of the Board of Directors for issue on May 2, 2017.






Standards, Amendments and
Interpretations Effective and Applied

The International Accounting Standards Board (IASB) and International Financial Reporting Interpretations
Committee (IFRIC) have issued the following standards and amendments or interpretations to existing standards that were effective and applied by the company.



|                                             |  |                                                                                                                                                                                                    |  |                                                                                                                                                                                    
|-------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Standard                                     |  | Description                                                                                                                                                                                        |  | Impact                                                                                                                                                                             
|Amendments to IAS 7,
Statement of Cash Flows |  | Issued to require a reconciliation of the opening and closing liabilities that form part of an entitys financing activities, including both changes arising from cash flows and non-cash changes. |  | Adopted prospectively effective January 1, 2017, with required disclosures included in Note 5.                                                                                     
|Amendments to IAS 12,
Income Taxes           |  | Issued to clarify the requirements on recognition of deferred tax assets for unrealized losses on debt instruments measured at fair value.                                                         |  | Adopted effective January 1, 2017, with no change to the companys interim financial statements. No changes are expected to the companys annual consolidated financial
statements.



|                                                            |  |  
|----------------------------------------------------------- |  | -
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 6



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Standards, Amendments and Interpretations Not Yet Effective and Not Applied

The IASB and IFRIC have issued the following standards and amendments or interpretations to existing standards that were not yet effective and not applied as at
March 31, 2017. The company does not anticipate early adoption of these standards at this time.



|                                               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                  |  |                                                                                      
|---------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------
|Standard                                       |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Expected Impact                                                                  |  | Effective Date 1                                                                     
|IFRS 15, Revenue From
Contracts With Customers |  | Issued to provide guidance on the recognition of revenue from contracts with customers, including multiple-element arrangements and transactions not previously addressed comprehensively, and
to enhance disclosures about revenue.                                                                                                                                                                                                                                                                    |  | The company is reviewing the standard to determine the potential impact, if any. |  | January 1, 2018, applied retrospectively with certain practical expedients available.
|IFRS 9, Financial
Instruments                  |  | Issued to replace IAS 39, providing guidance on the classification, measurement and disclosure of financial instruments and introducing a new hedge accounting model.                                                                                                                                                                                                                                                                                                                                   |  | The company is reviewing the standard to determine the potential impact, if any. |  | January 1, 2018, applied retrospectively with certain exceptions.                    
|Amendments to IFRS 2,
Share-Based Payment      |  | Issued to provide clarification on the classification and measurement of share-based transactions. Specifically, accounting for cash-settled share-based transactions, share-based payment
transactions with a net settlement feature and modifications of share-based payment transactions that change classification from cash-settled to equity settled.                                                                                                                                             |  | The company is reviewing the standard to determine the potential impact, if any. |  | January 1, 2018, with the option of retrospective or prospective application.        
|IFRS 16, Leases                                |  | Issued to supersede IAS 17, IFRIC 4, SIC-15 and SIC-27, providing the principles for the recognition,
measurement, presentation and disclosure of leases. Lessees will be required to recognize assets and liabilities for the rights and obligations created by leases. Lessors will continue to classify leases using a similar approach to that of the
superseded standards but with enhanced disclosure to improve information about a lessors risk exposure, particularly to residual value risk. |  | The company is reviewing the standard to determine the potential impact.         |  | January 1, 2019, applied retrospectively with certain practical expedients available.

1 Effective date for annual periods beginning on or after the stated date.



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|- |  | -----------------------------------------------------------
|  | 
|7 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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2. Segment Information

The company has
three reportable operating segments: potash, nitrogen and phosphate. These segments are differentiated by the chemical nutrient contained in the products that each produces. The accounting policies of the segments are the same as those described in
Note 1 and are measured in a manner consistent with that of the financial statements. Inter-segment sales are made under terms that approximate market value. The companys operating segments have been determined based on reports reviewed by the
Chief Executive Officer (assessed to be the companys chief operating decision-maker) that are used to make strategic decisions.



|                                                                             |  |                                   |       |   |          |   |       |           |  |   |            |   |  |              |       |   |  |   |        |  
|---------------------------------------------------------------------------- |  | --------------------------------- | ----- | - | -------- | - | ----- | --------- |  | - | ---------- | - |  | ------------ | ----- | - |  | - | ------ | -
|                                                                             |  | Three Months Ended March 31, 2017 |      
|                                                                             |  | Potash                            |       |   | Nitrogen |   |       | Phosphate |  |   | All Others |   |  | Consolidated |      
|Sales  third party                                                          |  | $                                 | 429   |   |          | $ | 375   |           |  | $ | 308        |   |  | $            |      |   |  | $ | 1,112  |  
|Freight, transportation and distribution  third party                       |  |                                   | (64   | ) |          |   | (32   | )         |  |   | (37        | ) |  |              |      |   |  |   | (133   | )
|Net sales  third party                                                      |  |                                   | 365   |   |          |   | 343   |           |  |   | 271        |   |  |              |      |   |  |   |        |  
|Cost of goods sold  third party                                             |  |                                   | (205  | ) |          |   | (257  | )         |  |   | (249       | ) |  |              |      |   |  |   | (711   | )
|Margin (cost) on inter-segment sales 1                                       |  |                                   |      |   |          |   | 11    |           |  |   | (11        | ) |  |              |      |   |  |   |       |  
|Gross margin                                                                 |  |                                   | 160   |   |          |   | 97    |           |  |   | 11         |   |  |              |      |   |  |   | 268    |  
|                                                                             |  |                                   |       |   |         
|Items included in cost of goods sold or selling and administrative expenses: |  |                                   |       |   |          |   |       |           |  |   |            |   |  |              |       |   |  |   |        |  
|Depreciation and amortization                                                |  |                                   | (55   | ) |          |   | (50   | )         |  |   | (58        | ) |  |              | (9    | ) |  |   | (172   | )
|                                                                             |  |                                   |       |   |         
|Assets                                                                       |  |                                   | 9,784 |   |          |   | 2,510 |           |  |   | 2,324      |   |  |              | 2,693 |   |  |   | 17,311 |  
|Cash outflows for additions to property, plant and
equipment                 |  |                                   | 45    |   |          |   | 33    |           |  |   | 51         |   |  |              | 4     |   |  |   | 133    |  

1 Inter-segment net sales were $22.



|                                                                             |  |                                   |       |   |          |   |       |           |  |   |            |   |  |              |       |   |  |   |        |  
|---------------------------------------------------------------------------- |  | --------------------------------- | ----- | - | -------- | - | ----- | --------- |  | - | ---------- | - |  | ------------ | ----- | - |  | - | ------ | -
|                                                                             |  | Three Months Ended March 31, 2016 |      
|                                                                             |  | Potash                            |       |   | Nitrogen |   |       | Phosphate |  |   | All Others |   |  | Consolidated |      
|Sales  third party                                                          |  | $                                 | 381   |   |          | $ | 428   |           |  | $ | 400        |   |  | $            |      |   |  | $ | 1,209  |  
|Freight, transportation and distribution  third party                       |  |                                   | (59   | ) |          |   | (33   | )         |  |   | (41        | ) |  |              |      |   |  |   | (133   | )
|Net sales  third party                                                      |  |                                   | 322   |   |          |   | 395   |           |  |   | 359        |   |  |              |      |   |  |   |        |  
|Cost of goods sold  third party                                             |  |                                   | (234  | ) |          |   | (298  | )         |  |   | (310       | ) |  |              |      |   |  |   | (842   | )
|Margin (cost) on inter-segment sales 1                                       |  |                                   |      |   |          |   | 10    |           |  |   | (10        | ) |  |              |      |   |  |   |       |  
|Gross margin                                                                 |  |                                   | 88    |   |          |   | 107   |           |  |   | 39         |   |  |              |      |   |  |   | 234    |  
|                                                                             |  |                                   |       |   |         
|Items included in cost of goods sold or selling and administrative expenses: |  |                                   |       |   |          |   |       |           |  |   |            |   |  |              |       |   |  |   |        |  
|Depreciation and amortization                                                |  |                                   | (48   | ) |          |   | (54   | )         |  |   | (57        | ) |  |              | (8    | ) |  |   | (167   | )
|Termination benefit costs                                                    |  |                                   | (32   | ) |          |   |      |           |  |   |           |   |  |              |      |   |  |   | (32    | )
|Impairment of property, plant and equipment                                  |  |                                   |      |   |          |   |      |           |  |   | (27        | ) |  |              |      |   |  |   | (27    | )
|                                                                             |  |                                   |       |   |         
|Assets                                                                       |  |                                   | 9,865 |   |          |   | 2,520 |           |  |   | 2,360      |   |  |              | 2,765 |   |  |   | 17,510 |  
|Cash outflows for additions to property, plant and
equipment                 |  |                                   | 91    |   |          |   | 69    |           |  |   | 43         |   |  |              | 43    |   |  |   | 246    |  

1 Inter-segment net sales were $17.



|                                                            |  |  
|----------------------------------------------------------- |  | -
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 8



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3. Other Expenses



|                                     |  |                             |     |   |      |   |     |  
|------------------------------------ |  | --------------------------- | --- | - | ---- | - | --- | -
|                                     |  | Three Months Ended March 31 |    
|                                     |  | 2017                        |     |   | 2016 |  
|Foreign exchange gain (loss)         |  | $                           | 1   |   |      | $ | (17 | )
|Proposed Transaction costs (Note 13) |  |                             | (9  | ) |      |   |    |  
|Other (expenses) income              |  |                             | (2  | ) |      |   | 7   |  
|                                     |  | $                           | (10 | ) |      | $ | (10 | )

4. Income Taxes

A separate estimated average annual
effective tax rate was determined for each taxing jurisdiction and applied individually to the interim period pre-tax income of each jurisdiction.



|                                                    |  |                             |     |   |      |   |     | 
|--------------------------------------------------- |  | --------------------------- | --- | - | ---- | - | --- | 
|                                                    |  | Three Months Ended March 31 |    
|                                                    |  | 2017                        |     |   | 2016 |  
|Income tax expense                                  |  | $                           | 13  |   |      | $ | 32  | 
|Actual effective tax rate on ordinary earnings      |  |                             | 11% |   |      |   | 26% | 
|Actual effective tax rate including discrete items  |  |                             | 8%  |   |      |   | 30% | 
|Discrete tax adjustments that impacted the tax rate |  | $                           | (5  | ) |      | $ | 4   | 

The actual effective tax rate on ordinary earnings for the three months ended March 31, 2017 decreased compared to the same period
last year primarily due to significantly lower forecasted annual earnings in the United States.

Tax changes in the province of Saskatchewan, subsequent to March 31,
2017, are expected to result in the company recording a $68 discrete deferred tax recovery in the second quarter of 2017.

Income tax balances within the condensed
consolidated statements of financial position were comprised of the following:



|                                |  |                                                    |  |                |        |   |                   |   |        |  
|------------------------------- |  | -------------------------------------------------- |  | -------------- | ------ | - | ----------------- | - | ------ | -
|Income Tax Assets (Liabilities) |  | Statements of Financial Position Location          |  | March 31,
2017 |        |   | December 31,
2016 |  
|Current income tax assets       |  |                                                    |  |                |        |   |                   |   |        |  
|Current                         |  | Receivables                                        |  | $              | 37     |   |                   | $ | 41     |  
|Non-current                     |  | Other assets                                       |  |                | 61     |   |                   |   | 67     |  
|Deferred income tax assets      |  | Other assets                                       |  |                | 9      |   |                   |   | 10     |  
|Total income tax assets         |  |                                                    |  | $              | 107    |   |                   | $ | 118    |  
|Current income tax liabilities  |  |                                                    |  |                |        |   |                   |   |        |  
|Current                         |  | Payables and accrued charges                       |  | $              | (32    | ) |                   | $ | (25    | )
|Non-current                     |  | Other non-current liabilities and deferred credits |  |                | (45    | ) |                   |   | (43    | )
|Deferred income tax liabilities |  | Deferred income tax liabilities                    |  |                | (2,452 | ) |                   |   | (2,463 | )
|Total income tax liabilities    |  |                                                    |  | $              | (2,529 | ) |                   | $ | (2,531 | )



|  |  |                                                            
|- |  | -----------------------------------------------------------
|  | 
|9 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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5. Consolidated Statements of Cash Flow



|                                                                             |  |                             |     |   |      |   |     |  
|---------------------------------------------------------------------------- |  | --------------------------- | --- | - | ---- | - | --- | -
|                                                                             |  | Three Months Ended March 31 |    
|                                                                             |  | 2017                        |     |   | 2016 |  
|Reconciliation of cash provided by operating activities                      |  |                             |     |   |      |   |     |  
|Net income                                                                   |  | $                           | 149 |   |      | $ | 75  |  
|Adjustments to reconcile net income to cash provided by operating activities |  |                             |     |   |      |   |     |  
|Depreciation and amortization                                                |  |                             | 172 |   |      |   | 167 |  
|Impairment of property, plant and equipment                                  |  |                             |    |   |      |   | 27  |  
|Net undistributed earnings of equity-accounted investees                     |  |                             | (37 | ) |      |   | (17 | )
|Share-based compensation                                                     |  |                             | 5   |   |      |   | 2   |  
|(Recovery of) provision for deferred income tax                              |  |                             | (14 | ) |      |   | 6   |  
|Pension and other post-retirement benefits                                   |  |                             | 15  |   |      |   | 15  |  
|Asset retirement obligations and accrued environmental costs                 |  |                             | (1  | ) |      |   | 16  |  
|Other long-term liabilities and miscellaneous                                |  |                             | 4   |   |      |   | (10 | )
|Subtotal of adjustments                                                      |  |                             | 144 |   |      |   | 206 |  
|Changes in non-cash operating working
capital                                |  |                             |     |   |      |   |     |  
|Receivables                                                                  |  |                             | 15  |   |      |   | (41 | )
|Inventories                                                                  |  |                             | (49 | ) |      |   | 8   |  
|Prepaid expenses and other current assets                                    |  |                             | (5  | ) |      |   | (2  | )
|Payables and accrued charges                                                 |  |                             | (31 | ) |      |   | (58 | )
|Subtotal of changes in
non-cash operating working capital                    |  |                             | (70 | ) |      |   | (93 | )
|Cash provided by operating
activities                                        |  | $                           | 223 |   |      | $ | 188 |  
|Supplemental cash flow disclosure                                            |  |                             |     |   |      |   |     |  
|Interest paid                                                                |  | $                           | 29  |   |      | $ | 29  |  
|Income taxes paid                                                            |  | $                           | 15  |   |      | $ | 11  |  

The following is a summary of changes in liabilities arising from financing activities:



|                                                        |  |                   |       |  |              |   |    |                  |  |   |                |  |  |   |       | 
|------------------------------------------------------- |  | ----------------- | ----- |  | ------------ | - | -- | ---------------- |  | - | -------------- |  |  | - | ----- | 
|                                                        |  | December 31,
2016 |       |  | Cash Flows 1 |   |    | Non-cash
Changes |  |   | March 31,
2017 | 
|Short-term debt and current portion of long-term debt
1 |  | $                 | 884   |  |              | $ | 21 |                  |  | $ |               |  |  | $ | 905   | 
|Long-term debt                                          |  |                   | 3,707 |  |              |   |   |                  |  |   |               |  |  |   | 3,707 | 
|Total liabilities from financing activities             |  | $                 | 4,591 |  |              | $ | 21 |                  |  | $ |               |  |  | $ | 4,612 | 

1 Cash inflows and cash outflows arising from short-term debt transactions are
presented on a net basis.



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 10



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6. Inventories



|                       |  |                |     |  |                   |   |     | 
|---------------------- |  | -------------- | --- |  | ----------------- | - | --- | 
|                       |  | March 31,
2017 |     |  | December 31,
2016 |  
|Finished products      |  | $              | 324 |  |                   | $ | 269 | 
|Intermediate products  |  |                | 183 |  |                   |   | 174 | 
|Raw materials          |  |                | 62  |  |                   |   | 75  | 
|Materials and supplies |  |                | 255 |  |                   |   | 250 | 
|                       |  | $              | 824 |  |                   | $ | 768 | 

The following items affected cost of goods sold during the period:



|                                                  |  |                             |     |  |      |   |     |  
|------------------------------------------------- |  | --------------------------- | --- |  | ---- | - | --- | -
|                                                  |  | Three Months Ended March 31 |    
|                                                  |  | 2017                        |     |  | 2016 |  
|Expensed inventories before the following items   |  | $                           | 684 |  |      | $ | 712 |  
|Reserves, reversals and writedowns of inventories |  |                             | 4   |  |      |   | (1  | )
|                                                  |  | $                           | 688 |  |      | $ | 711 |  

The carrying amount of inventory recorded at net realizable value was $71 as at March 31, 2017 (December 31, 2016  $47), with
the remaining inventory recorded at cost.

7. Share Capital

Authorized

The company is authorized to issue an unlimited number of common shares without par value and an unlimited number of first preferred shares. The common shares are not
redeemable or convertible. The first preferred shares may be issued in one or more series with rights and conditions to be determined by the Board of Directors. No first preferred shares have been issued.

Issued



|                                      |  |                         |             |  |               |   |       | 
|------------------------------------- |  | ----------------------- | ----------- |  | ------------- | - | ----- | 
|                                      |  | Number of
Common Shares |             |  | Consideration |  
|Balance  December 31, 2016           |  |                         | 839,790,379 |  |               | $ | 1,798 | 
|Issued under option plans             |  |                         | 114,900     |  |               |   | 2     | 
|Issued for dividend reinvestment plan |  |                         | 102,076     |  |               |   | 2     | 
|Balance  March 31,
2017              |  |                         | 840,007,355 |  |               | $ | 1,802 | 

Dividends Declared

During the three months ended
March 31, 2017, the company declared dividends per share of $0.10 (2016  $0.25).

Under the terms of the agreement governing the Proposed Transaction, as
described in Note 13, the company is permitted to pay quarterly dividends up to but not in excess of levels existing at the time of signing such agreement.



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|11 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

8. Share-Based Compensation

During the
three months ended March 31, 2017, the company issued stock options and performance share units (PSUs) to eligible employees under the 2016 Long-Term Incentive Plan (LTIP). Information on stock options and PSUs is
summarized below:



|                   |  |                       |           |      |                                                |  |           |                             |  |   |   |  |  |   |   | 
|------------------ |  | --------------------- | --------- | ---- | ---------------------------------------------- |  | --------- | --------------------------- |  | - | - |  |  | - | - | 
|                   |  | LTIP                  |           |      | Expense for all share-based compensation plans | 
|                   |  | Units
Granted
in 2017 |           |      | UnitsOutstandingas at
March 31, 2017           |  |           | Three Months Ended
March 31 | 
|                   |  |                       |           | 2017 |                                                |  | 2016      |                            
|Stock options      |  |                       | 1,482,829 |      |                                                |  | 4,543,536 |                             |  | $ | 3 |  |  | $ | 1 | 
|Share-settled PSUs |  |                       | 555,918   |      |                                                |  | 959,700   |                             |  |   | 1 |  |  |   |  | 
|Cash-settled PSUs  |  |                       | 855,426   |      |                                                |  | 1,541,734 |                             |  |   | 2 |  |  |   | 2 | 
|                   |  |                       |           |      |                                                |  |           |                             |  | $ | 6 |  |  | $ | 3 | 

Grant date fair value per unit for stock options and share-settled PSUs granted during the three months ended March 31, 2017 was
$4.36 and $19.93, respectively.



Stock Options Under the LTIP, stock options generally vest and become exercisable on the third anniversary of the grant date, subject to continuous employment or retirement, and have a
maximum term of 10 years. The weighted average fair value of stock options issued during the three months ended March 31, 2017 was estimated as of the date of grant using the Black-Scholes-Merton option-pricing model with the following weighted
average assumptions:  Exercise price per option

$
18.71Expected annual dividend per share

$
0.40Expected volatility


29%Risk-free interest rate


1.67%Expected life of options


5.7 years


Performance Share Units In 2017, PSUs granted under the LTIP vest based on the achievement of performance metrics, over three years, comprising 1) the relative ranking of the companys
total shareholder return compared with a specified peer group using a Monte Carlo simulation option-pricing model and 2) the outcome of the companys cash flow return on investment compared with its weighted average cost of capital.
Compensation cost is measured based on 1) the grant date fair value of the units, adjusted for the companys best estimate of the outcome of non-market vesting conditions 1 at the end of each period for share-settled PSUs and 2) period-end fair value of the awards for cash-settled PSUs. PSUs granted under the LTIP settle in shares
for grantees who are subject to the companys share ownership guidelines and in cash for all other grantees. 1 The companys cash flow return on investment compared with its weighted average cost of capital is a
non-market vesting condition as performance is not tied to the companys share price or relative share price.






|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 12



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9. Financial Instruments

Fair Value

Estimated fair values for financial instruments are designed to approximate amounts for which the instruments could be exchanged
in a current arms-length transaction between knowledgeable, willing parties. The valuation policies and procedures for financial reporting purposes are determined by the companys finance
department.

Financial instruments included in the unaudited interim condensed consolidated statements of financial position are measured either at fair value or
amortized cost. The tables below explain the valuation methods used to determine the fair value of each financial instrument and its associated level in the fair value hierarchy.



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                   
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------------------------------------------------------------------------------------------
|Financial Instruments Measured at Fair Value                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Fair Value Method                                                                                 
|Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Carrying amount (approximation to fair value assumed due to short-term nature).                   
|Available-for-sale investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Closing bid price of the common shares (Level 1) as at the statements of financial position dates.
|Foreign currency derivatives not traded in an active
market                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | Quoted forward exchange rates (Level 2) as at the statements of financial position dates.         
|Natural gas swaps not traded in an active
market                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | A discounted cash flow model.1                                                                    
|1   Inputs included contractual cash flows based on prices for natural gas futures contracts, fixed prices and notional volumes specified by the swap contracts, the time value of money,
liquidity risk, the companys own credit risk (related to instruments in a liability position) and counterparty credit risk (related to instruments in an asset position). Futures contract prices used as inputs in the model were supported by
prices quoted in an active market and therefore categorized in Level 2.
|Financial Instruments Measured at Amortized Cost                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Fair Value Method                                                                                 
|Receivables, short-term debt and payables and
accrued charges                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | Carrying amount (approximation to fair value assumed due to short-term nature).                   
|Long-term debt senior notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | Quoted market prices (Level 1 or 2 depending on the market liquidity of the debt).                
|Other long-term debt instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Carrying amount.                                                                                  

Presented below is a comparison of the fair value of the companys senior notes to their carrying values.



|                            |  |                                |       |  |                        |   |       |                               |  |   |                        |  |  |   |       | 
|--------------------------- |  | ------------------------------ | ----- |  | ---------------------- | - | ----- | ----------------------------- |  | - | ---------------------- |  |  | - | ----- | 
|                            |  | March 31, 2017                 |       |  | December 31, 2016      |  
|                            |  | Carrying Amount of
Liability 1 |       |  | Fair Value ofLiability |   |       | Carrying Amount ofLiability 1 |  |   | Fair Value ofLiability | 
|Long-term debt senior notes |  | $                              | 4,203 |  |                        | $ | 4,439 |                               |  | $ | 4,202                  |  |  | $ | 4,384 | 

|1 | Includes net unamortized debt issue costs.
|- | ------------------------------------------



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|13 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

The following table presents the companys fair value hierarchy for financial assets and financial liabilities carried
at fair value on a recurring basis:



|                                  |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|--------------------------------- |  | ------------------------------------ | --- | - | --------------------------------------------------------------- | - | --- | ------------------------------------------------ |  | - | --- | -
|                                  |  |                                      |     |   | Fair Value Measurements atReporting Dates Using:                |  
|                                  |  | Carrying
Amount of
Asset (Liability) |     |   | Quoted Prices
in Active Markets for
Identical Assets (Level 1)1 |   |     | Significant
Other Observable Inputs
(Level 2)1,2 | 
|March 31, 2017                    |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Derivative instrument assets      |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Natural gas derivatives           |  | $                                    | 6   |   |                                                                 | $ |    |                                                  |  | $ | 6   |  
|Available-for-sale
investments 3  |  |                                      | 973 |   |                                                                 |   | 973 |                                                  |  |   |    |  
|Derivative instrument liabilities |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Natural gas derivatives           |  |                                      | (93 | ) |                                                                 |   |    |                                                  |  |   | (93 | )
|December 31, 2016                 |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Derivative instrument assets      |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Natural gas derivatives           |  | $                                    | 6   |   |                                                                 | $ |    |                                                  |  | $ | 6   |  
|Available-for-sale
investments 3  |  |                                      | 940 |   |                                                                 |   | 940 |                                                  |  |   |    |  
|Derivative instrument liabilities |  |                                      |     |   |                                                                 |   |     |                                                  |  |   |     |  
|Natural gas derivatives           |  |                                      | (97 | ) |                                                                 |   |    |                                                  |  |   | (97 | )

|1 | During the three months ended March 31, 2017 and twelve months ended December 31, 2016, there were no transfers between Level 1 and Level 2. The companys policy is to recognize transfers at the
end of the reporting period.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2 | During the three months ended March 31, 2017 and twelve months ended December 31, 2016, there were no amounts categorized as Level 3.
|- | -------------------------------------------------------------------------------------------------------------------------------------

|3 | Available-for-sale investments are comprised of shares in ICL, Sinofert and other.
|- | ----------------------------------------------------------------------------------



10. Seasonality The companys
sales of fertilizer can be seasonal. Typically, fertilizer sales are highest in the second quarter of the year, due to the Northern Hemispheres spring planting season. However, planting conditions and the timing of customer purchases will vary
each year, and fertilizer sales can be expected to shift from one quarter to another. Feed and industrial sales are more evenly distributed throughout the year. 11. Contingencies and Other Matters Canpotex PCS is a shareholder in Canpotex Limited (Canpotex), which markets Canadian potash offshore. Should any operating losses or other liabilities be incurred by
Canpotex, the shareholders have contractually agreed to reimburse it for such losses or liabilities in proportion to each shareholders productive capacity. Through March 31, 2017, there were no such operating losses or other liabilities. Mining Risk The risk of underground water inflows, as with most other
underground risks, is currently not insured.


Legal and Other Matters The
company is engaged in ongoing site assessment and/or remediation activities at a number of facilities and sites, and anticipated costs associated with these matters are added to accrued environmental costs in the manner previously described in Note
18 to the companys 2016 annual consolidated financial statements. This includes matters related to investigation of potential brine migration at certain of the potash sites. The following environmental site assessment and/or remediation
matters have uncertainties that may not be fully reflected in the amounts accrued for those matters: Nitrogen and Phosphate  ·

The US Environmental Protection Agency (USEPA) has identified PCS Nitrogen, Inc. (PCS Nitrogen) as a
potentially responsible party at the Planters Property or Columbia Nitrogen site in Charleston, South Carolina. PCS Nitrogen is subject to a final judgment by the US District Court for the District of South Carolina allocating 30 percent of the
liability for response costs at the site to PCS Nitrogen, as well as a proportional share of any costs that cannot be recovered from another responsible party. In December 2013, the USEPA issued an order to PCS Nitrogen and four other respondents
requiring them jointly and severally to conduct certain cleanup work at the site and reimburse the USEPAs costs for overseeing that work. PCS Nitrogen is currently performing the work required by the USEPA order. The USEPA






|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 14



---

also has requested reimbursement of approximately $5 of previously incurred response costs. The ultimate amount of liability for PCS Nitrogen depends upon, among other factors, the final outcome
of litigation to impose liability on additional parties, the amount needed for remedial activities, the ability of other parties to pay and the availability of insurance.  ·

PCS Phosphate has been identified as a responsible party at the Ward Transformer Superfund Site in Raleigh, North Carolina (Site). In the past, PCS Phosphate worked with certain other responsible parties to
address PCB soil contamination at the Site pursuant to an agreement with the USEPA. The response actions are nearly complete at an estimated cost of $80, including anticipated remaining work on the Site. The USEPA also sought remediation in certain
downstream areas that are referred to as Operable Unit 1. PCS Phosphate signed a Consent Decree with USEPA for Operable Unit 1 in September 2016 that is not expected to require PCS Phosphate to incur any additional remediation costs.
Certain ongoing litigation for the recovery of previously incurred cleanup costs has been substantially resolved through mediation and is not currently expected to continue.  ·

In 1996, PCS Nitrogen Fertilizer, L.P. (PCS Nitrogen Fertilizer), then known as Arcadian Fertilizer, L.P., entered into a Consent Order (the Order) with the Georgia Environmental Protection
Division (GEPD) in conjunction with PCS Nitrogen Fertilizers acquisition of real property in Augusta, Georgia. Under the Order, PCS Nitrogen Fertilizer is required to perform certain activities to investigate and, if necessary,
implement corrective measures for substances in soil and groundwater. The investigation has proceeded and the results have been presented to GEPD. Two interim corrective measures for substances in groundwater have been proposed by PCS Nitrogen
Fertilizer and approved by GEPD. PCS Nitrogen Fertilizer is implementing the approved interim corrective measures, which may be modified by PCS Nitrogen Fertilizer from time to time, but it is unable to estimate with reasonable certainty the total
cost of its correction action obligations under the Order at this time. Based on current information and except for the uncertainties described in the
preceding paragraphs, the company does not believe that its future obligations with respect to these facilities and sites are reasonably likely to have a material adverse effect on its consolidated financial statements. Other legal matters with significant uncertainties include the following: Nitrogen and Phosphate  ·

The USEPA has an ongoing initiative to evaluate implementation within the phosphate industry of a particular exemption for mineral processing wastes under the hazardous waste program. In connection with this
industry-wide initiative, the USEPA conducted inspections at numerous phosphate operations and notified the company of alleged violations of the US Resource Conservation and Recovery Act


(RCRA) at its plants in Aurora, North Carolina; Geismar, Louisiana; and White Springs, Florida. The company has entered into RCRA 3013 Administrative Orders on Consent and has
performed certain site assessment activities at all of these plants. At this time, the company does not know the scope of action, if any, that may be required. As to the alleged RCRA violations, the company continues to participate in settlement
discussions with the USEPA but is uncertain if any resolution will be possible without litigation, or, if litigation occurs, what the outcome would be. The company routinely monitors public information about the impacts of the initiative on other
industry members, and it regularly considers this information in establishing the appropriate asset retirement obligations and accruals.  ·

In August 2015, the USEPA finalized amendments to the hazardous air pollutant emission standards for phosphoric acid manufacturing and phosphate fertilizer production (Final Rule). The Final Rule includes
certain new requirements for monitoring and emissions that are infeasible for the company to satisfy in a timely manner. As a result, in October 2015, the company petitioned the USEPA to reconsider certain aspects of the Final Rule and separately
asked the US Court of Appeals for the District of Columbia Circuit to review the Final Rule. Subsequent to these requests, required emissions testing at our Aurora facility in 2016 indicated alleged exceedances of the mercury emission limits that
were established by the Final Rule. The company has communicated with the relevant agencies about this issue and supplemented its filings with the USEPA and the court to include reconsideration and review of the mercury emission limits. The facility
also entered into an agreed order with the North Carolina Department of Environmental Quality (NCDEQ) in November 2016 to resolve the alleged mercury exceedances and provide a plan and schedule for evaluating alternative compliance
strategies. In December 2016, the USEPA proposed amendments to the Final Rule to address certain monitoring requirements raised in the companys request for reconsideration. The company submitted comments on the proposal and will wait for final
USEPA action on all petition issues before determining whether to proceed with the court action, which is being held in abeyance pending the outcome of the USEPA reconsideration proceeding. Given the pending legal issues and the companys
evaluation of alternative compliance strategies, the resulting cost of compliance with the various provisions of the Final Rule cannot be predicted with reasonable certainty at this time. General  ·

The countries where we operate are parties to the Paris Agreement adopted in December 2015 pursuant to the United Nations
Framework Convention on Climate Change. Each country that is a party to the Paris Agreement submitted an Intended Nationally Determined Contribution (INDC) toward the control of greenhouse gas emissions. The impacts of these INDCs on the
companys operations cannot be determined with any certainty at this time. In October 2016, the Canadian government announced a national plan to put a price on carbon emissions






|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|15 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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beginning in 2018 of $10 per tonne and increasing by $10 per tonne each year through 2022, to be implemented either through a carbon tax or a cap and trade program at the election of each
province. The province of Saskatchewan is considering various alternative approaches to address the national plan. Other countries where the company operates have not at this time announced regulatory plans that would appear to have a significant
impact on company operations. The company is monitoring these developments and their future effect on its operations cannot be determined with certainty at this time. In addition, various other claims and lawsuits are pending against the company in the ordinary course of business. While it is not possible to determine the ultimate
outcome of such actions at this time, and inherent uncertainties exist in predicting such outcomes, it is the companys belief that the ultimate resolution of such actions is not reasonably likely to have a material adverse effect on its
consolidated financial statements. The breadth of the companys operations and the global complexity of tax regulations require assessments of uncertainties and
judgments in estimating the taxes it will ultimately pay. The final taxes paid are dependent upon many factors, including negotiations with taxing authorities in various jurisdictions, outcomes of tax litigation and resolution of disputes arising
from federal, provincial, state and local tax audits. The resolution of these uncertainties and the associated final taxes may result in adjustments to the companys tax assets and tax liabilities. The company owns facilities that have been either permanently or indefinitely shut down. It expects to incur nominal annual expenditures for site security and other
maintenance costs at certain of these facilities. Should the facilities be dismantled, certain other shutdown-related costs may be incurred. Such costs are not expected to have a material adverse effect on the companys consolidated financial
statements and would be recognized and recorded in the period in which they are incurred.


12. Related Party Transactions The
company sells potash from its Canadian mines for use outside Canada and the US exclusively to Canpotex. Sales are at prevailing market prices and are settled on normal trade terms. Sales to Canpotex for the three months ended March 31, 2017
were $198 (2016  $179). At March 31, 2017, $137 (December 31, 2016  $141) was owing from Canpotex. 13. Proposed Transaction with
Agrium Inc. On September 11, 2016, the company entered into an Arrangement Agreement with Agrium Inc. (Agrium) pursuant to which the company and
Agrium have agreed to combine their businesses (the Proposed Transaction) in a merger of equals transaction to be implemented by way of a plan of arrangement under the Canada Business Corporations Act. On November 3, 2016, the
Proposed Transaction was approved by shareholders of both companies. On November 7, 2016, the Ontario Superior Court of Justice issued a final order approving the Proposed Transaction. The Proposed Transaction is currently anticipated to be
completed in mid-2017 and is subject to customary closing conditions, including regulatory approvals. Upon the closing of the
Proposed Transaction, the company and Agrium will become indirect, wholly owned subsidiaries of a new parent company. PotashCorp shareholders will own approximately 52 percent of the new parent, and Agrium shareholders will own approximately
48 percent.






|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 16



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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations (in US dollars) The following discussion and analysis is the responsibility of management and is as at May 2, 2017. The Board of Directors (Board) carries out its responsibility for
review of this disclosure principally through its audit committee, comprised exclusively of independent directors. The audit committee reviews and, prior to its publication, approves this disclosure, pursuant to the authority delegated to it by the
Board. The term PCS refers to Potash Corporation of Saskatchewan Inc. and the terms we, us, our, PotashCorp and the company refer to PCS and, as applicable, PCS and its direct
and indirect subsidiaries as a group. Additional information relating to PotashCorp (which, except as otherwise noted, is not incorporated by reference herein), including our Annual Report on Form 10-K
for the year ended December 31, 2016 (2016 Form 10-K), can be found on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. The company is a foreign private issuer under the rules and regulations of
the US Securities and Exchange Commission (the SEC); however, it currently files voluntarily on the SECs domestic forms. POTASHCORP
AND OUR OPERATING ENVIRONMENT PotashCorp is the worlds largest crop nutrient company by capacity, producing the three primary crop nutrients: potash
(K), nitrogen (N) and phosphate (P) for use in the production of fertilizer, industrial and animal feed products. Our Canadian potash operations  the
primary focus and namesake of our company  represent approximately one-fifth of global capacity. To enhance our global footprint, we also have investments in four potash-related businesses in Latin
America, the Middle East and Asia. We complement our potash assets with focused positions in nitrogen and phosphate. Detailed descriptions of our operating
environments can be found on pages 18 and 19 (potash), 20 and 21 (nitrogen) and 22 and 23 (phosphate) in our 2016 Annual Integrated Report (2016 AIR). GOVERNANCE In fulfilling its oversight responsibilities, our Boards commitment to excellence in governance permeates our overall
approach to business. Our Board fosters a culture that encourages us to uphold the highest ethical standards and strive for excellence in our business practices in order to build long-term value for all our stakeholders.


There have been no significant changes to how we approach governance from that described in our 2016 AIR (see pages 24
to 27). STRATEGY AND PERFORMANCE Creating superior
shareholder value is essential to ensure we can make plentiful possible for all our stakeholders. Strong and sustainable earnings growth  coupled with a premium valuation multiple  rewards our shareholders and, at the same time, allows
us to focus on our broader social and environmental responsibilities. Our seven strategic priorities determine where we focus our efforts to create long-term value for all those associated with our business. Our long-term objective is to create
superior shareholder value by: growing earnings and cash flow while minimizing volatility; protecting and enhancing a premium valuation multiple; and maintaining the trust and support of our stakeholders. Financially, we prioritize earnings growth and investment opportunities in potash, while complementing that business with other best-in-class assets. Our strategic priorities, depicted below and described in further detail along with key target metrics on pages 30 to 47 in our 2016 AIR, did not change during the first quarter of
2017.  LOGO






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|17 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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PENDING MERGER OF EQUALS WITH AGRIUM INC. During the third quarter of 2016, the company entered into an arrangement agreement (the Arrangement Agreement) with Agrium Inc. (Agrium) to combine their businesses (the
Proposed Transaction) in a merger of equals transaction to be implemented by way of a plan of arrangement under the Canada Business Corporations Act. Upon the closing of the Proposed Transaction, which is anticipated
mid-2017, the company and Agrium will become indirect, wholly owned subsidiaries of a new parent company (New Parent). PotashCorp shareholders will own approximately 52 percent of New Parent, and Agrium
shareholders will own approximately 48 percent. During the fourth quarter of 2016, shareholders of both companies overwhelmingly approved the Proposed Transaction and the Ontario Superior Court of Justice issued a final order approving it. From
a regulatory standpoint, we continue to cooperate with the various enforcement agencies in their reviews. We have received clearances in Brazil and Russia, and continue to work on obtaining approval from China, India, Canada and the US.


The creation of the combined company pursuant to the Proposed Transaction is designed to: 1) bring together world-class
nutrient production assets and retail distribution, providing an integrated platform with multiple paths for growth; 2) create up to $500 million of annual run-rate operating synergies within 24
months of closing; 3) enhance financial flexibility through the use of a strong balance sheet and improved cash flows, enabling the support of growth initiatives and shareholder returns; and 4) leverage best-in-class leadership and governance through the combination of two experienced teams that are focused on creating long-term value. For further discussion of the Proposed Transaction, please refer to our Current Reports on Form 8-K and the documents filed
therewith, filed with the SEC on September 12, 2016 and on October 6, 2016 and the various filings with Canadian provincial securities commissions including the joint information circular of PCS and Agrium dated October 3, 2016.






RISK

In our 2016 AIR, we provide an overview of our approach to risk (page 28), explain how we use a risk management-ranking methodology to assess the key risks specific to
our company (page 49) and provide a description of, management approach to and any significant developments for each key risk (pages 50 to 55).

Our risk-ranking
matrix, in terms of residual severity of consequence and likelihood, is displayed below.



LOGO



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|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 18



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Key risks with rankings unchanged from our 2016 AIR were as follows:



|                                                 |  |              |  |                        |  |                                            |  |              |  |                       
|------------------------------------------------ |  | ------------ |  | ---------------------- |  | ------------------------------------------ |  | ------------ |  | ----------------------
|Risk                                             |  | Risk
Ranking |  | Associated
Strategies1 |  | Risk                                       |  | Risk
Ranking |  | Associated
Strategies1
|Extreme loss                                     |  | B            |  | LOGO                   |  | Safety, health and security                |  | C            |  | LOGO                  
|Offshore potash sales and distribution           |  | B            |  | LOGO                   |  | Stakeholder support for our business plans |  | C            |  | LOGO                  
|Competitive supply                               |  | B            |  | LOGO                   |  | Sustaining growth                          |  | C            |  | LOGO                  
|Global potash demand                             |  | B            |  | LOGO                   |  | Trinidad natural gas supply                |  | C            |  | LOGO                  
|Cyber security                                   |  | C            |  | LOGO                   |  | Realization of asset values                |  | D            |  | LOGO                  
|Environment                                      |  | C            |  | LOGO                   |  | Capital management                         |  | D            |  | LOGO                  
|International operations and non-operated assets |  | C            |  | LOGO                   |  |                                            |  |              |  |                       

|1 | Brighter sections indicate the strategic priority (described on page 17 of this Form 10-Q) impacted by the risk. Faded sections mean the strategic priority is not significantly
affected by the risk.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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|   | 
|19 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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KEY PERFORMANCE DRIVERS  PERFORMANCE COMPARED TO TARGETS

Through our integrated value model, we set, evaluate and refine our targets to drive improvements that benefit all those impacted by our business. We demonstrate our
accountability by tracking and reporting our performance against targets related to each strategic priority set out on pages 32 to 47 in our 2016 AIR. A summary of our progress against selected strategic priorities and representative annual targets
is set out below.



|                                |  |                                                                                                                  |  |                                                                                                                                                                                                                                                                              
|------------------------------- |  | ---------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Strategic Priority              |  | Representative 2017 Annual Target                                                                                |  | Performance to March 31, 2017                                                                                                                                                                                                                                                
|Portfolio & Return Optimization |  | Exceed total shareholder return (TSR) performance for our sector and the DAXglobal Agribusiness Index.           |  | PotashCorps TSR was -5 percent in the first three months of 2017 compared to our sectors weighted average return based on market
capitalization1 of NIL percent and the DAXglobal Agribusiness Index weighted average return (based on market capitalization) of 4 percent.
|Operational Excellence          |  | Achieve a 95 percent ammonia reliability rate for our nitrogen division.                                         |  | Our ammonia reliability rate was 96 percent for the first three months of 2017.                                                                                                                                                                                              
|People Development              |  | Maintain an annual employee turnover rate of 5 percent or less.                                                  |  | Employee turnover rate on an annualized basis for the first three months of 2017 was 4 percent.                                                                                                                                                                              
|Safety & Health Excellence      |  | Achieve zero life-altering injuries at our sites.                                                                |  | There were no life-altering injuries at our sites during the first three months of 2017.                                                                                                                                                                                     
|                                |  |                                                                                                                 
|                                |  | Reduce total site recordable injury rate to 0.75 (or lower) and total lost-time injury rate to 0.07 (or lower).  |  | During the first three months of 2017, total site recordable injury rate was 0.95 and total lost-time injury rate was 0.05.                                                                                                                                                  
|Environmental Excellence        |  | By 2018, reduce environmental incidents (releases, permit excursions and spills) by 40 percent from 2014 levels. |  | Annualized total environmental incidents were down 67 percent during the first three months of 2017 compared to 2014 annual levels. Compared to the first three months of 2016, total
reportable incidents were down 78 percent.                                             

|1 | TSRs are based on the currencies of the primary exchanges in which the relevant shares are traded.
|- | --------------------------------------------------------------------------------------------------

PERFORMANCE OVERVIEW

This discussion and analysis are
based on the companys unaudited interim condensed consolidated financial statements included in Part I of this Quarterly Report on Form 10-Q (financial statements in this Form 10-Q) based on International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS), unless otherwise stated. All references to
per-share amounts pertain to diluted net income per share.

For an understanding of trends, events, uncertainties and the
effect of critical accounting estimates on our results and financial condition, this Form 10-Q should be read carefully, together with our 2016 AIR.

REVISED 1 ANNUAL EARNINGS GUIDANCE AND FIRST QUARTER 2017 RESULTS



|                   |  |                                  |  |                             
|------------------ |  | -------------------------------- |  | ----------------------------
|                   |  | Revised 1Annual Company
Guidance |  | First Quarter Actual
Results
|Earnings per share |  | $  0.45  $  0.65                |  | $  0.18                     

1 Effective April 27, 2017.



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|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 20



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OVERVIEW OF ACTUAL RESULTS



|                                             |  |                             |       |  |      |   |       |        |  |   |          |   |  |  |     |  
|-------------------------------------------- |  | --------------------------- | ----- |  | ---- | - | ----- | ------ |  | - | -------- | - |  |  | --- | -
|                                             |  | Three Months Ended March 31 |      
|Dollars (millions), except per-share amounts |  | 2017                        |       |  | 2016 |   |       | Change |  |   | % Change |  
|Sales                                        |  | $                           | 1,112 |  |      | $ | 1,209 |        |  | $ | (97      | ) |  |  | (8  | )
|Gross margin                                 |  |                             | 268   |  |      |   | 234   |        |  |   | 34       |   |  |  | 15  |  
|Operating income                             |  |                             | 221   |  |      |   | 159   |        |  |   | 62       |   |  |  | 39  |  
|Net income                                   |  |                             | 149   |  |      |   | 75    |        |  |   | 74       |   |  |  | 99  |  
|Net income per share  diluted               |  |                             | 0.18  |  |      |   | 0.09  |        |  |   | 0.09     |   |  |  | 100 |  
|Other comprehensive income                   |  |                             | 39    |  |      |   | 11    |        |  |   | 28       |   |  |  | 255 |  



LOGO Earnings in the first quarter of 2017 were higher than the first quarter of 2016 due primarily to higher gross margin in potash,
increased earnings of equity-accounted investees and decreased income taxes more than offsetting lower gross margins in nitrogen and phosphate. Nutrient
affordability and lower inventories led to consistent buyer engagement in potash during the first quarter. Deliveries increased to most major markets and contributed to modest increases in global spot prices from fourth-quarter 2016 levels. Lower urea exports from China were offset by increased supply from other regions and limited demand from India, leading to a softer pricing environment, especially late
in the quarter. Urea prices in the US were further pressured by large offshore imports during the quarter. Ammonia was more resilient as supply issues in key exporting regions supported a more constructive pricing environment.


Phosphate markets were supported by strong demand in much of the Western Hemisphere, supply constraints in key producing
regions and rising costs for key inputs. Spot prices for most phosphate fertilizer products strengthened from those realized late in 2016, but remained well below that years first quarter. Prices for feed and industrial products continued to
trend lower in the first quarter and remained below prior year levels, due primarily to increased supply from offshore producers. Other comprehensive income for the
first quarter of 2017 was primarily the result of increases in the fair value of our investments in Israel Chemicals Ltd. (ICL) and Sinofert Holdings Limited (Sinofert). Other comprehensive income for the first quarter of 2016 was primarily impacted
by an increase in the fair value of our investment in ICL and reclassification to income of net losses on natural gas hedging derivatives more than offsetting a decrease in the fair value of our investment in Sinofert.






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|   | 
|21 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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OPERATING SEGMENT REVIEW

We report our
results (including gross margin) in three business segments: potash, nitrogen and phosphate as described in Note 2 to the financial statements in this Form 10-Q. Our reporting structure reflects how we
manage our business and how we classify our operations for planning and measuring performance. We include net sales in segment disclosures in the financial statements in this Form 10-Q pursuant to IFRS, which
require segmentation based upon our internal organization and reporting of revenue and profit measures. As a component of gross margin, net sales (and the related per-tonne amounts) are the primary revenue measures we use and review in making
decisions about operating matters on a business segment basis. These decisions include assessments about potash, nitrogen and phosphate performance and the resources to be allocated to these segments. We also use net sales (and the related per-tonne
amounts) for business planning and monthly forecasting. Net sales are calculated as sales revenues less freight, transportation and distribution expenses. Realized prices refer to net sales prices.

Our discussion of segment operating performance is set out below and includes nutrient product and/or market performance results, where applicable, to give further
insight into these results.



LOGO



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|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 22



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POTASH PERFORMANCE

FINANCIAL PERFORMANCE



|                                                         |  |                             |      |   |                    |   |      |                    |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |  |  |          |     |   |  |   |      |   |  |  |     |  
|-------------------------------------------------------- |  | --------------------------- | ---- | - | ------------------ | - | ---- | ------------------ |  |  | ---- | - |  | ---- | ----- |  | -------- |  | ----- | ---- |  |  | ---- |  |  | -------- | --- | - |  | - | ---- | - |  |  | --- | -
|                                                         |  | Three Months Ended March 31 |     
|                                                         |  | Dollars (millions)          |      |   | Tonnes (thousands) |   |      | Average per Tonne1 | 
|                                                         |  | 2017                        |      |   | 2016               |   |      | % Change           |  |  | 2017 |   |  | 2016 |       |  | % Change |  |       | 2017 |  |  | 2016 |  |  | % Change |    
|Manufactured product                                     |  |                             |      |   |                    |   |      |                    |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |  |  |          |     |   |  |   |      |   |  |  |     |  
|Net sales                                                |  |                             |      |   |                    |   |      |                    |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |  |  |          |     |   |  |   |      |   |  |  |     |  
|North America                                            |  | $                           | 163  |   |                    | $ | 138  |                    |  |  | 18   |   |  |      | 859   |  |          |  | 778   |      |  |  | 10   |  |  | $        | 190 |   |  | $ | 178  |   |  |  | 7   |  
|Offshore                                                 |  |                             | 198  |   |                    |   | 180  |                    |  |  | 10   |   |  |      | 1,320 |  |          |  | 1,005 |      |  |  | 31   |  |  | $        | 150 |   |  | $ | 179  |   |  |  | (16 | )
|                                                         |  |                             | 361  |   |                    |   | 318  |                    |  |  | 14   |   |  |      | 2,179 |  |          |  | 1,783 |      |  |  | 22   |  |  | $        | 166 |   |  | $ | 178  |   |  |  | (7  | )
|Cost of goods sold                                       |  |                             | (196 | ) |                    |   | (229 | )                  |  |  | (14  | ) |  |      |       |  |          |  |       |      |  |  |      |  |  | $        | (90 | ) |  | $ | (128 | ) |  |  | (30 | )
|Gross margin                                             |  |                             | 165  |   |                    |   | 89   |                    |  |  | 85   |   |  |      |       |  |          |  |       |      |  |  |      |  |  | $        | 76  |   |  | $ | 50   |   |  |  | 52  |  
|Other miscellaneous and purchased product gross margin 2 |  |                             | (5   | ) |                    |   | (1   | )                  |  |  | 400  |   |  |      |       |  |          |  |       |      |  |  |      |  |  |          |     |   |  |   |      |   |  |  |     |  
|Gross Margin                                             |  | $                           | 160  |   |                    | $ | 88   |                    |  |  | 82   |   |  |      |       |  |          |  |       |      |  |  |      |  |  | $        | 73  |   |  | $ | 49   |   |  |  | 49  |  

|1 | Rounding differences may occur due to the use of whole dollars in per-tonne calculations.
|- | -----------------------------------------------------------------------------------------

|2 | Comprised of net sales of $4 million (2016  $4 million) less cost of goods sold of $9 million (2016  $5 million).
|- | -------------------------------------------------------------------------------------------------------------------

Potash gross margin variance was attributable to:



|                                          |  |                                           |    |   |                        |   |     |                    |  |   |       |  |  |   |    |  
|----------------------------------------- |  | ----------------------------------------- | -- | - | ---------------------- | - | --- | ------------------ |  | - | ----- |  |  | - | -- | -
|                                          |  | Three Months Ended
March 31 2017 vs. 2016 |   
|                                          |  |                                           |    |   | Change in
Prices/Costs |   |     |                    | 
|Dollars (millions)                        |  | Change inSales Volumes                    |    |   | Net
Sales              |   |     | Cost of
Goods Sold |  |   | Total | 
|Manufactured product                      |  |                                           |    |   |                        |   |     |                    |  |   |       |  |  |   |    |  
|North America                             |  | $                                         | 13 |   |                        | $ | 10  |                    |  | $ | 42    |  |  | $ | 65 |  
|Offshore                                  |  |                                           | 32 |   |                        |   | (38 | )                  |  |   | 17    |  |  |   | 11 |  
|Change in market mix                      |  |                                           | (1 | ) |                        |   |    |                    |  |   | 1     |  |  |   |   |  
|Total manufactured product                |  | $                                         | 44 |   |                        | $ | (28 | )                  |  | $ | 60    |  |  | $ | 76 |  
|Other miscellaneous and purchased product |  |                                           |    |   |                        |   |     |                    |  |   |       |  |  |   | (4 | )
|Total                                     |  |                                           |    |   |                        |   |     |                    |  |   |       |  |  | $ | 72 |  



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|   | 
|23 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

Sales to major offshore markets by Canpotex 1 were as follows:



|                      |  |  |  |  |                             |  |     |      |  |  |          |  |  |  |     |  
|--------------------- |  |  |  |  | --------------------------- |  | --- | ---- |  |  | -------- |  |  |  | --- | -
|                      |  |  |  |  | Three Months Ended March 31 | 
|                      |  |  |  |  | Percentage of Sales Volumes |  |     |      | 
|                      |  |  |  |  | 2017                        |  |     | 2016 |  |  | % Change | 
|Other Asian markets 2 |  |  |  |  |                             |  | 36  |      |  |  | 49       |  |  |  | (27 | )
|Latin America         |  |  |  |  |                             |  | 24  |      |  |  | 28       |  |  |  | (14 | )
|China                 |  |  |  |  |                             |  | 20  |      |  |  | 11       |  |  |  | 82  |  
|India                 |  |  |  |  |                             |  | 11  |      |  |  | 4        |  |  |  | 175 |  
|Other markets         |  |  |  |  |                             |  | 9   |      |  |  | 8        |  |  |  | 13  |  
|                      |  |  |  |  |                             |  | 100 |      |  |  | 100      |  |  |  |     |  

|1 | Canpotex Limited (Canpotex).
|- | ----------------------------

|2 | All Asian markets except China and India.
|- | -----------------------------------------

The most significant contributors to the change in total gross margin quarter
over quarter were as follows (direction of arrows refers to impact on gross margin):



|              |  |                                                                                |  |                    |      |  |  |                                                                                                                                                                                                                                                                                                              |  |      |      |  |                                                                                                                                                        |                                                                                                                                       
|------------- |  | ------------------------------------------------------------------------------ |  | ------------------ | ---- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---- | ---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------
|Sales Volumes |  | Net Sales Prices                                                               |  | Cost of Goods Sold
|LOGO          |  | Sales volumes were higher due primarily to stronger demand in all key markets. |  |                    | LOGO |  |  | Despite a continued recovery in global spot prices compared to the trailing quarter, our average realized potash price for the first
quarter of 2017 was below the amount realized in the first quarter of 2016, as weaker prices in standard-grade markets more than offset higher prices in North America. |  |      | LOGO |  |                                                                                                                                                        | Costs were lower in 2017 due to our portfolio optimization and results from our cost reduction strategy.                              
|              |  |                                                                                |  |                    |      |  |  |                                                                                                                                                                                                                                                                                                              |  | LOGO |      |  | Costs were also lower in 2017 as the first quarter of 2016 included costs associated with the indefinite suspension of potash operations at Picadilly.
|              |  |                                                                                |  |                    |     
|              |  |                                                                                |  |                    |      |  |  |                                                                                                                                                                                                                                                                                                              |  |      | LOGO |  |                                                                                                                                                        | Offshore cost of goods sold variance was positive as a relatively higher percentage of products sold was produced at lower-cost mines.



LOGO



|                                                            |  |   
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|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 24



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NON-FINANCIAL PERFORMANCE

The most significant contributors to the change in our non-financial performance highlights quarter over quarter were as follows:



LOGO



There were no significant changes between 2016 and 2017.


Combined with lower hours worked in 2017, the 13 recordable injuries in 2017 compared to 16 in 2016 resulted in a
slightly higher total recordable injury rate. No lost-time injuries in 2017 compared to two lost-time injuries in 2016 resulted in a lower lost-time injury
rate.


There were no significant changes between 2016 and 2017.


In 2017, we experienced no environmental incidents. In 2016, environmental incidents included one potash spill, one
brine spill and one water release with high suspended solids. Waste, as defined in our 2016 AIR, increased quarter over quarter due to the increase in
production.






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|   | 
|25 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

NITROGEN PERFORMANCE

FINANCIAL PERFORMANCE



|                                                         |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|-------------------------------------------------------- |  | --------------------------- | ---- | - | ------------------ | - | ---- | ------------------- |  |  | ---- | - |  | ---- | ----- |  | -------- |  | ----- | ---- |  |  | ---- | - |  | -------- | ---- | - |  | - | ---- | - |  |  | --- | -
|                                                         |  | Three Months Ended March 31 |     
|                                                         |  | Dollars (millions)          |      |   | Tonnes (thousands) |   |      | Average per Tonne 1 | 
|                                                         |  | 2017                        |      |   | 2016               |   |      | % Change            |  |  | 2017 |   |  | 2016 |       |  | % Change |  |       | 2017 |  |  | 2016 |   |  | % Change |     
|Manufactured product 2                                   |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Net sales                                                |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |       |  |          |  |       |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Ammonia                                                  |  | $                           | 159  |   |                    | $ | 188  |                     |  |  | (15  | ) |  |      | 546   |  |          |  | 601   |      |  |  | (9   | ) |  | $        | 291  |   |  | $ | 312  |   |  |  | (7  | )
|Urea                                                     |  |                             | 89   |   |                    |   | 86   |                     |  |  | 3    |   |  |      | 320   |  |          |  | 306   |      |  |  | 5    |   |  | $        | 279  |   |  | $ | 280  |   |  |  |    |  
|Solutions, nitric acid, ammonium nitrate                 |  |                             | 111  |   |                    |   | 133  |                     |  |  | (17  | ) |  |      | 701   |  |          |  | 757   |      |  |  | (7   | ) |  | $        | 158  |   |  | $ | 176  |   |  |  | (10 | )
|                                                         |  |                             | 359  |   |                    |   | 407  |                     |  |  | (12  | ) |  |      | 1,567 |  |          |  | 1,664 |      |  |  | (6   | ) |  | $        | 229  |   |  | $ | 244  |   |  |  | (6  | )
|Cost of goods sold                                       |  |                             | (266 | ) |                    |   | (304 | )                   |  |  | (13  | ) |  |      |       |  |          |  |       |      |  |  |      |   |  | $        | (170 | ) |  | $ | (182 | ) |  |  | (7  | )
|Gross margin                                             |  |                             | 93   |   |                    |   | 103  |                     |  |  | (10  | ) |  |      |       |  |          |  |       |      |  |  |      |   |  | $        | 59   |   |  | $ | 62   |   |  |  | (5  | )
|Other miscellaneous and purchased product gross margin 3 |  |                             | 4    |   |                    |   | 4    |                     |  |  |     |   |  |      |       |  |          |  |       |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Gross Margin                                             |  | $                           | 97   |   |                    | $ | 107  |                     |  |  | (9   | ) |  |      |       |  |          |  |       |      |  |  |      |   |  | $        | 62   |   |  | $ | 64   |   |  |  | (3  | )

|1 | Rounding differences may occur due to the use of whole dollars in per-tonne calculations.
|- | -----------------------------------------------------------------------------------------

|2 | Includes inter-segment ammonia sales, comprised of: net sales $22 million, cost of goods sold $11 million and 55,000 sales tonnes (2016  net sales $17 million, cost of goods sold $7 million and
40,000 sales tonnes). Inter-segment profits are eliminated on consolidation.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3 | Includes third-party net sales of $6 million and cost of goods sold $2 million (2016  net sales $5 million and cost of goods sold $1 million).
|- | -----------------------------------------------------------------------------------------------------------------------------------------------

Nitrogen gross margin variance was attributable to:



|                                          |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |     |  
|----------------------------------------- |  | ----------------------------------------- | -- | - | ---------------------- | - | --- | ----------------- |  | - | ----- | - |  | - | --- | -
|                                          |  | Three Months Ended
March 31 2017 vs. 2016 |   
|                                          |  |                                           |    |   | Change in
Prices/Costs |   |     |                   | 
|Dollars (millions)                        |  | Change inSales Volumes                    |    |   | Net Sales              |   |     | Cost ofGoods Sold |  |   | Total |  
|Manufactured product                      |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |     |  
|Ammonia                                   |  | $                                         | (5 | ) |                        | $ | (12 | )                 |  | $ | 15    |   |  | $ | (2  | )
|Urea                                      |  |                                           | 1  |   |                        |   |    |                   |  |   | 3     |   |  |   | 4   |  
|Solutions, nitric acid, ammonium nitrate  |  |                                           | (3 | ) |                        |   | (10 | )                 |  |   | (9    | ) |  |   | (22 | )
|Hedge                                     |  |                                           |   |   |                        |   |    |                   |  |   | 10    |   |  |   | 10  |  
|Change in product mix                     |  |                                           |   |   |                        |   | (2  | )                 |  |   | 2     |   |  |   |    |  
|Total manufactured product                |  | $                                         | (7 | ) |                        | $ | (24 | )                 |  | $ | 21    |   |  | $ | (10 | )
|Other miscellaneous and purchased product |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |    |  
|Total                                     |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  | $ | (10 | )



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 26



---

|                    |  |  |  |  |                             |  |       |                                   |  |  |       |  |  |      |     |  |  |   |     | 
|------------------- |  |  |  |  | --------------------------- |  | ----- | --------------------------------- |  |  | ----- |  |  | ---- | --- |  |  | - | --- | 
|                    |  |  |  |  | Three Months Ended March 31 | 
|                    |  |  |  |  | Sales Tonnes
(thousands)    |  |       | Average Net Sales Price
per Tonne | 
|                    |  |  |  |  | 2017                        |  |       | 2016                              |  |  | 2017  |  |  | 2016 |    
|Fertilizer          |  |  |  |  |                             |  | 620   |                                   |  |  | 666   |  |  | $    | 230 |  |  | $ | 232 | 
|Industrial and Feed |  |  |  |  |                             |  | 947   |                                   |  |  | 998   |  |  | $    | 228 |  |  | $ | 253 | 
|                    |  |  |  |  |                             |  | 1,567 |                                   |  |  | 1,664 |  |  | $    | 229 |  |  | $ | 244 | 

The most significant contributors to the change in total gross margin quarter over quarter were as follows (direction of arrows refers to
impact on gross margin):



|              |  |                                                                                                                                       |  |                    |  |                                                                                                                |  |      |  |                                                                                                                                                                                                                                                                                                                                                                                                            
|------------- |  | ------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------ |  | -------------------------------------------------------------------------------------------------------------- |  | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Sales Volumes |  | Net Sales Prices                                                                                                                      |  | Cost of Goods Sold
|LOGO          |  | Sales volumes were down primarily due to ammonia vessel timing, lower industrial demand and seasonal weakness for nitrogen solutions. |  | LOGO               |  | Our average realized price was down as increased global supply weighed on benchmark pricing for most products. |  | LOGO |  | Average costs, including our hedge position, for natural gas used as feedstock in production decreased two percent. Costs for natural gas used as feedstock in Trinidad production fell 21 percent (contract price indexed, in part, to
Tampa ammonia prices) while our US spot costs for natural gas increased 43 percent. Including losses on our hedge position, our US gas prices increased 19 percent.



LOGO



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|27 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

NON-FINANCIAL PERFORMANCE

The most significant contributors to the change in our non-financial performance highlights quarter over quarter were as follows:



LOGO



There were no significant changes between 2016 and 2017.


In 2017, there were four recordable injuries and no lost-time injuries compared to six recordable injuries and two
lost-time injuries in 2016.


The annualized employee turnover rate increased as a result of seven departures in 2017 compared to three departures
in 2016.


In 2017, we had two environmental incidents, consisting of one ammonia release and one organic nitrogen permit
exceedance. In 2016, we had three environmental incidents, consisting of one ammonia gas release, one fluoride air permit exceedance and one urea solution spill.






|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 28



---

PHOSPHATE PERFORMANCE

FINANCIAL PERFORMANCE



|                                                         |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |     |  |          |  |     |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|-------------------------------------------------------- |  | --------------------------- | ---- | - | ------------------ | - | ---- | ------------------- |  |  | ---- | - |  | ---- | --- |  | -------- |  | --- | ---- |  |  | ---- | - |  | -------- | ---- | - |  | - | ---- | - |  |  | --- | -
|                                                         |  | Three Months Ended March 31 |     
|                                                         |  | Dollars (millions)          |      |   | Tonnes (thousands) |   |      | Average per Tonne 1 | 
|                                                         |  | 2017                        |      |   | 2016               |   |      | % Change            |  |  | 2017 |   |  | 2016 |     |  | % Change |  |     | 2017 |  |  | 2016 |   |  | % Change |     
|Manufactured product                                     |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |     |  |          |  |     |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Net sales                                                |  |                             |      |   |                    |   |      |                     |  |  |      |   |  |      |     |  |          |  |     |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Fertilizer                                               |  | $                           | 136  |   |                    | $ | 191  |                     |  |  | (29  | ) |  |      | 368 |  |          |  | 437 |      |  |  | (16  | ) |  | $        | 369  |   |  | $ | 436  |   |  |  | (15 | )
|Feed and Industrial                                      |  |                             | 134  |   |                    |   | 167  |                     |  |  | (20  | ) |  |      | 271 |  |          |  | 280 |      |  |  | (3   | ) |  | $        | 495  |   |  | $ | 596  |   |  |  | (17 | )
|                                                         |  |                             | 270  |   |                    |   | 358  |                     |  |  | (25  | ) |  |      | 639 |  |          |  | 717 |      |  |  | (11  | ) |  | $        | 423  |   |  | $ | 499  |   |  |  | (15 | )
|Cost of goods sold                                       |  |                             | (260 | ) |                    |   | (320 | )                   |  |  | (19  | ) |  |      |     |  |          |  |     |      |  |  |      |   |  | $        | (406 | ) |  | $ | (446 | ) |  |  | (9  | )
|Gross margin                                             |  |                             | 10   |   |                    |   | 38   |                     |  |  | (74  | ) |  |      |     |  |          |  |     |      |  |  |      |   |  | $        | 17   |   |  | $ | 53   |   |  |  | (68 | )
|Other miscellaneous and purchased product gross margin 2 |  |                             | 1    |   |                    |   | 1    |                     |  |  |     |   |  |      |     |  |          |  |     |      |  |  |      |   |  |          |      |   |  |   |      |   |  |  |     |  
|Gross Margin                                             |  | $                           | 11   |   |                    | $ | 39   |                     |  |  | (72  | ) |  |      |     |  |          |  |     |      |  |  |      |   |  | $        | 17   |   |  | $ | 54   |   |  |  | (69 | )

|1 | Rounding differences may occur due to the use of whole dollars in per-tonne calculations.
|- | -----------------------------------------------------------------------------------------

|2 | Comprised of net sales of $1 million (2016  $1 million) less cost of goods sold of $NIL million (2016  $NIL).
|- | ---------------------------------------------------------------------------------------------------------------

Phosphate gross margin variance was attributable to:



|                                          |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |     |  
|----------------------------------------- |  | ----------------------------------------- | -- | - | ---------------------- | - | --- | ----------------- |  | - | ----- | - |  | - | --- | -
|                                          |  | Three Months Ended
March 31 2017 vs. 2016 |   
|                                          |  |                                           |    |   | Change in
Prices/Costs |   |     |                   | 
|Dollars (millions)                        |  | Change inSales Volumes                    |    |   | Net
Sales              |   |     | Cost ofGoods Sold |  |   | Total |  
|Manufactured product                      |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |     |  
|Fertilizer                                |  | $                                         | (6 | ) |                        | $ | (25 | )                 |  | $ | (1    | ) |  | $ | (32 | )
|Feed and Industrial                       |  |                                           | (1 | ) |                        |   | (28 | )                 |  |   | 33    |   |  |   | 4   |  
|Change in product mix                     |  |                                           | (1 | ) |                        |   | 4   |                   |  |   | (3    | ) |  |   |    |  
|Total manufactured product                |  | $                                         | (8 | ) |                        | $ | (49 | )                 |  | $ | 29    |   |  | $ | (28 | )
|Other miscellaneous and purchased product |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  |   |    |  
|Total                                     |  |                                           |    |   |                        |   |     |                   |  |   |       |   |  | $ | (28 | )



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|29 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

The most significant contributors to the change in total gross margin quarter over quarter were as follows (direction of
arrows refers to impact on gross margin):



|              |  |                                                                                          |  |                    |  |                                                                                                  |  |      |  |                                                                                                                                                                                                                                                                      
|------------- |  | ---------------------------------------------------------------------------------------- |  | ------------------ |  | ------------------------------------------------------------------------------------------------ |  | ---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Sales Volumes |  | Net Sales Prices                                                                         |  | Cost of Goods Sold
|LOGO          |  | Sales volumes were down largely due to weaker demand for our liquid fertilizer products. |  | LOGO               |  | Our average realized price was down, reflecting lower benchmark pricing for all of our products. |  | LOGO |  | In 2016, there was an impairment of property, plant and equipment related to product that the company no longer produces. There was no such impairment in 2017, resulting in a positive cost of goods sold variance in feed and
industrial.                          
|              |  |                                                                                          |  |                    | 
|              |  |                                                                                          |  |                    |  |                                                                                                  |  | LOGO |  | Fertilizer cost of goods sold variance was negative due to start-up costs of a solid fertilizer plant in White Springs more than offsetting lower sulfur costs and decreased provisions for
asset retirement obligations (2016 was impacted by lower discount rates).



LOGO



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 30



---

NON-FINANCIAL PERFORMANCE

The most significant contributors to the change in our non-financial performance highlights quarter over quarter were as follows:



LOGO



There were no significant changes between 2016 and 2017.


In 2017, there were three recordable injuries, including one lost-time injury, compared to six recordable injuries
and one lost-time injury in 2016.


The annualized employee turnover rate rose due to 16 departures in 2017 compared to nine departures in 2016.


In 2017, we experienced no environmental incidents. In 2016, environmental incidents included a total suspended
solids permit exceedance and a mercury permit exceedance. Water consumption increased as a result of drought conditions at our White Springs facility, which
recycles rainwater for use in operations.






OTHER EXPENSES AND INCOME



|                                                |  |                             |     |   |      |   |     |        |  |   |          |   |  |  |     |  
|----------------------------------------------- |  | --------------------------- | --- | - | ---- | - | --- | ------ |  | - | -------- | - |  |  | --- | -
|                                                |  | Three Months Ended March 31 |    
|Dollars (millions), except percentage amounts   |  | 2017                        |     |   | 2016 |   |     | Change |  |   | % Change |  
|Selling and administrative expenses             |  | $                           | (50 | ) |      | $ | (53 | )      |  | $ | 3        |   |  |  | (6  | )
|Provincial mining and other taxes               |  |                             | (34 | ) |      |   | (31 | )      |  |   | (3       | ) |  |  | 10  |  
|Share of earnings of equity-accounted investees |  |                             | 39  |   |      |   | 19  |        |  |   | 20       |   |  |  | 105 |  
|Dividend income                                 |  |                             | 8   |   |      |   |    |        |  |   | 8        |   |  |  | n/m |  
|Other expenses                                  |  |                             | (10 | ) |      |   | (10 | )      |  |   |         |   |  |  |    |  
|Finance costs                                   |  |                             | (59 | ) |      |   | (52 | )      |  |   | (7       | ) |  |  | 13  |  
|Income taxes                                    |  |                             | (13 | ) |      |   | (32 | )      |  |   | 19       |   |  |  | (59 | )

n/m = not meaningful



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|31 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

The most significant contributors to the change in other expenses and income quarter over quarter were as follows:



|                                                |  |  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                             |    |   |      |   |    |  
|----------------------------------------------- |  |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------- | -- | - | ---- | - | -- | -
|Share of Earnings of Equity-Accounted Investees |  |  |  | Share of earnings of equity-accounted investees pertains primarily to SQM and APC. Higher earnings were mainly due to higher earnings at SQM.                                                                                                                                                                                                                                                                                                                                   | 
|Finance Costs                                   |  |  |  | There were no significant changes.                                                                                                                                                                                                                                                                                                                                                                                                                                              | 
|                                                |  | 
|                                                |  |  |  | LOGO                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|Income Taxes                                    |  |  |  | Income taxes decreased primarily due to significantly lower forecasted annual earnings in the United States. For the first three months of 2017, 162 percent of the effective tax rate on the current years
ordinary earnings pertained to current income taxes (2016  83 percent) and (62) percent related to deferred income taxes (2016  17 percent). The decrease in the deferred portion is due to significantly lower
forecasted annual earnings in the United States. | 
|                                                |  | 
|                                                |  |  |  | EFFECTIVE TAX RATES AND DISCRETE ITEMS                                                                                                                                                                                                                                                                                                                                                                                                                                          | 
|                                                |  |  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | Three Months Ended March 31 |   
|                                                |  |  |  | Dollars (millions), except percentage amounts                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | 2017                        |    |   | 2016 |  
|                                                |  |  |  | Actual effective tax rate on ordinary earnings                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                             | 11 | % |      |   | 26 | %
|                                                |  |  |  | Actual effective tax rate including discrete items                                                                                                                                                                                                                                                                                                                                                                                                                              |  |                             | 8  | % |      |   | 30 | %
|                                                |  |  |  | Discrete tax adjustments that impacted the tax rate                                                                                                                                                                                                                                                                                                                                                                                                                             |  | $                           | 5  |   |      | $ | (4 | )

OTHER NON-FINANCIAL INFORMATION



|                                              |  |                             |    |  |      |   |    |        |  |   |          |  |  |  |    | 
|--------------------------------------------- |  | --------------------------- | -- |  | ---- | - | -- | ------ |  | - | -------- |  |  |  | -- | 
|                                              |  | Three Months Ended March 31 |   
|Dollars (millions), except percentage amounts |  | 2017                        |    |  | 2016 |   |    | Change |  |   | % Change | 
|Taxes and royalties1                          |  | $                           | 94 |  |      | $ | 78 |        |  | $ | 16       |  |  |  | 21 | 

|1 | Includes tax and royalty amounts on an accrual basis calculated as: current income tax expense less investment tax credits and realized excess tax benefit related to share-based compensation plus potash production tax,
resource surcharge, royalties, municipal taxes and other miscellaneous taxes.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 32



---

The most significant contributors to the change in other non-financial information
quarter over quarter were as follows:



|                    |  |                                                                                                                                                                                                                                   
|------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Taxes and Royalties |  | Taxes and royalties increased primarily due to an increase in current income taxes. The increase in current income taxes was due to a
decrease in estimated usage of Canadian investment tax credits to reduce cash taxes payable.

FINANCIAL CONDITION REVIEW

STATEMENT OF FINANCIAL POSITION ANALYSIS



LOGO

The most significant contributors to the changes in our statements of financial position were as follows (direction of arrows refers to
increase or decrease):



|       |  |                                                                                                                                                                                           |  |      |  |                                                                            
|------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- |  | ---------------------------------------------------------------------------
|Assets |  | Liabilities                                                                                                                                                                              
|LOGO   |  | Property, plant and equipment decreased as depreciation exceeded additions.                                                                                                               |  | LOGO |  | Payables and accrued charges were lower mainly due to lower trade payables.
|       |  |                                                                                                                                                                                           | 
|LOGO   |  | Investments were impacted by higher fair values of our available-for-sale investments in Sinofert and ICL and
increases in the values of our equity-accounted investments in SQM and APC. |  |      |  |                                                                            
|Equity |  |                                                                                                                                                                                           |  |     
|LOGO   |  | Retained earnings were higher as a result of net income (discussed in more detail above) exceeding dividends declared.                                                                   

As at March 31, 2017, $21 million (December 31, 2016  $21 million) of our cash and cash equivalents was held in certain
foreign subsidiaries. There are no current plans to repatriate the funds at March 31, 2017 in a manner that would result in tax consequences.



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|33 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

LIQUIDITY AND CAPITAL RESOURCES

CASH REQUIREMENTS

CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS

Our contractual obligations and other commitments detailed on page 84 of our 2016 AIR summarize certain of our liquidity and capital resource requirements, excluding
obligations that have original maturities of less than one year and planned (but not legally committed) capital expenditures.

SOURCES AND USES OF CASH

The companys cash flows from operating, investing and financing activities are summarized in the following table:



|                                                 |  |                             |      |   |      |   |      |        |  |   |          |   |  |  |     |  
|------------------------------------------------ |  | --------------------------- | ---- | - | ---- | - | ---- | ------ |  | - | -------- | - |  |  | --- | -
|                                                 |  | Three Months Ended March 31 |     
|Dollars (millions), except percentage amounts    |  | 2017                        |      |   | 2016 |   |      | Change |  |   | % Change |  
|Cash provided by operating activities            |  | $                           | 223  |   |      | $ | 188  |        |  | $ | 35       |   |  |  | 19  |  
|Cash used in investing activities                |  |                             | (132 | ) |      |   | (246 | )      |  |   | 114      |   |  |  | (46 | )
|Cash (used in) provided by financing activities  |  |                             | (61  | ) |      |   | 41   |        |  |   | (102     | ) |  |  | n/m |  
|Increase (Decrease) in Cash and Cash Equivalents |  | $                           | 30   |   |      | $ | (17  | )      |  | $ | 47       |   |  |  | n/m |  

n/m = not meaningful



LOGO



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 34



---

The most significant contributors to the changes in cash flows quarter over quarter were as follows:



|                                                |  |                                                                                                                                                                                                                                                                                                                    
|----------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Provided by Operating Activities           |  | Cash provided by operating activities was impacted by:
 Higher net income in 2017;
 Higher cash inflows from receivables in 2017; and
 Lower cash outflows on inventory in 2017.                                                                                                                                
|Cash Used in Investing Activities               |  | Cash used in investing activities was primarily for additions to property, plant and equipment.                                                                                                                                                                                                                    
|Cash Provided by (Used in) Financing Activities |  | Cash used in financing activities in 2017 was largely the result of dividends paid more than offsetting proceeds from the issuance of commercial paper. Cash provided by financing activities
in 2016 was largely the result of proceeds from the issuance of commercial paper more than offsetting dividends paid.

We believe that internally generated cash flow, supplemented by available borrowings under our existing financing sources if necessary,
will be sufficient to meet our anticipated capital expenditures and other cash requirements for at least the next 12 months, inclusive of requirements relating to the Proposed Transaction, but exclusive of any possible acquisitions. At this
time, we do not reasonably expect any presently known trend or uncertainty to affect our ability to access our historical sources of liquidity.



LOGO



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|35 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

CAPITAL STRUCTURE AND MANAGEMENT PRINCIPAL DEBT INSTRUMENTS  LOGO We use a combination of cash generated from operations and short-term and long-term debt to finance our operations. We typically pay
floating rates of interest on our short-term debt and credit facility and fixed rates on our senior notes. During the first quarter of 2017, there were no
significant changes to the nature of our outstanding commercial paper, credit facility, short-term line of credit and uncommitted letter of credit facility described on page 87 in our 2016 AIR. As at March 31, 2017, interest rates on
outstanding commercial paper ranged from 1.1 percent to 1.5 percent. (December 31, 2016  0.9 percent to 1.1 percent). The credit facility
and line of credit have financial tests and covenants, including consequences of non-compliance, referenced on page 87 of our 2016 AIR, with which we must comply at each
quarter-end. We were in compliance with all covenants as at March 31, 2017 and at this time anticipate being in compliance with such covenants through 2017. The accompanying table summarizes the limits and results of certain covenants:  Debt covenants at March 31
Dollars (millions), except ratio amounts

Limit


2017Debt-to-capital ratio 1

£
0.65



0.36Debt of subsidiaries

< $
1,000


$
-Net book value of disposed assets

< $
4,314
2

$
- 1Debt-to-capital ratio = debt (short-term debt and current portion of long-term debt + long-term debt) / (debt + shareholders equity). This non-IFRS financial measure is a requirement of our debt covenants and should not be considered as a substitute for, nor superior to, measures of financial performance prepared in accordance with IFRS. 2 Limit is 25 percent of the prior years year-end total
assets


Our ability to access reasonably priced debt in the capital markets is dependent, in part, on the quality of our credit
ratings. We continue to maintain investment-grade credit ratings for our long-term debt. A downgrade of the credit rating of our long-term debt would increase the interest rates applicable to borrowings under our credit facility and our line of
credit. Commercial paper markets are normally a source of same-day cash for the company. Our access to the US commercial
paper market primarily depends on maintaining our current short-term credit ratings as well as general conditions in the money markets.  Long-Term Debt

Short-Term DebtRating (Outlook)

RatingMarch 31
2017

December 31
2016

March 31
2017

December 31
2016Moodys

Baa1 (negative)

Baa1 (negative)

P-2

P-2Standard & Poors

BBB+ (stable)

BBB+ (stable)

A-21

A-21  1
S&P assigned a global commercial paper rating of A-2, but rated our commercial paper A-1 (low) on a Canadian scale. A security rating is not a recommendation to buy, sell or hold securities. Such rating may be subject to revision or withdrawal at any time by the respective credit
rating agency and each rating should be evaluated independently of any other rating. OUTSTANDING SHARE DATA  March 31
2017


December 31
2016Common shares issued and outstanding


840,007,355



839,790,379Options to purchase common shares outstanding


20,288,369



19,470,014Share-settled performance share units


959,700



602,740Number of share-settled compensation plans


10



10 Our $4,250 million of senior notes were issued under US shelf registration statements. If the Proposed Transaction is completed, a
downgrade in the companys credit ratings below investment-grade would trigger a change in control offer under existing debt securities, except for the notes issued in 2016, and the company would be required to make an offer to purchase all, or
any part, of the senior notes at 101 percent of the $3,750 million outstanding principal amount of the notes to be repurchased, plus accrued and unpaid interest For the first three months of 2017, our weighted average cost of capital was 7.0 percent (2016  7.6 percent), of which 76 percent
represented the cost of equity (2016  75 percent).






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OFF-BALANCE SHEET ARRANGEMENTS Off-balance sheet arrangements are described on page 88 of our 2016 AIR. We do not reasonably expect any presently known trend or
uncertainty to affect our ability to continue using these arrangements. Refer to Note 11 to the financial statements in this


Form 10-Q for a contingency related to Canpotex. Refer to page 88 of our 2016 AIR for information pertaining to our guarantees and derivative
instruments. See Cash Requirements on page 34 of this Form 10-Q and our 2016 AIR for obligations related to operating leases and certain of our long-term raw materials agreements that contain fixed price and/or volume components.






QUARTERLY FINANCIAL HIGHLIGHTS



|                                               |  |               |       |   |                  |   |       |                   |  |   |              |  |  |               |       |   |                  |   |       |                   |  |   |              |   |  |   |       |   |  |   |       |  
|---------------------------------------------- |  | ------------- | ----- | - | ---------------- | - | ----- | ----------------- |  | - | ------------ |  |  | ------------- | ----- | - | ---------------- | - | ----- | ----------------- |  | - | ------------ | - |  | - | ----- | - |  | - | ----- | -
|Dollars (millions), except
as otherwise noted  |  | March 31,2017 |       |   | December 31,2016 |   |       | September 30,2016 |  |   | June 30,2016 |  |  | March 31,2016 |       |   | December 31,2015 |   |       | September 30,2015 |  |   | June 30,2015 |  
|Financial Performance                          |  |               |       |   |                  |   |       |                   |  |   |              |  |  |               |       |   |                  |   |       |                   |  |   |              |   |  |   |       |   |  |   |       |  
|Sales                                          |  | $             | 1,112 |   |                  | $ | 1,058 |                   |  | $ | 1,136        |  |  | $             | 1,053 |   |                  | $ | 1,209 |                   |  | $ | 1,354        |   |  | $ | 1,529 |   |  | $ | 1,731 |  
|Gross margin                                   |  |               | 268   |   |                  |   | 163   |                   |  |   | 190          |  |  |               | 243   |   |                  |   | 234   |                   |  |   | 386          |   |  |   | 505   |   |  |   | 711   |  
|Net income                                     |  |               | 149   |   |                  |   | 46    |                   |  |   | 81           |  |  |               | 121   |   |                  |   | 75    |                   |  |   | 201          |   |  |   | 282   |   |  |   | 417   |  
|Net income per share  basic 1                 |  |               | 0.18  |   |                  |   | 0.05  |                   |  |   | 0.10         |  |  |               | 0.14  |   |                  |   | 0.09  |                   |  |   | 0.24         |   |  |   | 0.34  |   |  |   | 0.50  |  
|Net income per share  diluted 1               |  |               | 0.18  |   |                  |   | 0.05  |                   |  |   | 0.10         |  |  |               | 0.14  |   |                  |   | 0.09  |                   |  |   | 0.24         |   |  |   | 0.34  |   |  |   | 0.50  |  
|Non-Financial Performance                      |  |               |       |   |                  |   |       |                   |  |   |              |  |  |               |       |   |                  |   |       |                   |  |   |              |   |  |   |       |   |  |   |       |  
|Total shareholder return percentage            |  |               | (5    | ) |                  |   | 12    |                   |  |   | 2            |  |  |               | (3    | ) |                  |   | 2     |                   |  |   | (15          | ) |  |   | (33   | ) |  |   | (3    | )
|Employee turnover rate (annualized percentage) |  |               | 4     |   |                  |   | 3     |                   |  |   | 3            |  |  |               | 4     |   |                  |   | 3     |                   |  |   | 3            |   |  |   | 4     |   |  |   | 4     |  
|Total recordable injury rate                   |  |               | 0.95  |   |                  |   | 0.74  |                   |  |   | 0.92         |  |  |               | 0.69  |   |                  |   | 1.15  |                   |  |   | 0.97         |   |  |   | 1.29  |   |  |   | 0.85  |  
|Environmental incidents                        |  |               | 2     |   |                  |   | 1     |                   |  |   | 5            |  |  |               | 3     |   |                  |   | 9     |                   |  |   | 8            |   |  |   | 6     |   |  |   | 5     |  

1 Net income per share for each quarter has been computed based on the
weighted average number of shares issued and outstanding during the respective quarter, including the dilutive number of shares assumed for the diluted earnings per share computation; therefore, as the number of shares varies each period, quarterly
amounts may not add to the annual total.

Refer to Note 10 to the financial statements in this Form 10-Q for information
pertaining to sales that can be seasonal.

In the fourth quarter of 2016, earnings were impacted by a $20 million
non-cash impairment charge to property, plant and equipment in the phosphate segment. In the second quarter of 2016, earnings were impacted by $33 million in exit costs relating to Canpotexs Prince
Rupert terminal in the potash segment and a $10 million non-cash impairment charge on our available-for-sale investment in
Sinofert.



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OTHER FINANCIAL INFORMATION RELATED PARTY TRANSACTIONS Refer to Note 12 to the financial statements in this Form 10-Q for information pertaining to transactions with related parties. CRITICAL ACCOUNTING ESTIMATES There have been no material changes to our critical accounting policies in the first three months of 2017. Certain of these policies, such as long-lived asset impairment,
derivative instruments, provisions and contingencies for asset retirement, environmental and other obligations, and capitalization and depreciation of property, plant and equipment, involve critical accounting estimates because they require us to
make subjective or complex judgments about matters that are inherently uncertain and because of the likelihood that materially different amounts could be reported under different conditions or using different assumptions, particularly in the current
market environment. Information on impairment sensitivities is included on page 89 of our 2016 AIR. We have discussed the development, selection and application of
our key accounting policies, and the critical accounting estimates and assumptions they involve, with the audit committee of the Board, and the committee reviewed the disclosures described in this Form 10-Q. RECENT ACCOUNTING CHANGES Refer to Note 1 to the financial statements in
this Form 10-Q for information on issued accounting pronouncements that will be effective in future periods and were effective in 2017. Information on the implementation of IFRS 15, Revenue From Contracts With
Customers and IFRS 16, Leases is included on page 89 of our 2016 AIR. OUTLOOK POTASH MARKET OUTLOOK Strong demand is expected to continue through the remainder of
the year. We maintain our global shipments estimate of 61-64 million tonnes for 2017, above the approximately 60 million tonnes shipped in 2016, and expect supportive market fundamentals through the balance of this year. In North America, we believe fertilizer affordability and the need to replenish soil nutrients following 2016s record harvest will contribute to healthy demand at
the farm level. We maintain our full-year shipment expectation in the range of 9.3-9.8 million tonnes, consistent with our previous estimate.


In Latin America, we expect the affordability of nutrients to continue to support a positive demand environment. Factoring
in robust deliveries during the first quarter, we have increased our estimate of full-year shipments to 11.7-12.2 million tonnes, exceeding 2016s total. In
China, healthy consumption levels driven by attractive crop prices and strong affordability relative to other nutrients have resulted in a drawdown of inventory levels. We continue to expect demand for the full year in the range of 14.5-15.5 million
tonnes, above the approximately 14 million tonnes shipped in 2016. In India, we have lowered our expected shipment range to 3.8-4.3 million tonnes for the year due
to recent potash subsidy changes that are expected to result in higher retail prices for farmers. In Other Asian markets, we expect improved moisture conditions and
favorable economics for key crops such as oil palm to support demand in 2017. We have increased our estimated shipment range to 9.0-9.5 million tonnes for the full year, above 2016s total of approximately 9 million tonnes. FINANCIAL OUTLOOK Taking the above market factors into consideration, we have raised
the bottom end of our guidance ranges for potash sales volumes and gross margin to 8.9-9.4 million tonnes and $600-$800 million, respectively. In nitrogen, we
continue to expect that pressure from new US capacity will keep margins below those of the previous year. Similarly, we forecast phosphate profitability to be below 2016 levels as difficult market fundamentals are expected to weigh on realizations
for our products. Given these considerations, we maintain our combined nitrogen and phosphate gross margin estimate of $150-$400 million in 2017. Our effective
income tax rate is anticipated to fall to a range of 2-5 percent, primarily due to a non-cash income tax provision recovery relating to provincial tax changes that will be realized in future years. Selling and administrative expenses have been lowered and are now forecast in the range of $220-$230 million, while finance costs are now expected to be higher, in the
range of $225-$235 million. Additionally, income from equity investments is now anticipated in the range of $150-$170 million, above the previous guidance range. We have revised our full-year foreign exchange rate assumption to CDN$1.33 per US dollar, slightly higher than previous guidance. Based on these factors, we have increased our full-year 2017 earnings guidance to $0.45-$0.65 per share, including merger-related costs of $0.05 per share.






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LOGO



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FORWARD-LOOKING STATEMENTS Certain statements in this Quarterly Report on Form 10-Q, including, but not limited to, those in the Outlook
section of Managements Discussion and Analysis of Financial Condition and Results of Operations, contain forward-looking statements (within the meaning of the US Private Securities Litigation Reform Act of 1995 and
other US federal securities laws) or forward-looking information (within the meaning of applicable Canadian securities legislation) that relate to future events or our future financial performance. These statements can be identified by
expressions of belief, expectation or intention, as well as those statements that are not historical fact. These statements often contain words such as should, could, expect, may,
anticipate, forecast, believe, intend, estimates, plans and similar expressions. These statements are based on certain factors and assumptions as set forth in this Quarterly
Report on Form 10-Q, including with respect to: foreign exchange rates, expected growth, results of operations, performance, business prospects and opportunities, including the Proposed Transaction, and
effective tax rates. While the company considers these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking statements are subject to risks and uncertainties that are
difficult to predict. The results or events set forth in forward-looking statements may differ materially from actual results or events. Several factors could cause our actual results or events to differ materially from those expressed in
forward-looking statements including, but not limited to, the following: a number of risks and uncertainties relating to the Proposed Transaction, including the failure to satisfy all required conditions, including required regulatory approvals, or
to satisfy or obtain waivers with respect to all other closing conditions in a timely manner and on favorable terms or at all; the occurrence of any event, change or other circumstances that could give rise to the termination of the Arrangement
Agreement; certain costs that we may incur in connection with the Proposed Transaction; certain restrictions in the Arrangement Agreement on our ability to take action outside the ordinary course of business without the consent of Agrium; the effect
of the announcement of the Proposed Transaction on our ability to retain customers, suppliers and personnel and on our operating future business and operations generally; risks related to diversion of management time from ongoing business operations
due to the Proposed Transaction; failure to realize the anticipated benefits of the Proposed Transaction and to successfully integrate Agrium and PotashCorp; the risk that our credit ratings may be downgraded or there may be adverse conditions in
the credit markets; any significant impairment of the carrying amount of certain of our assets; variations from our assumptions with respect to


foreign exchange rates, expected growth, results of operations, performance, business prospects and opportunities, and effective tax rates; fluctuations in supply and demand in the fertilizer,
sulfur and petrochemical markets; changes in competitive pressures, including pricing pressures; risks and uncertainties related to any operating and workforce changes made in response to our industry and the markets we serve, including mine and
inventory shutdowns; adverse or uncertain economic conditions and changes in credit and financial markets; economic and political uncertainty around the world; changes in capital markets; the results of sales contract negotiations within major
markets; unexpected or adverse weather conditions; risks related to reputational loss; the occurrence of a major safety incident; inadequate insurance coverage for a significant liability; inability to obtain relevant permits for our operations;
catastrophic events or malicious acts, including terrorism; certain complications that may arise in our mining process, including water inflows; risks and uncertainties related to our international operations and assets; our ownership of non-controlling equity interests in other companies; our prospects to reinvest capital in strategic opportunities and acquisitions; risks associated with natural gas and other hedging activities; security risks
related to our information technology systems; imprecision in reserve estimates; costs and availability of transportation and distribution for our raw materials and products, including railcars and ocean freight; changes in, and the effects of,
government policies and regulations; earnings and the decisions of taxing authorities which could affect our effective tax rates; increases in the price or reduced availability of the raw materials that we use; our ability to attract, develop,
engage and retain skilled employees; strikes or other forms of work stoppage or slowdowns; rates of return on, and the risks associated with, our investments and capital expenditures; timing and impact of capital expenditures; the impact of further
innovation; adverse developments in pending or future legal proceedings or government investigations; and violations of our governance and compliance policies. These risks and uncertainties and additional risks and uncertainties can be found in our
Form 10-K for the year ended December 31, 2016 under the captions Forward-Looking Statements and Item 1ARisk Factors, and in our filings with the US Securities and Exchange
Commission and Canadian provincial securities commissions. As a result of these and other factors, there is no assurance that any of the events, circumstances or results anticipated by forward-looking statements included or incorporated by reference
into this Quarterly Report on Form 10-Q will occur or, if they do, of what impact they will have on our business, our performance, the results of our operations and our financial condition. Forward-looking
statements are given only as at the date of this report and the company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.






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Item 3. Quantitative and Qualitative Disclosures About Market Risk Market risk is the potential for loss from adverse changes in the market value of financial instruments. The level of market risk to which we are exposed varies depending
on the composition of our derivative instrument portfolio, as well as current and expected market conditions. A discussion of enterprise-wide risk management can be found in our 2016 AIR, pages 48 to 55. Price, foreign exchange and interest rate risks faced by the company and how we manage those risks are outlined in Notes 17 and 29 to the 2016 audited annual
consolidated financial statements and there were no significant changes as at March 31, 2017. PRICE RISK The carrying amount of our investments in ICL and Sinofert was $967 million at March 31, 2017 (December 31, 2016  $937 million). A 10 percent
increase in the prices of these investments would increase other comprehensive income by $97 million, while a 10 percent decrease would reduce other comprehensive income by $97 million. At March 31, 2017, this analysis assumed
that price decreases would not represent an impairment. There were no substantial changes to the price sensitivities related to our natural gas derivatives reported
in Note 29 to the 2016 audited annual consolidated financial statements. As at March 31, 2017, the companys net exposure to natural gas derivatives
in the form of swaps was a notional amount of 41 million MMBtu (December 31, 2016  swaps was a notional amount of 46 million MMBtu) with maturities in 2017 through 2022.


FOREIGN EXCHANGE RISK As at
March 31, 2017, the company had entered into foreign currency forward contracts to sell US dollars and receive Canadian dollars in the notional amount of $40 million (December 31, 2016$21 million) at an average exchange rate of
1.3340 (December 31, 20161.3490) per US dollar with maturities in 2017. There were no substantial changes to the foreign exchange sensitivities reported in Note 29 to the 2016 audited annual consolidated financial statements. INTEREST RATE RISK As at March 31, 2017, the company had no significant exposure
to interest rate risk. Item 4. Controls and Procedures As of March 31,
2017, we carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and
procedures. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even
effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based upon that evaluation and as of March 31, 2017, the Chief Executive Officer and Chief Financial Officer concluded
that the disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the reports the company files and submits under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported as and when required and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required
disclosure. There has been no change in our internal control over financial reporting during the quarter ended March 31, 2017 that has materially affected, or
is reasonably likely to materially affect, our internal control over financial reporting.






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|41 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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PART II. OTHER INFORMATION



Item 1. Legal Proceedings For a
description of certain legal and environmental proceedings, see Note 11 to the unaudited interim condensed consolidated financial statements included in Part I of this Quarterly Report on Form 10-Q. Item 4. Other Information MINE SAFETY DISCLOSURES Safety is a fundamental core value and we are committed to providing a healthy and safe work environment for our employees, contractors and all others at our sites to
help meet our company-wide goal of achieving no harm to people. The operations at the companys Aurora, Weeping Water and White Springs facilities are subject
to the Federal Mine Safety and Health Act of 1977, as amended by the


Mine Improvement and New Emergency Response Act of 2006, and the implementing regulations, which impose stringent health and safety standards on numerous aspects of mineral extraction and
processing operations, including the training of personnel, operating procedures, operating equipment and other matters. Our senior management is responsible for managing compliance with applicable government regulations, as well as implementing and
overseeing the elements of our safety program as outlined in our Safety, Health and Environment Manual. Section 1503(a) of the Dodd-Frank Wall Street Reform and
Consumer Protection Act (Section 1503(a)) requires us to include certain safety information in the periodic reports we file with the United States Securities and Exchange Commission. The information concerning mine safety violations and
other regulatory matters required by Section 1503(a) and Item 104 of Regulation S-K is included in Exhibit 95 to this Quarterly Report on Form 10-Q.






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|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 42



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Item 6. Exhibits

(a) Exhibits



|               |  |                                                                                                                                                                                                     |  |                                                                            |  |                            |  |                              
|-------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | -----------------------------
|               |  |                                                                                                                                                                                                     |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|               |  |                                                                                                                                                                                                     |  |                                                                           
|Exhibit Number |  | Description of Document                                                                                                                                                                             |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number
(if different)
|2(a)           |  | Arrangement Agreement, dated September 11, 2016, between Potash Corporation of Saskatchewan Inc. and Agrium Inc.                                                                                    |  | 8-K                                                                        |  | 9/12/2016                  |  | 2.1                          
|               |  |                                                                                                                                                                                                     |  |                                                                           
|3(a)           |  | Articles of Continuance of the registrant dated May 15, 2002.                                                                                                                                       |  | 10-Q                                                                       |  | 6/30/2002                  |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|3(b)           |  | General By-Law of the registrant, as amended through April 27, 2015.                                                                                                                                |  | 8-K                                                                        |  | 4/27/2015                  |  | 3(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(a)           |  | Indenture dated as of February 27, 2003, between the registrant and U.S. Bank National Association, as successor to The Bank of Nova Scotia Trust Company of New York.                              |  | 10-K                                                                       |  | 12/31/2002                 |  | 4(c)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(b)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 5.875% Notes due December 1, 2036.                                                                                       |  | 8-K                                                                        |  | 11/30/2006                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(c)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 6.50% Notes due May 15, 2019.                                                                                            |  | 8-K                                                                        |  | 5/1/2009                   |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(d)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 4.875% Notes due March 30, 2020.                                                                                         |  | 8-K                                                                        |  | 9/25/2009                  |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(e)           |  | Form of Note relating to the registrants $750,000,000 principal amount of 3.625% Notes due March 15, 2024.                                                                                         |  | 8-K                                                                        |  | 3/7/2014                   |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(f)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 3.000% Notes due April 1, 2025.                                                                                          |  | 8-K                                                                        |  | 3/26/2015                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(g)           |  | Revolving Term Credit Facility Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated December 11, 2009.                                               |  | 8-K                                                                        |  | 12/15/2009                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(h)           |  | Revolving Term Credit Facility First Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated September 23, 2011.                               |  | 8-K                                                                        |  | 9/26/2011                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(i)           |  | Revolving Term Credit Facility Second Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated as of May 24, 2013.                              |  | 8-K                                                                        |  | 5/28/2013                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(j)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 3.25% Notes due December 1, 2017.                                                                                        |  | 8-K                                                                        |  | 11/29/2010                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(k)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 5.625% Notes due December 1, 2040.                                                                                       |  | 8-K                                                                        |  | 11/29/2010                 |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(l)           |  | Agreement of Resignation, Appointment and Acceptance, dated as of June 25, 2013, by and among the registrant, The Bank of Nova Scotia Trust Company of New York and U.S. Bank National Association. |  | 8-K                                                                        |  | 6/27/2013                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(m)           |  | Revolving Term Credit Facility Third Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated July 8, 2014.                                     |  | 10-Q                                                                       |  | 7/29/2014                  |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(n)           |  | Revolving Term Credit Facility Fourth Amending Agreement between The Bank of Nova Scotia and other financial institutions and the registrant dated January 25, 2016.                                |  | 8-K                                                                        |  | 1/29/2016                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(o)           |  | Extension Agreement between The Bank of Nova Scotia and other financial institutions and the registrant dated June 27, 2016.                                                                        |  | 10-Q                                                                       |  | 8/3/2016                   |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(p)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 4.000% Notes due December 15, 2026.                                                                                      |  | 8-K                                                                        |  | 12/6/2016                  |  | 4(a)                         



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|43 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



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The registrant hereby undertakes to file with the Securities and Exchange Commission, upon request, copies of
any constituent instruments defining the rights of holders of long-term debt of the registrant or its subsidiaries that have not been filed herewith because the amounts represented thereby are less than 10% of the total assets of the
registrant and its subsidiaries on a consolidated basis.



|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                            |  |                            |  |                             
|------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | ----------------------------
|              |  |                                                                                                                                                                                                                                                                                                               |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|ExhibitNumber |  | Description of Document                                                                                                                                                                                                                                                                                       |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number(if different)
|10(a)         |  | Consolidated, Restated and Amended Canpotex Shareholders Agreement, Eighth Memorandum of Agreement dated January 1, 2014 between Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada
Ltd., the registrant and Canpotex Limited.                                            |  | 10-K                                                                       |  | 12/31/2013                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(b)         |  | Consolidated, Restated and Amended Producer Agreement, Eighth Memorandum of Agreement dated January 1, 2014 between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada Ltd.
and the registrant.                                                          |  | 10-K                                                                       |  | 12/31/2013                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(c)         |  | First Amending Agreement dated January 1, 2016, between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada Ltd. and the registrant, to the Consolidated, Restated and
Amended Producer Agreement Eighth Memorandum of Agreement dated January 1, 2014.   |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(d)         |  | Second Amending Agreement dated December 20, 2016, between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner 4379934 Canada Ltd. and the registrant, to the Consolidated, Restated and Amended
Producer Agreement Eighth Memorandum of Agreement dated January 1, 2014. |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(e)         |  | Short-Term Incentive Plan of the registrant effective January 1, 2000, as amended.                                                                                                                                                                                                                            |  | 8-K                                                                        |  | 3/13/2012                  |  | 10(a)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(f)         |  | Resolution and Forms of Agreement for Supplemental Executive Retirement Income Plan, for officers and key employees of the registrant.                                                                                                                                                                        |  | 10-K                                                                       |  | 12/31/1995                 |  | 10(o)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(g)         |  | Amending Resolution and revised forms of agreement regarding Supplemental Retirement Income Plan of the registrant.                                                                                                                                                                                           |  | 10-Q                                                                       |  | 6/30/1996                  |  | 10(x)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(h)         |  | Amended and restated Supplemental Executive Retirement Income Plan of the registrant and text of amendment to existing supplemental income plan agreements.                                                                                                                                                   |  | 10-Q                                                                       |  | 9/30/2000                  |  | 10(mm)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(i)         |  | Amendment, dated February 23, 2009, to the amended and restated Supplemental Executive Retirement Income Plan.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2008                 |  | 10(r)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(j)         |  | Amendment, dated December 29, 2010, to the amended and restated Supplemental Executive Retirement Income Plan.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2010                 |  | 10(r)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(k)         |  | Amended and restated Supplemental Executive Retirement Income Plan of the registrant, dated February 22, 2016.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(i)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(l)         |  | Form of Letter of amendment to existing supplemental income plan agreements of the registrant.                                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2002                 |  | 10(cc)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(m)         |  | Amendment, dated February 23, 2009, to the amended and restated agreement, dated August 2, 1996, between the registrant and Wayne R. Brownlee concerning the Supplemental Executive Retirement Income Plan.                                                                                                   |  | 10-K                                                                       |  | 12/31/2008                 |  | 10(w)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(n)         |  | Amendment, dated December 29, 2010, to the amended and restated agreement, dated August 2, 1996, between the registrant and Wayne R. Brownlee concerning the Supplemental Executive Retirement Income Plan.                                                                                                   |  | 10-K                                                                       |  | 12/31/2010                 |  | 10(z)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(o)         |  | Supplemental Retirement Agreement dated December 24, 2008, between the registrant and Stephen F. Dowdle.                                                                                                                                                                                                      |  | 10-K                                                                       |  | 12/31/2011                 |  | 10(bb)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(p)         |  | PCS Supplemental Retirement Plan for U.S Executives (as amended and restated and in effect as of January 1, 2016).                                                                                                                                                                                            |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(n)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(q)         |  | Forms of Agreement dated December 30, 1994, between the registrant and certain officers of the registrant.                                                                                                                                                                                                    |  | 10-K                                                                       |  | 12/31/1995                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(r)         |  | Form of Agreement of Indemnification dated August 8, 1995, between the registrant and certain officers and directors of the registrant.                                                                                                                                                                       |  | 10-K                                                                       |  | 12/31/1995                 |  |                             



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 44



---

|              |  |                                                                                                                                                                         |  |                                                                            |  |                            |  |                             
|------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | ----------------------------
|              |  |                                                                                                                                                                         |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|              |  |                                                                                                                                                                         |  |                                                                           
|ExhibitNumber |  | Description of Document                                                                                                                                                 |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number(if different)
|              |  |                                                                                                                                                                         |  |                                                                           
|10(s)         |  | Resolution and Form of Agreement of Indemnification dated January 24, 2001.                                                                                             |  | 10-K                                                                       |  | 12/31/2000                 |  | 10(ii)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(t)         |  | Resolution and Form of Agreement of Indemnification dated July 21, 2004.                                                                                                |  | 10-Q                                                                       |  | 6/30/2004                  |  | 10(ii)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(u)         |  | Potash Corporation of Saskatchewan Inc. Deferred Share Unit Plan for Non-Employee Directors.                                                                            |  | 10-Q                                                                       |  | 3/31/2012                  |  | 10(ll)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(v)         |  | Potash Corporation of Saskatchewan Inc. 2007 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2007                  |  | 10(ee)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(w)         |  | Potash Corporation of Saskatchewan Inc. 2008 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2008                  |  | 10(ff)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(x)         |  | Potash Corporation of Saskatchewan Inc. 2009 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2009                  |  | 10(mm)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(y)         |  | Potash Corporation of Saskatchewan Inc. 2010 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/7/2010                   |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(z)         |  | Potash Corporation of Saskatchewan Inc. 2011 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/13/2011                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(aa)        |  | Potash Corporation of Saskatchewan Inc. 2012 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/18/2012                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(bb)        |  | Potash Corporation of Saskatchewan Inc. 2013 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/17/2013                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(cc)        |  | Potash Corporation of Saskatchewan Inc. 2014 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/16/2014                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(dd)        |  | Potash Corporation of Saskatchewan Inc. 2015 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/13/2015                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ee)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan.                                                                                                  |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ff)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Performance Share Unit Agreement (2016-2018 Phased Grant).                              |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.2                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(gg)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Performance Share Unit Agreement.                                                       |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.3                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(hh)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Option Agreement.                                                                       |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.4                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ii)        |  | Executive Employment Agreement, dated July 1, 2014, between registrant and Jochen E. Tilk.                                                                              |  | 10-K                                                                       |  | 9/30/2014                  |  | 10(nn)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(jj)        |  | PCS Supplemental Executive Retirement Plan for Canadian Executives.                                                                                                     |  | 10-K                                                                       |  | 12/31/2014                 |  | 10(oo)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(kk)        |  | CEO Multi-Year Incentive Plan.                                                                                                                                          |  | 10-K                                                                       |  | 12/31/2014                 |  | 10(pp)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ll)        |  | Letter Agreement, dated January 13, 2016 and revised February 2, 2016, between registrant and G. David Delaney.                                                         |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(gg)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(mm)        |  | Short-Term Incentive Plan, dated February 22, 2016.                                                                                                                     |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(hh)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(nn)        |  | Form of Company Support Agreement.                                                                                                                                      |  | 8-K                                                                        |  | 9/12/2016                  |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10oo)         |  | Form of Agrium Support Agreement.                                                                                                                                       |  | 8-K                                                                        |  | 9/12/2016                  |  | 10.2                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(pp)        |  | Form of Change in Control Agreement between the registrant and certain Canadian executives.                                                                             |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|10(qq)        |  | Form of Change in Control Agreement, between the registrant and certain U.S. executives.                                                                                |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|10(rr)        |  | Letter Agreement, dated January 20, 2016 and revised February 2, 2016, between registrant and Paul E. Dekok.                                                            |  | 10-K                                                                       |  | 12/31/2016                 |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|31(a)         |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|31(b)         |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|32            |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|95            |  | Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. |  |                                                                            |  |                            |  |                             



|   |  |                                                            
|-- |  | -----------------------------------------------------------
|   | 
|45 |  | PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q



---

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.



|            |  |                                         |  |                                                                                                             
|----------- |  | --------------------------------------- |  | ------------------------------------------------------------------------------------------------------------
|            |  | POTASH CORPORATION OF SASKATCHEWAN INC.
|            |  |                                        
|May 2, 2017 |  | By:                                     |  | /s/ Joseph Podwika                                                                                          
|            |  |                                         |  | Joseph Podwika                                                                                              
|            |  |                                         |  | Senior Vice President, General Counsel and Secretary                                                        
|            |  |                                        
|May 2, 2017 |  | By:                                     |  | /s/ Wayne R. Brownlee                                                                                       
|            |  |                                         |  | Wayne R. Brownlee                                                                                           
|            |  |                                         |  | Executive Vice President, Treasurer and Chief Financial
Officer (Principal Financial and Accounting Officer)



|                                                            |  |   
|----------------------------------------------------------- |  | --
|                                                            | 
|PotashCorp 2017 First Quarter Quarterly Report on Form 10-Q |  | 46



---

EXHIBIT INDEX



|               |  |                                                                                                                                                                                                     |  |                                                                            |  |                            |  |                              
|-------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | -----------------------------
|               |  |                                                                                                                                                                                                     |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|               |  |                                                                                                                                                                                                     |  |                                                                           
|Exhibit Number |  | Description of Document                                                                                                                                                                             |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number
(if different)
|2(a)           |  | Arrangement Agreement, dated September 11, 2016, between Potash Corporation of Saskatchewan Inc. and Agrium Inc.                                                                                    |  | 8-K                                                                        |  | 9/12/2016                  |  | 2.1                          
|               |  |                                                                                                                                                                                                     |  |                                                                           
|3(a)           |  | Articles of Continuance of the registrant dated May 15, 2002.                                                                                                                                       |  | 10-Q                                                                       |  | 6/30/2002                  |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|3(b)           |  | General By-Law of the registrant, as amended through April 27, 2015.                                                                                                                                |  | 8-K                                                                        |  | 4/27/2015                  |  | 3(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(a)           |  | Indenture dated as of February 27, 2003, between the registrant and U.S. Bank National Association, as successor to The Bank of Nova Scotia Trust Company of New York.                              |  | 10-K                                                                       |  | 12/31/2002                 |  | 4(c)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(b)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 5.875% Notes due December 1, 2036.                                                                                       |  | 8-K                                                                        |  | 11/30/2006                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(c)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 6.50% Notes due May 15, 2019.                                                                                            |  | 8-K                                                                        |  | 5/1/2009                   |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(d)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 4.875% Notes due March 30, 2020.                                                                                         |  | 8-K                                                                        |  | 9/25/2009                  |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(e)           |  | Form of Note relating to the registrants $750,000,000 principal amount of 3.625% Notes due March 15, 2024.                                                                                         |  | 8-K                                                                        |  | 3/7/2014                   |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(f)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 3.000% Notes due April 1, 2025.                                                                                          |  | 8-K                                                                        |  | 3/26/2015                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(g)           |  | Revolving Term Credit Facility Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated December 11, 2009.                                               |  | 8-K                                                                        |  | 12/15/2009                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(h)           |  | Revolving Term Credit Facility First Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated September 23, 2011.                               |  | 8-K                                                                        |  | 9/26/2011                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(i)           |  | Revolving Term Credit Facility Second Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated as of May 24, 2013.                              |  | 8-K                                                                        |  | 5/28/2013                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(j)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 3.25% Notes due December 1, 2017.                                                                                        |  | 8-K                                                                        |  | 11/29/2010                 |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(k)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 5.625% Notes due December 1, 2040.                                                                                       |  | 8-K                                                                        |  | 11/29/2010                 |  | 4(b)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(l)           |  | Agreement of Resignation, Appointment and Acceptance, dated as of June 25, 2013, by and among the registrant, The Bank of Nova Scotia Trust Company of New York and U.S. Bank National Association. |  | 8-K                                                                        |  | 6/27/2013                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(m)           |  | Revolving Term Credit Facility Third Amending Agreement between the Bank of Nova Scotia and other financial institutions and the registrant dated July 8, 2014.                                     |  | 10-Q                                                                       |  | 7/29/2014                  |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(n)           |  | Revolving Term Credit Facility Fourth Amending Agreement between The Bank of Nova Scotia and other financial institutions and the registrant dated January 25, 2016.                                |  | 8-K                                                                        |  | 1/29/2016                  |  | 4(a)                         
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(o)           |  | Extension Agreement between The Bank of Nova Scotia and other financial institutions and the registrant dated June 27, 2016.                                                                        |  | 10-Q                                                                       |  | 8/3/2016                   |  |                              
|               |  |                                                                                                                                                                                                     |  |                                                                           
|4(p)           |  | Form of Note relating to the registrants $500,000,000 principal amount of 4.000% Notes due December 15, 2026.                                                                                      |  | 8-K                                                                        |  | 12/6/2016                  |  | 4(a)                         



---

The registrant hereby undertakes to file with the Securities and Exchange Commission, upon request, copies of
any constituent instruments defining the rights of holders of long-term debt of the registrant or its subsidiaries that have not been filed herewith because the amounts represented thereby are less than 10% of the total assets of the
registrant and its subsidiaries on a consolidated basis.



|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                            |  |                            |  |                             
|------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | ----------------------------
|              |  |                                                                                                                                                                                                                                                                                                               |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|ExhibitNumber |  | Description of Document                                                                                                                                                                                                                                                                                       |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number(if different)
|10(a)         |  | Consolidated, Restated and Amended Canpotex Shareholders Agreement, Eighth Memorandum of Agreement dated January 1, 2014 between Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada
Ltd., the registrant and Canpotex Limited.                                            |  | 10-K                                                                       |  | 12/31/2013                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(b)         |  | Consolidated, Restated and Amended Producer Agreement, Eighth Memorandum of Agreement dated January 1, 2014 between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada Ltd.
and the registrant.                                                          |  | 10-K                                                                       |  | 12/31/2013                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(c)         |  | First Amending Agreement dated January 1, 2016, between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner, 4379934 Canada Ltd. and the registrant, to the Consolidated, Restated and
Amended Producer Agreement Eighth Memorandum of Agreement dated January 1, 2014.   |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(d)         |  | Second Amending Agreement dated December 20, 2016, between Canpotex Limited, Agrium Inc., Mosaic Canada Crop Nutrition, LP, by its general partner 4379934 Canada Ltd. and the registrant, to the Consolidated, Restated and Amended
Producer Agreement Eighth Memorandum of Agreement dated January 1, 2014. |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(e)         |  | Short-Term Incentive Plan of the registrant effective January 1, 2000, as amended.                                                                                                                                                                                                                            |  | 8-K                                                                        |  | 3/13/2012                  |  | 10(a)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(f)         |  | Resolution and Forms of Agreement for Supplemental Executive Retirement Income Plan, for officers and key employees of the registrant.                                                                                                                                                                        |  | 10-K                                                                       |  | 12/31/1995                 |  | 10(o)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(g)         |  | Amending Resolution and revised forms of agreement regarding Supplemental Retirement Income Plan of the registrant.                                                                                                                                                                                           |  | 10-Q                                                                       |  | 6/30/1996                  |  | 10(x)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(h)         |  | Amended and restated Supplemental Executive Retirement Income Plan of the registrant and text of amendment to existing supplemental income plan agreements.                                                                                                                                                   |  | 10-Q                                                                       |  | 9/30/2000                  |  | 10(mm)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(i)         |  | Amendment, dated February 23, 2009, to the amended and restated Supplemental Executive Retirement Income Plan.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2008                 |  | 10(r)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(j)         |  | Amendment, dated December 29, 2010, to the amended and restated Supplemental Executive Retirement Income Plan.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2010                 |  | 10(r)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(k)         |  | Amended and restated Supplemental Executive Retirement Income Plan of the registrant, dated February 22, 2016.                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(i)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(l)         |  | Form of Letter of amendment to existing supplemental income plan agreements of the registrant.                                                                                                                                                                                                                |  | 10-K                                                                       |  | 12/31/2002                 |  | 10(cc)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(m)         |  | Amendment, dated February 23, 2009, to the amended and restated agreement, dated August 2, 1996, between the registrant and Wayne R. Brownlee concerning the Supplemental Executive Retirement Income Plan.                                                                                                   |  | 10-K                                                                       |  | 12/31/2008                 |  | 10(w)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(n)         |  | Amendment, dated December 29, 2010, to the amended and restated agreement, dated August 2, 1996, between the registrant and Wayne R. Brownlee concerning the Supplemental Executive Retirement Income Plan.                                                                                                   |  | 10-K                                                                       |  | 12/31/2010                 |  | 10(z)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(o)         |  | Supplemental Retirement Agreement dated December 24, 2008, between the registrant and Stephen F. Dowdle.                                                                                                                                                                                                      |  | 10-K                                                                       |  | 12/31/2011                 |  | 10(bb)                      
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(p)         |  | PCS Supplemental Retirement Plan for U.S Executives (as amended and restated and in effect as of January 1, 2016).                                                                                                                                                                                            |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(n)                       
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(q)         |  | Forms of Agreement dated December 30, 1994, between the registrant and certain officers of the registrant.                                                                                                                                                                                                    |  | 10-K                                                                       |  | 12/31/1995                 |  |                             
|              |  |                                                                                                                                                                                                                                                                                                               |  |                                                                           
|10(r)         |  | Form of Agreement of Indemnification dated August 8, 1995, between the registrant and certain officers and directors of the registrant.                                                                                                                                                                       |  | 10-K                                                                       |  | 12/31/1995                 |  |                             



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|              |  |                                                                                                                                                                         |  |                                                                            |  |                            |  |                             
|------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------- |  | ----------------------------
|              |  |                                                                                                                                                                         |  | Incorporated By Reference
(File No. 001-10351, unless otherwise indicated)
|              |  |                                                                                                                                                                         |  |                                                                           
|ExhibitNumber |  | Description of Document                                                                                                                                                 |  | Form                                                                       |  | Filing Date/PeriodEnd Date |  | Exhibit Number(if different)
|              |  |                                                                                                                                                                         |  |                                                                           
|10(s)         |  | Resolution and Form of Agreement of Indemnification dated January 24, 2001.                                                                                             |  | 10-K                                                                       |  | 12/31/2000                 |  | 10(ii)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(t)         |  | Resolution and Form of Agreement of Indemnification dated July 21, 2004.                                                                                                |  | 10-Q                                                                       |  | 6/30/2004                  |  | 10(ii)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(u)         |  | Potash Corporation of Saskatchewan Inc. Deferred Share Unit Plan for Non-Employee Directors.                                                                            |  | 10-Q                                                                       |  | 3/31/2012                  |  | 10(ll)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(v)         |  | Potash Corporation of Saskatchewan Inc. 2007 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2007                  |  | 10(ee)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(w)         |  | Potash Corporation of Saskatchewan Inc. 2008 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2008                  |  | 10(ff)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(x)         |  | Potash Corporation of Saskatchewan Inc. 2009 Performance Option Plan and Form of Option Agreement.                                                                      |  | 10-Q                                                                       |  | 3/31/2009                  |  | 10(mm)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(y)         |  | Potash Corporation of Saskatchewan Inc. 2010 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/7/2010                   |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(z)         |  | Potash Corporation of Saskatchewan Inc. 2011 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/13/2011                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(aa)        |  | Potash Corporation of Saskatchewan Inc. 2012 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/18/2012                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(bb)        |  | Potash Corporation of Saskatchewan Inc. 2013 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/17/2013                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(cc)        |  | Potash Corporation of Saskatchewan Inc. 2014 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/16/2014                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(dd)        |  | Potash Corporation of Saskatchewan Inc. 2015 Performance Option Plan and Form of Option Agreement.                                                                      |  | 8-K                                                                        |  | 5/13/2015                  |  | 10(a)                       
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ee)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan.                                                                                                  |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ff)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Performance Share Unit Agreement (2016-2018 Phased Grant).                              |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.2                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(gg)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Performance Share Unit Agreement.                                                       |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.3                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(hh)        |  | Potash Corporation of Saskatchewan Inc. 2016 Long-Term Incentive Plan  Form of Option Agreement.                                                                       |  | 8-K                                                                        |  | 5/11/2016                  |  | 10.4                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ii)        |  | Executive Employment Agreement, dated July 1, 2014, between registrant and Jochen E. Tilk.                                                                              |  | 10-K                                                                       |  | 9/30/2014                  |  | 10(nn)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(jj)        |  | PCS Supplemental Executive Retirement Plan for Canadian Executives.                                                                                                     |  | 10-K                                                                       |  | 12/31/2014                 |  | 10(oo)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(kk)        |  | CEO Multi-Year Incentive Plan.                                                                                                                                          |  | 10-K                                                                       |  | 12/31/2014                 |  | 10(pp)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(ll)        |  | Letter Agreement, dated January 13, 2016 and revised February 2, 2016, between registrant and G. David Delaney.                                                         |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(gg)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(mm)        |  | Short-Term Incentive Plan, dated February 22, 2016.                                                                                                                     |  | 10-K                                                                       |  | 12/31/2015                 |  | 10(hh)                      
|              |  |                                                                                                                                                                         |  |                                                                           
|10(nn)        |  | Form of Company Support Agreement.                                                                                                                                      |  | 8-K                                                                        |  | 9/12/2016                  |  | 10.1                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10oo)         |  | Form of Agrium Support Agreement.                                                                                                                                       |  | 8-K                                                                        |  | 9/12/2016                  |  | 10.2                        
|              |  |                                                                                                                                                                         |  |                                                                           
|10(pp)        |  | Form of Change in Control Agreement between the registrant and certain Canadian executives.                                                                             |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|10(qq)        |  | Form of Change in Control Agreement, between the registrant and certain U.S. executives.                                                                                |  | 10-Q                                                                       |  | 9/30/2016                  |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|10(rr)        |  | Letter Agreement, dated January 20, 2016 and revised February 2, 2016, between registrant and Paul E. Dekok.                                                            |  | 10-K                                                                       |  | 12/31/2016                 |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|31(a)         |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|31(b)         |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|32            |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                |  |                                                                            |  |                            |  |                             
|              |  |                                                                                                                                                                         |  |                                                                           
|95            |  | Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. |  |                                                                            |  |                            |  |