UNITED
STATES

SECURITIES
AND EXCHANGE COMMISSION

Washington,
D.C. 20549








FORM 20-F



 ̈REGISTRATION
STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR



xANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal
year ended December 31, 2013

OR



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

OR



 ̈SHELL
COMPANY REPORT PURSUANT TO SECTION 23 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event
requiring this shell company report_______________________________

For the transition
period from   _____________to__________



Commission
file number 33-65728



SOCIEDAD
QUIMICA Y MINERA DE CHILE S.A.

(Exact name
of registrant as specified in its charter)



CHEMICAL
AND MINING COMPANY OF CHILE INC.

(Translation
of registrant's name into English)

CHILE

(Jurisdiction
of incorporation or organization)



El Trovador
4285, 6th Floor, Santiago, Chile +56 2 2425-2000

(Address of
principal executive offices)





Gerardo Illanes +56 2 2425-2485 gerardo.illanes@sqm.comEl Trovador 4285, 6th Floor, Santiago, Chile
(Name, Telephone, E-mail and/or Facsimile Number and Address of Company Contact Person)





Securities registered
or to be registered pursuant to Section 12(b) of the Act.

|Title of each class                                            |  | Name of each exchange
    on which registered
|-------------------------------------------------------------- |  | ---------------------------------------------
|Series B shares, in the form of American
    Depositary Shares |  | New York Stock Exchange                      

Securities registered
or to be registered pursuant to Section 12(g) of the Act.

NONE



Securities for
which there is a reporting obligation pursuant to Section 15(d) of the Act.

NONE



Indicate the
number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered
by the annual report.

|Series A shares |  | 142,819,552
|--------------- |  | -----------
|Series B shares |  | 120,376,972



Indicate by
check mark if the registrant is a well-known seasoned issuer, as defined in rule 405 of the Securities Act:

xYES        ̈
NO



If this report
is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Securities Exchange act of 1934:

 ̈YES       x NO



Indicate by
check mark whether the registrant (1) has filed all reports required to be filed by Section 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.

xYES        ̈
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 (§232.405 of this chapter) 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, or a non accelerated filer. See definition
of “accelerated filer and large accelerated filer” in rule 12b-2 of the Exchange Act.

xLarge accelerated filer      ̈  Accelerated filer      ̈  Non- accelerated filer



Indicate by
check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

 ̈U.S. GAAP x International Financial Reporting Standards
as issued by the International Accounting Standards Board  ̈ Other

If “Other”
has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has
elected to follow.

Indicate by
check mark which financial statement item the registrant has elected to follow.       ̈  Item 17  x  Item 18

If this is an
annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

 ̈YES       x NO











TABLE
OF CONTENTS



|                                                              |                                                                                  | Page
|------------------------------------------------------------- | -------------------------------------------------------------------------------- | ----
|                                                              |                                                                                  |     
|PRESENTATION OF INFORMATION                                   | ii                                                                              
|GLOSSARY                                                      | ii                                                                              
|CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
    STATEMENTS | iv                                                                              
|                                                              |                                                                                  |     
|PART
    I                                                    |                                                                                  | 2   
|                                                              |                                                                                  |     
|ITEM
    1.                                                   | IDENTITY OF DIRECTORS,
    SENIOR MANAGEMENT AND ADVISERS                        | 2   
|ITEM
    2.                                                   | OFFER STATISTICS AND
    EXPECTED TIMETABLE                                      | 2   
|ITEM
    3.                                                   | KEY INFORMATION                                                                  | 2   
|ITEM
    4.                                                   | INFORMATION ON THE COMPANY                                                       | 17  
|ITEM
    5.                                                   | OPERATING AND FINANCIAL
    REVIEW AND PROSPECTS                                 | 63  
|ITEM
    6.                                                   | DIRECTORS, SENIOR MANAGEMENT
    AND EMPLOYEES                                   | 84  
|ITEM
    7.                                                   | MAJOR SHAREHOLDERS AND
    RELATED PARTY TRANSACTIONS                            | 96  
|ITEM
    8.                                                   | FINANCIAL INFORMATION                                                            | 99  
|ITEM
    9.                                                   | THE OFFER AND LISTING                                                            | 102 
|ITEM
    10.                                                  | ADDITIONAL INFORMATION                                                           | 104 
|ITEM
    11.                                                  | QUANTITATIVE AND QUALITATIVE
    DISCLOSURES ABOUT MARKET RISK                   | 117 
|ITEM
    12.                                                  | DESCRIPTION OF SECURITIES
    OTHER THAN EQUITY SECURITIES                       | 118 
|                                                              |                                                                                  |     
|PART
    II                                                   |                                                                                  | 120 
|                                                              |                                                                                  |     
|ITEM
    13.                                                  | DEFAULTS, DIVIDEND ARREARAGES
    AND DELINQUENCIES                              | 120 
|ITEM
    14.                                                  | MATERIAL MODIFICATIONS
    TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS | 120 
|ITEM
    15.                                                  | CONTROLS AND PROCEDURES                                                          | 120 
|ITEM
    16.                                                  | RESERVED                                                                         | 121 
|ITEM
    16.A                                                 | AUDIT COMMITTEE FINANCIAL  EXPERT                                                | 121 
|ITEM
    16.B                                                 | CODE OF ETHICS                                                                   | 121 
|ITEM
    16.C                                                 | PRINCIPAL ACCOUNTANT
    FEES AND SERVICES                                       | 122 
|ITEM
    16.D                                                 | EXEMPTIONS FROM THE
    LISTING STANDARDS FOR AUDIT COMMITTEES                   | 122 
|ITEM
    16.E                                                 | PURCHASES OF EQUITY
    SECURITIES BY THE ISSUERS AND AFFILIATED PURCHASERS.     | 122 
|ITEM
    16.F                                                 | CHANGE IN REGISTRANT'S
    CERTIFYING ACCOUNTANT.                                | 123 
|ITEM
    16.G                                                 | CORPORATE GOVERNANCE.                                                            | 123 
|ITEM
    16.H                                                 | MINE SAFETY AND DISCLOSURE.                                                      | 123 
|                                                              |                                                                                  |     
|PART
    III                                                  |                                                                                  | 124 
|                                                              |                                                                                  |     
|ITEM
    17.                                                  | FINANCIAL STATEMENTS                                                             | 124 
|ITEM
    18.                                                  | FINANCIAL STATEMENTS                                                             | 124 
|ITEM
    19.                                                  | EXHIBITS                                                                         | 124 
|SIGNATURES                                                    | 125                                                                             
|                                                              |                                                                                  |     
|CONSOLIDATED
    FINANCIAL STATEMENTS                         | 126                                                                             
|EXHIBIT 1.1                                                   |                                                                                 
|EXHIBIT 8.1                                                   |                                                                                 
|EXHIBIT 12.1                                                  |                                                                                 
|EXHIBIT 12.2                                                  |                                                                                 
|EXHIBIT 13.1                                                  |                                                                                 
|EXHIBIT 13.2                                                  |                                                                                 











PRESENTATION
OF INFORMATION



In this Annual
Report on Form 20-F, except as otherwise provided or unless the context requires otherwise, all references to "we",
"us", "Company" or "SQM" are to Sociedad Química y Minera de Chile S.A.,
an open stock corporation (sociedad anónima abierta) organized under the laws of the Republic of Chile, and its
consolidated subsidiaries.



All references to "$,"
"US$," "U.S. dollars," “USD” and "dollars" are to United
States dollars, references to "pesos," “CLP” and "Ch$" are to Chilean pesos,
references to ThUS$ are to thousands of United States dollars, references to ThCh$ are to thousands of Chilean pesos and references
to "UF" are to Unidades de Fomento. The UF is an inflation-indexed, peso-denominated unit that is linked
to, and adjusted daily to reflect changes in, the previous month's Chilean consumer price index. As of December 31, 2013, UF 1.00
was equivalent to US$44.43 and Ch$23,309.56.



The Republic
of Chile is governed by a democratic government, organized in fourteen regions plus the Metropolitan Region (surrounding and including
Santiago, the capital of Chile). Our production operations are concentrated in northern Chile, specifically in the Tarapacá
Region and in the Antofagasta Region.



Our fiscal
year ends on December 31. As December 31 is a public holiday in Chile; certain financial information is reflected as of December
30, 2013.



We use the
metric system of weights and measures in calculating our operating and other data. The United States equivalent units of the most
common metric units used by us are as shown below:



1
kilometer equals approximately 0.6214 miles



1
meter equals approximately 3.2808 feet



1
centimeter equals approximately 0.3937 inches



1
hectare equals approximately 2.4710 acres



1
metric ton (“MT”) equals 1,000 kilograms or approximately 2,205 pounds.



We are not
aware of any independent, authoritative source of information regarding sizes, growth rates or market shares for most of our markets.
Accordingly, the market size, market growth rate and market share estimates contained herein have been developed by us using internal
and external sources and reflect our best current estimates. These estimates have not been confirmed by independent sources.



Percentages
and certain amounts contained herein have been rounded for ease of presentation. Any discrepancies in any figure between totals
and the sums of the amounts presented are due to rounding.



GLOSSARY



“assay
values” Chemical result or mineral component amount that contains the sample.



“average
global metallurgical recoveries” Percentage that measures the metallurgical treatment effectiveness based on the quantitative
relationship between the initial product contained in the mine-extracted material and the final product produced in the plant.



“average
mining exploitation factor” Index or ratio that measures the mineral exploitation effectiveness, based on the quantitative
relationship between (in-situ mineral minus exploitation losses) / in-situ mineral.



“CAGR”
Compound annual growth rate, the year over year growth rate of an investment over a specified period of time



“cash
and cash equivalents”The International Accounting Standards Board (IASB) defines cash and cash equivalents as
short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value.



“Controller
Group”* A person or company or group of persons or companies that according to Chilean law, have executed a joint performance
agreement, that have a direct or indirect share in a company’s ownership and have the power to influence the decisions of
the company’s management.



“Corfo”
Production Development Corporation (Corporación de Fomento de la Producción), formed in 1939, a national
organization in charge of promoting Chile's manufacturing productivity and commercial development.



ii







“cut-off
grade” The minimal assay value or chemical amount of some mineral component above which exploitation is economical.



“dilution”
Loss of mineral grade because of contamination with barren material (or waste) incorporated in some exploited ore mineral.



“exploitation
losses” Amounts of ore mineral that have not been extracted in accordance with exploitation designs.



“fertigation”
The process by which plant nutrients are applied to the ground using an irrigation system.



“geostatistical
analysis” Statistical tools applied to mining planning, geology and geochemical data that allow estimation of averages,
grades and quantities of mineral resources and reserves.





“heap
leaching” A process whereby minerals are leached from a heap, or pad, of ROM (run of mine) ore by leaching solutions
percolating down through the heap and collected from a sloping, impermeable liner below the pad.



“horizontal
layering” Rock mass (stratiform seam) with generally uniform thickness that conform to the sedimentary fields (mineralized
and horizontal rock in these cases).



“hypothetical
resources” Mineral resources that have limited geochemical reconnaissance, based mainly on geological data and samples
assay values spaced between 500–1000 meters.



“Indicated
Mineral Resource” See "Resources—Indicated Mineral Resource."



“Inferred
Mineral Resource” See "Resources—Inferred Mineral Resource."



“industrial
crops” Refers to crops that require processing after harvest in order to be ready for consumption or sale. Tobacco,
tea and seed crops are examples of industrial crops.



“Kriging
Method”A technique used to estimate ore reserves, in which the spatial distribution of continuous geophysical variables
is estimated using control points where values are known.



“LIBOR”London Inter Bank Offered Rate.



“limited
reconnaissance” Low or limited level of geological knowledge.



“Measured
Mineral Resource” See "Resources—Measured Mineral Resource."



“metallurgical
treatment” A set of chemical and physical processes applied to the caliche ore and to the salar brines to extract their
useful minerals (or metals).



“ore
depth” Depth of the mineral that may be economically exploited.



“ore
type” Main mineral having economic value contained in the caliche ore (sodium nitrate or iodine).



“ore”
A mineral or rock from which a substance having economic value may be extracted.



“Probable
Mineral Reserve” See "Reserves—Probable Mineral Reserve."



“Proved
Mineral Reserve” See “Reserves—Proved Mineral Reserve.”



“Reserves—Probable
Mineral Reserve”** The economically mineable part of an Indicated Mineral Resource and, in some circumstances, Measured
Mineral Resource. The calculation of the reserves includes diluting of materials and allowances for losses which may occur when
the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out and include consideration
of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental
factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified. A Probable Mineral Reserve
has a lower level of confidence than a Proved Mineral Reserve.



“Reserves—Proved
Mineral Reserve” ** The economically mineable part of a Measured Mineral Resource. The calculation of the reserves includes
diluting materials and allowances for losses which may occur when the material is mined. Appropriate assessments, which may include
feasibility studies, have been carried out and include consideration of and modification by realistically assumed mining, metallurgical,
economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting
that extraction is reasonably justified.



iii







“Resources—Indicated
Mineral Resource” ** That part of a Mineral Resource for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a reasonable level of confidence. The calculation is based on exploration, sampling
and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings, and
drill holes. The locations are too widely or inappropriately spaced to confirm geological continuity and/or grade continuity but
are spaced closely enough for continuity to be assumed. An Indicated Mineral Resource has a lower level of confidence than that
applying to a Measured Mineral Resource, but has a higher level of confidence than that applying to an Inferred Mineral Resource.



A
deposit may be classified as an Indicated Mineral Resource when the nature, quality, amount and distribution of data are such
as to allow the Competent Person, as that term is defined under Chilean Law Number 20,235, determining the Mineral Resource to
confidently interpret the geological framework and to assume continuity of mineralization. Confidence in the estimate is sufficient
to allow the appropriate application of technical and economic parameters and to enable an evaluation of economic viability.



“Resources—Inferred
Mineral Resource” ** That part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with
a low level of confidence, by inferring them on the basis of geological evidence and assumed but not verified geological and/or
grade continuity. The estimate is based on information gathered through appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes, and this information is of limited or uncertain quality and/or reliability. An Inferred
Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource.



“Resources—Measured
Mineral Resource” ** The part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade
and mineral content can be estimated with a high level of confidence. The estimate is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings,
and drill holes. The locations are spaced closely enough to confirm geological and/or grade continuity.



A
deposit may be classified as a Measured Mineral Resource when the nature, quality, amount and distribution of data are such as
to leave no reasonable doubt, in the opinion of the Competent Person, as that term is defined under Chilean Law Number 20,235,
determining the Mineral Resource, that the tonnage and grade of the deposit can be estimated within close limits and that any
variation from the estimate would not significantly affect potential economic viability. This category requires a high level of
confidence in, and understanding of, the geology and controls of the mineral deposit. Confidence in the estimate is sufficient
to allow the appropriate application of technical and economic parameters and to enable an evaluation of economic viability.



“solar
salts”A mixture of 60% sodium nitrate and 40% potassium nitrate used in the storage of thermo- energy.



“vat
leaching” A process whereby minerals are extracted from crushed ore by placing the ore in large vats containing leaching
solutions.



“waste”
Rock or mineral which is not economical for metallurgical treatment.



“Weighted
average age” The sum of the product of the age of each fixed asset at a given facility and its current gross book value
as of December 31, 2013 divided by the total gross book value of the Company's fixed assets at such facility as of December 31,
2013.



| | * | The
                                         definition of a Controller Group that has been provided is the one that applies to the
                                         Company. Chilean law provides for a broader definition of a Controller Group.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ** | The
                                         definitions we use for resources and reserves are based on those provided by the “Instituto
                                         de Ingenieros de Minas de Chile” (Chilean Institute of Mining Engineers).
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



CAUTIONARY
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS



This Form 20-F
contains statements that are or may constitute forward-looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are not based on historical facts and reflect our expectations for future events and results.
Words such as "believe," "expect," "predict," "anticipate," "intend," "estimate,"
"should," "may," "likely", "could" or similar expressions may identify forward-looking
information. These statements appear throughout this Form 20-F and include statements regarding the intent, belief or current
expectations of the Company and its management, including but not limited to any statements concerning:



| | · | trends
                                         affecting the prices and volumes of the products we sell;
| | - | ---------------------------------------------------------------------------------------------------------

| | · | level
                                         of reserves, quality of the ore and brines, and production levels and yields;
| | - | ----------------------------------------------------------------------------------------------------------------------------



iv







| | · | our
                                         capital investment program and development of new products;
| | - | --------------------------------------------------------------------------------------------------------

| | · | the
                                         future impact of competition; and
| | - | ------------------------------------------------------------------------------

| | · | regulatory
                                         changes.
| | - | ------------------------------------------------------------

Such forward-looking
statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially
from those described in such forward-looking statements included in this Form 20-F, including, without limitation, the information
under Item 4. Information on the Company, Item Number 5. Operating and Financial Review and Prospects and Item 11. Quantitative
and Qualitative Disclosures About Market Risk. Factors that could cause actual results to differ materially include, but are not
limited to:



| | · | volatility
                                         of global prices for our products;
| | - | --------------------------------------------------------------------------------------

| | · | political,
                                         economic and demographic developments in certain emerging market countries, where we
                                         conduct a large portion of our business;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | changes
                                         in production capacities;
| | - | --------------------------------------------------------------------------

| | · | the
                                         nature and extent of future competition in our principal markets;
| | - | --------------------------------------------------------------------------------------------------------------

| | · | our
                                         ability to implement our capital expenditures program, including our ability to obtain
                                         financing when required;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | changes
                                         in raw material and energy prices;
| | - | -----------------------------------------------------------------------------------

| | · | currency
                                         and interest rate fluctuations;
| | - | ---------------------------------------------------------------------------------

| | · | risks
                                         relating to the estimation of our reserves;
| | - | ------------------------------------------------------------------------------------------

| | · | changes
                                         in quality standards or technology applications;
| | - | -------------------------------------------------------------------------------------------------

| | · | adverse
                                         legal, regulatory or labor disputes or proceedings;
| | - | ----------------------------------------------------------------------------------------------------

| | · | changes
                                         in governmental regulations; and
| | - | ---------------------------------------------------------------------------------

| | · | additional
                                         factors discussed below under Item 3. Key Information—Risk Factors
| | - | ----------------------------------------------------------------------------------------------------------------------



v







PART I



ITEM
1.IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS



Not Applicable.



ITEM
2.OFFER STATISTICS AND EXPECTED TIMETABLE



Not Applicable.





ITEM
3.KEY INFORMATION



3.A.
Selected Financial Data

The following
table presents selected financial data as of December 31, 2013 and the previous three years. The selected financial data should
be read in conjunction with the Consolidated Financial Statements and notes thereto, “Item 5. Operating and Financial Review
and Prospects” and other financial information included herein.



Since January
1, 2010, the Company’s consolidated financial statements have been prepared in accordance with the International Financial
Reporting Standards as published by the International Accounting Standards Board (IASB).



The Company’s
consolidated financial information as of and for the year ended, December 31, 2009 was restated in accordance with IFRS.



|                                                                                     |  | As of
    and for the year ended December 31, |         
|------------------------------------------------------------------------------------ |  | --------------------------------------------- | --------
|(in
    millions of U.S. dollars)(1)                                                 |  | 2013                                          |         
|                                                                                     |  |                                               |         
|Statement of income:                                                                 |  |                                               |         
|Revenues                                                                             |  |                                               | 2,203.1 
|Cost of sales                                                                        |  |                                               | (1,481.7
|                                                                                     |  |                                               |         
|Gross profit                                                                         |  |                                               | 721.5   
|                                                                                     |  |                                               |         
|Other income                                                                         |  |                                               | 96.7    
|Administrative expenses                                                              |  |                                               | (105.2  
|Other expenses                                                                       |  |                                               | (49.4   
|Other gains (losses)                                                                 |  |                                               | (11.4   
|Finance income                                                                       |  |                                               | 12.7    
|Finance expenses                                                                     |  |                                               | (58.6   
|Equity income of associates and joint ventures accounted for using the equity method |  |                                               | 18.8    
|Foreign currency exchange differences                                                |  |                                               | (12.0   
|                                                                                     |  |                                               |         
|Income before income tax expense                                                     |  |                                               | 613.1   
|                                                                                     |  |                                               |         
|Income tax expense                                                                   |  |                                               | (138.5  
|                                                                                     |  |                                               |         
|Profit for the year                                                                  |  |                                               | 474.6   
|Profit attributable to:                                                              |  |                                               |         
|Controlling interests                                                                |  |                                               | 467.1   
|Non-controlling interests                                                            |  |                                               | 7.5     
|Profit for the year                                                                  |  |                                               | 474.6   
|                                                                                     |  |                                               |         
|Basic earnings per share(2)                                                          |  |                                               | 1.77    
|Basic earnings per ADS(2)(3)                                                         |  |                                               | 1.77    
|Dividends per share(4)(5)(6)                                                         |  |                                               | 1.04    
|Dividends per ADS(5)(6)                                                              |  |                                               | 1.04    
|Weighted average(3)shares
    outstanding (000s)                                     |  |                                               | 263,197 



2







(1) Except
shares outstanding, dividend and net earnings per share and net earnings per ADS.



(2) The Company
has not conducted any type of operation which would give rise to a potential dilutive effect on its earnings per share. The total
number of outstanding shares is the same as the weighted average shares outstanding.



(3) The calculation
of earnings per ADSs and dividends per ADS is based on the ratio of 1:1.



(4) Dividends
per share are calculated based on 263,196,524 shares for the periods ended December 31, 2013, 2012, 2011, and 2010.



(5) Dividends
may only be paid from net income as determined in accordance with IFRS; see Item 8.A.8. Dividend Policy. For dividends in Ch$
see Item 8.A.8. Dividend Policy — Dividends.



(6) Dividend
amount paid per calendar year to shareholders of the Company.



|                                                 |  | As of
    and for the year ended December 31, |         |  |      | 
|------------------------------------------------ |  | --------------------------------------------- | ------- |  | ---- | 
|(in millions of U.S. dollars)                    |  | 2013                                          |         |  | 2012 | 
|Balance Sheet Data:                              |  |                                               |         |  |      | 
|Total assets                                     |  |                                               | 4,767.6 |  |      | 
|Total liabilities                                |  |                                               | 2,335.4 |  |      | 
|Total equity                                     |  |                                               | 2,432.2 |  |      | 
|Equity attributable to controlling
    interests |  |                                               | 2,376.6 |  |      | 
|Equity attributable to non-controlling interest  |  |                                               | 55.6    |  |      | 
|Capital stock                                    |  |                                               | 477.4   |  |      | 



3







EXCHANGE
RATES



Chile has two
currency markets, the Formal Exchange Market (Mercado Cambiario Formal) in which we conduct our transactions, and the Informal
Exchange Market (Mercado Cambiario Informal). The Formal Exchange Market comprises banks and other entities authorized
by the Chilean Central Bank(Banco Central de Chile). The Informal Exchange Market comprises entities that are not
expressly authorized to operate in the Formal Exchange Market, such as certain foreign exchange houses and travel agencies, among
others. The Chilean Central Bank is empowered to determine that certain purchases and sales of foreign currencies be carried out
on the Formal Exchange Market.



Both the Formal
Exchange Market and the Informal Exchange Market are driven by free market forces. Current regulations require that the Chilean
Central Bank be informed of certain transactions and that these transactions be effected through the Formal Exchange Market.



The Observed
Exchange Rate (dólar observado), which is reported by the Chilean Central Bank and published daily in the Chilean
newspapers, is computed by taking the weighted average of the previous business day’s transactions on the Formal Exchange
Market. The Chilean Central Bank has the power to intervene by buying or selling foreign currency on the Formal Exchange Market
to attempt to maintain the Observed Exchange Rate within a desired range. During the past few years the Chilean Central Bank has
intervened to attempt to maintain the Observed Exchange Rate within a certain range only under special circumstances. Although
the Chilean Central Bank is not required to purchase or sell U.S. dollars at any specific exchange rate, it generally uses spot
rates for its transactions. Other banks generally carry out authorized transactions at spot rates as well.



The Informal
Exchange Market reflects transactions carried out at an informal exchange rate (the “Informal Exchange Rate”). There
are no limits imposed on the extent to which the Informal Exchange Rate can fluctuate above or below the Observed Exchange Rate.
In recent years, the variations between the Observed Exchange Rate and the Informal Exchange Rate have not been significant.



The Federal
Reserve Bank of New York does not report a noon buying rate for Chilean pesos. As of April 21, 2014 the rate of exchange for Chilean
pesos was US$1.00 per CH$ 557.63.



4







|Observed Exchange Rate (1)
|--------------------------
|                          
|                          
|                          
|Year                      
|                          
|2009                      
|2010                      
|2011                      
|2012                      
|2013                      
|                          
|Last six months           
|                          
|2013                      
|October                   
|November                  
|December                  
|2014                      
|January                   
|February                  
|March                     



Source:
Central Bank of Chile



| | (1) | Reflects
                                         high and low rates on a day-to-day basis, for each period reported.
| | --- | ---------------------------------------------------------------------------------------------------------------------



| | (2) | The
                                         monthly average rate is calculated on a day-to-day basis for each month reported. The
                                         yearly average rate is calculated on a month-to-month basis for each year reported.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Based
                                         on transactions observed during the last day of the period.
| | --- | ----------------------------------------------------------------------------------------------------------



3.B.   Capitalization and Indebtedness

Not applicable.



3.C.   Reasons for the Offer and Use of Proceeds

Not applicable.



3.D.   Risk Factors

Our operations
are subject to certain risk factors that may affect SQM's business financial condition or results of operations. In addition to
other information contained in this Annual Report on Form 20-F, you should carefully consider the risks described below. These
risks are not the only ones we face. Additional risks not currently known to us or that are known but we currently believe are
not significant may also affect our business operations. Our business, financial condition or results of operations could be materially
affected by any of these risks.



Risks
Relating to our Business



Volatility
of world fertilizer and chemical prices and changes in production capacities could affect our business, financial condition and
results of operations



The prices
of our products, are determined principally by world prices, which, in some cases, have been subject to substantial volatility
in recent years. World fertilizer and chemical prices vary depending upon the relationship between supply and demand at any given
time. Supply and demand dynamics for our products are tied to a certain extent to global economic cycles, and have been impacted
by current global economic conditions. Furthermore, the supply of certain fertilizers or chemical products, including certain
products that we provide, varies principally depending on the production of the major producers, including SQM, and its respective
business strategies.



5







Since 2008,
world prices of potassium-based fertilizers (including some of our specialty plant nutrients and potassium chloride) have fluctuated
as a result of the broader global economic and financial conditions. Although prices of potassium-based fertilizers stabilized
in 2009 after the conclusion of important contract negotiations between major producers and buyers, during the second half of
2013, potassium prices declined as a result of an unexpected announcement made by the Russian company OAO Uralkali (“Uralkali”)
that it was terminating its participation in Belarus Potash Corporation (“BPC”). As a result of the termination of
Uralkali’s participation in BPC, there was increased price competition in the market. In addition, during the second half
of 2013, we observed lower pricing of contracts between Chinese purchasers and major potash producers, which has increased volatility
in the price of fertilizers. We cannot assure you that potassium-based fertilizer prices and sales volumes will not decline in
the future.



Iodine prices
followed an upward trend since late 2003 through 2012, reaching an average price of approximately US$53 per kilogram in 2012,
over 40% higher than average prices in 2011. During 2013, even though iodine demand reached record highs, demand growth softened,
and supply increased, causing a decline in iodine prices. The average price of iodine seen by SQM was approximately US$50 per
kilogram in 2013, approximately 6% less than average prices seen by the Company in 2012. We cannot assure you that iodine prices
or sales volumes will not continue to decline in the future.



In 2010, we
observed demand recovery in the lithium market, which continued in 2011 and 2012. In 2013, we continued to see strong market growth,
driven mostly by an increase in demand related to battery use. Nevertheless, demand growth was accompanied by an increase in supply
from existing competitors. The average price of lithium carbonate in 2013 was US$5,400 per ton. We cannot assure you that this
positive demand trend will continue in the future. We cannot assure you that lithium prices and sales volumes will not decline
in the future.



We expect that
prices for the products we manufacture will continue to be influenced, among other things, by worldwide supply and demand and
the business strategies of major producers. Some of the major producers, including SQM, have increased or have the ability to
increase production. As a result, the prices of our products may be subject to substantial volatility. High volatility or a substantial
decline in the prices, or in volume demand, of one or more of our products could have a material adverse effect on our business,
financial condition and results of operations.



Our sales
to emerging markets and expansion strategy expose us to risks related to economic conditions and trends in those countries



We sell our
products in more than 115 countries around the world. In 2013, approximately 49% of our sales were made in emerging market countries:
17% in Central and South America (excluding Chile); 8% to Africa and the Middle East; 12% in Chile; and 12% in Asia and Oceania
(excluding Japan). We expect to expand our sales in these and other emerging markets in the future. In addition, we may carry
out acquisitions or joint ventures in jurisdictions in which we currently do not operate, relating to any of our businesses or
to new businesses in which we believe we may have sustainable competitive advantages. The results of our operations and our prospects
in other countries in which we establish operations will depend, in part, on the general level of political stability and economic
activity and policies in those countries. Future developments in the political systems or economies of these countries or the
implementation of future governmental policies in those countries, including the imposition of withholding and other taxes, restrictions
on the payment of dividends or repatriation of capital, the imposition of import duties or other restrictions, the imposition
of new environmental regulations or price controls or changes in relevant laws or regulations, could have a material adverse effect
on our business, financial condition and results of operations in those countries.



6







Our inventory
levels may increase because of the global economic slowdown



In general,
the global economic slowdown experienced during 2008 and 2009 had an impact on our inventories. Demand decreased during 2009 and,
as a result, inventories increased significantly and continued to be high in 2013. Higher inventories carry a financial risk due
to increased need for cash to fund working capital. Higher inventory levels could also imply increased risk of loss of product.
We cannot assure you that inventory levels will not continue to remain high in 2014, or increase further, in the future. These
factors could have a material adverse effect on our business, financial condition and results of operations.



Our level
of and exposure to unrecoverable accounts receivable may significantly increase



Potentially
negative effects of the global economic slowdown on the financial condition of our customers may include the extension of the
payment terms of our accounts receivable and may increase our exposure to bad debt. While we have implemented certain safe guards,
such as using credit insurance, letters of credits and prepayment for a portion of sales, to minimize this risk, the increase
in our accounts receivable coupled with the financial condition of customers may result in losses that could have a material adverse
effect on our business, financial condition and results of operations.



New production of iodine or
lithium carbonate from current or new competitors



During 2013,
supply of iodine and lithium carbonate increased due to new supply from existing competitors entering the market and increases
in production from some of our current competitors, which affected prices for both products. Potential new production of iodine
and lithium carbonate from current or new competitors in the markets in which we operate could adversely affect prices. There
is limited information on the status of new iodine or lithium carbonate production capacity expansion projects being developed
by current and potential competitors and, as such, we cannot make accurate projections regarding the capacities of possible new
entrants into the market and the dates on which they could become operational. If these potential projects are completed in the
short term, they could adversely affect market prices and our market share, which, in turn, could have a material adverse effect
on our business, financial condition and results of operations.



We have
a capital expenditure program that is subject to significant risks and uncertainties



Our business
is capital intensive. Specifically, the exploration and exploitation of reserves, mining and processing costs, the maintenance
of machinery and equipment and compliance with applicable laws and regulations require substantial capital expenditures. We must
continue to invest capital to maintain or to increase our exploitation levels and the amount of finished products we produce.
We require environmental permits for our new projects. Obtaining permits in certain cases may cause significant delays in the
execution and implementation of new projects and, consequently, may require us to reassess the related risks and economic incentives.
We cannot assure you that we will be able to maintain our production levels or generate sufficient cash flow, or that we will
have access to sufficient investments, loans or other financing alternatives, to continue our activities at or above present levels,
or that we will be able to implement our projects or receive the necessary permits required for them in time. Any or all of these
factors may have a material adverse effect on our business, financial condition and results of operations.



7







High raw materials and energy
prices could increase our production costs and cost of sales, and energy may become unavailable at any price



We rely on
certain raw materials and various sources of energy (diesel, electricity, LNG, fuel oil and others) to manufacture our products.
Purchases of raw materials that we do not produce and energy constitute an important part of our cost of sales, approximately
16% in 2013. In addition, we may not be able to obtain energy at any price if supplies of our sources of energy are curtailed
or otherwise become unavailable. To the extent we are unable to pass on increases in raw materials and energy prices to our customers
or we are unable to obtain energy, our business, financial condition and results of operations could be materially adversely affected.



Currency
fluctuations may have a negative effect on our financial performance



We transact
a significant portion of our business in U.S. dollars, and the U.S. dollar is the currency of the primary economic environment
in which we operate. In addition, the U.S. dollar is our functional currency for financial statement reporting purposes. A significant
portion of our costs, however, is related to the Chilean peso. Therefore, an increase or decrease in the exchange rate between
the Chilean peso and the U.S. dollar would affect our costs of production. The Chilean peso has been subject to large devaluations
and revaluations in the past and may be subject to significant fluctuations in the future. As of December 31, 2013, the Chilean
peso exchange rate was Ch$524.61 per U.S. dollar, while as of December 31, 2012, the Chilean peso exchange rate was Ch$479.96
per U.S. dollar. The Chilean peso therefore depreciated against the U.S. dollar by 9% in 2013. As of March 17, 2014, the Observed
Exchange Rate was Ch$570.35 per U.S. dollar.



As an international
company operating in several other countries, we also transact business and have assets and liabilities in other non-U.S. dollar
currencies, such as, among others, the euro, the South African rand, the Mexican peso, the Chinese yuan, the Thai baht and the
Brazilian real. As a result, fluctuations in the exchange rates of such foreign currencies to the U.S. dollar may have a material
adverse effect on our business, financial condition and results of operations.



Interest
rate fluctuations may have a material impact on our financial performance



We have outstanding
short and long-term debt that bears interest based on the London Interbank Offered Rate (“LIBOR”), plus a spread.
Since we are currently hedging only a portion of these liabilities into fixed rates, we are exposed to interest rate risk relating
to LIBOR fluctuations. As of December 31, 2013, approximately 16% our financial debt had LIBOR-based pricing that was not hedged
into fixed rates. A relative increase in the rate could materially impact our business, financial condition and results of operations.



Our reserves estimates could
be subject to significant changes





Our caliche
ore mining reserves estimates are prepared by our own geologists, and were validated in January 2014, by Mrs. Marta Aguilera,
a geologist with over 20 years of experience in the field. She is currently employed by SQM as Manager of Non-metallic Geology. 
Mrs. Aguilera is a Competent Person (Persona Competente), as that term is defined under Chilean Law No. 20,235 that Regulates
the Position of Competent Person and Creates the Qualifying Committee for Competencies in Mining Resources and Reserves (Ley
que Regula la Figura de las Personas Competentes y Crea la Comisión Calificadora de Competencias de Recursos y Reservas
Minerasor“Competent Person Law”). Our Salar de Atacama brine mining reserve estimates are prepared by
our own geologists, and were validated by Álvaro Henríquez, a geologist with over 10 years of experience in hydrogeology,
who is currently employed in SQM as Superintendent of Geology, and is a Competent Person (Persona Competente),as the term
is defined under Chilean Law No. 20,235.. Estimation methods involve numerous uncertainties as to the quantity and quality of
the reserves, and reserve estimates could change upwards or downwards. In addition, our reserve estimates are not subject to review
by external geologists or an external auditing firm. A downward change in the quantity and/or quality of our reserves could affect
future volumes and costs of production and therefore have a material adverse effect on our business, financial condition and results
of operations.











8







Quality standards in markets
in which we sell our products could become stricter over time



In the markets
in which we do business, customers may impose quality standards on our products and/or governments may enact or are enacting stricter
regulations for the distribution and/or use of our products. As a result, if we cannot meet such new standards or regulations,
we may not be able to sell our products. In addition, our cost of production may increase in order to meet any such newly imposed
or enacted standards. Failure to sell our products in one or more markets or to important customers could materially adversely
affect our business, financial condition and results of operations.



Chemical and physical properties
of our products could adversely affect their commercialization



Since our products
are derived from natural resources, they contain inorganic impurities that may not meet certain customer or government standards.
As a result, we may not be able to sell our products if we cannot meet such requirements. In addition, our cost of production
may increase in order to meet such standards. Failure to meet such standards could materially adversely affect our business, financial
condition and results of operations.



Our business
is subject to many operating and other risks for which we may not be fully covered under our insurance policies



Our facilities
and business operations in Chile and abroad are insured against losses, damages or other risks by insurance policies that are
standard for the industry and that would reasonably be expected to be sufficient by prudent and experienced persons engaged in
businesses similar to ours.



We may be subject
to certain events that may not be covered under our insurance policies, which could have a material adverse effect on our business,
financial condition and results of operations. Additionally, as a result of recent major earthquakes in Chile and other natural
disasters worldwide, conditions in the insurance market have changed and may continue to change in the future, and as a result,
we may face higher premiums and reduced coverage.



Changes
in technology or other developments could result in preferences for substitute products



Our products,
particularly iodine, lithium and their derivatives, are preferred raw materials for certain industrial applications, such as rechargeable
batteries and liquid crystal display (“LCD”) screens. Changes in technology, the development of substitute raw materials
or other developments could adversely affect demand for these and other products which we produce.



9







We are
exposed to labor strikes and labor liabilities that could impact our production levels and costs



Over 95% of
our employees are employed in Chile, of which approximately 71% were represented by 25 labor unions as of December 31, 2013. As
in previous years, during 2013 we renegotiated collective labor contracts with individual unions one year before the expiration
of such contracts. As of December 31, 2013, we had concluded advanced negotiations with four labor unions, which represent 8.5%
of our total unionized workers, signing new agreements with each for the next three years. We are in the process of negotiating
collective labor contracts with the 21 remaining unions. We are exposed to labor strikes that could impact our production levels.
If a strike occurs and continues for a sustained period of time, we could be faced with increased costs and even disruption in
our product flow that could have a material adverse effect on our business, financial condition and results of operations.



Chilean Law
No. 16,744, known as the Law on Work Related Accidents and Professional Diseases(Ley de Accidentes de Trabajo y Enfermedades
Profesionales or the “Labor Accidents Law”), provides that when a serious accident in the workplace occurs, a
company must halt work at the site where the accident took place until authorities from either the National Geology and Mining
Service (Servicio Nacional de Geología y Minería or “SERNAGEOMIN”) or the Labor Board (Dirección
del Trabajo or “Labor Board”) or the National Health Service (Servicio Nacional de Salud or “SNA”),
inspect the site and prescribe the measures such company must take to prevent future risks. Work may not be resumed until such
company has taken the prescribed measures, and the period of time before work may be resumed may last for a number of hours, days,
or longer. The effects of this law could have a material adverse effect on our business, financial condition and results of operations.



Lawsuits
and arbitrations could adversely impact us



We are party
to a range of lawsuits and arbitrations involving different matters as described in Note 19.1 of our Consolidated Financial Statements.
Although we intend to defend our positions vigorously, our defense of these actions may not be successful. Judgments or settlements
in these lawsuits may have a material adverse effect on our business, financial condition and results of operations. In addition,
our strategy of being a world leader includes entering into commercial and production alliances, joint ventures and acquisitions
to improve our global competitive position. As these operations increase in complexity and are carried out in different jurisdictions,
we might be subject to legal proceedings that, if settled against us, could have a material adverse effect on our business, financial
condition and results of operations.



The Chilean
labor code (Código del Trabajo or “Labor Code”) has recently established new procedures for labor matters
which include oral trials conducted by specialized judges. The majority of these oral trials have found in favor of the employee.
These new procedures could increase the probability of adverse judgments in labor lawsuits which could have a material adverse
effect on our business, financial condition and results of operations.



We have
operations in multiple jurisdictions with differing regulatory, tax and other regimes



We operate
in multiple jurisdictions with complex regulatory environments subject to different interpretations by companies and respective
governmental authorities. These jurisdictions may each have their own tax codes, environmental regulations, labor codes and legal
framework, which could complicate efforts to comply with these regulations, which could have, in turn, a material adverse effect
on our business, financial condition and results of operations.



10







SQM employs
its best efforts to ensure such compliance. For example, the second deadline for the registration of chemical substances under
the European REACH regulations (Registration, Evaluation, Authorisation, and Restriction of Chemicals) expired in May 2013 and,
prior to that, SQM managed to enroll 10 new substances that it can export to the European market with a tonnage limit equivalent
to 100-1000 MT/year. The European Commission's Directorate General for Health and Consumers (DG Sanco) also issued, in July
2013, a statement on the presence of perchlorate in foods and, based on that, established provisional limits for their presence
in the latter, including fruits and vegetables and indicating, at the same time, that the soil, water, and fertilizers are considered
potential sources of perchlorate contamination in food. SQM fertilizers, currently marketed in the European market, contain less
than 100 ppm of perchlorate. The industry is currently conducting studies of absorption in some target crops to demonstrate that
the use of fertilizers, including those of SQM, allows compliance with the values ​​set by DG Sanco. In turn, those
provisional values ​​could be ratified or modified by DG Sanco after issuing a risk assessment report which is currently
being prepared by the European Food Safety Authority (EFSA ) and is expected to be available in September of this year.



In 2012, the
Occupational Health and Safety Administration (“OSHA”) aligned its Hazard Communication Standard to comply with the
Globally Harmonized System (“GHS”), which requires companies to review hazard information for all chemicals imported
into the US, classify chemicals according to the new classification criteria, and update labels and safety data sheets by June
2015. We are already working on a program which aims to comply with the requirements of this new regulation in line with the stages
and deadlines established by OSHA. The updating of the Safety Data Sheets (“SDS”) for all products sold in the US
has been finished, and the update of labels is in progress and will be completed the first quarter of 2015.



We could
be adversely affected by the negative outcome of pending proceedings against our Chairman of the Board and certain other named
defendants



On September
10, 2013, the SVS issued a press release disclosing it had instituted certain administrative proceedings against Mr. Julio Ponce
(in his capacity as chairman and “controller” of entities with direct or indirect share ownership interests in the
Company (the “Cascading Companies”)) and other named defendants, including the son of the Company’s Chief Executive
Officer, alleging violations of Chilean corporate and securities laws (the “Cascading Companies Proceedings”). SQM
has been informed that Mr. Ponce, who is Chairman of the Board of the Company, and related persons, beneficially own 29.92% of
SQM’s total shares. See Item 6.E. Share Ownership. On January 31, 2014, the SVS added a number of financial institutions
and asset managers, and certain of their controlling persons, executives or other principals, as named defendants to the Cascading
Companies Proceedings.



The SVS alleges
the existence of a scheme, involving the named defendants, whereby, through a number of transactions occurring between 2009 and
2011, the Cascading Companies sold securities of various companies, including securities of the Company, at below-market prices
to companies related to Mr. Ponce and to other named defendants, which companies, after a lapse of time, sold such securities,
in most instances back to the Cascading Companies, at prices higher than those at which they were purchased. The SVS alleges violation
by the defendants of a number of corporate and securities laws in furtherance of the alleged scheme.



11







In response
to the Cascading Companies Proceedings, Mr. Ponce has filed a criminal complaint against the superintendent of the SVS alleging,
among others things, malfeasance in public office and abuse of power against private citizens. The High Complexity Crimes Unit
(Unidad de Delitos de Alta Complejidad) of the Metropolitan District Attorney’s Office (Fiscalía Metropolitana
Centro Norte) is also investigating various criminal complaints filed by and against various parties to the Cascading Companies
Proceedings.



In addition,
the Chilean IRS (Servicio de Impuestos Internos) announced it is currently investigating the nature and characteristics
of the transactions alleged to have occurred in the Cascading Companies Proceedings in order to determine whether the individuals
or companies involved violated Chilean tax laws or filed false returns with the purpose of evading taxes.



The allegations
made in connection with the Cascading Companies Proceedings do not relate to any acts or omissions of the Company or of any of
its directors, officers or employees in their capacities as such. If any such claim were made by the SVS or by any other claimant,
including the Chilean IRS, it could have a material adverse effect on the Company. In addition, a final disposition of claims
in connection with the current Cascading Companies Proceedings that is adverse to Mr. Ponce or other named defendants could have
a material adverse effect on the Company’s market reputation and commercial dealings, even if no claim is asserted against
the Company or any of its directors, officers or employees in their capacities as such.



Our water
supply could be affected by geological changes



Our access
to water may be impacted by changes in geology or other natural factors, such as wells drying up, that we cannot control, and
which may have a material adverse effect on our business, financial condition and results of operations.



Risks
Relating to Chile



As we
are a company based in Chile, we are exposed to Chilean political risks



Our business,
results of operations, financial condition and prospects could be affected by changes in policies of the Chilean government, other
political developments in or affecting Chile, and regulatory and legal changes or administrative practices of Chilean authorities,
over which we have no control.



Changes
in regulations regarding, or any revocation or suspension of our concessions could negatively affect our business



Any changes
to regulations to which we are subject or adverse changes to our concession rights, or a revocation or suspension of our concessions,
could have a material adverse effect on our business, financial condition and results of operations.



Changes
in mining or port concessions could affect our operating costs





We conduct our mining (including brine
extraction) operations under exploitation and exploration concessions granted in accordance with provisions of the Chilean constitution
and related laws and statutes. Our exploitation concessions essentially grant a perpetual right to conduct mining operations in
the areas covered by the concessions, provided that we pay annual concession fees. Our exploration concessions permit us to explore
for mineral resources on the land covered thereby for a specified period of time and to subsequently request a corresponding exploitation
concession. SQM Salar S.A. holds exclusive rights to exploit the mineral resources in an area covering approximately 140,000 hectares
of land in the Salar de Atacama in northern Chile, of which SQM Salar S.A. is entitled to exploit the mineral resources of 81,920
hectares. These rights are owned by Corfo and leased to SQM Salar S.A. pursuant to a lease agreement between Corfo and SQM Salar
S.A. (the “Lease Agreement”). Corfo may not unilaterally amend the Lease Agreement, and the rights to exploit the resources
cannot be transferred. The Lease Agreement establishes that SQM Salar S.A. is responsible for the maintenance of Corfo’s
exploitation rights and for annual payments to the Chilean government, and it expires on December 31, 2030. Furthermore, under
the regulations of theChilean Nuclear and Energy Commission (Comisión Chilena de Energía Nuclear or
“CCHEN”), we are limited to 180,100 tons of total lithium extraction in the aggregate for all periods. More
than halfway through the term of the lease agreement, we have extracted less than half of the total accumulated extraction limit
of lithium. However, there can be no assurance that we will not reach the lithium extraction limit prior to the term of the lease
agreement.



12







We also operate
port facilities at Tocopilla, Chile for the shipment of our products and the delivery of certain raw materials, pursuant to concessions
granted by Chilean regulatory authorities. These concessions are renewable provided that we use such facilities as authorized
and pay annual concession fees.



Any significant
changes to any of these concessions could have a material adverse effect on our business, financial condition and results of operations.



Changes
in water rights laws could affect our operating costs



We hold water
rights that are key to our operations. These rights were obtained from the Chilean Water Authority (Dirección General
de Aguas) for supply of water from rivers and wells near our production facilities, which we believe are sufficient to meet
current operating requirements. However, the Chilean water rights code (Código de Aguas or the “Water Code”)
is subject to changes, which could have a material adverse impact on our business, financial condition and results of operations.
For example, an amendment published on June 16, 2005 modified the Water Code, allowing, under certain conditions, the granting
of permanent water rights of up to two liters per second for each well built prior to June 30, 2004, in the locations where we
conduct our mining operations, without considering the availability of water, or how the new rights may affect holders of existing
rights. Therefore, the amount of water we can effectively extract based on our existing rights could be reduced if these additional
rights are exercised. In addition, we must pay annual concession fees to maintain water rights we are not exercising. These and
potential future changes to the Water Code could have a material adverse effect on our business, financial condition and results
of operations.



The Chilean
government could levy additional taxes on corporations operating in Chile



In 2005, the
Chilean Congress approved Law No. 20,026 that “Establishes a Specific Tax on Mining Activity” (Ley que Establece
un Impuesto Específico a la Actividad Minera or the “Royalty Law”), establishing a royalty tax to be applied
to mining activities developed in Chile.



As a result
of the earthquake and tsunami in February 2010, the Chilean government raised the corporate income tax rate in order to pay for
reconstruction following the earthquake and tsunami. Such legislation increased the general corporate tax rate from its historic
rate of 17.0% to 20.0% for the income accrued in 2011, which was declared and paid in 2012. On September 27, 2012, Law No. 20,630
introduced new amendments to existing tax legislation. Among the amendments introduced, the corporate income tax was maintained
at 20% effective for the 2013 calendar year.



On April 1,
2014, a new tax bill was sent to the Congress. The proposed bill aims to increase the general corporate tax to 21% in 2014, 22.5%
in 2015, 24% in 2016 and 25% in 2017. The tax bill also aims to change the manner in which the general corporate tax is applied:
currently, such tax is applied on an imputated basis, whereby companies must pay a 20% tax on accrued profits and no further tax
until those profits are distributed by the company. The bill proposes the gradual modification of this system, resulting in profits
being taxed on an accrual basis as of 2017.



13







We cannot assure
you that the manner in which the Royalty Law or the corporate tax rate are interpreted and applied will not change in the future.
In addition, the Chilean government may decide to levy additional taxes on mining companies or other corporations in Chile. Such
changes could have a material adverse effect on our business, financial condition and results of operations.



Environmental
laws and regulations could expose us to higher costs, liabilities, claims and failure to meet current and future production targets



Our operations
in Chile are subject to national and local regulations relating to environmental protection. We are required to conduct environmental
impact studies or statements of any future projects or activities (or significant modifications thereto) that may affect the environment
and we are required to obtain an environmental license for certain projects and activities. The environmental assessment service
(Servicio de Evaluación Ambiental or “Environmental Assessment Service”) currently evaluates environmental
impact studies submitted for its approval, and private citizens, public agencies or local authorities may challenge projects that
may adversely affect the environment, either before these projects are executed or once they are already operating, if they fail
to comply with applicable regulations. Enforcement remedies available include fines up to approximately US$10 million and temporary
or permanent closure of facilities and revocation of the environmental license.



Chilean environmental
regulations have become increasingly stringent in recent years, both with respect to the approval of new projects and in connection
with the implementation and development of projects already approved, and we believe that this trend is likely to continue. Given
public interest in environmental enforcement matters, these regulations or their application may also be subject to political
considerations that are beyond our control.



We continuously
monitor the impact of our operations on the environment and have, from time to time, made modifications to our facilities to minimize
any adverse environmental impacts. We believe we are currently in compliance in all material respects with applicable environmental
regulations in Chile. Future developments in the creation or implementation of environmental requirements, or in their interpretation,
could result in substantially increased capital, operation or compliance costs or otherwise adversely affect our business, financial
condition and results of operations. In connection with our current investments at the Salar de Atacama and Nueva Victoria, the
success of these investments is dependent on the behavior of the ecosystem variables being monitored over time. If the behavior
of these variables in future years does not meet environmental requirements, our operation may be subject to important restrictions
by the authorities on the maximum allowable amounts of brine and water extraction.



Our future
development depends on our ability to sustain future production levels, which requires additional investments and the submission
of the corresponding environmental impact studies or statements. If we fail to obtain approval or required environmental licenses,
our ability to maintain production at specified levels will be seriously impaired, thus having a material adverse effect on our
business, financial condition and results of operations.



In addition,
our worldwide operations are subject to international and other local environmental regulations. Since environmental laws and
regulations in the different jurisdictions in which we operate may change, we cannot guarantee that future environmental laws,
or changes to existing environmental laws, will not materially adversely impact our business, financial condition and results
of operations.



14







Ratification
of the International Labor Organization’s Convention 169 concerning indigenous and tribal peoples might affect our development
plans



Chile, a member
of the International Labor Organization (“ILO”), has ratified the ILO’s Convention 169 (the “Indigenous
Rights Convention”) concerning indigenous and tribal peoples. The Indigenous Rights Convention established several rights
for indigenous individuals and communities. Among other rights, the Indigenous Rights Convention outlines that (i) indigenous
groups be notified of and consulted prior to the development of any project on land deemed indigenous (without any veto or approval
right) and of any legislative or administrative measure that may affect them directly; and (ii) indigenous groups have, to the
extent possible, a stake in benefits resulting from the exploitation of natural resources in alleged indigenous land. The extent
of these benefits has not been defined by the Chilean government. The new rights outlined in the Indigenous Rights Convention
could affect the development of our investment projects in alleged indigenous lands which could have a material adverse effect
on our business, financial condition and results of operations.



Chile
is located in a seismically active region



Chile is prone
to earthquakes because it is located along major fault lines.  The most recent major earthquake in Chile occurred in April
2014, offshore, and had a magnitude of 8.2. This earthquake followed one in February 2010, which caused substantial damage to
major areas of the country. A major earthquake or a volcano eruption could have significant negative consequences for our operations
and for the general infrastructure, such as roads, rail, and access to goods, in Chile. Although we maintain insurance policies
standard for this industry with earthquake coverage, we cannot assure you that a future seismic event will not have a material
adverse effect on our business, financial condition and results of operations.



Risks
related to our shares and to our ADRs



The
price of our ADSs and the U.S. dollar value of any dividends will be affected by fluctuations in the U.S. dollar/Chilean peso
exchange rate



Chilean trading
in the shares underlying our ADSs is conducted in Chilean pesos. The depositary will receive cash distributions that we make with
respect to the shares in Chilean pesos. The depositary will convert such Chilean pesos to U.S. dollars at the then prevailing
exchange rate to make dividend and other distribution payments in respect of ADSs. If the value of the Chilean peso falls relative
to the U.S. dollar, the value of the ADSs and any distributions to be received from the depositary will decrease.



Developments
in other emerging markets could materially affect the value of our ADSs



The Chilean
financial and securities markets are, to varying degrees, influenced by economic and market conditions in other emerging market
countries or regions of the world. Although economic conditions are different in each country or region, investor reaction to
developments in one country or region can have significant effects on the securities of issuers in other countries and regions,
including Chile and Latin America. Events in other parts of the world may have a material effect on Chilean financial and securities
markets and on the value of our ADSs.



15







The
volatility and low liquidity of the Chilean securities markets could affect the ability of our shareholders to sell our ADSs



The Chilean
securities markets are substantially smaller, less liquid and more volatile than the major securities markets in the United States.
The volatility and low liquidity of the Chilean markets could increase the price volatility of our ADSs and may impair the ability
of a holder to sell our ADSs into the Chilean market in the amount and at the price and time he wishes to do so.



Our
share price may react negatively to future acquisitions and investments



As world leaders
in our core businesses, part of our strategy is to look for opportunities that will allow us to consolidate and strengthen our
competitive position in jurisdictions in which we currently do not operate. Pursuant to this strategy, we may carry out acquisitions
or joint ventures relating to any of our businesses or to new businesses in which we believe we may have sustainable competitive
advantages. Depending on our capital structure at the time of such acquisitions, we may need to raise significant debt and/or
equity which will affect our financial condition and future cash flows. Any change in our financial condition could affect our
results of operations, negatively impacting our share price.



You
may be unable to enforce rights under U.S. Securities Laws



Because we
are a Chilean company subject to Chilean law, the rights of our shareholders may differ from the rights of shareholders in companies
incorporated in the United States, and you may not be able to enforce or may have difficulty enforcing rights currently in effect
under U.S. Federal or State securities laws.



Our Company
is a "sociedad anónima abierta" (open stock corporation) incorporated under the laws of the Republic of
Chile. Most of our directors and officers reside outside the United States, principally in Chile. All or a substantial portion
of the assets of these persons are located outside the United States. As a result, if any of our shareholders, including holders
of our ADSs, were to bring a lawsuit against our officers or directors in the United States, it may be difficult for them to effect
service of legal process within the United States upon these persons. Likewise, it may be difficult for them to enforce judgments
obtained in United States courts based upon the civil liability provisions of the federal securities laws of the United States
against them in United States courts.



In addition,
there is no treaty between the United States and Chile providing for the reciprocal enforcement of foreign judgments. However,
Chilean courts have enforced judgments rendered in the United States, provided that the Chilean court finds that the United States
court respected basic principles of due process and public policy. Nevertheless, there is doubt as to whether an action could
be brought successfully in Chile in the first instance on the basis of liability based solely upon the civil liability provisions
of the United States federal securities laws.



As
preemptive rights may be unavailable for our ADS holders, they have the risk of their holdings being diluted if we issue new stock



Chilean laws
require companies to offer their shareholders preemptive rights whenever selling new shares of capital stock. Preemptive rights
permit holders to maintain their existing ownership percentage in a company by subscribing for additional shares. If we increase
our capital by issuing new shares, a holder may subscribe for up to the number of shares that would prevent dilution of the holder's
ownership interest.



16







If we issue
preemptive rights, United States holders of ADSs would not be able to exercise their rights unless a registration statement under
the Securities Act were effective with respect to such rights and the shares issuable upon exercise of such rights or an exemption
from registration were available. We cannot assure holders of ADSs that we will file a registration statement or that an exemption
from registration will be available. We may, in our absolute discretion, decide not to prepare and file such a registration statement.
If our holders were unable to exercise their preemptive rights because we did not file a registration statement, the depositary
bank would attempt to sell their rights and distribute the net proceeds from the sale to them, after deducting the depositary's
fees and expenses. If the depositary could not sell the rights, they would expire and holders of ADSs would not realize any value
from them. In either case, ADS holders' equity interest in us would be diluted in proportion to the increase in our capital stock.



If
we were classified as a Passive Foreign Investment Company there could be adverse consequences for U.S. investors



We believe
that we were not classified as a passive foreign investment company, or PFIC, for 2013. Characterization as a PFIC could result
in adverse U.S. tax consequences to you if you are a U.S. investor in our shares or ADSs. For example, if we (or any of our subsidiaries)
are a PFIC, our U.S. investors may become subject to increased tax liabilities under U.S. tax laws and regulations and will become
subject to burdensome reporting requirements. The determination of whether or not we (or any of our subsidiaries or portfolio
companies) are a PFIC is made on an annual basis and will depend on the composition of our (or their) income and assets from time
to time. See Item 10.E. Taxation – United States Tax Considerations.



Changes
in Chilean tax regulations could have adverse consequences for U.S. investors



Currently cash
dividends paid by us to foreign shareholders are subject to a 35% Chilean withholding tax. If we have paid corporate income tax
(the "First Category Tax") on the income from which the dividend is paid, a credit for the First Category Tax effectively
reduces the rate of Withholding Tax. Changes in Chilean tax regulations could have adverse consequences for U.S. investors.



ITEM
4.INFORMATION ON THE COMPANY



4.A.   History and Development of the Company



Historical
Background



Sociedad Química
y Minera de Chile S.A. "SQM" is an open stock corporation (sociedad anónima abierta) organized under the
laws of the Republic of Chile. We were constituted by public deed issued on June 17, 1968 by the Notary Public of Santiago, Mr.
Sergio Rodríguez Garcés. Our existence was approved by Decree No. 1,164 of June 22, 1968 of the Ministry of Finance,
and we were registered on June 29, 1968 in the Registry of Commerce of Santiago, on page 4,537 No. 1,992. Our headquarters is
located at El Trovador 4285, Fl. 6, Las Condes, Santiago, Chile. Our telephone number is +56 2 2425-2000. Our US representative
is SQM NA located at 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta GA 30339. The phone number is +1 (770) 916-9407.



17







Commercial
exploitation of the caliche ore deposits in northern Chile began in the 1830s, when sodium nitrate was extracted from the ore
for use in the manufacturing of explosives and fertilizers. By the end of the nineteenth century, nitrate production had become
the leading industry in Chile and the country was the world's leading supplier of nitrates. The accelerated commercial development
of synthetic nitrates in the 1920s and the global economic depression in the 1930s caused a serious contraction of the Chilean
nitrate business, which did not recover significantly until shortly before the Second World War. After the war, the widespread
commercial production of synthetic nitrates resulted in a further contraction of the natural nitrate industry in Chile, which
continued to operate at depressed levels into the 1960s.



We were formed
in 1968 through a joint venture between Compañía Salitrera Anglo Lautaro S.A. (“Anglo Lautaro”) and
Corporación de Fomento de la Producción (“Production Development Corporation” or “Corfo”),
a Chilean government entity. Three years after our formation, in 1971, Anglo Lautaro sold all of its shares to Corfo, and we were
wholly owned by the Chilean Government until 1983. In 1983, Corfo began a process of privatization by selling our shares to the
public and subsequently listing such shares on the Santiago Stock Exchange. By 1988, all of our shares were publicly owned. Our
Series B ADRS have traded on the NYSE under the ticker symbol “SQM” since 1993.



Since our inception,
in addition to producing nitrates, we have produced iodine, which is also found in the caliche ore deposits in northern Chile.



Between the
years 1994 and 1999, we invested approximately US$300 million in the development of the Salar de Atacama project in northern Chile.
The project involved the construction of a potassium chloride plant, a lithium carbonate plant, a potassium sulfate plant, and
a boric acid plant.



To help finance
the above projects, we accessed the international capital markets by issuing additional Series B ADSs on the New York Stock Exchange
in 1995. In 1999 we issued additional Series A shares, which were also listed on the New York Stock Exchange as ADSs. Effective
March 27, 2008, the Company voluntarily delisted its Series A ADS (“SQM-A”) from the New York Stock Exchange. In addition,
on April 5, 2013, we filed a Form F-6 in order to issue 100 million additional Series B ADSs on the New York Stock Exchange, to
be effective as of April 15, 2013.



During the
period from 2000 through 2004, we principally consolidated the investments carried out in the preceding five years. We focused
on reducing costs and improving efficiencies throughout the organization.



Since 2005,
we have strengthened our leadership in our main businesses by increasing our capital expenditure program and making advantageous
acquisitions and divestitures. During this period we acquired Kemira Emirates Fertiliser Company (Kefco) in Dubai and the iodine
business of Royal DSM N.V. (DSM). We also sold (i) Fertilizantes Olmeca, our Mexican subsidiary, (ii) our butyllithium plant located
in Houston, Texas and (iii) our stake in Impronta S.R.L., our Italian subsidiary. These sales allowed us to concentrate our efforts
on our core products. In 2007, we completed the construction of a new prilling and granulating plant., and in 2008, we completed
our lithium carbonate capacity expansion and began work on the engineering stage of a new potassium nitrate plant. In addition,
in 2008 we entered into a joint venture with Migao Corporation (“Migao”) for the construction of a potassium nitrate
plant with a production capacity of 40,000 metric tons per year, and we completed construction and began operations of our potassium
nitrate plant as part of our joint venture with Migau in January 2011.



18







From 2010 to
2012, we continued to expand our production capacity of potassium products in our operations in the Salar de Atacama. In 2011,
we completed the construction of a new potassium nitrate facility in Coya Sur, increasing our overall production capacity of potassium
nitrate by 300,000 metric tons. In the second half of 2011, we effected a corporate reorganization whereby our subsidiary Soquimich
European Holding B.V. acquired a 66.6% ownership in Fertilizantes Naturales S.A. (later renamed SQM Iberian S.A.) from Nutrisi
Holding N.V. Soquimich European Holding B.V. owned a non-controlling 50% stake in Nutrisi Holding N.V. which was divested following
this acquisition in December 2011. The effect of these transactions has been that we indirectly control SQM Iberian S.A. through
Soquimich European Holding B.V. SQM Iberian S.A. sells and distributes fertilizers, primarily in Spain.



In 2012, SQM
Vitas FZ Company, our joint venture with the French Roullier Group, started the construction of new plants in Brazil (Candeias),
Peru and South Africa (Durban) for the production of water soluble fertilizers containing different relative amounts of nitrogen,
phosphorus and potassium, and, occasionally, smaller amounts of other chemicals. The Brazilian plant (Candeias Industrial Complex)
began operating in March 2012. It has a production capacity of 25,000 metric tons per year, and represented a total investment
of US$10 million.



In 2013, we
sold our royalty rights over the Antucoya mining project to Antofogasta Minerals for a sum of US$ 84 million. We also opened a
trading office in Thailand.



Capital
Expenditure Program



We regularly
review different opportunities to improve our production methods, reduce costs, increase production capacity of existing products
and develop new products and markets. Additionally, significant capital expenditures are required every year in order to sustain
our production capacity. We are focused on developing new products in response to identified customer demand, as well as new products
that can be derived as part of our existing production or other products that could fit our long-term development strategy. Our
capital expenditures during the past five years were mainly related to the acquisition of new assets, construction of new facilities
and renewal of plant and equipment, and performed with internal financing through our capital expenditure program for investments
in Chile.



Our capital
expenditures include investments aimed at sustaining, improving or increasing production levels, including acquisitions and investments
in related companies.



Our capital
expenditures for the years ended December 31, 2013, 2012 and 2011 were as follows:



|(in millions of US dollars) |  | 2013 |       |  | 2012 |  |       | 2011 | 
|--------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- | 
|Capital Expenditures        |  |      | 371.7 |  |      |  | 446.0 |      | 



19







During 2011,
we had total capital expenditures of US$501.1 million, primarily relating to:



| | · | increased
                                         production capacity of potassium-based products at the Salar de Atacama, with the continued
                                         construction and completion of potassium chloride and granulated potassium chloride facilities
                                         at the Salar de Atacama;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | increased
                                         capacity and efficiencies at nitrate and iodine facilities;
| | - | --------------------------------------------------------------------------------------------------------------



| | · | optimization
                                         of our rail system; and
| | - | -----------------------------------------------------------------------------



| | · | various
                                         projects designed to maintain production capacity, increase yields and reduce costs.
| | - | -------------------------------------------------------------------------------------------------------------------------------------



During 2012,
we had total capital expenditures of US$446.0 million, primarily relating to:



| | · | projects
                                         to increase capacity and efficiencies at nitrate and iodine facilities in the Tarapacá
                                         region;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | continued
                                         investments related to increasing production capacity of potassium-based products at
                                         the Salar de Atacama, including several projects related to production of finished products;
                                         and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | various
                                         projects designed to maintain production capacity, increase yields and reduce costs.
| | - | -------------------------------------------------------------------------------------------------------------------------------------



During 2013,
we had total capital expenditures of US$371.7 million, primarily related to:



| | · | improvement
                                         of nitrate-based products at Coya Sur;
| | - | -------------------------------------------------------------------------------------------



| | · | investment
                                         relating to increasing production capacity of potassium-based products at the Salar de
                                         Atacama;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | ongoing
                                         investment relating to increasing production capacity and efficiency in our nitrate and
                                         iodine facilities;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | optimization
                                         of our potassium chloride facility at the Salar de Atacama;
| | - | -----------------------------------------------------------------------------------------------------------------



| | · | projects
                                         to increase the efficiency of our human resources and logistics departments; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------



| | · | various
                                         projects designed to maintain production capacity, increase yields, and reduce costs.
| | - | --------------------------------------------------------------------------------------------------------------------------------------





The Board of Directors has approved a capital
expenditures plan for 2014 of US$135 million in connection with investments to be made in Chile. The 2014 capital investment program
is primarily focused on the maintenance of our production facilities. Our 2014 capital investment program will not require any
external financing; however, we reserve the right to access capital markets in order to optimize our financial position.



4.B.   Business Overview



The
Company



We believe
that we are the world’s largest producer of potassium nitrate, iodine and lithium chemicals. We produce specialty plant
nutrients, iodine and iodine derivatives, lithium and lithium derivatives, potassium chloride, potassium sulfate and certain industrial
chemicals (including industrial nitrates and solar salt). Our products are sold in more than 115 countries through our worldwide
distribution network, with 88% of our sales in 2013 derived from countries outside Chile.



Our products
are mainly derived from mineral deposits found in northern Chile. We mine and process caliche ore and brine deposits. The caliche
ore in northern Chile contains the only known nitrate and iodine deposits in the world and is the world’s largest commercially
exploited source of natural nitrates. The brine deposits of the Salar de Atacama, a salt-encrusted depression in the Atacama desert
in northern Chile, contain high concentrations of lithium and potassium as well as significant concentrations of sulfate and boron.



20







From our caliche
ore deposits, we produce a wide range of nitrate-based products used for specialty plant nutrients and industrial applications,
as well as iodine and iodine derivatives. At the Salar de Atacama, we extract brines rich in potassium, lithium, sulfate and boron
in order to produce potassium chloride, potassium sulfate, lithium solutions, boric acid and bischofite (magnesium chloride).
We produce lithium carbonate and lithium hydroxide at our plant near the city of Antofagasta, Chile, from the solutions brought
from the Salar de Atacama. We market all of these products through an established worldwide distribution network.



Our products
are divided into six categories: specialty plant nutrients; iodine and its derivatives; lithium and its derivatives; potassium
chloride and potassium sulfate; industrial chemicals; and other commodity fertilizers. Specialty plant nutrients are premium fertilizers
that enable farmers to improve yields and the quality of certain crops. Iodine and its derivatives are mainly used in the X-ray
contrast media and biocides industries and in the production of polarizing film, which is an important component in LCD screens.
Lithium and its derivatives are mainly used in batteries, greases and frits for production of ceramics. Potassium chloride is
a commodity fertilizer that is produced and sold by us worldwide. In addition, we complement our portfolio of plant nutrients
through the buying and selling of other commodity fertilizers for use mainly in Chile. Industrial chemicals have a wide range
of applications in certain chemical processes such as the manufacturing of glass, explosives and ceramics, and, more recently,
industrial nitrates are being used in solar thermal energy plants as a means for energy storage.



For the year
ended December 31, 2013, we had revenues of US$2,203.1 million, gross profit of US$721.5 million and profit attributable to controlling
interests of US$467.1 million. Our world wide market capitalization as of December 31, 2013 was approximately US$6.8 billion.



Our Series
A and Series B common shares are listed on the Santiago Stock Exchange. Our Series B American Depositary Shares (“ADSs”)
have been listed on the New York Stock Exchange (the “NYSE”) since 1993. Our ticker symbols on the Santiago Stock
Exchange for our Series A and Series B common shares are “SQM-A” and “SQM-B,” respectively, and our ticker
symbol on the NYSE for the Series B ADSs is “SQM.”



Specialty
Plant Nutrition: We produce four principal types of specialty plant nutrition products: potassium nitrate, sodium nitrate,
sodium potassium nitrate, and specialty blends. Furthermore, we sell other specialty fertilizers including trading of third party
products. All of these specialty plant nutrition products are used in either solid or liquid form mainly on high value crops such
as vegetables, fruits and flowers. They are widely used in crops that employ modern agricultural techniques such as hydroponics,
greenhousing, fertigation (where fertilizer is dissolved in water prior to irrigation) and foliar application. According to the
type of use or application our products are marketed under the brands: UltrasolTM (fertigation), QropTM (open field
application), SpeedfolTM (foliar application), and AllganicTM (organic farming). Specialty plant nutrition has certain
advantages over commodity fertilizers, such as rapid and effective absorption (without requiring nitrification), superior water
solubility, increased soil pH (which reduces soil acidity) and low chloride content. One of the most important products in this
business line is potassium nitrate, which is available in crystalline and prill form, allowing for multiple application methods.
Crystalline potassium nitrate products are ideal for application by fertigation and foliar sprays, and potassium nitrate prills
are suitable for soil applications.



21







The needs of
more sophisticated customers are leading the industry to provide solutions rather than individual products. The advantages of
our products, plus customized specialty blends that meet specific needs along with agronomic service provided, allow us to create
plant nutrition solutions that add value to crops through higher yields and better quality production. Because our products are
derived from natural nitrate compounds or natural potassium brines, they have certain advantages over synthetically produced fertilizers,
including the presence of certain beneficial trace elements, which makes them more attractive to customers who prefer products
of natural origin. As a result, specialty plant nutrition products are sold at a premium price compared to other commodity fertilizers.



Iodine
and its derivatives: We believe that we are the world's leading producer of iodine and iodine derivatives, which are used
in a wide range of medical, pharmaceutical, agricultural and industrial applications, including x-ray contrast media, polarizing
films for LCD, antiseptics, biocides and disinfectants, in the synthesis of pharmaceuticals, herbicides, electronics, pigments,
and dye components.



Lithium
and its derivatives: We are a leading producer of lithium carbonate and lithium hydroxide, products which are used in
a variety of applications, including electrochemical materials for batteries, frits for the ceramic and enamel industries, heat-resistant
glass (ceramic glass), primary aluminum smelting process, air conditioning chemicals, lubricating greases, continuous casting
powder for steel extrusion, and pharmaceuticals among others. Lithium carbonate and lithium hydroxide are also basic lithium chemicals
used to produce a wide range of lithium derivatives.



Potassium:We produce potassium chloride and potassium sulfate from brines extracted from the Salar de Atacama. Potassium chloride
is a commodity fertilizer used to fertilize a variety of crops including corn, rice, sugar, soybean, and wheat. Potassium sulfate
is a specialty fertilizer used mainly in crops such as vegetables, fruits and industrial crops.



Industrial
Chemicals: We produce and market four industrial chemicals: sodium nitrate, potassium nitrate, potassium chloride and
boric acid. Sodium nitrate is used primarily in the production of glass, explosives, charcoal briquettes and metal treatment.
Potassium nitrate is used in the manufacturing of specialty glass, and it is also an important raw material for the production
of frits for the ceramics and enamel industries. Solar salts, a combination of potassium nitrate and sodium nitrate are used as
a thermal storage medium in solar-based electricity generating plants. Boric acid is used in the manufacture of frits for the
ceramics and enamel industries, LCDs, glass and fiberglass. Potassium chloride is a basic chemical used to produce potassium hydroxide,
and is also used as an additive in oil drilling as well as in food processing, among others.



Other
Products and Services: We also sell other fertilizers and blends, some of which we do not produce. We are the only company
that produces and distributes the three main potassium sources: potassium nitrate, potassium sulphate and potassium chloride.



22







The following
table shows the percentage breakdown of our revenues for 2013, 2012 and 2011 according to our product lines:



|                          |  | 2013 |     |   | 2012 |  |     | 2011 | 
|------------------------- |  | ---- | --- | - | ---- |  | --- | ---- | 
|Specialty Plant Nutrition |  |      | 31  | % |      |  | 28  | %    | 
|Iodine and Derivatives    |  |      | 21  | % |      |  | 24  | %    | 
|Lithium and Derivatives   |  |      | 9   | % |      |  | 9   | %    | 
|Potassium                 |  |      | 28  | % |      |  | 25  | %    | 
|Industrial Chemicals      |  |      | 7   | % |      |  | 10  | %    | 
|Other                     |  |      | 4   | % |      |  | 4   | %    | 
|Total                     |  |      | 100 | % |      |  | 100 | %    | 



Business
Strategy



Our general
business strategy is to:



| | · | maintain
                                         leadership in specialty plant nutrients, iodine, lithium and industrial nitrates, in
                                         terms of production capacity, competitive pricing and the development of new products;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | increase
                                         our production capacity of potassium-related fertilizers from the Salar de Atacama;
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | · | maintain
                                         our competitiveness through the continued increase in the efficiency of our production
                                         processes and cost reduction;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | evaluate
                                         and execute acquisitions, joint ventures or commercial alliances which have concrete
                                         synergies with our current core businesses or provide sustainable competitive advantages;
                                         and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | maintain
                                         a solid, conservative financial position and investment grade ratings for our debt securities.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



We have identified
market demand in each of our major product lines, both within our existing customer base and in new markets, for existing products
and for additional products that can be produced from our natural resources. In order to take advantage of these opportunities,
we have developed specific strategies for each of our product lines.



Specialty
Plant Nutrition

Our strategy
in our specialty plant nutrients business is to: (i) continue expanding our sales of natural nitrates by continuing to leverage
the advantages of our specialty products over commodity-type fertilizers; (ii) selectively expand by increasing our sales of higher
margin specialty plant nutrients based on potassium and natural nitrates, particularly soluble potassium nitrate and NPK blends;
(iii) pursue investment opportunities in complementary businesses to enhance our product portfolio, increase production, reduce
costs, and add value to, and improve the marketing of, our products; (iv) develop new specialty nutrient blends produced in our
mixing plants that are strategically located in or near our principal markets, in order to meet specific customer needs; (v) focus
primarily on the markets for plant nutrients in soluble and foliar applications in order to establish a leadership position; (vi)
further develop our global distribution and marketing system directly and through strategic alliances with other producers and
global or local distributors; and (vii) reduce our production costs through improved processes and higher labor productivity so
as to compete more effectively.



23







Iodine
and its derivatives

Our strategy
in our iodine business is to (i) maintain our leadership in the iodine market by adjusting our production capacity in line with
market needs; (ii) encourage demand growth and develop new iodine derivatives, (iii) participate in iodine recycling projects;
(iv) reduce our production costs through improved processes and higher productivity in order to compete more effectively, and
(v) supply a product with consistent quality according to the requirements of our customers.



Lithium
and its derivatives

Our strategy
in our lithium business is to (i) maintain our leading position in the lithium industry as a producer and distributor of lithium
carbonate and lithium hydroxide; (ii) encourage demand growth, (iii) selectively pursue opportunities in the lithium derivatives
business by creating new lithium compounds; (iv) reduce our production costs through improved processes and higher productivity
in order to compete more effectively, and (v) supply a product with consistent quality according to the requirements of our customers.



Potassium

Our strategy
in our potassium business is to significantly increase our production capacity of potassium chloride and potassium sulfate. Our
distribution strategy is to (i) offer a portfolio of potassium products, including potassium sulfate, potassium chloride and other
fertilizers to our traditional markets; (ii) create flexibility to offer crystalized (standard) or granular (compacted) form products
according to market requirements; and (iii) focus on markets where we have logistical advantages.



Industrial
Chemicals

Our strategy
in our industrial chemical business is to (i) maintain our leadership position in the industrial nitrates market as well as increase
our supply of potassium chloride in markets where we have natural advantages; (ii) encourage demand growth in different applications,
(iii) become a long-term, reliable supplier for the thermal storage industry; (iv) reduce our production costs through improved
processes and higher productivity in order to compete more effectively, and (v) supply a product with consistent quality according
to the requirements of our customers.



New Business
Ventures



From time to
time we evaluate opportunities to expand in our current core businesses or within new businesses in which we believe we may have
sustainable competitive advantages, both within and outside Chile, and we expect to continue to do so in the future. We are currently
exploring concessions for certain metallic minerals. If such minerals are found, we may decide to exploit, sell or enter into
a joint venture to extract these resources. We may decide to acquire part or all of the equity of, or undertake joint ventures
or other transactions with, other companies involved in our businesses or in other businesses. We are also exploring the possibility
of acquiring controlling interests in companies that have mining properties in our core business areas, and that are in early
stages of development.  Consistent with our business strategy, we will continue to evaluate acquisitions, joint ventures
and alliances in our core businesses and, depending on all facts and circumstances, may seek to acquire controlling stakes or
other interests in companies with mining properties outside of Chile and Latin America, including in other emerging markets.



24







In addition
we are actively conducting exploration operations in various properties we own for copper, gold and other metals deposits and
we have already identified several areas in which we are conducting more targeted exploration. Fiel Rosita, a copper-gold deposit
located close to the city of Vallenar, is our most advanced prospect. It is located in the same district as other deposits currently
being exploited by other companies. We are updating the geological model using new 2013 drill data that will be used in updating
the resource estimate prior to advancing a preliminary economic assessment to completion. Additional exploration will be undertaken
to confirm the updated geological model and test extensions to the known mineralized areas. We may decide not to move forward
with any potential metallic prospects discovered from our exploration operations.



In parallel
to our exploration operations, we have entered into memoranda of understanding, option agreements and similar arrangements with
third-party mining companies relating to metallic minerals.  In all these agreements, we retain the rights to non-metallic
minerals such as nitrate, iodine, potassium, lithium and their respective derivatives



Main Business Lines



Specialty
Plant Nutrition



We believe
we are the world’s largest producer of potassium nitrate. We estimate that our sales accounted for approximately 48% of
global potassium nitrate sales by volume in 2013. This estimate does not include potassium nitrate we produced and sold locally
in China, only net imports. During 2013, the potassium nitrate market remained stable, with global sales at 1 million MT. We also
produce the following specialty plant nutrition products: sodium nitrate, sodium potassium nitrate and specialty blends (containing
various combinations of nitrogen, phosphate and potassium and generally known as “NPK blends”).



These specialty
plant nutrients have specific characteristics that increase productivity and enhance quality when used on certain crops and soils.
Our specialty plant nutrients have significant advantages for certain applications over commodity fertilizers based on nitrogen
and potassium, such as urea and potassium chloride.



In particular,
our specialty plant nutrients:



| | · | are
                                         fully water soluble, allowing their use in hydroponics, fertigation, foliar applications
                                         and other advanced agricultural techniques;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | improve
                                         the water use efficiency of crops and help conserve water;
| | - | -----------------------------------------------------------------------------------------------------------

| | · | are
                                         chloride-free, which prevents chloride toxicity in certain crops associated with high
                                         levels of chlorine in plant nutrients;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | provide
                                         nitrogen in nitric form, thereby allowing crops to absorb nutrients faster than they
                                         absorb urea or ammonium-based fertilizers;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | do
                                         not release hydrogen after application, thereby avoiding increased soil acidity;
| | - | ----------------------------------------------------------------------------------------------------------------------------

| | · | possess
                                         trace elements, which promote disease resistance in plants; and
| | - | ----------------------------------------------------------------------------------------------------------------

| | · | are
                                         more attractive to customers who prefer products of natural origin.
| | - | ----------------------------------------------------------------------------------------------------------------



In 2013, our
specialty plant nutrients sales were US$687.5 million, representing 31% of our total sales for that year and a 1.8% increase from
US$675.3 million specialty plant nutrients sales in 2012. This increase was a result of higher demand for premium vegetables and
fruits, caused by improved economic conditions, which has reinforced the consumption of specialty fertilizers.



25







Specialty
Plant Nutrition: Our Market

The target
market for our specialty plant nutrients includes producers of high-value crops such as vegetables, fruits, industrial crops,
flowers, cotton and others. Furthermore, we sell specialty plant nutrients to producers of chloride-sensitive crops. Since 1990,
the international market for specialty plant nutrients has grown at a faster rate than the international market for commodity-type
fertilizers. This is mostly due to: (i) the application of new agricultural technologies such as fertigation and hydroponics,
and the increasing use of greenhouses; (ii) the increase in the cost of land and the scarcity of water, which has forced farmers
to improve their yields and reduce water use; and (iii) the increase in demand for higher quality crops, such as fruits and vegetables.



Over the last
10 years, the compound annual growth rate for vegetable production per capita was 3.0% while the compound annual growth rate for
the world population was only 1.5%.



Worldwide scarcity
of water and arable land drives the development of new agricultural techniques to maximize the use of these resources. Irrigation
has grown at an average annual rate of 1.5% during the last 20 years (a pace equal with population growth). However, micro-irrigation
has grown at 10% per year over the same period. Microirrigation systems, which include drip-irrigation and micro-sprinklers, are
the most efficient forms of technical irrigation. Global microirrigation acreage is estimated at 10 million hectares, which represents
approximately 3% of total worldwide irrigated area. These applications require fully water-soluble plant nutrients. Our nitrate-based
specialty plant nutrients provide nitrogen in nitric form, which helps crops absorb these nutrients faster than they absorb urea-
or ammonium-based fertilizers, facilitating a more efficient application of nutrients to the plant and thereby increasing the
crop’s yield and improving its quality.



Specialty
Plant Nutrition: Our Products

Potassium nitrate,
sodium potassium nitrate and specialty blends are higher margin products derived from, or consisting of, sodium nitrate, and they
are all produced in crystallized or prilled form. Specialty blends are produced using our own specialty plant nutrients and other
components at blending plants operated by us or our affiliates and related companies in Chile, the United States, Mexico, United
Arab Emirates, South Africa, Turkey, China, India, Thailand, Brazil and Peru.



The following
table shows our sales volumes of and revenues from specialty plant nutrients for 2013, 2012 and 2011.



|                                               |  | 2013 |       |  | 2012 |  |       | 2011 | 
|---------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- | 
|Sales Volume  (Th. MT)                         |  |      |       |  |      |  |       |      | 
|Sodium nitrate                                 |  |      | 26.2  |  |      |  | 24.4  |      | 
|Potassium nitrate and sodium potassium nitrate |  |      | 512.6 |  |      |  | 469.3 |      | 
|Blended and other specialty plant nutrients(1) |  |      | 308.9 |  |      |  | 286.5 |      | 
|Total Revenues (in US$ millions)               |  |      | 687.5 |  |      |  | 675.3 |      | 

| | (1) | Includes
                                         blended and other specialty plant nutrients. It also includes Yara’s products sold
                                         pursuant to our commercial agreement
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Specialty
Plant Nutrition: Marketing and Customers



In 2013, we
sold our specialty plant nutrients in close to 90 countries. During the same year, sales of our specialty plant nutrients were
as per the table below. No single customer represented more than 10% of our specialty plant nutrient sales during 2013, and we
estimate that our 10 largest customers accounted in the aggregate for approximately 23% of sales during that period.



26







|Sales Breakdown         |  | 2013 |    |   | 2012 |  |    | 2011 | 
|----------------------- |  | ---- | -- | - | ---- |  | -- | ---- | 
|Central & South America |  |      | 14 | % |      |  | 18 | %    | 
|North America           |  |      | 25 | % |      |  | 27 | %    | 
|Europe                  |  |      | 16 | % |      |  | 18 | %    | 
|Chile                   |  |      | 25 | % |      |  | 19 | %    | 
|Others                  |  |      | 20 | % |      |  | 18 | %    | 



We sell our
specialty plant nutrition products outside Chile mainly through our own worldwide network of representative offices and through
our distribution affiliates.



We maintain
stocks of our specialty plant nutrients in the main markets of the Americas, Asia, Europe, the Middle East and Africa in order
to facilitate prompt deliveries to customers. In addition, we sell specialty plant nutrition products directly to some of our
large customers. Sales are made pursuant to spot purchase orders and short-term contracts.



In connection
with our marketing efforts, we provide technical and agronomical assistance and support to some of our customers. By working closely
with our customers, we are able to identify new, higher-value-added products and markets. Our specialty plant nutrients products
are used on a wide variety of crops, particularly value-added crops, where the use of our products enables our customers to increase
yield and command a premium price. In 2013, we launched the global SpeedfolTM Crop SP project in order to promote a range
of crop-specific, predominantly potassium nitrate-based, locally-produced, water-soluble NPK formulations for foliar spray applications.
The SpeedfolTM Crop SP project has a duration of five years and targets a variety of crops such as cereals grains, citrus,
mango, cotton, soybean and coffee, in countries such as Brazil, China, India, Mexico, South Africa and the Unites States of America.
Scientifically proven benefits of SpeedfolTM Crop SP applications include increased yields, better quality (e.g. larger-sized
fruits) and reduced crop losses (e.g. less premature fruit drop, less lodging incidence in cereals).



Our customers
are located in both the northern and southern hemispheres. Consequently, we do not believe there are any seasonal or cyclical
factors that can materially affect the sales of our specialty plant nutrient products.



From time to
time we evaluate opportunities to expand in our current core businesses, including our specialty plant nutrients business, or
within new businesses in which we believe we may have sustainable competitive advantages, both within and outside Chile. Consistent
with our business strategy, we evaluate potential acquisitions, joint ventures and alliances in our core businesses with companies
outside of Chile and Latin America, including in emerging markets.



In May 2008,
we signed a commitment letter for a joint venture with Migao for the production and distribution of specialty plant nutrients
in China. In 2009, we signed a shareholders agreement in connection with this joint venture. Through the joint venture, we constructed
a potassium nitrate plant with a production capacity of 40,000 metric tons per year. The plant began operating in January 2011,
and offers us an increased our presence in China,



27







In May 2009,
our subsidiary Soquimich European Holdings entered into an agreement with Coromandel Fertilizers Ltd. to create a joint venture
for the production and distribution of water soluble fertilizers in India. The agreement established a 50⁄50 contribution
to the joint venture. As part of the agreement, a new 15,000 metric ton facility was constructed in the city of Kakinada to produce
water soluble fertilizers (NPK grades). This new facility required a total investment of approximately US$2.6 million and began
operating in January 2012.



In December
2009, we signed an agreement with the French Roullier Group to form the joint venture SQM Vitas. This agreement joins two of the
largest companies in the businesses of specialty plant nutrients, specialty animal nutrition and professional hygiene. Peru, Brazil
and South Africa are the main focus markets of this joint venture and Dubai is the main productive unit. As part of the agreement,
our phosphate plant located in Dubai became part of this joint venture. In September 2010, SQM Vitas implemented a new phosphate
line that will allow the production of two of the main water soluble phosphorus products in the world: mono ammonium phosphate
and urea phosphate.



In the second
half of 2011, we effected a corporate reorganization whereby our subsidiary Soquimich European Holding B.V. acquired a 66.6% ownership
in Fertilizantes Naturales S.A. (later renamed SQM Iberian S.A.) from Nutrisi Holding N.V. Soquimich European Holding B.V. owned
a non-controlling 50% stake in Nutrisi Holding N.V. which was sold following this acquisition. The effect of these transactions
has been that we indirectly control SQM Iberian S.A. through Soquimich European Holding B.V. SQM Iberian S.A. sells and distributes
fertilizers, primarily in Spain.



In 2012, SQM
Vitas started the construction of new plants in Brazil (Candeias), Peru and South Africa (Durban) for the production of water
soluble fertilizers containing different relative amounts of nitrogen, phosphorus and potassium, and at times, smaller amounts
of other chemicals. The Brazilian plant (Candeias Industrial Complex) began operating in March 2012. It has a production capacity
of 25,000 million tons per year, and represented a total investment of US$10 million.



Between 2010
and 2012, we continued to expand our production capacity of potassium products in our operations in the Salar de Atacama. In 2011,
we completed the construction of a new potassium nitrate facility in Coya Sur, increasing our overall production capacity of potassium
nitrate by 300,000 metric tons. In addition, as mentioned above, we entered into a joint venture with Migao in 2008 for the construction
of a potassium nitrate plant with a production capacity of 40,000 metric tons per year that began operating in January 2011.



The market
for potassium nitrate in China is 350,000-400,000 MT, of which approximately 150,000 is related to the tobacco industry and 40,000-50,000
is related to the horticulture business. Our market share in agricultural potassium nitrate products in China is approximately
80% for water-soluble fertilizers and we expect to increase our market share for water-soluble NPK blends.



During 2013
we changed our development strategy for the Chinese water-soluble fertilizer segment. In particular, we revised our marketing
and distribution strategy through our subsidiary SQM (Beijing) and in connection with the SQM-Migao joint venture, located in
Qingdao of Shandong Province. Pursuant to this new strategy, our water-soluble fertilizer products produced by the SQM-Migao joint
venture will be sold through SQM (Beijing), and the marketing team of the SQM-Migao joint venture will be integrated into SQM
(Beijing). This change aims to enhance the efficiency of distribution channels for fertilizer products by consolidating marketing
into a unified brand and management team, thus reducing costs. In addition, our strategy in this segment is to increase production
of water-soluble fertilizers and extend our technologies for applications in order to increase popularity and expand the use of
these products.



28









On March 8, 2013, SQM VITAS acquired the
Controlled Release Fertilizer (CRF) Technology and Plantacote® business and brand name from AGLUKON. Plantacote® is highly
efficient in nutrient utilization and is environmentally friendly due to prevention of leaching, volatilization and fixation of
nutrients in the soils as well as the degradation of the coating by microorganisms after complete nutrient release. The unique
coating technology and quality standards make Plantacote® very reliable for growing high-quality plants. This new global facility
will produce both premium and standard CRFs under the Plantacote® brand name in order to supply worldwide customers that are
active in horticulture, agriculture, turf, growing media and consumer markets. Due to this acquisition, SQM VITAS will be able
to further expand its current product portfolio of specialty plant nutrition solutions for the benefit of its customers.



In 2009, SQM
VITAS and Quimigra S.A, part of the Roullier Group, a French multinational group involved in plant, animal and human nutrition,
entered into a joint venture for the construction and development of a new production facility in Port Cádiz, Spain, of
nutritional solutions with high-added value to be destined for local demand. On June 12, 2013, the facilities were completed and
began operating. The new facility has a production capacity of 15,000 MT per year. The production is focused on nutritional solutions
with high added value destined to meet local demand for both, the Roullier Group and SQM, and to market to the agricultural sector
in nearby countries.



Specialty
Plant Nutrition: Fertilizer Sales in Chile



We market specialty
plant nutrition products in Chile through Soquimich Comercial S.A., either as a standalone product or in blends with other imported
products, in particular triple super phosphate (TSP) and diammonium phosphate (DAP).



Soquimich Comercial
S.A. sells imported fertilizers to farmers in Chile principally for use in the production of sugar beets, cereals, industrial
crops, potatoes, grapes and other fruits. Most of the fertilizers that Soquimich Comercial S.A. imports are purchased on a spot
basis from different countries in the world, including China, Mexico and Venezuela.



All contracts
and agreements between Soquimich Comercial S.A. and its suppliers of imported fertilizers generally contain standard and customary
commercial terms and conditions. During the preceding 10 years, Soquimich Comercial S.A. has experienced no material difficulties
in obtaining adequate supplies of such fertilizers at satisfactory prices.



Soquimich Comercial
S.A.’s sales of fertilizers represented approximately 30% of total fertilizer sales in Chile during 2013. Soquimich Comercial
S.A.’s consolidated revenues were approximately US$230 million and US$256 million in 2013 and 2012, respectively.



Specialty
Plant Nutrition: Competition



We believe
we are the world’s largest producer of sodium and potassium nitrate for agricultural use. Our sodium nitrate products compete
indirectly with specialty and commodity-type substitutes, which may be used by some customers instead of sodium nitrate depending
on the type of soil and crop to which the product will be applied. Such substitute products include calcium nitrate, ammonium
nitrate and calcium ammonium nitrate.



In the potassium
nitrate market our largest competitor is Haifa Chemicals Ltd. (“Haifa”), in Israel, which is a subsidiary of Trans
Resources International Inc. We estimate that sales of potassium nitrate by Haifa accounted for approximately 33% of total world
sales during 2013 (excluding sales by Chinese producers to the domestic Chinese market), compared to our share of the market which
accounted for approximately 48% of global potassium nitrate sales by volume for the period.



29







ACF, another
Chilean producer, mainly oriented to iodine production, has produced potassium nitrate from caliche ore and potassium chloride
since 2005. Kemapco, a Jordanian producer owned by Arab Potash, produces potassium nitrate in a plant located close to the Port
of Aqaba, Jordan. In addition, there are several potassium nitrate producers in China, the largest of which are Wentong and Migao.
Most of the Chinese production is consumed by the Chinese domestic market.



The principal
means of competition in the sale of potassium nitrate are product quality, customer service, location, logistics, agronomic expertise
and price.



In Chile, our
products mainly compete with imported fertilizer blends that use calcium ammonium nitrate or potassium magnesium sulfate. Our
specialty plant nutrients also compete indirectly with lower-priced synthetic commodity-type fertilizers such as ammonia and urea,
which are produced by many producers in a highly price-competitive market. Our products compete on the basis of advantages that
make them more suitable for certain applications as described above.



Iodine
and its derivatives



We believe
we are the world’s largest producer of iodine. In 2013, our revenues from iodine and iodine derivatives amounted to US$461.0
million, representing 21% of our total revenues in that year. We estimate that our sales accounted for approximately 28% of world
iodine sales by volume in 2013.



Market



Iodine and
iodine derivatives are used in a wide range of medical, agricultural and industrial applications as well as in human and animal
nutrition products. Iodine and iodine derivatives are used as raw materials or catalysts in the formulation of products such as
X-ray contrast media, biocides, antiseptics and disinfectants, pharmaceutical intermediates, polarizing films for LCDs, chemicals,
herbicides, organic compounds and pigments. Iodine is also added in the form of potassium iodate or potassium iodide to edible
salt to prevent iodine deficiency disorders. We have seen consistent growth in the iodine market over the last ten years, with
the exception of 2009 which that was affected by the global financial crisis, with demand being led by uses related to X-ray contrast
media and pharmaceuticals. During 2013, iodine demand only saw a moderate increase compared to 2012 as a consequence of high prices
and stock optimization. We estimate that the global market size in 2013 was 31 thousand metric tons, with close to 60% of supply
coming from Chilean producers, including us. Increased supply entered the market in 2012 and 2013.



Iodine:
Our Products:



We produce
iodine, and through a joint venture with Ajay Chemicals Inc., (“Ajay”), a U.S.-based Company, we produce organic and
inorganic iodine derivatives. Ajay-SQM Group (“ASG”), established in the mid-1990s, has production plants in the United
States, Chile and France. ASG is the world’s leading inorganic and organic iodine derivatives producer.



30







Consistent
with our business strategy, we are constantly working on the development of new applications for our iodine-based products, pursuing
a continuing expansion of our businesses and maintaining our market leadership.



We manufacture
our iodine and iodine derivatives in accordance with international quality standards and have qualified our iodine facilities
and production processes under the ISO-9001:2008 program, providing third party certification of the quality management system
and international quality control standards that we have implemented.



The following
table shows our total sales and revenues from iodine and iodine derivatives for 2013, 2012 and 2011:



|                           |  | 2013 |       |  | 2012 |  |       | 2011 | 
|-------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- | 
|Sales Volume (Th. MT)      |  |      |       |  |      |  |       |      | 
|Iodine and derivatives     |  |      | 9.3   |  |      |  | 11.0  |      | 
|Revenues (in US$ millions) |  |      | 461.0 |  |      |  | 578.1 |      | 



Our sales revenues
decreased from US$578.1 million in 2012 to US$461.0 million in 2013. This decrease was primarily attributable to slower demand
growth than seen in previous years, and supply outpacing demand.



Iodine:
Marketing and Customers



In 2013, we
sold our iodine products to approximately 300 customers in over 70 countries and most of our sales were exports: 37% was sold
to customers in Europe, the Middle East and Africa, 36% to customers in North America, 11% to customers in Central and South America
and 16% to customers in Asia and other regions. No single customer accounted for more than 13% of our iodine sales in 2013, and
we estimate that our 10 largest customers accounted in the aggregate for approximately 50% of sales.



The following
table shows the geographical breakdown of our sales for 2013, 2012, and 2011.



|Sales Breakdown              |  | 2013 |    |   | 2012 |  |    | 2011 | 
|---------------------------- |  | ---- | -- | - | ---- |  | -- | ---- | 
|Europe, Middle East & Africa |  |      | 37 | % |      |  | 31 | %    | 
|North America                |  |      | 36 | % |      |  | 36 | %    | 
|Central & South America      |  |      | 11 | % |      |  | 3  | %    | 
|Others                       |  |      | 16 | % |      |  | 30 | %    | 



We sell iodine
through our own worldwide network of representative offices and through our sales, support and distribution affiliates. We maintain
inventories of iodine at our facilities throughout the world to facilitate prompt delivery to customers. Iodine sales are made
pursuant to spot purchase orders or within the framework of supply agreements. Supply agreements generally specify annual minimum
and maximum purchase commitments, and prices are adjusted periodically, according to prevailing market prices.



Iodine:
Competition



The world’s
main iodine producers are based in Chile, Japan and the United States. Iodine is also produced in Turkmenistan, Azerbaijan, Indonesia,
Russia and China.



31







Iodine production
in Chile starts from a unique mineral ore known as caliche ore, whereas in Japan, the United States, Turkmenistan, Azerbaijan,
Indonesia, and Russia producers extract iodine from underground brines that are mainly obtained together with the extraction of
natural gas and petroleum. In China, iodine is extracted from seaweed.



Six Chilean
companies (SQM; Atacama Chemical S.A. (Cosayach), controlled by the Chilean holding Inverraz S.A.; ACF Minera S.A. owned by the
Chilean family De Urruticoechea; Algorta Norte S.A., a joint venture between ACF Minera S.A. and Toyota Tsusho; SCM Bullmine;
and Sirocco Mining Inc., a Canadian company previously known as Atacama Minerals) accounted for approximately 56% of global iodine
sales in 2013 (28% by SQM and 28% by the other five Chilean producers).



We estimate
that eight Japanese iodine producers accounted for approximately 31% of global iodine sales in 2013, including recycled iodine.



We estimate
that iodine producers in the United States (one of which is owned by Ise Chemicals Ltd., a Japanese company) accounted for 5%
of world iodine sales in 2013.



Iodine recycling
is an increasing trend worldwide. Several Japanese producers have recycling facilities where they recover iodine and iodine derivatives
from iodine waste streams. Iodine recycling, mainly related to LCD consumption, has increased over the past few years and currently
represents approximately 17% of world iodine sales. It is estimated that approximately 70% to 75% of the world recycling was done
by Japanese iodine producers.



We, through
ASG or alone, are also actively participating in the iodine recycling business using iodinated side-streams from a variety of
chemical processes in Europe, the United States and Asia.



The prices
of iodine and iodine derivative products are determined by market conditions. World iodine prices vary depending upon, among other
things, the relationship between supply and demand at any given time. As a result of new supply from other Chilean producers,
our annual average iodine sales prices decreased to US$ 50 per kilogram in 2013.



Demand for
iodine varies depending upon overall levels of economic activity and the level of demand in the medical, pharmaceutical, industrial
and other sectors that are the main users of iodine and iodine-derivative products. Certain substitutes for iodine ore available
for certain applications, such as antiseptics and disinfectants, which could represent a cost-effective alternative to iodine
depending on prevailing prices. We believe that some substitution has taken place during 2012 and 2013.



The main factors
of competition in the sale of iodine and iodine derivative products are reliability, price, quality, customer service and the
price and availability of substitutes. We believe we have competitive advantages compared to other producers due to the size and
quality of our mining reserves and the available production capacity. We believe our iodine is competitive with that produced
by other manufacturers in certain advanced industrial processes. We also believe we benefit competitively from the long-term relationships
we have established with our largest customers.



Lithium
and its derivatives



We believe
we are the leading producer of lithium carbonate and one of the world’s largest producers of lithium hydroxide. In 2013,
our revenues from lithium sales amounted to US$196.5 million, representing 9% of our total revenues. We estimate that our sales
accounted for approximately 27% of the sale of global lithium chemicals sales in volume.



32







Lithium:
Market



Lithium carbonate
is used in a variety of applications, including electrochemical materials for batteries, ceramic and enamel frits, heat resistant
glass (ceramic glass), primary aluminum smelting process, air conditioning chemicals, continuous casting powder for steel extrusion,
synthesis of pharmaceuticals and lithium derivatives.



Lithium hydroxide
is primarily used as a raw material in the lubricating grease industry, as well as in the dyes and the battery industries.



During 2013,
lithium chemicals demand increased 4% reaching 130 thousand metric tons, with close to 50% supplied by Chilean producers.



Lithium:
Our Products



We produce
lithium carbonate at the Salar del Carmen facilities, near Antofagasta, Chile, from solutions with high concentrations of lithium,
in the form of lithium chloride, coming from the potassium chloride production at the Salar de Atacama. The annual production
capacity of our lithium carbonate plant is 48,000 metric tons per year. We believe that the technologies we use, together with
the high concentrations of lithium and unique characteristics of the Salar de Atacama, such as high evaporation rate and concentration
of other minerals, allow us to be one of the lowest cost producers worldwide.



We also produce
lithium hydroxide at our facilities at the Salar del Carmen, next to the lithium carbonate operation. The lithium hydroxide facility
has a production capacity of 6,000 metric tons per year and is one of the largest plants in the world.



The following
table shows our total sales and revenues from lithium carbonate and its derivatives for 2013, 2012 and 2011:



|                           |  | 2013 |       |  | 2012 |  |       | 2011 | 
|-------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- | 
|Sales Volume (Th. MT)      |  |      |       |  |      |  |       |      | 
|Lithium and derivatives    |  |      | 36.1  |  |      |  | 45.7  |      | 
|Revenues (in US$ millions) |  |      | 196.5 |  |      |  | 222.2 |      | 



Our revenues
in 2013 were US$196.5 million, a 13% decrease from US$222.2 million in 2012, due to lower sales volumes resulting from an increase
in supply in 2013.



Lithium:
Marketing and Customers



In 2013, we
sold our lithium products to over 300 customers in approximately 50 countries. No single customer accounted for more than 10%
of our lithium sales in 2013, and we estimate that our 10 largest customers accounted in aggregate for approximately 50% of sales.



33







The following
table shows the geographical breakdown of our sales for 2013, 2012 and 2011.



|Sales Breakdown              |  | 2013 |    |   | 2012 |  |    | 2011 | 
|---------------------------- |  | ---- | -- | - | ---- |  | -- | ---- | 
|Europe, Middle East & Africa |  |      | 30 | % |      |  | 24 | %    | 
|North America                |  |      | 13 | % |      |  | 10 | %    | 
|Asia & Oceania and others    |  |      | 57 | % |      |  | 66 | %    | 



We sell lithium
carbonate and lithium hydroxide through our own worldwide network of representative offices and through our sales, support and
distribution affiliates. We maintain inventories of these products at our facilities throughout the world to facilitate prompt
delivery to customers. Sales of lithium carbonate and lithium hydroxide are made pursuant to spot purchase orders or within the
framework of supply agreements. Supply agreements generally specify annual minimum and maximum purchase commitments, and prices
are adjusted periodically, according to prevailing market prices.



Lithium:
Competition



Our main competitors
in the lithium carbonate and lithium hydroxide businesses are Rockwood Lithium (“Rockwood”), a subsidiary of Rockwood
Specialties Group Inc., and FMC Corporation (“FMC”). In addition, a number of Chinese producers together accounted
for approximately 40% of the world market in 2013, in volume. Rockwood produces lithium carbonate at its operations in Chile,
through Sociedad Chilena del Litio Limitada, and in Nevada, United States. Its production of downstream lithium products is mostly
performed in the United States, Germany and Taiwan. FMC has production facilities in Argentina through Minera del Altiplano S.A.,
where it produces lithium chloride and lithium carbonate. Production of its downstream lithium products is mostly performed in
the United States and the United Kingdom.



We believe
that lithium production will increase in the near future. A number of new projects to develop lithium deposits have been announced
recently, some of them are already under advanced development and others could materialize in the medium-term.



Potassium



We produce
potassium chloride and potassium sulfate by extracting brines from the Salar de Atacama that are rich in potassium chloride and
other salts.



Since 2009,
our end product capacity has increased to over 2 million metric tons per year, granting us improved flexibility and market coverage.



In 2013, our
potassium chloride and potassium sulfate revenues amounted to US$606.3 million, representing 28% of our total revenues and a 0.2%
increase compared to 2012. We are currently completing projects in the Salar de Atacama, which will enable us to increase production
and sales of potassium-based products.



Potassium is
one of the three macronutrients that a plant needs to develop. Although potassium does not form part of a plant’s structure,
it is essential to the development of its basic functions. Potassium chloride is the most commonly used potassium-based fertilizer.
It is used to fertilize crops that can tolerate relatively high levels of chloride, and to fertilize crops that are grown under
conditions with sufficient rainfall or irrigation practices that prevent chloride to accumulate to excess levels in the rooting
systems of the plant.



34







Some benefits that may be obtained
through the use of potassium are:

| | · | increased
                                         yield and quality;
| | - | ---------------------------------------------------------------------



| | · | increased
                                         production of proteins;
| | - | --------------------------------------------------------------------------



| | · | increased
                                         photosynthesis;
| | - | ------------------------------------------------------------------



| | · | intensified
                                         transport and storage of assimilates;
| | - | ------------------------------------------------------------------------------------------



| | · | prolonged
                                         and more intense assimilation period;
| | - | ----------------------------------------------------------------------------------------



| | · | improved
                                         water efficiency;
| | - | -------------------------------------------------------------------



| | · | regulated
                                         opening and closure of stomata; and
| | - | --------------------------------------------------------------------------------------



| | · | synthesis
                                         of lycopene.
| | - | ---------------------------------------------------------------



Potassium chloride
is also an important component for our specialty plant nutrition product line, where it is used as a raw material to produce potassium
nitrate.



Potassium:
Market



During the
last decade, the potassium chloride market has experienced rapid growth due to several key factors such as a growing world population,
higher demand for protein-based diets and less arable land. All of these factors have contributed to growing demand for fertilizers
and, in particular, potassium chloride, as efforts are being made to maximize crop yields and use resources more efficiently.
For the last 10 years, the compound annual growth for the global potassium chloride market was approximately 1.6%.



According to
most recent studies prepared by the International Fertilizer Industry Association in 2010-2010/11, cereals received 10.3 MT K2O,
(i.e., 37.4% of world K consumption, with a low contribution of wheat (6.2%) compared to rice (12.6%) and maize (14.9%)). In contrast,
oilseeds represented 19.8% of the total (5.4 MT K2O), with more than four fifths being applied to soybean (9.0%) and oil palm
(7.2%) together. K fertilizer use on fibre crops and roots and tubers was modest (2.8 and 3.8%, respectively) compared to sugar
crops (7.7%) and fruits and vegetables (16.6%). The remaining 11.8% were applied to other crops.



Demand in the
potassium chloride market increased in 2013. We estimate that demand reached the level of 54 million MT for potassium chloride
during 2013, an increase of approximately 6% as compared to 2012. After unfavorable farming conditions in several countries during
2012, production had to increase in order to meet demand (in a year with historical low inventory levels). We expect the potassium
chloride market maintain its growth trend to up to 57 million MT during 2014.



Average prices
in the potassium market decreased significantly during 2013 due to unusual events. Uralkali, a leading company in the potash market,
abandoned the business arrangement that it held with BPC and generated market uncertainty which affected the commodity’s
price levels. In the last quarter of 2013 the market saw major industry contracts close at significantly lower prices than previous
years. We believe these price pressures will have an impact on our potassium revenues in the near term.



35







Potassium:
Our Products



Potassium chloride
differs from our specialty plant nutrition products because it is a commodity fertilizer and contains chloride. We offer potassium
chloride in two grades: standard and compacted. Potassium sulfate is considered a specialty fertilizer and we offer three grades:
standard, compacted and soluble.



The following
table shows our sales volumes of and revenues from potassium chloride and potassium sulfate for 2013, 2012 and 2011.



|                                       |  | 2013 |         |  | 2012 |  |         | 2011 | 
|-------------------------------------- |  | ---- | ------- |  | ---- |  | ------- | ---- | 
|Sales Volume (Th. MT)                  |  |      |         |  |      |  |         |      | 
|Potassium Chloride & Potassium Sulfate |  |      | 1,434.9 |  |      |  | 1,209.5 |      | 
|Revenues (in US$ millions)             |  |      | 606.3   |  |      |  | 605.1   |      | 



Potassium:
Marketing and Customers



In 2013, we
sold potassium chloride and potassium sulfate in approximately 70 countries. No single customer accounted for more than 20% of
our sales of potassium chloride and potassium sulfate in 2013, and we estimate that our 10 largest customers accounted in the
aggregate for approximately 53% of such sales.



The following table shows the geographical
breakdown of our sales for 2013, 2012, and 2011.



|Sales Breakdown          |  | 2013 |    |   | 2012 |  |    | 2011 | 
|------------------------ |  | ---- | -- | - | ---- |  | -- | ---- | 
|Chile                    |  |      | 4  | % |      |  | 5  | %    | 
|Central & South America  |  |      | 41 | % |      |  | 42 | %    | 
|Africa & the Middle East |  |      | 14 | % |      |  | 11 | %    | 
|North America            |  |      | 15 | % |      |  | 15 | %    | 
|Others                   |  |      | 26 | % |      |  | 27 | %    | 



Potassium:
Competition



The prices
in the potassium chloride market declined during the second half of 2013 as a result of the unexpected announcement made by the
Russian company, Uralkali, on July 30, 2013, that it was terminating its participation in BPC. As a result of the termination
of Uralkali’s participation in BPC, there was increased price competition in the market. We believe that world market demand
is the most important indicator when assessing pricing and the overall future of the potash market. We remain confident that total
potash demand levels in 2014 will surpass levels recorded during 2013, which could lead to a positive change in the prices.



We estimate
that we accounted for less than 3% of global sales of potassium chloride in 2013. Our main competitors are Uralkali, PCS, Belaruskali
and Mosaic. We believe that in 2013 the leading producer in the market was Uralkali Group, which accounted for approximately 18%
of global sales. PCS and Mosaic, accounted each 15% and 14% respectively, and Belaruskali, who accounted for approximately 13%
of global sales.



In the potassium
sulfate market, we have several competitors, of which the most important are K+S KALI GmbH (Germany), Tessenderlo Chemie (Belgium)
and Great Salt Lake Minerals Corp. (United States). We believe that these three producers account for approximately 40% of the
world production of potassium sulfate.



36







Industrial
Chemicals



In addition
to producing sodium and potassium nitrate for agricultural applications, we produce three grades of sodium and potassium nitrate
for industrial applications: industrial, technical and refined grades. The three grades differ mainly in their chemical purity.
We enjoy certain operational flexibility when producing industrial sodium and potassium nitrate because they are produced from
the same process as their equivalent agricultural grades, needing only an additional step of purification. We may, with certain
constraints, shift production from one grade to the other depending on market conditions. This flexibility allows us to maximize
yields and to reduce commercial risk.



In addition to producing industrial
nitrates, we produce and market other industrial chemicals such as boric acid, a by-product of the production of potassium sulfate,
and industrial-grade potassium chloride, both of which are sold into industrial markets in crystalline form.



In 2013, our
revenues from industrial chemicals were US$245.2 million, representing approximately 7% of our total revenues for that year.



Industrial
Chemicals: Market



In addition
to producing sodium and potassium nitrate for agricultural applications, we produce three grades of sodium and potassium nitrate
for industrial applications: industrial, technical and refined grades. The three grades differ mainly in their chemical purity.
We enjoy certain operational flexibility when producing industrial sodium and potassium nitrate because they are produced from
the same process as their equivalent agricultural grades, needing only an additional step of purification. We may, with certain
constraints, shift production from one grade to the other depending on market conditions. This flexibility allows us to maximize
yields and to reduce commercial risk.



Industrial
sodium and potassium nitrates are used in a wide range of industrial applications, including the production of glass, ceramics,
explosives, charcoal briquettes, metal treatments and various chemical processes. In addition, this product line enjoys long-term
growth potential from industrial nitrates for thermal storage in solar energy projects. Solar salts for this specific application
contain a blend of 60% sodium nitrate and 40% potassium nitrate by weight ratio.



Boric acid
is primarily used as raw material in the manufacturing of glass, fiberglass, ceramic and enamel frits, and LCD flat panel displays.



Potassium chloride
is a basic chemical used to produce potassium hydroxide, and is used as an additive in oil drilling as well as in food processing,
among others.



37







Industrial
Chemicals: Our Products



The following
table shows our sales volumes of industrial chemicals and total revenues for 2013, 2012 and 2011:



|                           |  | 2013 |       |  | 2012 |  |       | 2011 | 
|-------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- | 
|Sales Volume (Th. MT)      |  |      |       |  |      |  |       |      | 
|Industrial nitrates        |  |      | 173.5 |  |      |  | 277.7 |      | 
|Boric Acid                 |  |      | 2.0   |  |      |  | 1.8   |      | 
|Revenues (in US$ millions) |  |      | 154.0 |  |      |  | 245.2 |      | 



Sales of industrial
chemicals decreased from US$245.2 million in 2012 to US$154.0 million in 2013 primarily as a result of a decrease in sales volumes
of solar salts products due to new alternative energy projects that utilize industrial grade sodium and potassium nitrate solar
thermal energy.



Industrial
Chemicals: Marketing and Customers



We sold our
industrial nitrate products in over 50 countries in 2013, with 47% percent of our sales of industrial chemicals to customers in
North America, 35% to customers in Europe, the Middle East and Africa, 12% to customers in Central and South America and 6% to
customers in other regions. No single customer accounted for more than 22% of our sales of industrial chemicals in 2012, and we
estimate that our 10 largest customers accounted in the aggregate for approximately 59% of such sales.



The following table shows the geographical
breakdown of our sales for 2013, 2012, and 2011.



|Sales Breakdown              |  | 2013 |    |   | 2012 |  |    | 2011 | 
|---------------------------- |  | ---- | -- | - | ---- |  | -- | ---- | 
|Europe, Middle East & Africa |  |      | 35 | % |      |  | 37 | %    | 
|North America                |  |      | 47 | % |      |  | 49 | %    | 
|Central & South America      |  |      | 12 | % |      |  | 7  | %    | 
|Others                       |  |      | 6  | % |      |  | 7  | %    | 



We sell our
industrial chemical products mainly through our own worldwide network of representative offices and through our sales and distribution
affiliates. We maintain inventories of our different grades of sodium nitrate and potassium nitrate products at our facilities
in Europe, North America, South Africa and South America to achieve prompt deliveries to customers. Our Research and Development
department, together with our foreign affiliates, provides technical support to our customers and continuously works with them
to develop new products or applications for our products.



Industrial
Chemicals: Competition



We believe
we are the world’s largest producer of industrial sodium and potassium nitrate. In the case of industrial sodium nitrate,
we estimate that our sales represented close to 50% of world demand in 2013 (excluding China and India internal demand, for which
we believe reliable estimates are not available). Our competitors are mainly based in Europe and Asia, producing sodium nitrate
as a by-product of other production processes. In refined grade sodium nitrate, BASF AG, a German corporation and several producers
in China and Eastern Europe are highly competitive in the European and Asian markets. Our industrial sodium nitrate products also
compete indirectly with substitute chemicals, including sodium carbonate, sodium hydroxide, sodium sulfate, calcium nitrate and
ammonium nitrate, which may be used in certain applications instead of sodium nitrate and are available from a large number of
producers worldwide.



38







Our main competitor
in the industrial potassium nitrates business is Haifa; which we estimate had a 23% of the market share. We estimate that our
market share was approximately 28% for 2013.



Producers compete
in the market for industrial sodium and potassium nitrate based on reliability, product quality, price and customer service. We
believe that we are a low cost producer of both products and are able to produce high quality products.



In the potassium
chloride and boric acid markets, we are a relatively small producer mainly supplying regional needs.



Other
Products



A large part
of our other revenue is related to fertilizer trading, usually commodities. These fertilizers are traded in large volumes worldwide.
We have developed a trade, supply, and inventory management business that allows us to respond quickly and effectively to the
changing fertilizer market in which we operate and profit on these trades.



Production
Process



Our integrated production process
can be classified according to our natural resources:



| | · | caliche
                                         ore deposits, which contain nitrates and iodine; and
| | - | -----------------------------------------------------------------------------------------------------

| | · | salar
                                         brines, which contain potassium, lithium, sulfate, boron and magnesium.
| | - | ----------------------------------------------------------------------------------------------------------------------



Caliche
Ore Deposits





Caliche ore deposits are located in northern
Chile. During 2013, we operated three mines in this region: Pedro de Valdivia, El Toco (mining site of Maria Elena production facilities)
and Nueva Victoria. In December 2013, mining operations at El Toco were temporarily suspended in an effort to optimize our production
facilties with lower production costs.



Caliche ore is found under a layer of barren
overburden in seams with variable thickness from one meter to five meters, and with the overburden varying in thickness between
zero and two meters.



Before proper
mining begins, a full exploration stage is carried out, including full geological reconnaissance, sampling and drilling caliche
ore to determine the features of each deposit and its quality. Drill-hole samples are properly identified and tested at our chemical
laboratories. With the exploration information on a closed grid pattern of drill holes, the ore evaluation stage provides information
for mine planning purposes. Mine planning is done on a long-term basis (10 years), medium-term basis (three years) and short-term
basis (one year). After drill holes are made, information is updated to offer the most accurate ore supply schedule to the processing
plants.



The mining
process generally begins with bulldozers first ripping and removing the overburden in the mining area. This process is followed
by production drilling and blasting to break the caliche seams. Front-end loaders load the ore on off-road trucks. In the Pedro
de Valdivia mine, trucks deliver the ore to stockpiles next to rail loading stations. The stockpiled ore is later loaded onto
railcars that take the mineral to the processing facilities.



39







At the Pedro
de Valdivia facility, the ore is crushed and leached to produce concentrated solutions containing the nitrate and iodine. The
crushing of the ore produces a coarse fraction that is leached in a vat system and a fine fraction that is leached by agitation.
These are followed by liquid-solid separation, where solids precipitate as sediment and liquids containing nitrate and iodine
are sent to be processed. In Nueva Victoria and El Toco, the run of mine ore is loaded in heaps and leached with water to produce
concentrated solutions.



Caliche
Ore-Derived Products



Caliche ore-derived products are:
sodium nitrate, potassium nitrate, sodium potassium nitrate, iodine and iodine derivatives.



Sodium
Nitrate



During 2013,
sodium nitrate for both agricultural and industrial applications was produced at the Pedro de Valdivia facility using the Guggenheim
method, which was originally patented in 1921, and is based on a closed-circuit method of leaching vats. This process uses heated
brines to leach the crushed caliche in vats and selectively dissolve the contents. The concentrated solution is then cooled, producing
sodium nitrate crystals, which can then be separated from the brine using basket centrifuges. After the crystallization process,
the brine is pumped to the iodine facilities, where the iodide is separated in a solvent extraction plant. The brine is returned
to the vat leaching process. The fine fraction of caliche’s crushing process is leached at ambient temperature with water,
producing a weak solution that is pumped to the iodine facilities. After a solvent extraction process, the brine is pumped to
solar evaporation ponds in Coya Sur, 15 km south of María Elena.



Our total current
crystallized sodium nitrate production capacity at the Pedro de Valdivia facility is approximately 500,000 metric tons per year.
Crystallized sodium nitrate is processed further at the Coya Sur and María Elena production plants to produce potassium
nitrate in different qualities, sodium potassium nitrate and/or crystallized or prilled nitrates (potassium or sodium), which
are transported to our port facilities in Tocopilla by railway for shipping to customer and distributors worldwide.



Potassium nitrate



Potassium nitrate
is produced at our Coya Sur facility using a production process developed by us. The brine leached with the fine fraction process
at Pedro de Valdivia and the brines produced by heap leaching process in Maria Elena are pumped to Coya Sur’s solar evaporation
ponds for a nitrate concentration process. After the nitrate concentration process, the brine is pumped to a conversion plant
where potassium salts are added and where a chemical reaction begins and produces brine with dissolved potassium nitrate. This
brine is pumped to a crystallization plant, which crystallizes the potassium nitrate by cooling it and separating it from the
liquid by centrifuge.



Concentrated
nitrate salts were produced at Pampa Blanca until March 2010, and are currently produced at Nueva Victoria by leaching caliche
ore in heaps in order to extract solutions that are rich in iodine and nitrates. These solutions are then sent to plants where
iodine is extracted through both solvent-extraction and blow out processes. The remaining solutions are subsequently sent to solar
evaporation ponds where the solutions are evaporated and rich nitrate salts are produced. These concentrated nitrate salts are
then sent to Coya Sur where they are used to produce potassium nitrate.



Our current
potassium nitrate production capacity at Coya Sur is approximately 950,000 metric tons per year. A new potassium nitrate plant
began operations in 2011. During 2013, we produced approximately 247,000 tons of potassium nitrate at this plant. This new plant
was designed to use raw material salts harvested in Nueva Victoria and potassium salts from the Salar de Atacama.



40







The nitrates
produced in crystallized or prilled form at Coya Sur have been certified by TÜV-Rheiland under the quality standard ISO 9001:2008.
Potassium nitrate produced at Coya Sur and María Elena is transported to Tocopilla for shipping to customers and distributors.



Sodium
potassium nitrate



Sodium potassium
nitrate is a mixture of approximately two parts sodium nitrate per one part potassium nitrate. We produce sodium potassium nitrate
at our Coya Sur and María Elena prilling facilities using standard, non-patented production methods we have developed.
Crystallized sodium nitrate is mixed with the crystallized potassium nitrate to make sodium potassium nitrate, which is then prilled.
The prilled sodium potassium nitrate is transported to Tocopilla for bulk shipment to customers.



The production
process for sodium potassium nitrate is basically the same as that for sodium nitrate and potassium nitrate. With certain production
restraints and following market conditions we may supply sodium nitrate, potassium nitrate or sodium potassium nitrate either
in prilled or crystallized form.



Iodine
and iodine derivatives



We produce
iodine at our Pedro de Valdivia, Maria Elena and Nueva Victoria facilities.During 2013, iodine was produced by extracting
it from the solutions resulting from the heap leaching of caliche ore at María Elena and Nueva Victoria, including the
Iris facility as part of the Nueva Victoria facility, and from the vat leaching of caliche ore at the Pedro de Valdivia facilities.
Production of iodine at the Iris plant was stopped during October 2013.



As in the case
of nitrates, the process of extracting iodine from the caliche ore is well established, but variations in the iodine and other
chemical contents of the treated ore and other operational parameters require a high level of know-how to manage the process effectively
and efficiently.



The solutions
resulting from the leaching of caliche carry iodine in iodate form. Part of the iodate solution is reduced to iodide using sulfur
dioxide, which is produced by burning sulfur. The resulting iodide is combined with the rest of the untreated iodate solution
to release elemental iodine in low concentrations. The iodine is then extracted from the aqueous solutions and concentrated as
iodide form using a solvent extraction and stripping plant in the Pedro de Valdivia and Nueva Victoria facilities and using a
blow out plant in Iris. The concentrated iodide is oxidized to solid iodine, which is then refined through a smelting process
and prilled. We have obtained patents in the United States and recently in Chile under the Chilean patent number 47,080, for our
iodine prilling process.



Prilled iodine
is tested for quality control purposes, using international standard procedures that we have implemented, then packed in 20 to
50 kilogram drums or 350 to 700 kilogram maxibags and transported by truck to Antofagasta or Iquique for export. Our iodine and
iodine derivatives production facilities have qualified under the new ISO-9001:2008 program, providing third-party certification—by
TÜV-Rheiland—of the quality management system. The last recertification process was approved in February 2011. Iodine
from the Iris plant was certified under ISO-9001:2008 in April 2012.



Our total iodine
production in 2013 was approximately 10,757 metric tons: approximately 6,119 metric tons from Nueva Victoria and Iris, 3,165 metric
tons from Pedro de Valdivia, and 1,474 metric tons from María Elena. The Nueva Victoria facility is also used for recycling
iodine from the potassium iodide contained in the LCD waste solutions imported mainly from Korea. Nueva Victoria is also equipped
to toll iodine from iodide delivered from other SQM facilities. We have the flexibility to adjust our production according to
market conditions. Our total current production capacity at our iodine production plants is approximately 12,500 metric tons per
year.



41







We use a portion
of the produced iodine to manufacture inorganic iodine derivatives, which are intermediate products used for manufacturing agricultural
and nutritional applications, at facilities located near Santiago, Chile. We also produce inorganic and organic iodine derivative
products together with Ajay, which purchases iodine from us. In the past, we have primarily marketed our iodine derivative products
in South America, Africa and Asia, while Ajay and its affiliates have primarily sold their iodine derivative products in North
America and Europe.



In September
2010, the National Environmental Commission of Chile (Comisión Nacional del Medioambiente or “CONAMA”)
approved the environmental study of our Pampa Hermosa project in the Region of Tarapacá in Chile. This approval allowed
us to increase the production capacity of our Nueva Victoria operations from 4,500 to 11,000 metric tons of iodine per year and
to produce up to 1.2 million metric tons of nitrates, mine up to 33 million metric tons of caliche per year and use new water
rights of up to 570.8 liters per second. During 2012, we made investments in order to increase the water capacity in the Nueva
Victoria operations from two water sources approved by the environmental study of Pampa Hermosa, expand the capacity of solar
evaporation ponds and to implement new areas of mining and collection of solutions. Additional expansions may be done from time
to time in the future, depending on market conditions.



During 2012,
we submitted a request to the CONAMA requesting approval to expand our caliche ore extraction in the region of Antofagasta, which,
if approved, is expected to increase production capacity by 10,000 tons of iodine and 1.3 million tons of nitrates per year. The
project also requested permission to build a pipeline from the Pacific Ocean to the mining site. Currently, the request is being
evaluated by the commission and other governmental agencies.



Salar
de Atacama Brine Deposits



The Salar de
Atacama, located approximately 250 kilometers east of Antofagasta, is a salt-encrusted depression in the Atacama desert, within
which lies an underground deposit of brines contained in porous sodium chloride rock fed by an underground inflow from the Andes
mountains. The brines are estimated to cover a surface of approximately 2,800 square kilometers and contain commercially exploitable
deposits of potassium, lithium, sulfates and boron. Concentrations vary at different locations throughout the Salar de Atacama.
Our production rights to the Salar de Atacama are pursuant to a lease agreement with Corfo, which expires in 2030. The lease agreement
permits the CCHEN to establish a total accumulated extraction limit of 180,100 tons of lithium extraction in the aggregate for
all periods.



Brines are
pumped from depths of 1.5 to 60 meters below surface, through a field of wells that are located in areas of the Salar de Atacama
that contain relatively high concentrations of potassium, lithium, sulfate, boron and other minerals.



We process
these brines to produce potassium chloride, potassium sulfate, lithium carbonate, lithium hydroxide, lithium chloride, boric acid
and bischofite (magnesium chloride).



42







Potassium
chloride



We use potassium
chloride in the production of potassium nitrate. Production of our own supplies of potassium chloride provides us with substantial
raw material cost savings.



In order to
produce potassium chloride, brines from the Salar de Atacama are pumped to solar evaporation ponds. Evaporation of the brines
results in a complex crystallized mixture of salts of potassium, sodium and magnesium. Waste sodium chloride salts are removed
by precipitation.  After further evaporation, the sodium and potassium salts are harvested and sent for treatment at one
of the potassium chloride plants where potassium chloride is separated by a grinding, flotation, and filtering process. Potassium
salts also containing magnesium are harvested and sent for treatment at one of the cold leach plants where magnesium is removed.
Potassium chloride is transferred for approximately 300 kilometers to our Coya Sur facilities via a dedicated truck transport
system, where it is used in the production of potassium nitrate. We sell potassium chloride produced at the Salar de Atacama in
excess of our needs to third parties. All of our potassium-related plants in the Salar de Atacama currently have a production
capacity in excess of up to 2.6 million metric tons per year. Actual production capacity will depend on volume, metallurgical
recovery rates and quality of the mining resources pumped from the Salar de Atacama. We expect to finish expansion capacity of
compacted potassium chloride to 1.4 million metric tons per year during 2014.



The by-products
of the potassium chloride production process are (i) brines remaining after removal of the potassium chloride, which are used
to produce lithium carbonate as described below, with the excess amount being reinjected into the Salar de Atacama; (ii) sodium
chloride, which is similar to the surface material of the Salar de Atacama and is deposited at sites near the production facility;
and (iii) other salts containing magnesium chloride.



The by-products
of the potassium chloride production process are (i) brines remaining after removal of the potassium chloride, which are used
to produce lithium carbonate as described below, with the excess amount being reinjected into the Salar de Atacama; (ii) sodium
chloride, which is similar to the surface material of the Salar de Atacama and is deposited at sites near the production facility;
and (iii) other salts containing magnesium chloride.



Lithium
carbonate and lithium chloride



A portion of
the brines remaining after the production of potassium chloride is sent to additional solar concentration ponds adjacent to the
potassium chloride production facility. Following additional evaporation, the remaining concentrated solution of lithium chloride
is transported by truck to a production facility located near Antofagasta, approximately 230 kilometers from the Salar de Atacama.
At the production facility, the solution is purified and treated with sodium carbonate to produce lithium carbonate, which is
dried and then, if necessary, compacted and finally packaged for shipment. A portion of this purified lithium chloride solution
is packaged and shipped to customers. The production capacity of our lithium carbonate facility is approximately 48,000 metric
tons per year. Future production will depend on the actual volumes and quality of the lithium solutions sent by the Salar de Atacama
operations, as well as prevailing market conditions.



Lithium carbonate
production quality assurance program has been certified by TÜV-Rheiland under ISO 9001:2000 since 2005 and under ISO 9001:2008
since October 2009.



43







Lithium
hydroxide



Lithium carbonate
is sold to customers, and we also use it as a raw material for our lithium hydroxide monohydrate facility, which started operations
at the end of 2005. This facility has a production capacity of 6,000 metric tons per year and is located in the Salar del Carmen,
adjacent to our lithium carbonate operations. In the production process, lithium carbonate is reacted with a lime solution to
produce lithium hydroxide brine and calcium carbonate salt, which is filtered and piled in reservoirs. The brine is evaporated
in a multiple effect evaporator and crystallized to produce the lithium hydroxide monohydrate, which is dried and packaged for
shipment to customers.



Lithium hydroxide
production quality assurance program has been certified by TÜV-Rheiland under ISO 9001:2000 since 2007 and under ISO 9001:2008
since October 2009.



Potassium
sulfate and boric acid





Approximately 12 kilometers
northeast of the potassium chloride facilities at the Salar de Atacama, we use the brines from the Salar de Atacama to
produce potassium sulfate, potassium chloride (as a by-product of potassium sulfate process) and boric acid. The plant is
located in an area of the Salar de Atacama where high sulfate and potassium concentrations are found in the brines. Brines
are pumped to pre-concentration solar evaporation ponds where waste sodium chloride salts are removed by precipitation. After
further evaporation, the sulfate and potassium salts are harvested and sent for treatment at the potassium sulfate plant.
Potassium sulfate is produced using flotation, concentration and reaction processes, after which it is crystallized, dried
and packaged for shipment. Production capacity for the potassium sulfate plant is approximately 340,000 metric tons per year
from which aprox. 95,000 metric tons correspond to potassium chloride production as by product of the potassium sulphate
process. This capacity is part of the total plant capacity of 2.6 million metric tons per year. In our dual plant complex we
may switch, to some extent, between potassium chloride and potassium sulfate production. Part of the pond system in this area
is also used to process potassium chloride brines extracted from the low sulfate sulfate concentration areas found in the
salar.



The principal
by-products of the production of potassium sulfate are: (i) non-commercial sodium chloride, which is deposited at sites near the
production facility, and (ii) remaining solutions, which are re-injected into the Salar de Atacama or returned to the evaporation
ponds. The principal by-products of the boric acid production process are remaining solutions that are treated with sodium carbonate
to neutralize acidity and then are reinjected into the Salar de Atacama.



Raw
materials



The main raw
material that we require in the production of nitrate and iodine is caliche ore, which is obtained from our surface mines. The
main raw material in the production of potassium chloride, lithium carbonate and potassium sulfate is the brine extracted from
our operations at the Salar de Atacama.



Other important
raw materials are sodium carbonate (used for lithium carbonate production and for the neutralization of iodine solutions), sulfur,
sulfuric acid, kerosene, anti-caking and anti-dust agents, ammonium nitrate (used for the preparation of explosives in the mining
operations), woven bags for packaging our final products, electricity acquired from electric utilities, and liquefied natural
gas and fuel oil in heat generation. Our raw material costs (excluding caliche ore and salar brines and including energy) represented
approximately 20% of our cost of sales in 2012.



44







We have several
electricity supply agreements signed with major producers in Chile which are expected to cover our electricity needs until 2030.
We are connected to the northern power grid in Chile, which currently supplies electricity to most cities and Industrial facilities
in northern Chile, since April 2000.



In May 2001,
we entered into a 10-year gas supply contract with Distrinor S.A. (a subsidiary of E-CL) for a maximum of 5,160,000 MMBtu per
year, considering an average of consumption of 3,120,000 MMBtu per year. This gas supply was considered sufficient at the time
to satisfy the requirements for the facilities that are connected to a natural gas supply. However, beginning in 2004, the Argentinean
government imposed restrictions on the supply of natural gas to Chile and, in 2011; the supply came to a complete stop. In 2010,
Chile began to import liquefied natural gas. We signed a new contract in 2013 for liquefied natural gas with Solgas, which is
in effect from 2013 to 2014.



We obtain ammonium
nitrate, sulfur, sulfuric acid, kerosene and soda ash from several large suppliers, mainly in Chile and the United States, under
long-term contracts or general agreements, some of which contain provisions for annual revisions of prices, quantities and deliveries.
Diesel fuel is obtained under contracts that provide fuel at international market prices.



We believe
that all of our contracts and agreements with third-party suppliers with respect to our main raw materials contain standard and
customary commercial terms and conditions.



Water
Supply



The main sources
of water for our nitrate and iodine facilities at Pedro de Valdivia, María Elena and Coya Sur are the Loa and San Salvador
rivers, which run near our production facilities. Water for our Nueva Victoria and Salar de Atacama facilities is obtained from
wells near the production facilities. We additionally buy water from third parties for our production processes at the Salar del
Carmen lithium carbonate plant. In addition, we purchase potable water from local utility companies. We have not experienced significant
difficulties obtaining the necessary water to conduct our operations.



Government
Regulations



Regulations
in Chile Generally



We are subject
to the full range of government regulations and supervision generally applicable to companies engaged in business in Chile, including
labor laws, social security laws, public health laws, consumer protection laws, environmental laws, tax laws, securities laws
and anti-trust laws. These include regulations to ensure sanitary and safety conditions in manufacturing plants.



We conduct
our mining operations pursuant to exploration concessions and exploitation concessions granted pursuant to applicable Chilean
law. Exploitation concessions essentially grant a perpetual right to conduct mining operations in the areas covered by the concessions,
provided that annual concession fees are paid (with the exception of the Salar de Atacama rights, which have been leased to us
until 2030). Exploration concessions permit us to explore for mineral resources on the land covered thereby for a specified period
of time, and to subsequently request a corresponding exploitation concession.



Under Law No.
16,319 that created the CCHEN (Chilean Nuclear Energy Commission), we have an agreement with the CCHEN regarding the exploitation
and sale of lithium from the Salar de Atacama. The agreement sets quotas for the tonnage of lithium authorized to be sold.



45









We also hold water rights obtained from
the Chilean water regulatory authority for the supply of water from rivers or wells near our production facilities sufficient to
meet our current and anticipated operating requirements. See “Risk factors—Risks relating to Chile.” The Water
Code is subject to changes, which could have a material adverse impact on our business, financial condition and results of operations.
Law No. 20,017, published on June 16, 2005, modified the Chilean laws relating to water rights. Under certain conditions, these
modifications allow the constitution of permanent water rights of up to two liters per second for each well built prior to June
30, 2004, in the locations where we conduct our mining operations. In constituting these new water rights, the law does not consider
the availability of water, or how the new rights may affect holders of existing rights. Therefore, the amount of water we can effectively
extract based on our existing rights could be reduced if these additional rights are exercised. These and other potential future
changes to Chilean laws relating to water rights could have a material adverse impact on our business, financial condition and
results of operations.



We operate port facilities at Tocopilla
for shipment of products and delivery of certain raw materials pursuant to maritime concessions, under applicable Chilean laws,
which are normally renewable on application, provided that such facilities are used as authorized and annual concession fees are
paid.



In 2005, the Chilean Congress approved
the Royalty Law, which established a royalty tax to be applied to mining activities developed in Chile. In 2010, modifications
were made to the law and taxes were increased. In 2012, new modifications to the tax laws were enacted to set the corporate tax
rate at 20%. The Chilean government may again decide to levy additional taxes on mining companies or other corporations in Chile,
and such taxes could have a material adverse impact on our business, financial condition and results of operations.



In 2006, the Chilean Congress amended the
Labor Code, and effective January 15, 2007, certain changes were made affecting companies that hire subcontractors to provide certain
services. This new law, known as the Subcontracting Law (Ley de Subcontratación), further amends the Labor Accidents
Law No. 16,744 to provide that when a serious accident in the workplace occurs, a company must halt work at the site where the
accident took place until authorities from the SERNAGEOMIN, the Labor Board or the SNA, inspect the site and prescribe the measures
such company must take to prevent future risks. Work may not be resumed until said company has taken the prescribed measures, and
the period of time before work may be resumed may last for a number of hours, days, or longer. The effects of this law could have
a material adverse effect on our business, financial condition and results of operations.



On December 2, 2009, Law No. 20,393 went
into effect, establishing a system of criminal liability for legal entities. The objective of the new regulation is to allow legal
entities to be prosecuted for the crimes of (a) asset laundering, (b) financing terrorism and (c) bribery, where such crimes are
committed by people who hold relevant positions within a legal entity in order to benefit that legal entity. The law establishes
a prevention model that includes, among others, the designation of a person in charge of prevention and the establishment of special
programs and policies. The implementation of this model can exempt a company from liability.



46







On January 1, 2010, Law No. 20,382 went
into effect, introducing modifications to the Securities Law and Law No. 18,046 on Corporations (Ley de Sociedades Anónimas
or the “Chilean Corporations Act”). The new law relates to corporate governance and, in general, seeks to improve such
matters as the professionalization of senior management at corporations, the transparency of information, and the detection and
resolution of possible conflicts of interest. The law establishes the concept of an independent director for certain corporations,
including SQM. Such director has a preferential right to be a member of the Directors’ Committee, a position which, in turn,
grants the director further powers. The new independent director may be proposed by any shareholder with an ownership interest
of 1% or more in a company, but he or she must satisfy a series of independence requirements with respect to the company and the
company’s competition, providers, customers and majority shareholders. The new law also refines the regulations regarding
the information that companies must provide to the general public and to the SVS, as well as regulations relating to the use of
inside information, the independence of external auditors, and procedures for the analysis of transactions with related parties.



On January 26, 2010, the Chilean Congress
amended the Environmental Law to create the Ministry of Environment, the Environmental Assessment Service and the Environmental
Enforcement Superintendence (Superintendencia del Medioambiente or “Environmental Enforcement Superintendence”).
These changes introduced important amendments to environmental regulations by setting up new agencies and introducing new provisions
and procedures applicable to projects whose operations bear an impact on the environment. The new Ministry designs and implements
environmental policies relating to environmental conservation, sustainable growth and the protection of Chile’s renewable
energy resources. In addition, the Ministry is responsible for enacting emission and quality standard regulations, as well as recovery
and decontamination plans. The Environmental Assessment Service pursues procedures of the Environmental Impact Assessment System,
pursuant to which projects are environmentally approved or rejected. In procedures for obtaining an environmental license, any
person, including legal entities and companies, will be allowed to file oppositions and comments. Summary procedures, such as Environmental
Impact Statements, allow comments in support or opposition under certain circumstances. Technical reports from governmental agencies
are considered to be final. The Environmental Enforcement Superintendence is an independent agency which oversees and coordinates
with other governmental agencies in charge of supervision of suspended projects and projects requiring environmental approval.
Likewise, it will receive, investigate and rule on complaints concerning the infringement of environmental regulations and will
sanction violators, deliver injunction orders and levy relevant fines. The Environmental Enforcement Superintendence had its powers
suspended until the First Environmental Court was installed in Santiago on December 28, 2012.



There are currently no material legal or
administrative proceedings pending against us except as discussed in Note 16.1 to our Consolidated
Financial Statements and below under “—Safety, health and environmental regulations in Chile,” and we
believe that we are in compliance in all material respects with all applicable statutory and administrative regulations with respect
to our business.



Safety, Health and Environmental
Regulations in Chile



Our operations in Chile are subject to
both national and local regulations related to safety, health, and environmental protection. In Chile, the main regulations on
these matters that are applicable to SQM are the Mine Health and Safety Act of 1989 (Reglamento de Seguridad Minera or the
“Mine Health and Safety Act”), the Health Code (Código Sanitario), the Health and Safety Act 1999 (Reglamento
sobre Condiciones Sanitarias y Ambientales Básicas en los Lugares de Trabajoor the “Health and Basic Conditions
Act”), the Subcontracting Law, and the environmental framework law of 1994, amended in 2010 (Ley sobre Bases Generales
del Medio Ambiente or the “Environmental Law”).



47







Health and safety at work are fundamental
aspects in the management of mining operations, which is why SQM has made constant efforts to maintain good health and safety conditions
for the people working at its mining sites. In addition to the role played by us in this important matter, the Chilean government
has a regulatory role, enacting and enforcing regulations in order to protect and ensure the health and safety of workers. The
Chilean government, acting through the Ministry of Health and the SERNAGEOMIN, performs health and safety inspections and oversees
mining projects, among other tasks, and it has exclusive powers to enforce standards related to environmental conditions and the
health and safety of the people performing activities related to mining.



The Mine Health and Safety Act protects
workers and nearby communities against health and safety hazards, and it provides for enforcement of the law where compliance has
not been achieved. SQM’s Internal Mining Standards (Reglamentos Internos Mineros) establish our obligation to maintain
a workplace that is safe and free of health risks, in as much as this is reasonably practicable. We must comply with the general
provisions of the Health and Basic Conditions Act, our own internal standards, and the provisions of the Mine Health and Safety
Act. In the event of non-compliance, the Ministry of Health and particularly the SERNAGEOMIN are entitled to use their enforcement
powers to ensure compliance with the law.



In November 2011, the Ministry of Mining
enacted Law No. 20,551 that Regulates Mine Closure and its Facilities (Ley que Regula el Cierre de Faenas e Instalaciones Mineras).
This new statute entered in force in November 2012. Its main requirements are related to disclosures to the SERNAGEOMIN regarding
decommissioning plans for each mining site and its facilities, along with the estimated cost to implement such plans. There is
a requirement to provide a form of financial assurance to the SERNAGEOMIN to secure compliance with the decommissioning plans.
There are various types of financial assurance that satisfy the requirement.  By November 2014, we have to inform the SERNAGEOMIN
of the estimated costs for each of our decommissioning plans and the corresponding financial assurances we propose to provide,
which are subject to approval by the SVS.



The Environmental Law was subjected to
several important modifications that entered into effect in January 2010, including the creation of the Ministry of the Environment,
the Environmental Assessment Service, and the Environmental Enforcement Superintendence. The Environmental Enforcement Superintendence
began operations on December 28, 2012. The new and modified Environmental Law replaced the CONAMA with both the Ministry of the
Environment, which is currently the governmental agency responsible for coordinating and supervising environmental issues and the
Environmental Assessment Service. Under the new Environmental Law, we will continue to be required to conduct environmental impact
studies or statements of any future projects or activities (or their significant modifications) that may affect the environment.
With the above mentioned modifications to the Environmental Law, the Environmental Assessment Service, together with other public
institutions with mandates related to the environment, evaluates environmental impact studies or statements submitted for its approval.
The Environmental Enforcement Superintendence is responsible for auditing environmental performance during the construction, operation,
and closure of the projects. The Environmental Law also promotes citizen participation in project evaluation and implementation,
providing more opportunities during the environmental evaluation process. Annually, the Environmental Enforcement Superintendence
audits a sample of approved projects to verify compliance with the environmental permits, and it may pursue fines or sanctions
if applicable, which can be challenged in the Environmental Court.



48







In August 10, 1993, the Ministry of Health
published in the Official Gazette a resolution establishing that atmospheric particulate levels at our production facilities in
María Elena and Pedro de Valdivia exceeded air quality standards, affecting the nearby towns. The high particulate matter
levels came principally from dust produced during the processing of caliche ore, particularly the crushing of the ore before leaching.
Residents of the town of Pedro de Valdivia were relocated to the town of María Elena, practically removing Pedro de Valdivia
from the scope of the determination of the Ministry of Health. In 1998, authorities approved a plan to reduce the atmospheric particulate
levels later modified by Decree No. 37/2004 in March 2004, which called for an 80% reduction of the emissions of atmospheric particulate
material. This was achieved by 2008 through the implementation of a project that modified the milling and screening systems used
in the processing of the caliche ore at the María Elena facilities. Due to international market conditions, this project
ceased its operation in March 2010, and today the milling and screening systems used in the processing of the caliche ore at the
María Elena facilities remain closed. Air quality in the area has improved significantly and compliance of air quality standards
required by law is being assessed. When the average of three consecutive years meets the Chilean air quality standard, the resolution
of 1993 of the Ministry of Health may be reviewed.



On March 16, 2007, the Ministry of Health
published in the Official Gazette a resolution establishing that atmospheric particulate levels exceeded air quality standards
in the coast-town of Tocopilla, where we have our port operations. The high particulate matter levels are caused mainly by two
thermoelectric power plants that use coal and fuel oil and are located next to our port operations. Our participation in particulate
matter emissions is very small (less than 0.20% of the total). However, a decontamination plan was developed by the environmental
authority, and its implementation began in October 2010. During 2008 and 2009, earlier than required, SQM implemented control measures
for mitigating particulate matter emissions in its port operations according to the requirements of this plan. We do not expect
any additional measures to be required of SQM following the implementation of the plan.



We continuously monitor the impact of our
operations on the environment and have made, from time to time, modifications to our facilities in an effort to eliminate any adverse
impacts. Also, over time, new environmental standards and regulations have been enacted, which have required minor adjustments
or modifications of our operations for full compliance. We anticipate that additional laws and regulations will be enacted over
time with respect to environmental matters. While we believe that we will continue to be in compliance with all applicable environmental
regulations of which we are now aware, there can be no assurance that future legislative or regulatory developments will not impose
new restrictions on our operations. We are committed to both complying with all applicable environmental regulations and applying
an Environmental Management System to continuously improve our environmental performance.



We have submitted and will continue to
submit several environmental impact assessment studies related to our projects to the governmental authorities. We require the
authorization of these submissions in order to maintain and to increase our production capacity.



International Regulations



In May 2013, the second deadline for registration
of chemicals under European regulation  REACH (Regulation, Evaluation, Authorisation and Restriction of Chemical Substances)
expired. SQM registered 10 substances imported to the European market in the tonnage threshold of 100-1000 MT/year.



49







In July 2013, the Health and Consumers
Directorate-General of the European Commission (“DG Sanco”) released a statement about the presence of perchlorate
in food, setting provisional maximum levels  in all foods, including fruits and vegetables, and indicating  that fertilizers,
in addition to soil and water,  are considered to be potential sources of perchlorate contamination in food.  The provisional
values could be kept or changed by DG Sanco after the release of a risk assessment report  which is currently being developed
by the European Food Safety Authority (“EFSA”), and which is expected to be ready on September 2014.  SQM fertilizers
marketed in the European market contain less than 0,01% of perchlorate, and uptake studies in targeted crops are being performed
by the industry to demonstrate compliance with the above referred provisional values.



In 2012, the Occupational Health and Safety
Administration (“OSHA”) aligned its Hazard Communication Standard to comply with the Globally Harmonized System (“GHS”),
which requires companies to review hazard information for all chemicals imported into the US, classify chemicals according to the
new classification criteria, and update labels and safety data sheets by June 2015. We are already working on a program which aims
to comply with the requirements of this new regulation in line with the stages and deadlines established by OSHA. The updating
of the Safety Data Sheets (“SDS”) for all products  sold in the US has been finished, and the update of labels
is in progress and will be completed the first quarter of 2015.



Research and development, patents
and licenses



See Item 5.C. Research and Development,
Patents and Licenses, etc.



4.C. Organizational
Structure



All of our principal operating subsidiaries
are essentially wholly-owned, except for Soquimich Comercial S.A., which is approximately 61% owned by us and whose shares are
listed and traded on the Santiago Stock Exchange, and Ajay SQM Chile S.A., which is 51% owned by us. The following is a summary
of our main subsidiaries as of December 31, 2013. For a list of all our consolidated subsidiaries, see Note 2.5 to our Consolidated
Financial Statements.



|Principal
    subsidiaries                                                                                                                                             |  | Activity                                                                                                                         |  | Country ofIncorporation |  | SQM BeneficialOwnership Interest(Direct/Indirect)
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------- |  | -------------------------------------------------
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|SQM Nitrates S.A.                                                                                                                                                      |  | Extracts and sells caliche ore to subsidiaries and affiliates of SQM                                                             |  | Chile                   |  | 100%                                             
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|SQM Industrial S.A.                                                                                                                                                    |  | Produces and markets SQM’s products directly and through other subsidiaries and affiliates of SQM                                |  | Chile                   |  | 100%                                             
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|SQM Salar S.A.                                                                                                                                                         |  | Exploits the Salar de Atacama to produce and market SQM’s products directly and through other subsidiaries and affiliates of SQM |  | Chile                   |  | 100%                                             
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|SQM Potasios S.A.                                                                                                                                                      |  | Produces and markets SQM’s products directly and through other subsidiaries and affiliates of SQM                                |  | Chile                   |  | 100%                                             
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|Servicios Integrates de Transitos y Transferencias S.A. (SIT)                                                                                                          |  | Owns and operates a rail transport system and also owns and operates the Tocopilla port facilities                               |  | Chile                   |  | 100%                                             
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|Soquimich Comercial S.A.                                                                                                                                               |  | Markets SQM’s specialty plant nutrition products domestically and imports fertilizers for resale in Chile                        |  | Chile                   |  | 61%                                              
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|Ajay-SQM Chile S.A.                                                                                                                                                    |  | Produces and markets SQM’s iodine and iodine derivatives                                                                         |  | Chile                   |  | 51%                                              
|                                                                                                                                                                       |  |                                                                                                                                  |  |                         |  |                                                  
|Sales and distribution subsidiaries in the United States, Belgium, Brazil, Ecuador, Peru, Argentina, Mexico, South Africa, Spain, China, Thailand and other locations. |  | Market SQM’s products throughout the world                                                                                       |  | Various                 |  |                                                  



50







4.D. Property,
Plant and Equipment



Discussion of our mining rights is organized
below according to the geographic location of our mining operations. SQM's mining interests located throughout the valley of the
Tarapacá and Antofagasta regions of northern Chile (in a part of the country known as “el Norte Grande”), referred
to collectively as the “Caliche Ore Mines”, are discussed first. The Company's mining interests within the Atacama
Desert in the eastern region of el Norte Grande (the “Salar de Atacama Brines”) are discussed second.



Description of the Caliche Ore Mines



As of December 31, 2013, we held constituted
exploitation rights to mineral resources representing approximately 551,418 hectares. In addition, as of December 31, 2013, we
held exploration rights to mineral resources representing approximately 21,600 hectares, and we have applied for additional exploration
rights for approximately 500 hectares. Currently, Pedro de Valdivia, María Elena and Nueva Victoria are being exploited.



Pedro de Valdivia

The mine and facilities that we operate
in Pedro de Valdivia are located 170 kilometers northeast of Antofagasta and are accessible by highway. These facilities have been
in operation since 1931 and were previously owned and operated by Anglo Lautaro. The areas currently being mined are located approximately
17 kilometers southeast and approximately 20 kilometers west of the Pedro de Valdivia production facilities. Our mining facilities
at Pedro de Valdivia have a Weighted average age of approximately 10.1 years. Electricity, natural gas and fuel oil are the primary
sources of power for this operation.



María Elena

The mining
operations using heap leaching were temporarily suspended in October 2013. The María Elena mine and facilities, named El
Toco, are located 220 kilometers northeast of Antofagasta and are accessible by highway. The area mined until operations were suspended
is located approximately 14 kilometers north of the María Elena production facilities. Electricity, natural gas, and fuel
oil are the primary sources of power. The Weighted average age of the Company's mining facilities at María Elena is approximately
13.5 years.



51







Pampa Blanca

We operated mining facilities in Pampa
Blanca, which is located 100 kilometers northeast of Antofagasta, until operations were suspended in March 2010. Ore from the Pampa
Blanca mine was transported by truck to nearby heap leaching pads where it is used to produce iodine and nitrate salts. The Weighted
average age of the ore recovery facilities at Pampa Blanca is approximately 14.8 years. Electricity, produced by mobile diesel
generators was the primary source of power.



Nueva Victoria

We currently conduct caliche ore operations
in Nueva Victoria, which is located 180 kilometers north of María Elena and is accessible by highway. Since 2007, the Nueva
Victoria mine includes the mining properties Soronal, Mapocho and Iris. Ore from Nueva Victoria is transported by truck to heap
leaching pads where it is then used to produce iodine is produced in Nueva Victoria and the Iris plants. Electricity is the primary
source of power. The Weighted average age of the ore recovery facilities at Nueva Victoria is approximately 7.2 years.



Description
of the Salar de Atacama Brines



Salar de Atacama Brines



As of December 31, 2013, SQM Salar S.A.
held exclusive rights to exploit the mineral resources in an area covering approximately 140,000 hectares of land in the Salar
de Atacama in northern Chile, of which SQM Salar S.A. is entitled to exploit the mineral resources of 81,920 hectares. These rights
are owned by Corfo and leased to SQM Salar S.A. pursuant to a lease agreement between Corfo and SQM Salar S.A. (the “Lease
Agreement”). Corfo may not unilaterally amend the Lease Agreement, and the rights to exploit the resources cannot be transferred.
The Lease Agreement establishes that SQM Salar S.A. is responsible for the maintenance of Corfo’s exploitation rights and
for annual payments to the Chilean government, and it expires on December 31, 2030. Furthermore, the same lease Agreement permits
the CCHEN to establish a total accumulated extraction limit set at 180,100 tons of lithium extraction in the aggregate for all
periods. SQM Salar S.A. is required to make lease-royalty payments to Corfo according to specified percentages of the value of
production of minerals extracted from the Salar de Atacama brines. SQM Salar S.A. holds an additional 297,688 hectares of constituted
exploitation rights in the Salar de Atacama.



In addition, as of December 31, 2013, we
held constituted exploration rights covering approximately 70,100 hectares, and we had applied for additional exploration rights
covering approximately 55,800 hectares. Exploration rights are valid for a period of two years, after which we can (i) request
an exploitation concession for the land, (ii) request an extension of the exploration rights for an additional two years (the extension
only applies to a reduced surface area equal to 50% of the initial area), or (iii) cease exploration of the zone covered by the
rights. The weighted average age of the assets of our mining facilities at the Salar de Atacama is approximately 6.8 years. Solar
energy is the primary source of power used by the Salar de Atacama operation.



Under the terms of the Salar de Atacama
project agreement between Corfo and SQM Salar S.A., (the “Project Agreement”), Corfo has agreed that it will not permit
any other person to explore, exploit or mine any mineral resources in approximately 147,000 hectares of the Salar de Atacama (which
include the 140,000 hectares) mentioned above. The Project Agreement expires on December 31, 2030.



52







Concessions,
Extraction Yields and Reserves for the Caliche Ore Mines and Salar Brines



Concessions Generally



Caliche ore. We hold our mineral
rights pursuant to one of two types of exclusive concessions granted pursuant to applicable law in Chile:



| | (1) | “Exploitation Concessions” These are concessions whereby we are legally entitled to
use the land in order to exploit the mineral resources contained therein on a perpetual basis subject to annual payments to the
Chilean government; or
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | “Exploration Concessions” These are concessions whereby we are legally entitled to
use the land in order to explore for mineral resources for a period of two years, at the expiration of which the concession may
be extended one time only for two additional years if the area covered by the concession is reduced by half.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



An Exploration Concession is generally
obtained for purposes of evaluating the mineral resources in an area. Generally, after the holder of the Exploration Concession
has determined that the area contains exploitable mineral resources, such holder will apply for an Exploitation Concession for
the area. Such application will give the holder absolute priority with respect to such Exploitation Concession against third parties.
If the holder of the Exploration Concession determines that the area does not contain commercially exploitable mineral resources,
the concession is usually allowed to lapse. An application also can be made for an Exploitation Concession without first having
obtained an Exploration Concession for the area involved.



Concessions for the Caliche Ore Mines
and Salar Brines



As of December 31, 2013, approximately
93% of our total mining concessions were held pursuant to exploitation concessions and 7% pursuant to exploration concessions.
Of the exploitation concessions, approximately 88% already have been granted pursuant to applicable Chilean law, and approximately
12% are in the process of being granted. Of the exploration concessions, approximately 70% already have been granted pursuant to
applicable Chilean law, and approximately 30% are in the process of being granted.



We made payments to the Chilean government
for our exploration and exploitation concessions of approximately US$9.7 million in 2013.



The following table shows our constituted
exploitation and exploration concessions as of December 31, 2013:



|                           |  | Exploitation concessions |        |  | Exploration concessions |  |           | Total        | 
|-------------------------- |  | ------------------------ | ------ |  | ----------------------- |  | --------- | ------------ | 
|Mines                      |  | Total  number            |        |  | Hectares                |  |           | Total number | 
|Pedro de Valdivia          |  |                          | 565    |  |                         |  | 144,737   |              | 
|Maria Elena-EI Toco        |  |                          | 647    |  |                         |  | 190,352   |              | 
|Pampa Blanca               |  |                          | 469    |  |                         |  | 137,662   |              | 
|Nueva Victoria             |  |                          | 306    |  |                         |  | 78,667    |              | 
|Subtotal Caliche Ore Mines |  |                          | 1,987  |  |                         |  | 551,418   |              | 
|Salar de Atacama(1)        |  |                          | 1,025  |  |                         |  | 444,808   |              | 
|Subtotal Mines             |  |                          | 3,012  |  |                         |  | 996,226   |              | 
|Subtotal other Areas       |  |                          | 7,931  |  |                         |  | 1,763,668 |              | 
|Total                      |  |                          | 10,943 |  |                         |  | 2,759,894 |              | 





| | (1) | See Description of Salar Brines, Item 4.D.
| | --- | ------------------------------------------



53







Extraction yields



The following table shows certain operating data relating to
each of our mines for 2013, 2012 and 2011:



|(in thousands, unless otherwise stated)                          |  | 2013 |        |  | 2012 |  |        | 2011 | 
|---------------------------------------------------------------- |  | ---- | ------ |  | ---- |  | ------ | ---- | 
|Pedro de Valdivia                                                |  |      |        |  |      |  |        |      | 
|Metric tons of ore mined                                         |  |      | 11,571 |  |      |  | 12,027 |      | 
|Average grade nitrate (% by weight)                              |  |      | 7.5    |  |      |  | 7.3    |      | 
|Iodine (parts per million (ppm))                                 |  |      | 415    |  |      |  | 406    |      | 
|Metric tons of crystallized nitrate produced                     |  |      | 445    |  |      |  | 466    |      | 
|Metric tons of iodine produced                                   |  |      | 3.2    |  |      |  | 3.2    |      | 
|                                                                 |  |      |        |  |      |  |        |      | 
|Maria Elena(1)                                                   |  |      |        |  |      |  |        |      | 
|Metric tons of ore mined                                         |  |      | 5,870  |  |      |  | 6,787  |      | 
|Average grade nitrate (% by weight)                              |  |      | 6.6    |  |      |  | 6.2    |      | 
|Iodine (ppm)                                                     |  |      | 484    |  |      |  | 454    |      | 
|Metric tons of crystallized nitrate produced                     |  |      | –      |  |      |  | –      |      | 
|Metric tons of iodine produced                                   |  |      | 1.5    |  |      |  | 1.7    |      | 
|                                                                 |  |      |        |  |      |  |        |      | 
|Coya Sur(2)                                                      |  |      |        |  |      |  |        |      | 
|Metric tons of crystallized nitrate produced                     |  |      | 441    |  |      |  | 491    |      | 
|                                                                 |  |      |        |  |      |  |        |      | 
|Pampa Blanca(1)                                                  |  |      |        |  |      |  |        |      | 
|Metric tons of ore mined                                         |  |      | –      |  |      |  | –      |      | 
|Iodine (ppm)                                                     |  |      | –      |  |      |  | –      |      | 
|Metric tons of iodine produced                                   |  |      | –      |  |      |  | –      |      | 
|                                                                 |  |      |        |  |      |  |        |      | 
|Nueva Victoria(1)                                                |  |      |        |  |      |  |        |      | 
|Metric tons of ore mined                                         |  |      | 23,515 |  |      |  | 23,937 |      | 
|Iodine (ppm)                                                     |  |      | 462    |  |      |  | 465    |      | 
|Metric tons of iodine produced                                   |  |      | 6.1    |  |      |  | 6.0    |      | 
|                                                                 |  |      |        |  |      |  |        |      | 
|Salar de Atacama (3)                                             |  |      |        |  |      |  |        |      | 
|Metric tons of lithium carbonate produced                        |  |      | 33     |  |      |  | 41     |      | 
|Metric tons of potassium chloride and potassium sulfate produced |  |      | 1,908  |  |      |  | 1,977  |      | 





| | (1) | Operations at the El Toco and Pampa Blanca mines were temporarily suspended in November 2013 and March 2010 respectively. Operations
at the Iris Iodine Plant were temporarily suspended in October 2013.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Includes production at Coya Sur from treatment of nitrates solutions from María Elena and fines from Pedro de Valdivia,
nitrates from pile treatment at Nueva Victoria and net production from NPT, or technical (grade) potassium nitrate, plants.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Lithium carbonate is extracted at the Salar de Atacama and processed at our facilities at the Salar del Carmen.
| | --- | ---------------------------------------------------------------------------------------------------------------



54







Reserves



Reserves for the Caliche Ore
Deposits



Our in-house staff of geologists and mining
engineers prepares our estimates of caliche ore reserves. The proven and probable reserve figures presented below are estimates,
and no assurance can be given that the indicated levels of recovery of nitrates and iodine will be realized.





We estimate ore reserves based
on engineering evaluations of assay values derived from sampling of drill-holes and other openings. Drill-holes have been made
at different space intervals in order to recognize mining resources. Normally, we start with 400x400 meters and then we reduce
spacing to 200x200 meters, 100x100 meters and 50x50 meters. The geological occurrence of caliche mineral is unique and different
from other metallic and non-metallic minerals. Caliche ore is found in large horizontal layers at depths ranging from one to five
meters and has an overburden between zero and two meters. This horizontal layering is a natural geological condition and allows
the Company to estimate the continuity of the caliche bed based on surface geological reconnaissance and analysis of samples and
trenches. Mining resources can be calculated using the information from the drill-hole sampling.



According to our experience in caliche
ore, the grid pattern drill-holes with spacing equal to or less than 100 meters produce data on the caliche resources that is sufficiently
defined to consider them measured resources and then, adjusting for technical, economic and legal aspects, as proven reserves.
These reserves are obtained using the Kriging Method and the application of operating parameters to obtain economically profitable
reserves. Similarly, the information obtained from detailed geologic work and samples taken from grid pattern drill-holes with
spacing equal to or less than 200 meters can be used to determine indicated resources. By adjusting such indicated resources to
account for technical, economic and legal factors, it is possible to calculate probable reserves. Probable reserves are calculated
by evaluating polygons and have an uncertainty or margin of error greater than that of proven reserves. However, the degree of
certainty of probable reserves is high enough to assume continuity between points of observation.



Probable reserves are the economically
mineable part of an "Indicated Mineral Resource" and, in some circumstances, a "Measured Mineral Resource."
An indicated mineral resource is the part of a mineral resource for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a reasonable level of confidence. The calculation is based on exploration, sampling
and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings, and
drill holes. A measured mineral resource is the part of a mineral resource for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a high level of confidence. The estimate is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings,
and drill holes.



Proven reserves are the economically mineable
part of a measured mineral resource. The calculation of the reserves includes diluting materials and allowances for losses which
may occur when the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out and
include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental,
social and governmental factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified.



The calculation of the reserves includes
diluting of materials and allowances for losses which may occur when the material is mined. Appropriate assessments, which may
include feasibility studies, have been carried out and include consideration of and modification by realistically assumed mining,
metallurgical, economic, marketing, legal, environmental, social and governmental factors.



55







Proven and probable reserves are determined
using extensive drilling, sampling and mine modeling, in order to estimate potential restrictions on production yields, including
cut-off grades, ore type, dilution, waste-to-ore ratio and ore depth. Economic feasibility is determined on the basis of this information.



The estimates of proven reserves of caliche
ore at each of our mines as of December 31, 2013 are set forth below. The Company holds 100% of the concession rights for each
of these mines.



|Mine              |  | Proven Reserves
    (1) (6) (millions of metric tons) |  | Nitrate Average Grade
    (percentage by weight) |  | Iodine Average
    Grade (parts per million) |  | Cutoff Grade Average
    for
Mine (5)
|----------------- |  | ----------------------------------------------------- |  | ------------------------------------------------ |  | -------------------------------------------- |  | -------------------------------------
|Pedro de Valdivia |  | 194.4                                                 |  | 7.1%                                             |  | 369                                          |  | Nitrate  6.0 %                       
|María Elena       |  | 134.1                                                 |  | 7.2%                                             |  | 416                                          |  | Nitrate 6.0 % - Iodine 300 ppm       
|Pampa Blanca      |  | 71.4                                                  |  | 5.6%                                             |  | 544                                          |  | Iodine 300 ppm                       
|Nueva Victoria    |  | 336.7                                                 |  | 5.7%                                             |  | 442                                          |  | Iodine 300 ppm – Nitrate 6.0%        





In addition, the updated estimates
of our probable reserves of caliche ore at each of our principal mines as of December 31, 2013, are as follows:



|Mine                  |  | Probable Reserves
    (1) (2) (7)(millions of metric tons) |       |  | Nitrate Average
    Grade(percentage by weight) |  |     | Iodine Average
    Grade(parts per million) |  |  | Cutoff Grade (5)
|--------------------- |  | ---------------------------------------------------------- | ----- |  | ----------------------------------------------- |  | --- | ------------------------------------------- |  |  | ----------------
|Pedro de Valdivia (3) |  |                                                            | 118.7 |  |                                                 |  | 6.9 | %                                           |  |  | 444             
|María Elena           |  |                                                            | 98.0  |  |                                                 |  | 7.3 | %                                           |  |  | 380             
|Pampa Blanca          |  |                                                            | 447.8 |  |                                                 |  | 5.8 | %                                           |  |  | 538             
|Nueva Victoria        |  |                                                            | 59.1  |  |                                                 |  | 7.6 | %                                           |  |  | 362             



Notes
on Reserves:



| | (1) | The proven and probable reserves set forth in the tables above are shown before losses related
to exploitation and mineral treatment. Proven and probable reserves are affected by mining exploitation methods, which result in
differences between the estimated reserves that are available for exploitation in the mining plan and the recoverable material
that is finally transferred to the leaching vats or heaps. The average mining exploitation factor for each of our different mines
ranges between 80% and 90%, whereas the average global metallurgical recoveries of processes for nitrate and iodine contained in
the recovered material vary between 55% and 65%.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Probable reserves can be expressed as proven reserves using a conversion factor. On average, this
conversion factor is higher than 60%. This factor depends on geological conditions and caliche ore continuity, which vary from
mine to mine. The difference between the probable reserve amounts and the converted probable reserve amounts is the result of the
lower degree of certainty pertaining to probable reserves compared with proven reserves.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | The increase in probable reserves of Pedro de Valdivia, from 78.5 MMTons to 118.7 MMTons is the
product of a recognition program in unexplored areas of Lynch.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (4) | Information set forth in the table above was validated in January 2014, by Mrs. Marta Aguilera,
a geologist with over 20 years of experience in the field. She is currently employed by SQM as Manager Exploration and Mining Development. 
Mrs. Aguilera is a Competent Person (“Persona Competente”), as that term is defined under Chilean Law
Number 20,235.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | The cutoff grades referring to the Proven and Probable reserves are variable due to the fact that
the various mines have different areas which in turn demonstrate variable cutoff grades, according to required objectives. The
assigned values ​​correspond to averages of the different sectors.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (6) | The Proven reserves include the projection of indicated and measured resources and the measured
mineral resources (bonanza - 3d). The Proven reserves may change as a result of the exploitation method, producing differences
between the reserves calculated in the mining plan and the material placed in vats or heaps. The average exploitation factor for
different mining operations is around 80%, allowing, with this factor, to project these reserves to a Proven Exploitable category.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (7) | To increase and ensure the quality of the probable reserve, an average geological factor greater
than 60% is considered allowing projecting this reserve to a minable category.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



56







The proven and probable reserves shown
above are the result of exploration and evaluation of approximately 19.4% of the total caliche-related mining property of our Company.
However, we have explored those areas in which we believe there is a higher potential of finding high-grade caliche ore minerals.
The remaining 80.6% of this area has not been explored yet or has had limited reconnaissance to determine hypothetical resources.
Reserves shown in these tables are calculated based on mining properties that are not involved in any legal disputes between SQM
and other parties.



The subject of the dilution factors is as follows:

| | · | The Proven reserves consist of: Measured Mineral resources (bonanza or 3d) and the projection of indicated resources to measured
resources (a projection factor is applied here which, on the average, reaches 0.7). In turn, the measured mineral resources are
indicated entirely without any correction factor.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | The Probable reserves are comprised of Inferred resources; these become Probable reserves without any correction factor or
projection.
| | - | --------------------------------------------------------------------------------------------------------------------------------------

| | · | In the Exploitable Proven Reserves category, we apply an average dilution factor of 0.8 - 0.9 to our proven reserves.
| | - | ---------------------------------------------------------------------------------------------------------------------

| | · | For Probable reserves, the projection factor is reduced to an average of 0.6 - 0.7.
| | - | -----------------------------------------------------------------------------------



The dilution factor applied to the measured resources averages
10 - 12%, in order to project them to exploitable, in the case of iodine at Nueva Victoria, while for Pampa Blanca and Maria Elena,
it averages 20%. For Pedro de Vadivia, the dilution factor averages 25% (Lynch 20% - Manchas Antiguas 30%). This factor increases
in the measure that we change the resources category. For example, the factor to project NV’s indicated resources to measured
resources considers a 10% dilution, while to project Lynch’s indicated resources to measured resources, the dilution increases
to 30%.



We maintain an ongoing program of exploration
and resource evaluation on the land surrounding the mines at Nueva Victoria, Pedro de Valdivia, María Elena and Pampa Blanca
and at other sites for which we have the appropriate concessions. In 2013, we continued a basic reconnaissance program on new mining
properties including a geological mapping of the surface and spaced drill-hole campaign covering approximately 7,143 hectares.
Additionally, we conducted general explorations based on a closer grid pattern of drill-holes over a total area of approximately
3,920 hectares and, in addition, carried out in-depth sampling of approximately 1,239 hectares (1,113 hectares at Pedro de Valdivia,126hectares at Nueva Victoria). There is no exploration and development program in 2014.



Caliche ore is the key raw material used
in the production of iodine, speciality plant nutrition, and industrial chemicals. The following gross margins for the business
lines specified were calculated on the same basis as cut off grades used to estimate our reserves. We expect costs to remain relatively
stable in the near future.



|                          |  | 2013         |    |   | 2012  |  |            | 2011         | 
|------------------------- |  | ------------ | -- | - | ----- |  | ---------- | ------------ | 
|                          |  | Gross Margin |    |   | Price |  |            | Gross Margin | 
|Iodine and derivatives    |  |              | 56 | % |       |  | US$50/kg   |              | 
|Specialty Plant Nutrition |  |              | 22 | % |       |  | US$811/ton |              | 
|Industrial Chemicals      |  |              | 28 | % |       |  | US$877/ton |              | 



57







Reserves for the Salar de Atacama
Brines



Our in-house staff of hydro-geologists
and mining engineers prepares our estimates of potassium, sulfate, lithium and boron reserves at the Salar de Atacama. We have
explotation concessions of approximately 819.2 square kilometers where we have carried out geological exploration, brine sampling
and geostatistical analysis. We estimate that our proven and probable reserves as of December 31, 2013 based on economic restrictions,
geological exploration, brine sampling and geostatistical analysis up to a depth of 100 meters of our total explotation concessions,
and additionally, up to a depth of 500 meters over approximately 47% of the same total area, are as follows:



|                    |  | Proven Reserves (1)       |      |  | Probable Reserves (1)     |  |      | Total Reserves            | 
|------------------- |  | ------------------------- | ---- |  | ------------------------- |  | ---- | ------------------------- | 
|                    |  | (millions of metric tons) |      |  | (millions of metric tons) |  |      | (millions of metric tons) | 
|Potassium (K+) (2)  |  |                           | 52.8 |  |                           |  | 18.6 |                           | 
|Sulfate (SO4-2) (3) |  |                           | 31.0 |  |                           |  | 10.3 |                           | 
|Lithium (Li+) (4)   |  |                           | 3.0  |  |                           |  | 3.1  |                           | 
|Boron (B3+) (5)     |  |                           | 0.9  |  |                           |  | 0.3  |                           | 



Notes on Reserves:



| | (1) | Metric tons of potassium, sulfate, lithium and boron considered in the proven and probable reserves
are shown before losses from evaporation processes and metallurgical treatment. The recoveries of each ion depend on both brine
composition, and the process applied to produce the desired commercial products.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Recoveries for potassium vary from 47% to 77%.
| | --- | ----------------------------------------------



| | (3) | Recoveries for sulfate vary from 27% to 45%.
| | --- | --------------------------------------------



| | (4) | Recoveries for lithium vary from 28% to 40%.
| | --- | --------------------------------------------



| | (5) | Recoveries for boron vary from 28% to 32%.
| | --- | ------------------------------------------



A cutoff grade of 1% K is used in the calculation considering
MOP-S as the low margin scenario and using diluted brine with higher contaminants as raw material,
yielding on the lower side of approx. 47% recovery. In this scenario cost for MOP production is competitive considering actual
and recent years historic market situation.



Cutoff for lithium Extraction is set to 0,05% Li. Cost of the
process is competitive in the market though small increase from actual cost is considered to accommodate more evaporation area
(to reach required Li concentration) and the use of additives to maintain brine quality feeding the plant.



The proven and probable reserves are based
on drilling, brine sampling and geo-statistic reservoir modeling in order to estimate brine volumes and their composition. To evaluate
reserves, we conduct a geostatistical study using the Kriging Method in 2 and 3D. We calculate the volume of brine effectively
drainable or exploitable in each evaluation unit. We consider chemical parameters to determine the process to be applied to the
brines. Based on the chemical characteristics, the volume of brine and drainable porosity, we determine the number of metric tons
for each of the chemical ions. Proven reserves are defined as those geographical blocks that comply with a Kriging method estimation
error of up to 15%. In the case of probable reserves, the selected blocks must comply with an estimation error between 15% and
35%. Blocks with an error greater than 35% are not considered in the evaluation of reserves and remain as an indicated resource
until further exploration is performed . This procedure is used to estimate potential restrictions on production yields and the
economic feasibility of producing such commercial products, as potassium chloride, potassium sulfate, lithium carbonate and boric
acid, is determined on the basis of the evaluation.



Salar brines are the key raw material used
in the production of potassium chloride and potassium sulfate, and lithium and derivatives. The following gross margins for the
business lines specified were calculated on the same basis as cut off grades used to estimate our reserves. We expect costs to
remain relatively stable in the near future.



58







|                                        |  | 2013         |    |   | 2012  |  |              | 2011         | 
|--------------------------------------- |  | ------------ | -- | - | ----- |  | ------------ | ------------ | 
|                                        |  | Gross Margin |    |   | Price |  |              | Gross Margin | 
|Potassium Choride and Potassium Sulfate |  |              | 27 | % |       |  | US$423/ton   |              | 
|Lithium and derivatives                 |  |              | 49 | % |       |  | US$5,444/ton |              | 



Ports and water rights



We operate port facilities at Tocopilla
in northern Chile for shipment of products and delivery of certain raw materials pursuant to renewable concessions granted by Chilean
regulatory authorities, provided that such facilities are used as authorized, and annual concession fees are paid by us. We also
hold water rights for the supply of water from rivers and wells near our production facilities sufficient to meet our current operational
requirements.



PRODUCTION
FACILITIES

Our principal production facilities
are located near our mines and extraction facilities in northern Chile. The following table shows the principal production
facilities as of December 31, 2013:



|Location                          |  | Type
    of Facility                                                       |  | Approximate
    Size (Hectares)
|--------------------------------- |  | -------------------------------------------------------------------------- |  | -------------------------------
|Pedro de Valdivia (1)             |  | Nitrates and iodine production                                             |  | 236                            
|María Elena (1)                   |  | Nitrates and iodine production                                             |  | 98                             
|Coya Sur  (1)                     |  | Nitrates and iodine production                                             |  | 251                            
|Pampa Blanca (1)                  |  | Concentrated nitrate salts and iodide production                           |  | 129                            
|Nueva Victoria (1)                |  | Concentrated nitrate salts and iodine production                           |  | 537                            
|Salar de Atacama (2)              |  | Potassium chloride, lithium chloride, potassium
    sulfate and boric acid |  | 4,122                          
|Salar del Carmen, Antofagasta (2) |  | Lithium carbonate and lithium hydroxide production                         |  | 63                             
|Tocopilla                         |  | Port facilities                                                            |  | 22                             



(1)          Includes
production facilities, solar evaporation ponds and leaching heaps.



(2)          Includes
production facilities and solar evaporation ponds.



We own, directly or indirectly through
subsidiaries, all of the facilities free of any material liens, pledges or encumbrances, and believe that they are suitable and
adequate for the business we conduct in them. As of December 31, 2013, the approximate gross book value of the property and associated
plant and equipment at our locations was as follows: Pedro de Valdivia (US$118.5 million), María Elena (US$143.2 million),
Coya Sur (US$339.5 million), Pampa Blanca (US$16.5 million), Nueva Victoria (US$316.9 million), Salar de Atacama (US$786.4 million),
Salar del Carmen (US$212.4 million) and Tocopilla (US$89.7 million).



59







In addition to the above-listed facilities,
we operate a computer and information system linking our principal subsidiaries to our operating facilities throughout Chile via
a local area network. The computer and information system is used mainly for accounting, monitoring of supplies and inventories,
billing, quality control and research activities. The system's mainframe computer equipment is located at our offices in Santiago.



The approximate Weighted average age of
our production facilities as of December 31, 2013 was as follows: Pedro de Valdivia (10.1 years), María Elena (13.5 years),
Coya Sur (3.5 years), Nueva Victoria (7.2 years), Salar de Atacama (6.8 years), and Salar del Carmen (9.6 years). Our railroad
line between our production facilities and Tocopilla was originally constructed in 1890, but the rails, locomotives and rolling
stock have been replaced and refurbished as needed. The Tocopilla port facilities were originally constructed in 1961 and have
been refurbished and expanded since that time. The Weighted average age of the Tocopilla port facilities is approximately 11.1
years. We consider the condition of our principal plant and equipment to be good.



The map below shows the location of SQM’s
principal mining operations and land concessions that have been granted and those that are in the process of being granted.



60













TRANSPORTATION AND STORAGE FACILITIES



We own and operate railway lines and equipment,
as well as port and storage facilities, for the transport and handling of finished products and consumable materials.



61







Our main center for production and storage
of raw materials is the hub composed of the facilities in Coya Sur - Pedro de Valdivia and the Salar de Atacama facilities. Other
facilities include Nueva Victoria and the lithium carbonate and lithium hydroxide finishing plants. The Tocopilla port terminal
(“Tocopilla Port Terminal”), which we own, is the main facility for storage and shipment of our products.



Nitrate raw materials are produced and
first stored at our Pedro de Valdivia mine, and then transported by trucks to the plants described in the next paragraph, for further
processing. Nitrate raw material is also produced at Nueva Victoria, from where it is transported by trucks to Coya Sur for further
processing.



Nitrate finished products are produced
at our facilities in Coya Sur and then transported by our rail system to Tocopilla Port Terminal, where they are stored and shipped,
either bagged or in bulk. Potassium chloride is produced at our facilities in the Salar de Atacama and transported either to Tocopilla
Port Terminal or Coya Sur by truck owned by a third-party dedicated contractor. Products transported to Coya Sur are used as a
raw material for the production of potassium nitrate. Potassium sulfate and boric acid are both produced at our facilities in the
Salar de Atacama and are then transported by trucks to the Tocopilla Port Terminal.



Lithium solutions, produced at our facilities
in the Salar de Atacama, are transported to the lithium carbonate facility in the Salar del Carmen area, where finished lithium
carbonate is produced. Part of the lithium carbonate is fed to the adjacent lithium hydroxide plant, where finished lithium hydroxide
is produced. These two products are bagged and stored on the premises and are subsequently transported by truck to the Tocopilla
Port Terminal or to the Antofagasta and Mejillones terminals for shipment on charter vessels or container vessels.



Iodine raw material, obtained in the same
mines as the nitrates, is processed, bagged and stored exclusively in the facilities of Pedro de Valdivia and Nueva Victoria, and
then shipped by truck to Antofagasta, Mejillones or Iquique for vessel container transport or by truck to Santiago, where iodine
derivatives are produced.



The facilities at Tocopilla Port Terminal
are located approximately 186 kilometers north of Antofagasta and approximately 124 kilometers west of Pedro de Valdivia, 84 kilometers
west of María Elena and Coya Sur and 372 kilometers west of the Salar de Atacama. Our subsidiary, Servicios Integrales de
Tránsitos y Transferencias S.A. (SIT) operates the facilities under maritime concessions granted pursuant to applicable
Chilean laws. The port also complies with ISPS (International Ship and Port Facility Security Code) regulation. The Tocopilla Port
Terminal facilities include a railcar dumper to transfer bulk product into the conveyor belt system used to store and ship bulk
product.



Storage facilities consist of a six silo
system, with a total production capacity of 55,000 metric tons, and an open storage area for approximately 250,000 metric tons.
Additionally, to meet future storage needs, we will continue to make investments in accordance with the investment plan outlined
by management. Products are also bagged at port facilities in Tocopilla, where the bagging capacity is approximately 300,000 metric
tons per year.



For shipping bulk product, the conveyor
belt system extends over the coast line to deliver product directly inside bulk carrier hatches. Using this system, the loading
capacity is 1,200 tons per hour. Bags are loaded to bulk vessels using barges that are loaded in the Tocopilla Port Terminal dock
and unloaded by vessel cranes into the hatches. Both bulk and bagged trucks are loaded in Tocopilla Port Terminal for transferring
product directly to customers or for container vessels shipping from other ports, mainly Antofagasta, Mejillones and Iquique.



62







Bulk carrier loading in the Tocopilla Port
Terminal is mostly contracted to transfer product to our hubs around the world or for shipping to customers, which in some cases
use their own contracted vessels for delivery. Trucking is provided by a mix of spot, contracted and customer- owned equipment.



Tocopilla processes related to the reception,
handling, storage, and shipment of bulk/packaged nitrates produced in Coya Sur are certified by third party organization TÜV-Rheiland
under the quality standard ISO 9001:2008.



ITEM 4A. UNRESOLVED STAFF COMMENTS



Not applicable.



ITEM
5.OPERATING AND FINANCIAL REVIEW AND PROSPECTS



The information in this Item 5 should be
read in conjunction with the Company’s Consolidated Financial Statements and the notes thereto included elsewhere in this
Annual Report.



Since January 1, 2010, the Company’s
consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards as published
by the International Accounting Standards Board (IASB).



CRITICAL ACCOUNTING POLICIES AND ESTIMATES



Critical accounting policies are defined
as those that are reflective of significant judgments and uncertainties, which would potentially result in materially different
results under different assumptions and conditions.



We believe that our critical accounting
policies applied in the preparation of our audited consolidated financial statements are limited to those described below. It should
be noted that in many cases, IFRS specifically dictates the accounting treatment of a particular transaction, limiting management’s
judgment in their application. There are also areas in which management’s judgment in selecting available alternatives would
not produce materially different results.



Trade and Other Accounts Receivable



Trade and other accounts receivable relate
to non-derivative financial assets with fixed payments that can be determined and are not quoted in any active market. These arise
from sales operations involving products and/or services that we sell directly to our customers that are not within the following
categories:



| | · | those which we have the intention of selling immediately in the near future and which are held-for-sale;
| | - | --------------------------------------------------------------------------------------------------------

| | · | those designated at their initial recognition as available-for-sale; and
| | - | ------------------------------------------------------------------------



63







| | · | those through which we do not intend to recover for reasons other than credit impairment and therefore
must be classified as available-for-sale.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



These assets are initially recognized at
their fair value (which is equivalent to their face value, discounting implicit interest for installment sales) and subsequently
at amortized cost according to the effective interest rate method less a provision for impairment loss. When the face value of
the account receivable does not significantly differ from its fair value, it is recognized at face value. An allowance for impairment
loss is established for trade accounts receivable when there is objective evidence that we will not be able to collect all the
amounts owed to us according to the original terms of accounts receivable.



Implicit interest in installment sales
is recognized as interest income when interest is accrued over the term of the sale.



Income tax



Corporate income tax for the year is determined
as the aggregate of current taxes from all of the consolidated companies. Current taxes are calculated on the basis of the tax
laws enacted or substantively enacted as of the date of our statements of financial position in the countries in which we and our
subsidiaries operate and generate taxable income.



Deferred tax is recognized using the liability
method on temporary differences arising between the tax basis for assets and liabilities and their carrying amounts in our audited
consolidated financial statements. Deferred income taxes are calculated using the tax rates expected to be applicable when the
assets are realized or the liabilities are settled.



In conformity with current Chilean tax
regulations, the provision for corporate income tax and taxes on mining activity is recognized on an accrual basis, presenting
the net balances of accumulated monthly tax provisional payments for the fiscal period and credits associated with it. The balances
of these accounts are presented in current income taxes recoverable or current taxes payable, as applicable.



Tax on companies and variations in deferred
tax assets or liabilities that are not the result of business combinations are recorded in income statement accounts or net shareholders’
equity accounts in our consolidated statements of financial position, depending on the origin
of the gains or losses which have generated them.



At the year end, the carrying value of
deferred tax assets has been reviewed and reduced for as long as possible for there to be no sufficient taxable income to allow
the recovery of all or a portion of the deferred tax asset. Likewise, at the date of the statement of financial position, deferred
tax assets not recognized are revalued and recognized as long as it has become possible that future taxable income will allow the
recovery of the deferred tax asset.



With respect to deductible temporary differences
associated with investments in subsidiaries, associated companies and interests in joint ventures, deferred tax assets are recognized
solely provided that there is a possibility that the temporary differences will be reversed in the near future and that there will
be taxable income with which they may be used.



64







The deferred income tax related to entries
directly recognized in equity is recognized with an effect on equity and not with an effect on profit or loss.



Deferred tax assets and liabilities are
offset if there is a legally receivable right of offsetting tax assets against tax liabilities and the deferred tax is related
to the same tax entity and authority.



Inventories



We state inventory at the lower of cost
and net realizable value. The method used to determine the cost of inventory is weighted average cost. The cost of finished products
and products-in-progress includes direct costs of materials and, as applicable, labor costs, indirect costs incurred to transform
raw materials into finished products and general expenses incurred in carrying inventory to their current location and conditions.



The net realizable value represents the
estimate of the sales price less all finishing estimated costs and costs that will be incurred in sales and distribution processes.
Commercial discounts, rebates obtained and other similar entries are deducted in the determination of the cost. We conduct an evaluation
of the net realizable value of inventory at the end of each year, recording a provision with a charge to income when circumstances
warrant. When the circumstances that previously gave rise to the reserve cease to exist, or when there is clear evidence of an
increase in the net realizable value due to a change in economic circumstances or prices of main raw materials, the estimate made
previously is modified. The valuation of obsolete, impaired or slow-moving products relates to their estimated net realizable value.



Provisions on our inventory have been made
based on a technical study which covers the different variables affecting products in stock (density, humidity, among others).



Raw materials, supplies and materials are
recorded at the lower of acquisition cost or market value. Acquisition cost is calculated according to the annual average price
method.



Obligations related to staff severance
indemnities and pension commitments



Our obligations with respect to our employees
are established in collective bargaining agreements and individual employment contracts. In the case of certain employees in the
United States, our obligations are established through a pension plan, which was terminated in 2002.



These obligations are valued using an actuarial
calculation that considers factors such as mortality rate, employee turnover, interest rates, retirement dates, effects related
to increases in employees’ salaries, as well as the effects on variations in services derived from variations in the inflation
rate.



Actuarial losses and gains that may be
generated by variations in previously defined obligations are directly recorded in profit or loss for the year.



Actuarial losses and gains originating
from deviations deviations between the estimate and the actual behavior of actuarial hypotheses or in the reformulation of established
actuarial hypotheses are recorded in equity.



The discount rate used for for calculating
obligations outside the United States was 6% for the periods ended as of December 31, 2013 and 2012.



65







Our United States subsidiary, SQM North
America Corp. has established pension plans for its retired employees that are calculated by measuring the projected benefit obligation
in accordance with International Accounting Standards (“IAS”) using a net salary progressive rate net of adjustments
to inflation, mortality and turnover assumptions, deducting the resulting amounts at present value using a 5.0% interest rate for
2013 and 2012. The net balance of this obligation is presented in the line item called Provisions for Employee Benefits, Non-Current.



Mining development costs



Mine exploration costs and stripping costs
to maintain production of mineral resources extracted from operating mines are considered variable production costs and are included
in the cost of inventory produced during the period. Mine development costs at new mines, and major development costs at operating
mines outside existing areas under extraction that are expected to benefit future production, are capitalized under “other
long-term assets” and amortized using a units-of-production method over the associated proven and probable reserves. We determine
our proven and probable reserves based on drilling, brine sampling and geostatistical reservoir modeling in order to estimate mineral
volume and composition.



All other mine exploration costs, including
expenses related to low grade mineral resources rendering reserves that are not economically exploitable, are charged to the statement
of income in the period in which they are incurred.



Asset value impairment



We assess on an annual basis any impairment
on the value of buildings, plant and equipment, intangible assets, goodwill and investments accounted for using the equity method
of accounting in accordance with IAS 36 “Impairment of Assets.” Assets to which this method applies are:



| | · | investments recognized using the equity method of accounting;
| | - | -------------------------------------------------------------

| | · | property, plant and equipment;
| | - | ------------------------------

| | · | intangible assets; and
| | - | ----------------------

| | · | goodwill.
| | - | ---------



Assets are reviewed for impairment as to
the existence of any indication that the carrying value is lower than the recoverable amount. If such an indication exists, the
asset recoverable amount is calculated in order to determine the extent of the impairment, if any. In the event that the asset
does not generate any cash flows independent from other assets, we determine the recoverable amount of the cash generating unit
to which this asset belongs according to the corresponding business segment (specialty plant nutrients, iodine and derivatives,
lithium and derivatives, potassium, industrial chemicals and other products and services.)



We conduct impairment tests on intangible
assets and goodwill with indefinite useful lives on an annual basis and every time there is indication of impairment. If the recoverable
value of an asset is estimated at an amount lower than its carrying value, the latter decreases to its recoverable amount.



66







Financial derivatives and hedging
transactions



Derivatives are recognized initially at
fair value at the date in which the derivatives contract has been signed and subsequently they are valued at fair value at each
period end. The method for recognizing the resulting loss or gain depends on whether the derivative has been designated as an accounting
hedging instrument and if so, the type of hedging, which may be:



| | a. | fair value hedge of assets and liabilities recognized (fair value hedges); or
| | -- | -----------------------------------------------------------------------------

| | b. | hedging of a single risk associated with an asset or liability recognized or a highly possible
foreseen transaction (cash flow hedge).
| | -- | --------------------------------------------------------------------------------------------------------------------------------------



At the beginning of the transaction, we
document the relationship between hedging instruments and those entries hedged, as well as their objectives for risk management
purposes and the strategy to conduct different hedging operations.



We also document our evaluation both at
the beginning and the end of each period of whether derivatives used in hedging transactions are highly effective to offset changes
in the fair value or in cash flows of hedged entries.



The fair value of derivative instruments
used for hedging purposes is shown in Note 9.3 to our Consolidated Financial Statements.



Non-hedge instruments are classified as
current assets or liabilities, and the change in their fair value is recognized directly in profit or loss.



| | a. | Fair value hedge
| | -- | ----------------



The change in the fair value of a derivative
is recognized with a debit or credit to profit or loss, as applicable. The change in the fair value of the hedged entry attributable
to hedged risk is recognized as part of the carrying value of the hedged entry and is also recognized with a debit or credit to
profit or loss.



For fair value hedging related to items
recorded at amortized cost, the adjustment of the fair value is amortized against income on the remaining years to its expiration.
Any adjustment to the carrying value of a hedged financial instrument for which the effective rate is used is amortized with a
debit or credit to profit or loss at its fair value attributable to the risk being covered.



If the hedged entry no longer meets the
criteria for hedge accounting, the fair value not amortized is immediately recognized with a debit or credit to profit or loss.



| | b. | Cash flow hedge
| | -- | ---------------



The effective portion of gains or losses
from the hedging instrument is initially recognized as “other revenue” with a debit or credit to other comprehensive
income whereas any ineffective portion is immediately recognized with a debit or credit to profit or loss, as applicable.



Amounts accumulated in equity are transferred
to profit or loss when the hedged transaction affects income for the period, such as when the hedged interest income or expense
is recognized when a forecasted sale occurs. When the hedged item is the cost of a non-financial asset or liability, amounts taken
to equity are transferred to the initial carrying value of the non-financial asset or liability.



67







Should the expected firm transaction or
commitment no longer be expected to occur, the amounts previously recognized as other comprehensive income are transferred to income.
If a hedging instrument expires, is sold, finished, and exercised without any replacement, or if a rollover is performed or if
its designation as hedging is revoked, the amounts previously recognized in equity are maintained in equity until the expected
firm transaction or commitment occurs.



5.A. Operating
Results



Introduction



The following discussion should be read
in conjunction with the Company's Consolidated Financial Statements. Certain calculations (including percentages) that appear herein
have been rounded.



Our Consolidated Financial Statements are
prepared in accordance with IFRS standards and prepared in U.S. dollars. The U.S. dollar is the primary currency in which we operate.



We operate as an independent corporation.
Nonetheless we are a "controlled corporation", as that term is defined under Chilean law. See Item 6.E. Share Ownership.



Overview
of Our Results of Operations



We divide our operations into the production
and sale of the following product lines:



| | · | specialty plant nutrients;
| | - | --------------------------

| | · | iodine and its derivatives;
| | - | ---------------------------

| | · | lithium and its derivatives;
| | - | ----------------------------

| | · | potassium, including potassium chloride and potassium sulfate;
| | - | --------------------------------------------------------------

| | · | industrial chemicals, principally industrial nitrates and solar salts; and
| | - | --------------------------------------------------------------------------

| | · | the purchase and sale of other commodity fertilizers for use primarily in Chile.
| | - | --------------------------------------------------------------------------------



We sell our products through three primary
channels: our own sales offices; a network of distributors; and, in the case of our fertilizer products, through Yara International
ASA’s (formerly Norsk Hydro ASA) (“Yara”) distribution network in countries where its presence and commercial
infrastructure are larger than ours. Similarly, in those markets where our presence is larger, both our specialty plant nutrients
and Yara’s are marketed through our offices.



Factors
Affecting Our Results of Operations



Our results of operations substantially
depend on:



| | · | trends in demand for and supply of our products, including global economic conditions, which impact
prices and volumes;
| | - | -----------------------------------------------------------------------------------------------------------------------

| | · | efficient operations of our facilities, particularly as some of them run at production capacity;
| | - | ------------------------------------------------------------------------------------------------

| | · | our ability to accomplish our capital expenditures program in a timely manner;
| | - | ------------------------------------------------------------------------------

| | · | the levels of our inventories;
| | - | ------------------------------

| | · | trends in the exchange rate between the U.S. dollar and Chilean peso, as a significant portion
of the cost of sales is in Chilean pesos, and trends in the exchange rate between the U.S. dollar and the euro, as a significant
portion of our sales is denominated in euros; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | energy, logistics, raw materials, labor and maintenance costs.
| | - | --------------------------------------------------------------



68







The following table
shows our revenues (in millions of U.S. dollars) and the percentage accounted for by each of our product lines for each of the
periods indicated:



|                          |  | 2013 |         |  | 2012 |  |     | 2011 | 
|------------------------- |  | ---- | ------- |  | ---- |  | --- | ---- | 
|                          |  | US$  |         |  | %    |  |     | US$  | 
|Specialty plant nutrition |  |      | 687.5   |  |      |  | 31  | %    | 
|Iodine and derivatives    |  |      | 461.0   |  |      |  | 21  | %    | 
|Lithium and derivatives   |  |      | 196.5   |  |      |  | 9   | %    | 
|Potassium                 |  |      | 606.3   |  |      |  | 28  | %    | 
|Industrial chemicals      |  |      | 154.0   |  |      |  | 7   | %    | 
|Other Income(1)           |  |      | 97.9    |  |      |  | 4   | %    | 
|                          |  |      |         |  |      |  |     |      | 
|Total                     |  |      | 2,203.1 |  |      |  | 100 |      | 



The following table shows certain financial information of the
Company under IFRS (in millions of U.S. dollars) for each of the periods indicated, as a percentage of revenues:



|                                                                                     |  | Year Ended December 31, |         
|------------------------------------------------------------------------------------ |  | ----------------------- | --------
|                                                                                     |  | 2013                    |         
|(in millions of U.S. dollars)                                                        |  | US$                     |         
|Revenues                                                                             |  |                         | 2,203.1 
|Cost of sales                                                                        |  |                         | (1,481.7
|Gross profit                                                                         |  |                         | 721.5   
|Other income                                                                         |  |                         | 96.7    
|Administrative expenses                                                              |  |                         | (105.2  
|Other expenses                                                                       |  |                         | (49.4   
|Other gains (losses)                                                                 |  |                         | (11.4   
|Finance income                                                                       |  |                         | 12.7    
|Finance expenses                                                                     |  |                         | (58.6   
|Equity income of associates and joint ventures accounted for using the equity method |  |                         | 18.8    
|Foreign currency exchange differences                                                |  |                         | (12.0   
|Income before income tax expense                                                     |  |                         | 613.1   
|Income tax expense                                                                   |  |                         | (138.5  
|                                                                                     |  |                         |         
|Profit attributable to:                                                              |  |                         |         
|Controlling interests                                                                |  |                         | 467.1   
|Non-controlling interests                                                            |  |                         | 7.5     
|Profit for the year                                                                  |  |                         | 474.6   



69







Results
of Operations – 2013 compared to 2012



Revenues



During 2013, we generated total revenues
of US$2,203.1 million, a 9.3% decrease compared to US$2,429.2 million in 2012.



The main factors causing the increase in
revenues and the variation in the different product lines are described below.



Specialty plant
nutrition



Specialty plant nutrition revenues for
2013 totaled US$687.5 million, a 1.8% increase compared to US$675.3 million in 2012. Set forth below are sales volume data for
the specified years by product category in this product line.



|(in Th. MT)                                    |  | 2013 |       |  | 2012 |  |       | % Change | 
|---------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | -------- | 
|Potassium nitrate and sodium potassium nitrate |  |      | 512.6 |  |      |  | 469.3 |          | 
|Specialty blends                               |  |      | 208.1 |  |      |  | 197.5 |          | 
|Other specialty plant nutrients (*)            |  |      | 100.8 |  |      |  | 89.0  |          | 
|Sodium nitrate                                 |  |      | 26.2  |  |      |  | 24.4  |          | 

* Includes trading of other specialty fertilizers.



The speciality plant
nutrition market experienced stable demand growth during 2013 when compared to 2012. We have not seen any curtailment of supply,
and do not expect any new supply from any of the three main players, including SQM, in the market.



Our sales volumes in the specialty plant
nutrition business line in 2013 increased 8.6% compared to sales volumes in 2012. In general, potassium nitrate prices are less
volatile than other commodity fertilizers such as potassium chloride; we saw prices in the business line decrease 6% during 2013
when compared to 2012.



Iodine and its derivatives



Revenues for iodine and its derivatives
during 2013 totaled US$461.0 million, a 20.3% decrease compared to US$578.1 million in 2012. Set forth below are sales volume data
for the specified years.



|(in Th. MT)                |  | 2013 |     |  | 2012 |  |      | % Change | 
|-------------------------- |  | ---- | --- |  | ---- |  | ---- | -------- | 
|Iodine and its derivatives |  |      | 9.3 |  |      |  | 11.0 |          | 



Iodine market growth was approximately
2% during 2013, slightly lower than the growth rates we have seen in previous years. We believe this is related to inventory optimization
from our customers. Based on our analysis, consumption continued to grow at a rate of 2-4% during 2013, slightly higher than demand
growth. As we have seen in recent years, demand was led primarily by x-ray contrast media and LCD and LED applications.



Our sales volumes decreased approximately
15% in 2013 when compared to 2012. Average prices for 2013 were just under US$50/kg, almost 6% less than prices reported during
2012. These price decreases were in line with market conditions and our expectations.



70







We are the world leader in the iodine market,
with the largest capacity, the best natural resources, and a significant cost advantage. We believe that total demand will grow
between 3-4% during 2014. Despite these positive signals, we believe our sales volumes could decrease during 2014 as uncertainty
surrounding the production and sales volumes of our competitors continues. We have also seen pressure on pricing in recent months,
as announced at the end of 2013. We expect this pressure to continue through 2014.



Lithium and its derivatives



Revenues for lithium and its derivatives totaled US$196.5 million
during 2013, an 11.6% decrease compared to US$222.2 million in 2012. Set forth below are sales volume data for the specified years.



|(in Th. MT)                 |  | 2012 |      |  | 2012 |  |      | % Change | 
|--------------------------- |  | ---- | ---- |  | ---- |  | ---- | -------- | 
|Lithium and its derivatives |  |      | 36.1 |  |      |  | 45.7 |          | 



The lithium market continued to grow in
2013, due primarily to growth in the rechargeable battery. Demand growth reached 4%, while demand growth in batteries grew well
over 10%.



Our sales volumes in the lithium segment
decreased approximately 21% in 2013, when compared to 2012. This resulted from increased supply from various competitors. We believe
our market share totaled 27% in 2013. Prices remained strong in the lithium market, and our average price in the lithium business
line was almost 12% higher in 2013 than prices seen in 2012.



We believe the lithium market is positioned
to grow in the short and long term resulting from the development of new technologies, as well as due to the strong growth in industrial
applications. We expect lithium market demand to grow between 8-10% in 2014.



Potassium

Potassium revenues for 2013 totaled US$606.3 million, a 0.2%
increase as compared to US$606.3 million in 2012. Set forth below are sales volume data for the specified years.



|(in Th. MT)                              |  | 2013 |         |  | 2012 |  |         | % Change | 
|---------------------------------------- |  | ---- | ------- |  | ---- |  | ------- | -------- | 
|Potassium chloride and potassium sulfate |  |      | 1,434.9 |  |      |  | 1,209.5 |          | 



As anticipated, the potassium chloride
market demand increased in 2013; we estimate that demand reached levels close to 53 million metric tons for potassium chloride
during 2013, an increase of 6% when compared to 2012. The prices in the potassium chloride market declined during the second half
of 2013 as a result of the unexpected announcement made by the Russian company, Uralkali, on July 30, 2013, that it was terminating
its participation in BPC. As a result of the termination of Uralkali’s participation in BPC, there was increased price competition
in the market.



Amidst all of the announcements and information
published surrounding the potassium market in 2013, we saw our sales volumes in this business line increase over 18% compared to
2012, which was in line with our expectations. As mentioned above, pricing for the second half of 2013 remained volatile, and we
were not immune to impacts. Our average price for the potassium chloride and potassium sulfate business line in 2013 was approximately
16% lower than average prices reported during 2012.



We continued to take advantage of our developed
distribution network, and distributed potassium chloride to customers all over the world. Our biggest market continued to be Brazil,
which, in 2013, accounted for approximately one third of our potassium chloride sales. Moving forward, we expect demand to grow
in 2014 to over 55 million tons. Additionally, we expect our sales volumes of potassium chloride and potassium sulfate to increase
over 10% when compared to sales volumes seen in 2013. As we have stated in the past, we believe that market demand is the most
important indicator when evaluating the potash market, and specifically future potassium chloride prices.



71







Industrial chemicals



Industrial chemicals revenues for 2013
totaled US$154.0 million, a 37.2% decrease as compared to US$245.2 million in 2012. Set forth below are sales volume data for the
specified years by product category.



|(in Th. MT)         |  | 2013 |       |  | 2012 |  |       | % Change | 
|------------------- |  | ---- | ----- |  | ---- |  | ----- | -------- | 
|Industrial nitrates |  |      | 173.5 |  |      |  | 277.7 |          | 
|Boric acid          |  |      | 2.0   |  |      |  | 1.8   |          | 



Industrial chemical demand for traditional
applications such as detergents and glass has remained relatively stable when compared to 2012.



Average prices for industrial chemicals
business line in 2013 remained virtually unchanged compared to 2012. As expected, volumes during 2013 decreased significantly compared
to sales volumes reported during 2012. This is a direct result of a reduction in the sale of solar salts, products used for alternative
energy sources. This decrease in sales volumes was particularly relevant during the second half of 2013 when sales volumes in solar
salts were trivial.



Sales volumes in this business line in
2014 are expected to be lower than sales volumes seen in 2013. However, we do see a peaked interest in the market, and expect sales
volumes to return in 2015; these estimations are based on current negotiations. The long-term prospects in the solar salt market
remain positive.



Other products and services



Revenues from sales of other commodity
fertilizers and other products totaled US$97.9 million during 2013, a 5.1% decrease compared to US$103.2 million in 2012.



Cost of sales



Cost of sales increased by 5.0% to US$1,481.7
million in 2013 from US$1,400.6 million in 2012, representing 67% of revenues in 2013 as compared to 58% of revenues in 2012. This
increase in the percentage of revenues was principally caused higher volumes and lower prices in most of our products. Cost of
sales includes, among others, the costs of depreciation and amortization.



Gross profit



Gross profit decreased by 29.9% from US$1,028.6
million in 2013 to US$721.5 million in 2013 and decreased as percentage of revenues, representing 32.7% of revenues in 2013 as
compared to 42.3% of revenues in 2012. Gross margin was impacted by generally lower average prices in 2013 compared to 2012 in
the fertilizer business lines.



Administrative expenses



Administrative expenses as a percentage
of revenues increased in 2013 as compared to 2012. Administrative expenses were US$105.2 million (5.9% of revenues) in 2013 and
US$106.4 million (4.4% of revenues) in 2012. The increase to 5.9% of revenues was mostly caused by decreases in revenues and relatively
stable expenses.



72







Other expenses



Other expenses increased by 42.6% to US$49.3
million in 2013 from US$34.6 million in 2012. Other expenses represented 2.2% of revenues in 2013 as compared to 1.4% of revenues
in 2012.



Other gains (losses)



Other gains (losses) decreased by 1.6%
to a loss of US$11.3 million in 2013 from a gain of US$0.7 million in 2012.



Finance income



Finance income decreased by 43.6% to US$12.6
million in 2013 from US$29.1 million in 2012, and decreased as percentage of revenues, representing 0.6% of revenues in 2013 as
compared to 1.2% of revenues in 2012.Financial income decreased resulting from lower returns in financial investments such as money
market and time deposits.



Finance expenses



Finance expenses increased by 8.3% to US$58.6
million in 2013 from US$54.1 million in 2012, but remained relatively stable as a percentage of revenues, representing 2.1% of
revenues in 2012 as compared to 2.6% of revenues in 2013. The increase in finance expenses was due to a net increase in indebtedness
during 2013.



Equity income of associates and joint
ventures accounted for using the equity method



Equity income of associates and joint ventures
accounted for using the equity method decreased by 23.0% to US$18.8 million in 2013 from US$24.4 million in 2012, representing
0.9% of revenues both in 2013.



Foreign currency exchange differences



Losses from foreign currency exchange differences
decreased by 44.9% to a loss of US$11.9 million in 2013 from a loss of US$26.8 million in 2012, and decreased as a percentage of
revenues, representing 0.5% of revenues in 2013 as compared to 1.1% of revenues in 2012. Since most of our operations are in Chile
part of our costs of sales are related to the Chilean peso. Although we have an active hedging program and policy, we are subject
to currency fluctuations. During 2013, the Chilean peso appreciated by 9.4% against the U.S. dollar.



Income tax expense



In 2013, income taxes were US$138.5 million,
compared to income taxes of US$216.1 million in 2012. The effective tax rate in 2013 was 22.5% compared with 24.7% in 2012. The
difference between the statutory and effective tax rates is due primarily to royalty taxes on income.



73







Profit for the year



Profit for the year decreased by 27.8%
to US$474.6 million in 2013 from US$657.4 million in 2012, as a result of the foregoing factors. Profit for the year was lower
in 2013 resulting from lower prices across multiple business lines, and lower volumes in lithium, iodine, and industrial chemicals
when compared to 2012.



Results
of Operations – 2012 compared to 2011



Revenues



During 2012, we generated total revenues
of US$2,429.2 million, a 13.2% increase compared to US$2,145.3 million in 2011.



The main factors causing the increase in
revenues and the variation in the different product lines are described below.



Specialty plant
nutrition



Specialty plant nutrition revenues for
2012 totaled US$675.3 million, a 6.4% decrease compared to US$721.7 million in 2011. Set forth below are sales volume data for
the specified years by product category in this product line.



|(in Th. MT)                                    |  | 2012 |       |  | 2011 |  |       | % Change | 
|---------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | -------- | 
|Potassium nitrate and sodium potassium nitrate |  |      | 469.3 |  |      |  | 551.1 |          | 
|Specialty blends                               |  |      | 197.5 |  |      |  | 189.3 |          | 
|Other specialty plant nutrients (*)            |  |      | 89.0  |  |      |  | 86.7  |          | 
|Sodium nitrate                                 |  |      | 24.4  |  |      |  | 22.2  |          | 

* Includes trading of other specialty fertilizers.



Market supplies of the specialty plant
nutrition market increased during 2012, as a significant competitor returned to normal production levels. In general, the specialty
plant nutrition markets are less volatile than commodity and fertilizer markets, but future improvement in this product line will
depend on the behavior of the market for potassium based fertilizers such as potassium chloride.



Our overall sales volumes in the specialty
plant nutrition product line in 2012 decreased compared to 2011. This was a result of increased supply in the market and low market
growth due mainly to the financial situation in Europe, one of the most important markets for this product line. Prices within
our specialty plant nutrition product line increased by almost 2% in 2012 as compared to 2011.



Iodine and its derivatives



Revenues for iodine and its derivatives
during 2012 totaled US$578.1 million, a 27.2% increase compared to US$454.5 million in 2011. Set forth below are sales volume data
for the specified years.



|(in Th. MT)                |  | 2012 |      |  | 2011 |  |      | % Change | 
|-------------------------- |  | ---- | ---- |  | ---- |  | ---- | -------- | 
|Iodine and its derivatives |  |      | 11.0 |  |      |  | 12.2 |          | 



74







Overall market sales volumes of iodine
reached new levels in 2012 mainly as a result of increased demand. Strong demand was led primarily by X-ray contrast media and
pharmaceutical applications. Increased supply entered the market in 2012, and we expect to see additional new supply in 2013.



Our sales volumes decreased by approximately
10% in 2012, as a result of new market supply, and as we returned to normal operational inventory. These volume decreases were
more than offset by prices, which were more than 40% higher than average prices during 2011, increasing gross profit in the iodine
product line by over 38%.



Lithium and its derivatives



Revenues for lithium and its derivatives totaled US$222.2 million
during 2012, a 21.2% increase compared to US$183.4 million in 2011. Set forth below are sales volume data for the specified years.



|(in Th. MT)                 |  | 2012 |      |  | 2011 |  |      | % Change | 
|--------------------------- |  | ---- | ---- |  | ---- |  | ---- | -------- | 
|Lithium and its derivatives |  |      | 45.7 |  |      |  | 40.7 |          | 



The lithium market continued to grow in
2012, primarily due to growth in the rechargeable battery and lubricating grease markets, as has been the trend in recent years.



Our sales volumes in the lithium segment
increased by 12% in 2012, as compared to 2011. We believe we supply over one-third of the world lithium chemical market, and aim
to maintain this market share in coming years.



Along with increased volumes, we saw increased
prices of approximately 8% in this product line during 2012 as compared to the previous year, increasing our gross margin by approximately
30% as compared with 2011.



We believe we are the lowest cost producer
of lithium in the world. We produce lithium as a by-product of potassium chloride, which gives us a unique competitive advantage.



Potassium



Potassium revenues for 2012 totaled US$605.1 million, an 8.9%
increase as compared to US$555.7 million in 2011. Set forth below are sales volume data for the specified years.



|(in Th. MT)                              |  | 2012 |         |  | 2011 |  |         | % Change | 
|---------------------------------------- |  | ---- | ------- |  | ---- |  | ------- | -------- | 
|Potassium chloride and potassium sulfate |  |      | 1,209.5 |  |      |  | 1,103.4 |          | 



We estimate that market sales volumes of
potassium chloride decreased by 12% in 2012 as compared to 2011. Despite favorable economic conditions of relevant crops, demand
was mainly affected by economic uncertainty in Europe and the behavior of influential buyers in China and India.



We increased our sales volumes in this
product line by approximately 10% compared to 2011, as we took advantage of our developed distribution network. Average prices
in the potassium market remained relatively stable as compared to 2011. In the fourth quarter of 2012, the potassium market saw
major contracts close at lower prices than seen earlier in 2012; during the first quarter of 2013, prices have remained stable.



75







Industrial chemicals



Industrial chemicals revenues for 2012
totaled US$245.2 million, a 75.8% increase as compared to US$139.5 million in 2011. Set forth below are sales volume data for the
specified years by product category.



|(in Th. MT)         |  | 2012 |       |  | 2011 |  |       | % Change | 
|------------------- |  | ---- | ----- |  | ---- |  | ----- | -------- | 
|Industrial nitrates |  |      | 277.7 |  |      |  | 181.2 |          | 
|Boric acid          |  |      | 1.8   |  |      |  | 2.4   |          | 



Industrial chemical demand for traditional
applications such as detergents and glass has remained relatively stable as compared to 2011.



New alternative energy projects that utilize
industrial-grade sodium and potassium nitrate in solar thermal energy storage had a positive impact on our 2012 industrial chemicals
volumes, which increased by over 50% as compared to 2011.



Prices for industrial chemicals increased
by 15%, mainly because of the product mix, increasing our gross margins by approximately 48%.



Other products and services



Revenues from sales of other commodity
fertilizers and other products totaled US$103.2 million during 2012, a 14.0% increase compared to US$90.5 million in 2011.



Cost of sales



During 2012, cost of sales increased by
8.5% to US$1,400.6 million in 2012 from US$1,290.5 million in 2011, but remained stable as a percentage of revenues, representing
58% of revenues in 2012 as compared to 60% of revenues in 2011. This increase was principally caused by higher volume production
and a stronger Chilean peso. Cost of sales includes, among others, the costs of depreciation and amortization.



Gross profit



Gross profit increased by 20.3% from US$854.8
million in 2011 to US$1,028.6 million in 2012 and remained stable as percentage of revenues, representing 42.3% of revenues in
2012 as compared to 39.8% of revenues in 2011. Gross margin was impacted by generally higher average prices in 2012 compared to
2011, led by iodine prices, which increased by 40% on average in 2012 as compared to prices in 2011.



Administrative expenses



Administrative expenses as a percentage
of revenues remained stable in 2012 as compared to 2011. Administrative expenses were US$106.4 million (4.4% of revenues) in 2012
and US$91.8 million (4.3% of revenues) in 2011.



76







Other expenses



Other expenses decreased by 45.1% to US$34.6
million in 2012 from US$63.0 million in 2011. Other expenses represented 1.4% of revenues in 2012 as compared to 2.9% of revenues
in 2011. Thedecrease in other expenses is attributable to a decrease
in expenses accounted for as depreciation of assets no longer in use.



Other gains (losses)



Other gains (losses) decreased by 87.9%
to a gain of US$0.7 million in 2012 from a gain of US$5.8 million in 2011, but remained stable as a percentage of revenues, representing
0.03% of revenues in 2012 as compared to 0.3% of revenues in 2011. The decrease is attributable in part to a loss in sales of investment
in associated companies and a provision no longer in effect for the suspension of our operations at El Toco mine at the Maria Elena
facility.



Finance income



Finance income increased by 25.4% to US$29.1
million in 2012 from US$23.2 million in 2011, but remained stable as a percentage of revenues, representing 1.2% of revenues in
2012 as compared to 1.1% of revenues in 2011.



Finance expenses



Finance expenses increased by 37.7% to
US$54.1 million in 2012 from US$39.3 million in 2011, but remained stable as a percentage of revenues, representing 1.8% of revenues
in 2011 as compared to 2.1% of revenues in 2012. The increase in finance expenses was due to a net increase in indebtedness during
2012 and a decrease in capitalized interest related to ongoing capital expenditure projects as compared to 2011.



Equity income of associated companies
and joint ventures accounted for using the equity method



Equity income of associated companies and
joint ventures accounted for using the equity method increased by 11.9% to US$24.4 million in 2012 from US$21.8 million in 2011,
but remained stable as a percentage of revenues, representing 1.0% of revenues both in 2012 and in 2011.



Foreign currency exchange differences



Losses from foreign currency exchange differences
increased by 5.9% to a loss of US$26.8 million in 2012 from a loss of US$25.3 million in 2011, but remained stable as a percentage
of revenues, representing 1.1% of revenues in 2012 as compared to 1.2% of revenues in 2011. Since most of our operations are in
Chile, part of our costs of sales are related to the Chilean peso. Although we have an active hedging program and policy, we are
subject to currency fluctuations. During 2012, the Chilean peso appreciated by 7.6% against the U.S. dollar.



Income tax expense



In 2012, income taxes were US$216.1 million,
compared to income taxes of US$179.7 million in 2011. During 2012, the Chilean tax rate increased to 20%. The effective tax rate
in 2012 was 24.7% compared with 24.5% in 2011. The difference between the statutory and effective tax rates is due primarily to
royalty taxes on income.



77







Profit for the year



Profit for the year increased by 18.6%
to US$657.4 million in 2012 from US$554.1 million in 2011, as a result of the foregoing factors.



Impact of Foreign Exchange Rates



We transact a significant portion of our
business in U.S. dollars, which is the currency of the primary economic environment in which we operate and is our financial currency
for financial reporting purposes. A significant portion of our operating costs is related to the Chilean peso, and therefore an
increase or decrease in the exchange rate between the Chilean peso and the U.S. dollar affects our costs of production. Additionally,
as an international company operating in Chile and several other countries, we transact a portion of our business and have assets
and liabilities in Chilean pesos and other non-U.S. dollar currencies, such as the Euro, the South African Rand and the Mexican
peso. As a result, fluctuations in the exchange rate of such currencies to the U.S. dollar may affect our financial condition and
results of operations. See Note 24 of Financial Statements included in this Annual Report.



We monitor and attempt to maintain our
non-dollar assets and liabilities position in balance and make use of foreign exchange contracts and other hedging instruments
aiming to minimize our exposure to the risks of changes in foreign exchange rates. As of December 31, 2013, for hedging purposes
we had open contracts to buy U.S. dollars and sell Euros for approximately US$8.6 million (EUR6.2million) and sell South African
rand for approximately US$30 million (ZAR301 million), as well as forward exchange contracts to sell U.S. dollars and buy Chilean
pesos for US$92.5 million (CH$48,526 million). As of this date, all of our UF and Chilean pesos bonds were hedged with cross-currency
swaps to the U.S. dollar for approximately US$ 555.3 million.



Also, we had open forward exchange contracts
to buy U.S. dollars and sell Chilean pesos to hedge our time deposits in Chilean Pesos for approximately US$134.1 million (CH$70,384
million).



5.B. Liquidity
and Capital Resources



As of December 31, 2013,
we had US$908.5 million of cash and cash equivalents and time deposits. In addition, as of December 31, 2013, we had unused uncommitted
working capital credit lines amounting to US$555.0 million.



Shareholders’ equity
increased from US$2,132.8 million as of December 31, 2012 to US$2,409.5 million as of December 31, 2013. Our ratio of total liabilities
to total equity (including non-controlling interest) on a consolidated basis decreased from 1.02 as of December 31, 2012 to 0.94
as of December 31, 2013.



We evaluate from time to time our cash
requirements to fund capital expenditures, dividend payouts and increases in working capital. As debt requirements also depend
on the level of accounts receivables and inventories, we cannot accurately determine the amount of debt we will require.



78







The table below shows our cash flows for 2013, 2012, and 2011:



|(in millions of U.S. dollars)                                      |  | 2013 |        |   | 2012 |  |        | 2011 | 
|------------------------------------------------------------------ |  | ---- | ------ | - | ---- |  | ------ | ---- | 
|Net cash from (used in):                                           |  |      |        |   |      |  |        |      | 
|Net cash from operating activities                                 |  |      | 651.7  |   |      |  | 650.2  |      | 
|Net cash used in financing activities                              |  |      | (2.3   | ) |      |  | (197.7 | )    | 
|Net cash used in investing activities                              |  |      | (487.4 | ) |      |  | (562.9 | )    | 
|Effects of exchange rate fluctuations on cash and cash equivalents |  |      | (9.8   | ) |      |  | (10.3  | )    | 
|Net increase (decrease) in cash and cash equivalents               |  |      | (152.3 | ) |      |  | (120.6 | )    | 



We operate a capital-intensive business
that requires significant investments in revenue-generating assets. Our growth strategy has included the purchase of production
facilities and equipment and has also included the improvement and expansion of existing facilities. Funds for capital expenditures
and working capital requirements have been obtained from net cash from operating activities, borrowings under credit facilities
and issuance of debt securities.





The Board of Directors has approved a capital
expenditures plan for 2014 of US$135 million in connection with investments to be made in Chile. The 2014 capital investment program
is primarily focused on the maintenance of our production facilities. Our 2014 capital investment program will not require any
external financing; however, we reserve the right to access capital markets in order to optimize our financial position.See
“Business—Business strategy—Capital expenditure program.”



Our other major use of funds is the payment
of dividends. We paid dividends of US$273.6 million and US$334.8million during 2013 and 2012, respectively. Our 2013 dividend policy,
as approved by shareholders, is to pay 50% of our profit for each fiscal year in dividends. Under Chilean law, the minimum dividend
payout is 30% of profit for each fiscal year.



79







Financing activities



Our current ratio (current assets divided by current liabilities)
was 3.40 as of December 31, 2013, a change from 3.70 as of December 31, 2012. The following table shows key information about our
outstanding long- and short-term debt as of December 31, 2013.



|Debt Instrument(1)(2)                   |  | Interest rate |       |   | Issue date |               | Maturity date |               | Amortization
|--------------------------------------- |  | ------------- | ----- | - | ---------- | ------------- | ------------- | ------------- | ------------
|3.625% Notes due 2023 — US$ 300 million |  |               | 3.625 | % |            | Apr. 3, 2013  |               | Apr. 3, 2023  |             
|Series O Bond — UF 1.50 million         |  |               | 3.80  | % |            | Apr. 4, 2012  |               | Feb. 1, 2033  |             
|Series H Bond — UF 4 00 million         |  |               | 4.90  | % |            | Jan. 13, 2009 |               | Jan. 5, 2030  |             
|Series C Bond — UF 2.1 million          |  |               | 4.00  | % |            | Jan. 24, 2006 |               | Dec. 1 , 2026 |             
|5.50% Notes due 2020 — US$ 250 million  |  |               | 5.50  | % |            | Apr. 21,2010  |               | Apr. 21, 2020 |             
|Series M Bond — UF 1.00 million         |  |               | 3.30  | % |            | Apr. 4, 2012  |               | Feb. 1, 2017  |             
|Bilateral loan — US$140 million         |  |               | 2.69  | % |            | Sep. 13, 2012 |               | Sep. 13, 2017 |             
|6.125% Notes due 2016 — US$ 200 million |  |               | 6.13  | % |            | Apr. 5, 2006  |               | Apr. 15, 2016 |             
|Bilateral loan — US$40 million          |  |               | 1.52  | % |            | Oct. 6, 2011  |               | Oct. 6, 2016  |             
|Bilateral loan — US$50 million          |  |               | 1.26  | % |            | Oct. 12, 2011 |               | Oct. 12, 2016 |             
|Bilateral loan — US$50 million          |  |               | 1.46  | % |            | Dec. 21, 2011 |               | Dec. 21, 2016 |             
|Bilateral loan — US$50 million          |  |               | 1.62  | % |            | Oct. 19, 2012 |               | Oct. 19, 2015 |             
|Series G Bond — CH$21,000  million      |  |               | 7.00  | % |            | Jan. 13, 2009 |               | Jan. 5, 2014  |             
|Series I Bond — UF 1.50 million         |  |               | 3.00  | % |            | May. 8, 2009  |               | Apr. 1, 2014  |             
|Series J Bond — CH$52,000  million      |  |               | 5.50  | % |            | May. 8, 2009  |               | Apr. 1, 2014  |             
|Bilateral loan — US$50 million          |  |               | 1.54  | % |            | Sep. 12, 2011 |               | Sep. 12, 2014 |             





| | (1) | UF- and Ch$-denominated bonds are fully hedged to U.S. dollars with cross-currency swaps.
| | --- | -----------------------------------------------------------------------------------------

| | (2) | Some floating rate bilateral loans are currently hedged to fixed rate loans using interest rate
swaps.
| | --- | ------------------------------------------------------------------------------------------------------



As of December 31, 2013, we had total financial
debt of US$1,834 million, compared to US$1,599 million as of December 31, 2012. Taking into account the effects of financial derivatives,
our total financial debt amounted to US$1,803.5 million as of December 31, 2013 and US$1,498.4 million as of December 31, 2012.
Of the total debt as of December 31, 2013, US$401.4 million was short-term debt. All of our UF and Ch$ local bonds, as of December
31, 2013, were hedged with cross-currency swaps to the U.S. dollar.



All of our long-term debt (including the
current portion) as of December 31, 2013 was denominated in U.S. dollars, and all our UF and Ch$ local bonds were hedged with cross-currency
swaps to the U.S. dollar.



The financial covenants related to our
debt instruments include: (i) limitations on the ratio of total liabilities to equity (including non-controlling interest) on a
consolidated basis, (ii) minimum net worth requirements, (iii) limitations on net financial debt to EBITDA, (iv) limitations on
interest indebtedness of operating subsidiaries and (v) minimum production assets. We believe that the terms and conditions of
our debt agreements are standard and customary and that we are in compliance in all material respects with such terms and conditions
as of December 31, 2013.



80







The following table shows the maturities of our long-term debt
by year as of December 31, 2013 (in millions of US dollars):



|Maturity(1)         |  | Amount |        
|------------------- |  | ------ | -------
|                    |  |        |        
|2014                |  |        | 357,3  
|2015                |  |        | 95,1   
|2016                |  |        | 285.1  
|2017                |  |        | 191.6  
|2018                |  |        | 5.1    
|2019 and thereafter |  |        | 805.7  
|Total               |  |        | 1,410.4



| | (1) | Only the principal amount has been included. For the UF- and Ch$-denominated local bonds, the amounts
presented reflect the real U.S. dollar obligation as of December 31, 2013, not including the effects of the cross currency swaps
that hedge these bonds to the U.S. dollar and which had, as of December 312013, a market value of US$23 million in favor of SQM.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Environmental Projects



In 2013, we made disbursements amounting
to US$13.3 million related to environmental, safety and health projects. We have budgeted future disbursements for the year 2014
amounting to approximately US$ 9.6 million related to environmental, safety and health projects. This amount forms part of the
capital expenditure program discussed above.



5.C. Research
and Development, Patents and Licenses, etc.



One of the main objectives of our research
and development team is to develop new processes and products in order to maximize the returns obtained from the resources that
we exploit. Our research is performed by four different units whose research topics include chemical process design, phase chemistry,
chemical analysis methodologies, and physical properties of finished products.



Our research and development policy emphasizes
the following: (i) optimization of current processes in order to decrease costs and improve product quality through the implementation
of new technology, and (ii) development of higher-margin products from current products through vertical integration or different
product specifications.



Our research and development activities
have been instrumental in improving our production processes and developing new value-added products. As a result of research and
development activities, new methods of extraction, crystallization and finishing products have been developed. Technological advances
in recent years have enabled us to improve process efficiency for the nitrate, potassium and lithium operations, to improve the
physical quality of our prilled products and to reduce dust emissions and caking by applying specially designed additives to our
products handled in bulk. Our research and development efforts have also resulted in new, value-added markets for our products.
One example is the use of sodium nitrate and potassium nitrate as thermal storage in solar power plants.



We have patented several production processes
for nitrate, iodine, and lithium products. These patents have been filed mainly in the United States, Chile, and in other countries
when necessary.



81









For the years ended December 31, 2013,
2012 and 2011, we invested US$9.3 million, US$ 10.4 million, and US$6.9 million, respectively, on research and development activities.



5.D. Trend
Information

Our revenues totaled
US$2,203.1 million during 2013, representing a decrease of 9.3% from revenues of US$2,429.2 million in 2012. Gross margin was US$721.5
million (32.7% of revenues), 29.9% lower than gross margin of US$1,028.6 million (42.3% of revenues) in 2012. Profit attributable
to controlling interests decreased by 27.8% to US$467.1 million in 2013, compared to US$649.2 million in 2012.



Our sales volumes in
the specialty plant nutrition business line in 2013 increased by 8.6% compared to 2012. This increase was a result of increased
demand in the market. In particular, this product line depends on the behavior of the market for potassium-based fertilizers such
as potassium chloride. Potassium chloride is an important raw material in the production of potassium nitrate, a specialty fertilizer
and, as a result, prices of the two products are related. However, the specialty plant nutrition markets tend to be less volatile
than commodity and fertilizer markets. We saw this during 2013 as prices fell in the speciality plant nutrition business line approximately
6%, while prices in the potassium chloride and potassium sulfate business lines fell over 15%. We feel confident in the future
of specialty plant nutrient market as food quality requirements increase, and land and fresh water scarcity impacts some parts
of the world. We suspect market growth to be led primarily by potassium nitrate, and we believe we are prepared to meet the growing
market demand in the future.



Our sales volumes in
the iodine business line decreased by 11.5% in 2013 as a result of new supply from competitors in the market, and a result of slightly
slower growth rates than we have seen in previous years. Therefore, we saw pressure on prices in the iodine market, and our average
price in the business line was 5.7% lower than average prices seen during 2012. We continue to be a world leader in the iodine
market, and these special market conditions have created unique opportunities for us.



Our sales volumes in
the lithium business line decreased by 21% in 2013 compared to 2012. However, despite lower sales volumes, we saw increased prices
in this business line during 2013 when compared to 2012, up 11.9%. The decrease in sales volumes can be attributed to increased
supply from competitors. We believe the lithium market is positioned to grow in the short and long term due to the development
of new technologies, as well as strong growth in industrial applications. We expect world lithium production to increase in the
near future, as a number of new projects have been announced and have begun procurement.



Our sales volumes in
the potassium business line increased by 18.6% in 2013 compared to the prior year. Average prices in the potassium market fell
following during the second half of 2013, and therefore our average prices for 2013 were 15.5% lower than prices seen during 2012.
We expect market sales volumes to increase during 2014, and believe that this could have a positive impact on prices.



Our sales volumes in
the industrial chemicals product line decreased by 37.2% in 2013 compared to 2012. As anticipated, the decrease was caused by delays
in new alternative energy projects that utilize industrial-grade sodium and potassium nitrate in solar thermal energy storage.
In particular, our sales volumes in solar salts decreased by approximately 100,000 metric tons during 2013. We remain confident
in the long-term prospects in the solar thermal energy storage market, and are currently working on negotiations sales contracts
for 2015 and beyond.



5.E. Off-Balance
Sheet Arrangements

We have not entered into any transactions
with unconsolidated entities whereby we have financial guarantees, retained or contingent interests in transferred assets, derivative
instruments or other contingent arrangements that would expose us to material continuing risks, contingent liabilities, or any
other obligations arising out of a variable interest in an unconsolidated entity that provides financing, liquidity, market risk
or credit risk support to us or that engages in leasing, hedging or research and development services with us.



82







5.F. Tabular
Disclosure of Contractual Obligations



The following table shows our material
expected obligations and commitments as of December 31, 2013:



|                                              |  |       |           |  | Less Than |  |         | 1  -  3 |  |  | 3  -  5  |  |  | More 
Than |        
|--------------------------------------------- |  | ----- | --------- |  | --------- |  | ------- | ------- |  |  | -------- |  |  | ---------- | -------
|                                              |  | Total |           |  | 1 year    |  |         | years   |  |  | Years    |  |  | 5 years    |        
|                                              |  | ThUS$ |           |  | ThUS$     |  |         | ThUS$   |  |  | ThUS$    |  |  | ThUS$      |        
|Long- and short-term debt                     |  |       | 1,819,317 |  |           |  | 382,463 |         |  |  | 3383,339 |  |  |            | 197,762
|Capital lease obligations                     |  |       | -         |  |           |  | -       |         |  |  | -        |  |  |            | -      
|Operating leases                              |  |       | 132,946   |  |           |  | 6,997   |         |  |  | 13,994   |  |  |            | 13,994 
|Purchase commitments (*)                      |  |       | 127,484   |  |           |  | 127,484 |         |  |  | -        |  |  |            | -      
|Staff severance indemnities                   |  |       | 34,839    |  |           |  | -       |         |  |  | -        |  |  |            | -      
|Total Contractual Obligations and Commitments |  |       | 1,894,306 |  |           |  | 287,324 |         |  |  | 350,940  |  |  |            | 553,808



(*) The purchase commitments
held by the Company are recognized as a liability when the services and goods are received by the Company.



5.G. Safe
Harbor



The information contained in Items 5.E and 5.F contains statements
that may constitute forward-looking statements. See “Cautionary Statement Regarding Forward-Looking Statements” in
this Annual Report, for safe harbor provisions.



83







ITEM
6.DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES



6.A. Directors
and Senior Management

We are managed by our executive officers
under the direction of our Board of Directors, which, in accordance with our by-laws, consists of eight directors, seven of whom
are elected by holders of Series A common shares and one of whom is elected by holders of Series B common shares. The entire Board
of Directors is regularly elected every three years at our ordinary shareholders’ meeting. Cumulative voting is allowed for
the election of directors. At the annual ordinary shareholders’ meeting that took place on April 25, 2013, a new Board was
elected, and their terms will expire in 2016. The Board of Directors may appoint replacements to fill any vacancies that occur
during periods between elections. If a vacancy occurs, the entire Board must be elected or re-elected at the next regularly scheduled
meeting of shareholders. Our Chief Executive Officer is appointed by the Board of Directors and holds office at the discretion
of the Board. The Chief Executive Officer appoints our executive officers. There are regularly scheduled meetings of the Board
of Directors once a month. Extraordinary meetings may be called by the Chairman when requested by (i) the director elected by holders
of the Series B common shares, (ii) any other director with the assent of the Chairman or (iii) an absolute majority of all directors.
The Board has a Directors’ Committee and its regulations are discussed below.



Our directors as of the date of this Annual Report are as follows:



|Name              |  | Position and relevant experience                                                                                                                                                                                                                                                                                                                                                                      |  | Current positionheld since
|----------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------
|Julio Ponce L.(1) |  | Chairman of the Board and Director. Mr. Ponce is a Forestry Engineer with a degree from the Universidad de Chile. He joined SQM in 1981. He is also Chairman of the board of directors of the following corporations: Sociedad de Inversiones Pampa Calichera S.A., Sociedad de Inversiones Oro Blanco S.A., Norte Grande S.A. and Soquimich Comercial S.A. He is the brother of Eugenio Ponce L.     |  | September 1987            
|                  |  |                                                                                                                                                                                                                                                                                                                                                                                                       |  |                           
|Wayne R. Brownlee |  | Vice Chairman of the Board and Director. Mr. Brownlee is Executive Vice-President, Treasurer and Chief Financial Officer of Potash Corporation of Saskatchewan, Inc. Mr. Brownlee earned degrees in Arts and Science and Business Administration from the University of Saskatchewan. He is on the board of directors of Great Western Brewing Company. He became a director of SQM in December 2001. |  | December 2001             
|                  |  |                                                                                                                                                                                                                                                                                                                                                                                                       |  |                           
|Hernan Buchi B.   |  | Director. Mr. Buchi is a Civil Engineer with a degree from the Universidad de Chile. He served as Vice Chairman of SQM’s Board from January 2000 to April 2002. He is currently a member of the board of directors of Quinenco S.A. Banco de Chile, S.A.C.I. Falabella and Madeco S.A., among others. He is also Chairman of the board of directors of the Universidad del Desarrollo.                |  | April 1993                
|                  |  |                                                                                                                                                                                                                                                                                                                                                                                                       |  |                           



84







|Name                     |  | Position and relevant experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  | Current positionheld since
|------------------------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------------------
|Patricio Contesse Fica.  |  | Mr. Contesse is a lawyer who obtained his degree from the Pontificia Universidad Católica de Chile. He is also a member of the Board of Directors of Sociedad de Inversiones Pampa Calichera S.A. and Norte Grande S.A. Prior to joining SQM, he was an associate at Barros & Errázuriz Abogados, and CEO of Potasios de Chile S.A. and Nitratos de Chile S.A. He is the son of Patricio Contesse G.                                                                                                                                                                           |  | April 2013                
|                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                           
|Jose Maria Eyzaguirre B. |  | Director. Mr. Eyzaguirre is a lawyer and is a partner of the Chilean law firm Claro y Cía. He obtained his law degree from the Universidad de Chile and was admitted to the Chilean Bar in 1985.  In 1987, he obtained a Master’s Degree from New York University School of Law. He was admitted to the New York Bar in 1988. He is also a member of the board of directors of Gasoducto del Pacifico S.A., a transandean gas pipeline, Embotelladora Andina S.A., a bottler of The Coca Cola Company, and Chairman of the board of directors of Club de Golf Valle Escondido. |  | December 2001             
|                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                           
|Juan Antonio Guzmán M.   |  | Mr. Guzmán is an Industrial and Chemical Engineer from Pontificia Universidad Católica de Chile and has a Ph.D. from the Polytechnic of North London. He has professional experience in managing different organizations both in the public service (Minister of Education) and in the private sector where he has been appointed to several executive positions as CEO and Board member (Gener, Polpaico, CGE, Sonda, Indisa). Furthermore he has been active as owner in entrepreneurial activities in sectors such as Energy, Education, Real Estate and Health.            |  | April 2013                
|                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                           
|Alejandro Montero P.     |  | Mr. Montero graduated from the Pontificia Universidad Catolica de Chile with a degree in Business Administration. He is a Partner and CEO of Celfin Capital, a BTG Pactual company. Mr. Montero joined Celfin Capital in December 1993 to restructure the Research Unit. He became a Partner in 1997 and CEO in 2007.                                                                                                                                                                                                                                                          |  | April 2013                
|                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                           
|Wolf von Appen           |  | Director. Mr. Von Appen is an entrepreneur. He is currently a member of Centro de Estudios Publicos.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | May 2005                  



85







Our executive officers as of the date of
this Annual Report were as follows:



|Name                      |  | Position and relevant experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Current positionheld since
|------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------
|Patricio Contesse G.      |  | Chief Executive Officer. Mr. Contesse is a Forestry Engineer with a degree from the Universidad de Chile. He joined SQM in 1981 as CEO, a position he held until 1982, and again in 1988 for one year.  In the past, he has been CEO of Celco Limitada, Schwager S.A. and Compañía de Aceros del Pacífico S.A. He has also served as Operations Senior Executive Vice President of Codelco Chile, President of Codelco USA and Executive President of Codelco Chile. Mr. Contesse is also a member of the board of directors of Soquimich Comercial S.A. He is the father of Patricio Contesse F. |  | March 1990                
|                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                           
|Patricio de Solminihac T. |  | Chief Operating Officer and Executive Vice President. Mr. de Solminihac is an Industrial Engineer with a degree from the Pontificia Universidad Católica de Chile and holds a Master in Business Administration from the University of Chicago. He joined SQM in 1988 as Business Development Vice President. Currently he is a member of the board of directors of Melon S.A. Mr. de Solminihac is also a member of the board of directors of Soquimich Comercial S.A.                                                                                                                           |  | January 2000              
|                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                           
|Matías Astaburuaga S.     |  | General Counsel and Senior Vice President. Mr. Astaburuaga is a lawyer with a degree from the Pontificia Universidad Católica de Chile. He joined SQM in 1989.  Prior to joining SQM, he was Regional Counsel of The Coca Cola Export Corporation, Andean Region and Regional Counsel of American Life Insurance Company, Latin America Region.                                                                                                                                                                                                                                                   |  | February 1989             
|                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                           



86







|Name                |  | Position and relevant experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Current positionheld since
|------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------
|Ricardo Ramos R.    |  | Chief Financial Officer and Senior Vice President of Business Development.  Mr. Ramos is an Industrial Engineer with a degree from the Pontificia Universidad Católica de Chile. He joined SQM in 1989. Mr. Ramos is also a member of the board of directors of Soquimich Comercial S.A.                                                                                                                                                                                                                                                                                                                                                                                    |  | November 1994             
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                           
|Jaime San Martín L. |  | Nueva Victoria Operations Senior Vice President. Mr. San Martín
is a Transportation Engineer with a degree from the Pontificia Universidad Católica de Chile. He joined SQM in 1995 as Project
Manager. He became Metallic Mining Development Manager in 1997, and Development Manager in 1998, Business Development and Mining
Property Vice President in 1999, Technical Senior Vice President in 2001, and Senior Vice President of Lithium Operations and Mining
Affairs in January 2007. From 2008 until August 2013, he was the Senior Vice President of Nueva Victoria Operations (iodine and
nitrates in the I Region of Chile). He left the Company is August 2013 |  | March 2008                
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                           
|Eugenio Ponce L.    |  | Senior Commercial Vice President. Mr. Ponce is a Mechanical Engineer with a degree from the Universidad Católica de Valparaíso. In 1981, he joined SQM as a Sales Manager. He became Commercial Manager in 1982, Commercial and Operations Manager in 1988 and Chief Executive Officer of SQM Nitratos S.A. in 1991. Currently he is a member of the board of directors of Soquimich Comercial S.A. and Vice Chairman of the board of directors of Pampa Calichera S.A. He is the brother of Julio Ponce L.                                                                                                                                                                 |  | April 1981                
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                           
|Carlos Díaz O.      |  | Senior Vice President Operations, Nitrates-Iodine. Mr. Diaz is an Industrial Civil Engineer with an engineering degree and an MBA from the Pontificia Universidad Católica de Chile. In 1996, he joined SQM as Planning Engineer in the Sales Division where he was promoted to Planning Manager in 1998. In 2002, he assumed the position of Deputy Financial Manager of the Commercial Offices and after four years took up the position of Logistics Manager.                                                                                                                                                                                                            |  | October 2012              
|                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                           



87







|Name                   |  | Position and relevant experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Current positionheld since
|---------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------
|Pauline De Vidts S.    |  | Senior Vice President of Human Resources and Sustainability. Mrs. De Vidts is an Industrial Engineer with a degree from the Pontificia Universidad Católica de Chile and holds a Ph.D. in Chemical Engineering from Texas A&M University. She joined SQM in 1996 to work in process development for the Salar de Atacama Operations, becoming Development Manager for these operations in 1998, and later Corporate R&D and Environmental Issues Vice President in 2001. Since 2005, she has overseen safety, health and environmental issues, and in 2011, she also began overseeing public affairs for SQM. In 2013, she began her new role in the current position. |  | August 2013               
|                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                           
|Juan Carlos Barrera P. |  | Senior Vice President Operations, Salar and Lithium. Mr. Barrera is an Industrial Engineer with a degree from the Pontificia Universidad Católica de Chile and holds a Masters in Business Administration degree from Tulane University and a Masters in Business Administration degree from Universidad de Chile.  He joined SQM in 1991 as an advisor in the Business Development area and has served in many positions since then.  In 1995, he became Business Development Manager of SQM Nitratos S.A. In 1999, he became the Corporate Quality Manager, in 2000, Corporate Supply Chain Vice President and, in 2006, General Manager of Soquimich Comercial S.A. |  | January 2007              
|                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                           
|Daniel Jiménez Sch..   |  | Senior Vice President of Exploration. Mr. Jiménez is an Industrial Engineer with a degree from the Pontificia Universidad Católica de Chile and holds a Masters in Business Administration degree from Old Dominion University. He joined SQM in 1991, holding several positions in the finance and sales areas at SQM’s headquarters and foreign subsidiaries in USA and Belgium, countries he was based in for eight years.  In 2002, he became VP Sales and Marketing Iodine, Lithium and Industrial Chemicals.                                                                                                                                                     |  | August 2013               





| | (1) | Mr. Julio Ponce’s ownership interest in SQM is explained in Item 6.E. Share Ownership.
| | --- | --------------------------------------------------------------------------------------

| | (2) | The individual beneficially owns less than one percent of the Company’s shares
| | --- | ------------------------------------------------------------------------------



88







6.B. Compensation

During 2013, directors were paid a monthly
fee (UF 300 to the Chairman and UF 50 to each of the remaining seven directors), which was independent of attendance and the number
of Board sessions. In addition, the directors received variable compensation (in Chilean pesos) based on a profit-sharing program
approved by the shareholders. In 2013, the Chairman received the equivalent of 0.35% of 2012 profit and each of the remaining seven
directors received the equivalent of 0.04% of 2012 profit.



In addition, during 2013, members of the
Directors’ Committee were paid UF 17 regardless of the number of sessions held by the Committee. Additionally, shareholders
approved variable compensation for the 2013 fiscal year of an amount equal to 0.013% of 2012 profit for each Committee member.
This remuneration is also independent from what the Committee members obtain as members of our Board of Directors.



During 2013, the compensation paid to each
of our directors, who served on the Board during the year, was as follows (amounts in Chilean pesos):



|                               |  | SQM Board Meeting(Ch$) |               |  | SQM Committee (Ch$) |  |             | SQM Committee Meeting (Ch$) |  |  | Total (Ch$) | 
|------------------------------ |  | ---------------------- | ------------- |  | ------------------- |  | ----------- | --------------------------- |  |  | ----------- | 
|Julio Ponce L.                 |  |                        | 1,175,395,866 |  |                     |  | —           |                             |  |  | 82,791,807  | 
|Hernan Buchi B.                |  |                        | 136,303,635   |  |                     |  | 43,973,524  |                             |  |  | —           | 
|*Eduardo Novoa C.              |  |                        | 127,873,049   |  |                     |  | 41,627,438  |                             |  |  | —           | 
|Jose Maria Eyzaguirre B.       |  |                        | 137,077,176   |  |                     |  | —           |                             |  |  | —           | 
|*Daniel Yarur E.               |  |                        | 127,873,049   |  |                     |  | —           |                             |  |  | —           | 
|Wolf Von Appen                 |  |                        | 145,008,656   |  |                     |  | 43,973,524  |                             |  |  | —           | 
|**Patricio Contesse Fica       |  |                        | 9,227,566     |  |                     |  | —           |                             |  |  | —           | 
|**Alejandro Montero Purviance  |  |                        | 8,062,089     |  |                     |  | —           |                             |  |  | —           | 
|Wayne Brownlee                 |  |                        | 145,006,762   |  |                     |  | —           |                             |  |  | —           | 
|*Kendrick T. Wallace           |  |                        | 136,944,673   |  |                     |  | —           |                             |  |  | —           | 
|**Juan Antonio Guzman Molinari |  |                        | 8,062,089     |  |                     |  | 2,741,109   |                             |  |  | —           | 
|Total                          |  |                        | 2,156,834,610 |  |                     |  | 132,315,595 |                             |  |  | 82,791,807  | 

* until april 2013

**since may 2013





For the year ended December 31, 2013, the aggregate compensation
paid to our 117 principal executives based in Chile was US$24.1 million. We do not disclose to our shareholders or otherwise make
available to the public information as to the compensation of our individual executive officers.



We maintain incentive programs for our
employees, based on individual performance, company performance, and short- medium- and long-term indicators. Additionally, in
order to provide incentives to key executives and to retain such executives, we maintain a long-term cash bonus compensation plan
for certain senior executives, which consists of a long-term bonus linked to share price and is payable between 2015 and 2018.



As of December 31, 2013, the provision
providing a long-term bonus linked to our share price would have increased or decreased by approximately US$1.5 million per each
movement of US$1 in the Series B common share price, when the share price is above US$50. The amount of actual cash bonuses payable
under the long-term incentive program will vary depending on the market share price of the Series B common shares on the date as
of which the bonuses are paid.



As of December 31, 2013, we had a provision
related to all of the incentive programs in an aggregate of US$25.2 million.



89







We do not maintain any pension or retirement
programs for the members of the Board or our executive officers in Chile.



6.C. Board
Practices

Information regarding the period of time
each of SQM's current Directors has served in his office is provided in the discussion of each member of the Board above in Item
6.A Directors and Senior Managers.



The date of expiration of the term of the
current Board of Directors is April 2016. The contracts of our executive officers are indefinite. On April 5, 2013, Mr. Kendrick
T. Wallace resigned from his position as Director of the Company. As required by our by-laws and in light of this vacancy, we held
elections for the entire board at the regularly scheduled meeting on shareholders on April 25, 2013.



The members of the Board are remunerated
in accordance with the information provided above in Item 6.B. Compensation. There are no contracts between SQM, or any of its
subsidiaries, and the members of the Board providing for benefits upon termination of their term.



Directors' Committee – Audit Committee



As required by Chilean Law, during 2013
we had a Directors’ Committee (Comité de Directores) composed of three Directors, which performs many of the
functions of an audit committee. This Directors’ Committee complies with the requirements of the NYSE corporate governance
rules applicable to audit committees. Under the NYSE corporate governance rules, the audit committee of a U.S. company must perform
the functions detailed in the NYSE Listed Company Manual Rules 303A.06 and 303A.07. Non-U.S. companies are required to comply with
Rule 303A.06 but are not at any time required to comply with Rule 303A.07.



As of December 31, 2013, our Directors’
Committee was comprised of three Directors: Mr. Buchi, Mr. Guzmán and Mr. Von Appen. Each of the three members meet the
NYSE independence requirements for audit committee members. According to Chilean independence requirements, Mr. Guzmán meets
the requirements for independence. Our Directors’ Committee operates in accordance with article 50 bis of the Chilean
Corporations Act, which provides that the Directors’ Committee will, among other things:



(a)     examine and issue an
opinion regarding the external auditor’s report including financial statements prior to its final presentation for approval
at the ordinary shareholders meeting;



(b)     propose to the Board
the external auditors and the rating agencies that will be presented at the ordinary shareholders meeting;



(c)     examine and elaborate
a report concerning the operations covered by Title XVI of the Chilean Corporations Act, which relates to related party transactions;
and



(d)     examine the remuneration
and compensation plans of the senior management.



Accordingly, the following were the main
activities of our Directors’ Committee during 2013:



(a)     analysis of unaudited
financial reports;



(b)     analysis of audited
financial reports;



(c)     analysis of reports
and proposals submitted by external auditors, account inspectors and rating agencies, and recommendations to the Board of Directors
regarding external auditors and rating agencies that could be designated by shareholders at the respective annual general shareholders
meeting;



(d)     analysis of tax and
other non-audit services provided by external auditors for SQM and its subsidiaries in Chile and abroad;



(e)     analysis of functions,
objectives and working programs of the Internal Audit Department;



90







(f)     analysis of SQM’s
senior executives’ remuneration and compensation plans;



(g)     analysis of the records
relating to the transactions referred to in Title XVI of the Chilean Corporations Act;



(h)     analysis of matters
related to the Sarbanes-Oxley Act, especially regarding Section 404;



(i)     analysis of matters
related to IFRS standards issued by U.S. standard-setter, the Public Company Accounting Oversight
Board; and



(j)     analysis of an internal
control report.



On April 25, 2013, the Annual General Shareholders
Meeting of SQM approved an operational budget for the Directors Committee; the operational budget is equivalent to the annual remuneration
of the members of the Directors Committee.



The activities carried out by the Committee,
as well as the expenses incurred by it, are to be disclosed at the General Shareholders Meeting. During 2013, the Directors Committee
did not incur any consulting expenses.



Article 50 bis of the Chilean Corporations
Act states that the Committee should consist of three Directors, of which at least one member should preferably be independent
from the controller (i.e. any person or entity who “controls” the company for Chilean law purposes), if any, and that
their functions be remunerated.



Comparative Summary of Differences
in Corporate Governance Standards



The following table provides a comparative
summary of differences in corporate governance practices followed by us under our home-country rules and those applicable to U.S.
domestic issuers pursuant to Section 303A of the New York Stock Exchange (NYSE) Listed Company Manual.



Listed Companies that are foreign private
issuers, such as SQM, are permitted to follow home country practices in lieu of the provisions of Section 303A, except such companies
are required to comply with the requirements of Section 303A.06, 303A.11 and 303A.12(b) and (c).



|Section |  | NYSE Standards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | SQM practices pursuant to Chilean StockExchange regulations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|303A.01 |  | Listed companies must have a majority of independent directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | There is no legal obligation to have a majority of independent directors on the Board but, according to Chilean law, the Company's directors cannot serve as executive officers.                                                                                                                                                                                                                                                                                                                                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|303A.02 |  | No director qualifies as "independent" unless the
board of directors affirmatively determines that the director has no material relationship with the listed company (either directly
or as a partner, shareholder or officer of an organization that has a relationship with the company).In addition, a director is not independent if:(i) The director is, or has been within the last three years, an employee of the listed
company, or an immediate family member is, or has been within the last three years, an executive officer, of the listed
company.(ii) The director has received, or has an immediate family member who has received,
during any twelve-month period within the last three years, more than $120,000 in direct compensation from the listed company,
other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation
is not contingent in any way on continued service). |  | A director would not be considered independent if, at any time,
within the last 18 months he or she:(i) Maintained any relationship of a relevant nature and amount with the company, with other companies
of the same group, with its controlling shareholder or with the principal officers of any of them or has been a director, manager,
administrator or officer of any of them;(ii) Maintained a family relationship with any of the members described in (i) above;(iii) Has been a director, manager, administrator or principal officer of non-profit organizations
that have received contributions from (i) above;
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               



91







|Section |  | NYSE Standards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | SQM practices pursuant to Chilean StockExchange regulations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  | (iii) (A) The director is a current partner or employee of a firm that is the listed company's internal
or external auditor; (B) the director has an immediate family member who is a current partner of such a firm; (C) the director
has an immediate family member who is a current employee of such a firm and personally works on the listed company's audit; or
(D) the director or an immediate family member was within the last three years a partner or employee of such a firm and personally
worked on the listed company's audit within that time.(iv) The director or an immediate family member is, or has been with the last three years, employed
as an executive officer of another company where any of the listed company's present executive officers at the same time serves
or served on that company's compensation committee.(v) The director is a current employee, or an immediate family member is a current executive
officer, of a company that has made payments to, or received payments from, the listed company for property or services in
an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company's
consolidated gross revenues. |  | (iv) Has been a partner or a shareholder that has had or controlled, directly or indirectly, 10%
or more of the capital stock or has been a director, manager, administrator or principal officer of an entity that has provided
consulting or legal services for a relevant consideration or external audit services to the persons listed in (i) above;
(v) Has been a partner or a shareholder that has had or controlled, directly or indirectly, 10%
or more of the capital stock or has been a director, manager, administrator or principal officer of the principal competitor,
supplier or clients.
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|303A.03 |  | The non-management directors must meet at regularly scheduled executive sessions without management.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | These meetings are not needed given that directors cannot serve as executive officers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|303A.04 |  | (a) Listed companies must have a nominating/corporate governance committee composed entirely of independent directors.
(b) The nominating/corporate governance committee must have a written charter that addresses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | This committee is not required as such in the Chilean regulations.  However, pursuant to Chilean regulations SQM has a Directors' Committee (see Board practices above).                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        |  | (i) the committee's purpose and responsibilities – which, at minimum, must be to: identify individuals qualified to become board members, consistent with criteria approved by the board, and to select, or to recommend that the board select, the director nominees for the next annual meeting of shareholders; develop and recommend to the board a set of corporate governance guidelines applicable to the corporation; and oversee the evaluation of the board and management; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        |  | (ii) an annual performance evaluation of the committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|303A.05 |  | Listed companies must have a compensation committee composed entirely of independent directors, and must have a written charter                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | This committee is not required as such in the Chilean regulations. Pursuant to Chilean regulations, SQM has a Director’s Committee (see Board practices above) that is in charge of reviewing management’s compensation.                                                                                                                                                                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|303A.06 |  | Listed companies must have an audit committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | This committee is not required as such in the Chilean regulations. Pursuant to Chilean regulations, SQM has a Directors’ Committee that performs the functions of an audit committee and that complies with the requirements of the NYSE corporate governance rules.                                                                                                                                                                                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             



92







|Section |  | NYSE Standards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | SQM practices pursuant to Chilean StockExchange regulations                                                                                                                                                                                                                                                                                                    
|------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|303A.07 |  | The audit committee must have a minimum of three members. All audit committee members must satisfy requirements of independence, and the committee must have a written charter.The listed companies must have an internal audit function to provide management with ongoing assistance of the Company's risk management process and the system of internal controls                                                                                                                                                                                                                                                                                                                  |  | Pursuant to Section 303A.00, SQM is not required to comply with requirements in 303A.07. Pursuant to Chilean Regulations SQM has a Director’s Committee (see Board practices above) that also performs the functions of an audit committee with certain requirements of independence.                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.08 |  | Shareholders must have the opportunity to vote on all equity-compensation plans and material revisions thereto.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | SQM does not have equity compensation plans. However, as mentioned in Item 6.B Compensation, the Company does have a long-term cash bonus compensation plan. Directors and executives may only acquire SQM shares by individual purchases. The purchaser must give notice of such purchases to the Company and the Superintendence of Securities and Insurance.
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.09 |  | Listed companies must adopt and disclose corporate governance guidelines.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Chilean law does not require that corporate governance guidelines be adopted. Directors' responsibilities and access to management and independent advisors are directly provided for by applicable law. Directors' compensation is approved at the annual meeting of shareholders, pursuant to applicable law.                                                
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.10 |  | Listed companies must adopt and disclose a code of business conduct and ethics for directors, officers and employees and promptly disclose any waivers of the code for directors or executive officers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | Not required in the Chilean regulations. SQM has adopted and disclosed a Code of Business Conduct and Ethics, available at the Company's website, www.sqm.com.                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.11 |  | Listed foreign private issuers must disclose any significant ways in which their corporate governance practices differ from those followed by domestic companies under NYSE listed standards.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | Pursuant to 303A.11, this table shows a comparative summary of differences in corporate governance practices followed by SQM under Chilean regulations and those applicable to U.S. domestic issuers pursuant to Section 303A.                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.12 |  | Each listed company CEO must (a) certify to the NYSE each year that he or she is not aware of any violation by the listed company of NYSE corporate governance listing standards; (b) promptly notify the NYSE in writing after any executive officer becomes aware of any material non-compliance with any applicable provisions of Section 303A; and (c) must submit an executed Written Affirmation annually to the NYSE.  In addition, each listed company must submit an interim Written Affirmation as and when required by the interim Written Affirmation form specified by the NYSE. The annual and interim Written Affirmations must be in the form specified by the NYSE. |  | Not required in the Chilean regulations.  The CEO must only comply with Section 303A.12 (b) and (c).                                                                                                                                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                
|303A.13 |  | The NYSE may issue a public reprimand letter to any listed company that violates a NYSE listing standard.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Not specified in the Chilean regulations.                                                                                                                                                                                                                                                                                                                      



6.D. Employees

As of December 31, 2013, we had 4,792 permanent employees, 209
of whom were employed outside of Chile. The average tenure of our permanent employees is approximately 7.2 years.



93







|                           |  | As of December 31, |      
|-------------------------- |  | ------------------ | -----
|                           |  | 2013               |      
|Employees in Chile         |  |                    | 4,583
|Employees outside of Chile |  |                    | 209  
|Total employees            |  |                    | 4,792



As of December 31, 2013, 71% of our permanent
employees in Chile were represented by 25 labor unions, which represent their members in collective negotiations with us. Compensation
for unionized personnel is established in accordance with the relevant collective bargaining agreements. The terms of most such
agreements currently in effect are three years, and expiration dates of such agreements vary from contract to contract. Under these
agreements, employees receive a salary according to a scale that depends upon job function, seniority and productivity. Unionized
employees also receive certain benefits provided by law and certain benefits provided under the applicable collective bargaining
agreement, which vary depending upon the terms of the collective agreement, such as housing allowances and additional death and
disability benefits.



In addition, we own all of the equity of
Institución de Salud Previsional Norte Grande Limitada (“Isapre Norte Grande”), which is a health care organization
that provides medical services primarily to our employees and Sociedad Prestadora de Servicios de Salud Cruz de Norte S.A. (“Prestadora”),
which is a hospital in María Elena. We make contributions to Isapre Norte Grande and to Prestadora in accordance with Chilean
laws and the provisions of our various collective bargaining agreements, but we are not otherwise responsible for its liabilities.



Non-unionized employees receive individually
negotiated salaries, benefits provided for by law and certain additional benefits which we provide.



We provide housing and other facilities
and services for employees and their families at the María Elena site.



We do not maintain any pension or retirement
programs for our Chilean employees. Most workers in Chile are subject to a national pension law, adopted in 1980, which establishes
a system of independent pension plans that are administered by the corresponding Sociedad Administradora de Fondos de Pensiones.
We have no liability for the performance of any of these pension plans or any pension payments to be made to our employees. We,
however, sponsor staff severance indemnities plans for our employees and employees of our Chilean subsidiaries whereby we commit
to provide a lump sum payment to each employee at the end of his/her employment, whether due to death, termination, resignation
or retirement.



Over 95% of our employees are employed
in Chile, of which approximately 71% were represented by 25 labor unions as of December 31, 2013. As in previous years, during
2013, we renegotiated collective labor contracts with individual unions one year before the expiration of such contracts. As of
December 31, 2013, we had concluded advanced negotiations with four labor unions, which represent 8.5% of our total unionized workers,
signing new agreements with each for durations of three years. We are in the process of negotiating collective labor contracts
with the 21 remaining unions. We are exposed to labor strikes that could impact our production levels. If a strike occurs and continues
for a sustained period of time, we could be faced with increased costs and even disruption in our product flow that could have
a material adverse effect on our business, financial condition and results of operations.



94







6.E. Share
Ownership

As of December 31, 2013, SQM had a “controlling
group”, as such term is defined in Title XV of Chilean Law N°18,045. SQM has been informed that, as of December 31, 2013,
Mr. Julio Ponce Lerou, Chairman to the Board of SQM, and related persons, control 100% of Inversiones SQYA Ltda. (“SQYA”),
which controls indirectly 29.92% of all shares of SQM (consisting of 71,736,516 Series A shares and 7,007,688 Series B shares),
as follows: (i) SQYA controls 67.31% of Norte Grande S.A. (“Norte Grande”), which controls 76.34% of Sociedad de Inversiones
Oro Blanco S.A., which controls 88.62% of Sociedad de Inversiones Pampa Calichera S.A. (“Pampa Calichera”), which controls
19.67% of SQM; (ii) Pampa Calichera controls 99.99% of Inversiones Global Mining (Chile) Limitada, which controls 3.34% of SQM;
and (iii) Norte Grande controls 76.34% of Nitratos de Chile S.A., which controls 98.62% of Potasios de Chile S.A., which controls
10.07% of Pampa Calichera and 6.91% of SQM. Thus, Pampa Calichera and its related companies, Inversiones Global Mining (Chile)
Limitada and Potasios de Chile S.A. (“Pampa Group”), control 29.92% of SQM. In addition, the Pampa Group has also informed
SQM that, as of December 31, 2013, it owns an additional 35,889 shares of SQM,currently held under custody at Larraín Vial
Corredora de Bolsa S.A.



Kowa Company Ltd., Inversiones La Esperanza
(Chile) Limitada, Kochi S.A., and the Esperanza Delaware Corporation (“Kowa Group”) are owners of 2.08% of all shares
in SQM. On December 21, 2006, the Pampa Group and the Kowa Group entered into a Joint Operation Agreement which, together, allows
them to control 32% of all shares in SQM. Therefore, the Pampa Group, together with Kowa Group, indirectly control 32% of all SQM
shares, giving them the status of “controlling group” of the Company.



We do not grant stock options or other
arrangements involving the capital of SQM to directors, managers or employees.



The following table shows the combined
stakes that the Controller Group held in SQM as of:



|                  |  | % Beneficial ownership |      
|----------------- |  | ---------------------- | -----
|December 31, 2013 |  |                        | 32.00
|December 31, 2012 |  |                        | 34.05
|December 31, 2011 |  |                        | 34.05



Separately from any ownership interest
held by the Controller Group, as of December 31, 2013, SQM has been informed that the Canadian company Potash Corporation of Saskatchewan
Inc. (“PCS”) indirectly controls 100% of the shares of Inversiones El Boldo Limitada and 100% of the shares of Inversiones
RAC Chile Limitada. PCS also owns shares of SQM through BTG Pactual Chile S.A. Corredora de Bolsa. Through these companies, PCS
owns 32% of the total shares of SQM.  For additional information regarding share ownership of the Company, see Item 7. below.



95









ITEM
7.MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS



7.A. Major
Shareholders

The following table shows certain information
concerning beneficial ownership of the Series A and Series B common shares of SQM as of December 31, 2013 with respect to each
shareholder known by us to beneficially own more than 5% of the outstanding Series A or Series B common shares. The following information
is derived from our records and reports filed by certain of the persons named below with the SVS and the Santiago Stock Exchange.



|Shareholder                                     |  | Number of series A shares beneficially owned |            |  | % series A shares |  |       | Number of series B shares beneficially owned |  |  | % series B shares |  |  | % total shares |      
|----------------------------------------------- |  | -------------------------------------------- | ---------- |  | ----------------- |  | ----- | -------------------------------------------- |  |  | ----------------- |  |  | -------------- | -----
|The Bank of New York                            |  |                                              | —          |  |                   |  | —     |                                              |  |  | 56,302,367        |  |  |                | 46.77
|Sociedad de Inversiones Pampa Calichera S.A.(1) |  |                                              | 44,758,830 |  |                   |  | 31.34 | %                                            |  |  | 6,971,799         |  |  |                | 5.79 
|Inversiones El Boldo Ltda.(2)                   |  |                                              | 29.225.196 |  |                   |  | 20.46 | %                                            |  |  | 18.028.676        |  |  |                | 14.98
|Inversiones RAC Chile Ltda.(2)                  |  |                                              | 19,200,242 |  |                   |  | 13.44 | %                                            |  |  | 2,202,773         |  |  |                | 1.83 
|Potasios de Chile S.A.(3)                       |  |                                              | 18,179,147 |  |                   |  | 12.73 | %                                            |  |  | —                 |  |  |                | 0    



| | (1) | Pampa Calichera is a publicly held corporation whose shares are traded on the Santiago Stock Exchange.
Originally, the shareholders of Pampa Calichera were employees of SQM. Pampa Calichera was formed to hold the capital stock of
SQM contributed by such employees or later acquired in the open market.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | PCS owns 100% of Inversiones El Boldo Limitada and 100% of Inversiones RAC Chile Ltda., and, accordingly,
is the beneficial owner of 85,047,999 of SQM’s shares. In addition, PCS owns shares of SQM through BTG Pactual Chile S.A.
Corredora de Bolsa, and is the beneficial owner of 32.00% of SQM’s total shares. The stake held by PCS as of December 31,
2012 and 2011 was, respectively, 32.00% and 32.00% of SQM’s total shares.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | As of December 31, 2013, SQM had a “controlling group”, as such term is defined in
Title XV of Chilean Law N°18,045. SQM has been informed that, as of December 31, 2013, Mr. Julio Ponce Lerou, Chairman to the
Board of SQM, and related persons, control 100% of Inversiones SQYA Ltda. (“SQYA”), which controls indirectly 29.92%
of all shares of SQM (consisting of 71,736,516 Series A shares and 7,007,688 Series B shares), as follows: (i) SQYA controls 67.31%
of Norte Grande S.A. (“Norte Grande”), which controls 76.34% of Sociedad de Inversiones Oro Blanco S.A., which controls
88.62% of Sociedad de Inversiones Pampa Calichera S.A. (“Pampa Calichera”), which controls 19.67% of SQM; (ii) Pampa
Calichera controls 99.99% of Inversiones Global Mining (Chile) Limitada, which controls 3.34% of SQM; and (iii) Norte Grande controls
76.34% of Nitratos de Chile S.A., which controls 98.62% of Potasios de Chile S.A., which controls 10.07% of Pampa Calichera and
6.91% of SQM. Thus, Pampa Calichera and its related companies, Inversiones Global Mining (Chile) Limitada and Potasios de Chile
S.A. (“Pampa Group”), control 29.92% of SQM. In addition, the Pampa Group has also informed SQM that, as of December
31, 2013, it owns an additional 35,889 shares of SQM,currently held under custody at Larraín Vial Corredora de Bolsa S.A.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Kowa Company Ltd., Inversiones
La Esperanza (Chile) Limitada, Kochi S.A., and the Esperanza Delaware Corporation (“Kowa Group”) are owners of 2.08%
of all shares in SQM. On December 21, 2006, the Pampa Group and the Kowa Group entered into a Joint Operation Agreement which,
together, allows them to control 32% of all shares in SQM. Therefore, the Pampa Group, together with Kowa Group, indirectly control
32% of all SQM shares, giving them the status of “controlling group” of the Company.



On December 21, 2006, Pampa Calichera
and Kowa executed a joint performance agreement that allows them to become the “controller group” of the Company,
as such term is defined under Chilean law. We have been informed that, as of December 31, 2013, Mr. Julio Ponce L. and related
persons beneficially owned, through Pampa Calichera and certain other companies, 29.92% of the shares of the Company. As of December
31, 2013, Kowa Group owned, directly and indirectly, 2.08% of the shares of the Company. As of December 31, 2013, pursuant to
the joint performance agreement, the “controller group” led by Mr. Julio Ponce L. beneficially owned 32.00% of the
total shares of the Company.



96







Series A and Series B common shares have
the same economic rights (i.e., both series are entitled to share equally in any dividends declared on the outstanding stock) and
voting rights at any shareholders meeting, whether ordinary or extraordinary, with the exception of the election of the Board,
in which the Series A shareholders elect seven members and the Series B shareholders elect one member. Additionally, Series B common
shares cannot exceed 50% of SQM’s issued and outstanding stock; shareholders of at least 5% of this Series may call an ordinary
or extraordinary shareholders’ meeting; and the director elected by this Series may request an extraordinary Board meeting
without the authorization of the Chairman of the Board. These conditions will remain in effect until 2043. Under our by-laws, the
maximum individual voting power personally and/or in representation of other shareholders per Series is limited to 37.5% of the
subscribed shares of each Series with voting rights and 32% of the total subscribed shares with voting rights. To calculate these
percentages, shares that belong to the voting shareholder’s related persons must be added. In addition, the director elected
by the Series B shareholders cannot vote in the election of the Chairman of the Board if a tie vote has occurred in the prior voting
process. As of December 31, 2013, there are 142,819,552 Series A common shares and 120,376,972 Series B common shares outstanding.



7.B. Related
Party Transactions



Title XVI of the Chilean Corporations Act
regulates transactions with related parties for publicly held corporations and its related parties.



Articles 146 to 149 of the Chilean Corporations
Act requires that our transactions with related parties (i) have as their purpose to contribute to SQM’s interests (ii) be
on price, terms and conditions similar to those customarily prevailing in the market at the time of their approval and (iii) satisfy
the requirements and procedures established by the Chilean Corporations Act. Violation of such articles may also result in administrative
or criminal sanctions and civil liability may be sought by SQM, shareholders or interested third parties that suffer losses as
a result of such violations.



In addition, article 89 of the Chilean
Corporations Act requires that transactions between affiliates, subsidiaries or related parties of a closed-stock company, such
as some of SQM’s main affiliates and subsidiaries, shall also be on terms similar to those customarily prevailing in the
market. Directors and executive officers of companies that violate article 89 are liable for losses resulting from such violations.



With respect to SQM, operations with related
parties include negotiations, proceedings, contracts or operations involving SQM and its controller, directors, managers and officers,
and their spouses and relatives, and other companies and persons connected to the abovementioned parties or mentioned in the by-laws
or by the Directors’ Committee. Such operations may only be carried out if (i) their objective is to contribute to SQM’s
interests and if their price, terms and conditions conform to prevailing market prices, terms and conditions at the time of their
approval and (ii) they satisfy the requirements and procedures established by the Chilean Corporations Act. Such requirements include,
among others:



| | · | that the operation be informed to the Directors’ Committee and to the Board of Directors
prior to its execution;
| | - | ----------------------------------------------------------------------------------------------------------------



| | · | that the Board of Directors, excluding any Directors involved in the operation, approves the operation
with an absolute majority of its members, or, if an absolute majority is not feasible, with a unanimous vote by the Directors not
involved in the transaction, or, if neither of these options is available, that an extraordinary shareholders’ meeting be
held and that shareholders representing 2/3 of the outstanding shares with voting rights approve the operation. In the latter case,
prior to the meeting, the shareholders must be provided with a report by an independent evaluator and with statements by the directors
as to whether or not such operation is in SQM’s interest;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



97







| | · | that the grounds for the decision and for the exclusion be recorded in the respective minutes of
the Board meeting; and
| | - | -----------------------------------------------------------------------------------------------------------------------



| | · | that the agreement and the names of the directors who approved the same be reported at the next
shareholders’ meeting. Infractions will not affect the validity of the operation but they will grant SQM or its shareholders
the right to demand that the related party committing such infraction refund the amount equivalent to the benefits received by
such party in the operation to SQM, and that such party indemnify for any corresponding damages.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



However, the Board of Directors may authorize
the following operations with related parties to be carried out without following such requirements and procedures, as long as
such authorization is obtained in advance: (a) operations wherein the amount of the transaction is not significant or (b) operations
that, according to the general policies on customary practices determined by the Board of Directors, are considered normal based
on SQM’s business activities or (c) operations carried out between legal entities wherein SQM holds at least a 95% ownership
interest in the counterpart.



We believe that we have complied with the
applicable requirements of the referred articles in all transactions with related parties. Accounts receivable from and payable
to related companies are stated in U.S. dollars and accrue no interest. Other than the above, transactions are made under terms
and conditions that are similar to those offered to unrelated third parties. We further believe that we could obtain from third
parties all raw materials now being provided by related parties that are not our affiliates. The provision of such raw materials
by new suppliers could initially entail additional expenses.



In each case, terms and conditions vary
depending on the transaction pursuant to which it was generated.



The Company regularly enters into business
arrangements with related parties, principally its joint ventures and associates, which are described in Note 9.0 to the Consolidated
Financial Statements.



7.C. For
additional information concerning our transactions with affiliates and other related parties, see Note 8 of the Consolidated Financial
Statements. Interests of Experts and Counsel



Not applicable.



98







ITEM
8.FINANCIAL INFORMATION



8.A. Consolidated
Statements and Other Financial Information

8.A.1 See
Item 18. Financial Statements



8.A.2 See
Item 18. Financial Statements.



8.A.3 See
Item 18. Financial Statements—Reports of Independent Registered Public Accounting Firm.



8.A.4 Not
applicable.



8.A.5 Not
applicable.



8.A.6 Export Sales



We derive most of our revenues from sales
outside of Chile. The distribution of sales presented below reflects the location of the Company’s subsidiaries making such
sales and does not necessarily reflect the final destination of the products sold.



The following is the composition of the
consolidated sales for the periods ending on December 31, 2013, 2012, and 2011:



|US$                |  | 2013 |           |   | 2012 |  |           | 2011 | 
|------------------ |  | ---- | --------- | - | ---- |  | --------- | ---- | 
|                   |  |      |           |   |      |  |           |      | 
|Foreign sales      |  |      | 1,960,767 |   |      |  | 2,159,739 |      | 
|Total sales        |  |      | 2,203,140 |   |      |  | 2,429,160 |      | 
|                   |  |      |           |   |      |  |           |      | 
|% of foreign sales |  |      | 89.00     | % |      |  | 88.91     | %    | 



8.A.7 Legal Proceedings



In October 2010, the City of Pomona, California,
named Sociedad Química y Minera de Chile S.A. (SQM) and SQM North America Corporation (SQMNA) as defendants in an action
filed in the California Superior Court for Los Angeles County. In this matter the plaintiff seeks damages for alleged groundwater
contamination from the use of defendant’s fertilizer products. This case has been dismissed by the trial court and is currently
on appeal by the plaintiff to the Ninth Circuit Court of Appeals.



In October 2010, the City of Lindsay, California,
named Sociedad Química y Minera de Chile S.A. (SQM) and SQM North America Corporation (SQMNA) as defendants in an action
filed in the California Superior Court for Tulare County. In this matter the plaintiff seeks damages for alleged groundwater contamination
from the use of defendant’s fertilizer products. This case is pending in the trial court subject to the resolution of the
Ninth Circuit Court of Appeals in the City of Pomona’s action.



SQM has not been served in either action.
SQMNA and SQM (if it is legally served) intend to vigorously defend both actions.



We are party to various other lawsuits
arising in the ordinary course of business. For more information on these lawsuits, see Note 16.1 to our Consolidated Financial
Statements. Also see Item 3.D. Risk Factors—Risks Relating to our Business—Lawsuits and arbitrations could adversely
impact us.



99







8.A.8. Dividend Policy



As required by Chilean law and regulations,
our dividend policy is decided upon from time to time by our Board of Directors and is announced at the Annual Ordinary Shareholders'
Meeting, which is generally held in April of each year. Shareholder approval of the dividend policy is not required. However, each
year the Board must submit the declaration of the final dividend or dividends in respect of the preceding year, consistent with
the then-established dividend policy to the Annual Ordinary Shareholders' Meeting for approval. As required by the Chilean Companies
Act, unless otherwise decided by unanimous vote of the holders of issued shares, we must distribute a cash dividend in an amount
equal to at least 30% of our consolidated net income for that year (determined on an IFRS basis), unless and except to the extent
it has a deficit in retained earnings.



The dividend policy for 2012 established
that SQM must distribute and pay in favor of its shareholders, as a final dividend, the amount in Chilean pesos equivalent to 50%
of the distributable income for 2012. At the Annual Shareholders’ Meeting held on April 25, 2013, SQM’s shareholders
approved a payment of a definitive dividend in the amount of US$1.23323 per share. From this definitive dividend, the interim dividend
amount of US$0.94986 per share was deducted. Payments for this dividend were made on May 8, 2013.



At the Annual Shareholders’ Meeting
held on April 25, 2013, shareholders also agreed to pay and distribute a dividend equal to 50% of the distributable income corresponding
to 2013. For this purpose, distributable net income includes income for the year included in the income statement item “Profit
(Loss) Attributable to Owners of the Parent" less significant changes in the fair value of assets and liabilities that are
not realized - and which correspond to earnings net of taxes that have been generated in relation to the acquisition of companies.
Also, at the same meeting, shareholders agreed to the payment and distribution of an interim dividend. The interim dividend was
paid on December 6, 2013 in the amount of US$0.75609 per share.



We generally declare dividends in U.S.
dollars (but may declare dividends in Chilean pesos) and pay such dividends in Chilean pesos. When a dividend is declared in U.S.
dollars, the exchange rate to be used to convert the dividend into Chilean pesos is decided by the shareholders at the meeting
that approves the dividend, which has usually been the Observed Exchange Rate on the date the dividend is declared. In the case
of interim dividends, the exchange rate to be used is the Observed Exchange Rate published five business days before the payment
date.



Although the Board of Directors has no
current plan to recommend a change in the dividend policy, the amount and timing for payment of dividends is subject to revision
from time to time, depending upon our then current level of sales, costs, cash flow and capital requirements, as well as market
conditions. Accordingly, there can be no assurance as to the amount or timing of declaration or payment of dividends in the future.
Any change in dividend policy would ordinarily be effective for dividends declared in the year following adoption of the change,
and a notice as to any such change of policy must be filed with Chilean regulatory authorities and would be publicly available
information.



Dividends



Each Series A Share and Series B Share
is entitled to share equally in any dividends declared on the outstanding capital stock of SQM.



100







The following table shows the U.S. dollar
equivalent of dividends per share and per ADS paid in each of the years indicated, based on the Observed Exchange Rate for the
date on which the dividend was declared.



|Dividends                       |  | Per Share |  |     | Per ADS (1) | 
|------------------------------- |  | --------- |  | --- | ----------- | 
|Declared for the  business year |  | Paid in   |  | Ch$ |             | 
|                                |  |           |  |     |             | 
|2008 (interim)                  |  | 2008      |  |     | 243.34      | 
|2008                            |  | 2009      |  |     | 515.90      | 
|2009 (interim)                  |  | 2009      |  |     | 191.32      | 
|2009                            |  | 2010      |  |     | 126.69      | 
|2010 (interim)                  |  | 2010      |  |     | 198.90      | 
|2010                            |  | 2011      |  |     | 142.40      | 
|2011 (interim)                  |  | 2011      |  |     | 376.99      | 
|2011                            |  | 2012      |  |     | 147.66      | 
|2012(interim)                   |  | 2012      |  |     | 456.93      | 
|2012                            |  | 2013      |  |     | 134.56      | 
|2013 (interim)                  |  | 2013      |  |     | 401.60      | 



| | (1) | The Series A ADSs were delisted from the New York Stock Exchange on March 27, 2008. The ratio of
ordinary shares to Series B ADSs changed from 10:1 to 1:1 on March 28, 2008. The calculation in the table for all periods is based
on a ratio 1:1.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Dividends payable to holders of ADSs will
be paid net of conversion expenses of the Depositary and will be subject to Chilean withholding tax, currently imposed at the rate
of 35% (subject to credits in certain cases).



As a general requirement, a shareholder
who is not a resident of Chile must register as a foreign investor under one of the foreign investment regimes contemplated by
Chilean law to have dividends, sale proceeds or other amounts with respect to its shares remitted outside Chile through the Formal
Exchange Market. Under the Foreign Investment Contract, the Depositary, on behalf of ADR holders, will be granted access to the
Formal Exchange Market to convert cash dividends from Chilean Pesos to U.S. dollars and to pay such U.S. dollars to ADR holders
outside Chile net of taxes, and no separate registration of ADR holders is required.



8.B. Significant
Changes



No significant change has occurred since
the date of the financial statements set forth in Item 18.



101







ITEM
9.THE OFFER AND LISTING



9.A. Offer and Listing Details



Price History



The table below shows, for the periods
indicated, the reported high and low closing prices for our shares on the Santiago Stock Exchange and the high and low closing
prices of the ADSs as reported by the NYSE, as the two main exchanges on which our shares are traded. On March 27, 2008, the Company
voluntarily delisted its series A ADRs from the New York Stock Exchange. In addition, on March 28, 2008, a ration change for the
Company’s series B ADSs entered into effect, modifying the ratio of ordinary shares to Series B ADSs from the previous ration
of 10:1 to a new ratio of 1:1.



(a)              Last 5 years



|     |  | Santiago Stock Exchange |        |  | NYSE     | 
|---- |  | ----------------------- | ------ |  | -------- | 
|     |  | Per Share (1)           |        |  | Per ADS  | 
|     |  | Series A                |        |  | Series B | 
|     |  | High                    |        |  | Low      | 
|     |  | Ch$                     |        |  | Ch$      | 
|2009 |  |                         | 22,000 |  |          | 
|2010 |  |                         | 27,000 |  |          | 
|2011 |  |                         | 30,000 |  |          | 
|2012 |  |                         | 30,050 |  |          | 
|2013 |  |                         | 27,350 |  |          | 



| | (b) | Last 8 quarters
| | --- | ---------------



|               |  | Santiago Stock Exchange |        |  | NYSE     | 
|-------------- |  | ----------------------- | ------ |  | -------- | 
|               |  | Per Share (1)           |        |  | Per ADS  | 
|               |  | Series A                |        |  | Series B | 
|               |  | High                    |        |  | Low      | 
|               |  | Ch$                     |        |  | Ch$      | 
|               |  |                         |        |  |          | 
|2012           |  |                         |        |  |          | 
|First quarter  |  |                         | 27,690 |  |          | 
|Second quarter |  |                         | 28,000 |  |          | 
|Third quarter  |  |                         | 30,050 |  |          | 
|Fourth quarter |  |                         | 30,020 |  |          | 
|               |  |                         |        |  |          | 
|2013           |  |                         |        |  |          | 
|First quarter  |  |                         | 27.350 |  |          | 
|Second quarter |  |                         | 25.500 |  |          | 
|Third quarter  |  |                         | 20.600 |  |          | 
|Fourth quarter |  |                         | 21.500 |  |          | 



102







(c)                Last 6 months



|              |  | Santiago Stock Exchange |        |  | NYSE     | 
|------------- |  | ----------------------- | ------ |  | -------- | 
|              |  | Per Share (1)           |        |  | Per ADS  | 
|              |  | Series A                |        |  | Series B | 
|              |  | High                    |        |  | Low      | 
|              |  | Ch$                     |        |  | Ch$      | 
|October 2013  |  |                         | 21.500 |  |          | 
|November 2013 |  |                         | 21.500 |  |          | 
|December 2013 |  |                         | 19.500 |  |          | 
|January 2014  |  |                         | 18.500 |  |          | 
|February 2014 |  |                         | 19.000 |  |          | 
|March 2014    |  |                         | 19.071 |  |          | 



| | (1) | Pesos per share of Common Stock reflect nominal price at trade date.
| | --- | --------------------------------------------------------------------

| | (2) | Series A shares started trading on the New York Stock Exchange on April 9, 1999.
| | --- | --------------------------------------------------------------------------------

| | (3) | Series B shares began trading on the New York Stock Exchange on September 20, 1993. Historical
prices have been restated to reflect the change in the ratio of local shares to ADSs from 10:1 to 1:1, effective March 28, 2008.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of December 31, 2013, there were 56,302,367
Series B ADRs outstanding. As of December 31, 2013, such ADSs represented approximately 21.39% of the total number of issued and
outstanding shares of our Company.



9.BPlan
Of Distribution



Not Applicable.



9.C      Markets



The Series A shares and the Series B shares
are currently traded on the Santiago Stock Exchange, the Bolsa Electrónica de Chile Bolsa de Valores S.A., (the Electronic
Stock Exchange), and the Bolsa de Corredores Bolsa de Valores S.A., (the Valparaíso Stock Exchange). As of December 31,
2013, each series was also traded on the New York Stock Exchange in the form of ADSs at a ratio of 1:1. The ADSs representing Series
B shares have traded on the NYSE since September 20, 1993. The depositary bank for these ADSs is the Bank of New York Mellon.



9.D      Selling
Shareholders



Not applicable.



9.E      Dilution



Not applicable.



9.F      Expenses
Of The Issue



Not applicable.



103







ITEM
10.ADDITIONAL INFORMATION



10.A. Share
Capital



Not applicable.



10.B. Memorandum
and Articles of Association

SQM S.A., headquartered at El Trovador
No. 4285, 6th Floor, Santiago, Chile, is an open stock corporation -sociedad anónima abierta- organized under the
laws of the Republic of Chile. The Company was constituted by public deed issued on June 17, 1968 by Mr. Sergio Rodríguez
Garcés, Notary Public of Santiago. Its existence was approved by Decree No. 1,164 of June 22, 1968, of the Ministry of Finance,
and it was registered on June 29, 1968, in the Business Registry of Santiago, on page 4,537 No. 1,992.



Corporate purposes



Our main purposes, which appear in article
4 of our By-laws, are to: (a) perform all kinds of chemical or mining activities and businesses and, among others, those
related to researching, prospecting, extracting, producing, working, processing, purchasing, disposing of, and marketing properties,
as applicable, of all metallic and non-metallic and fossil mining substances and elements of any type or nature, to be obtained
from them or from one or more concessions or mining deposits, and in their natural or converted state, or transformed into different
raw materials or manufactured or partially manufactured products, and of all rights and properties thereon; (b) manufacture,
produce, work, purchase, transfer ownership, import, export, distribute, transport, and market in any way, all kinds of fertilizers,
components, raw materials, chemical, mining, agricultural, and industrial products, and their by-products; (c) generate,
produce, distribute, purchase, transfer ownership, and market, in any way, all kinds of electrical, thermal, geothermic or other
type of power, and hydric resources or water rights in general; (d) request, manifest, claim, constitute, explore, work,
lease, transfer ownership, and purchase, in any way, all kinds of mining concessions; (e) purchase, transfer ownership,
and administer, in any way, any kind of telecommunications, railroads, ships, ports, and any means of transport, and represent
and manage shipping companies, common carriers by water, airlines, and carries in general; (f)manufacture, produce, market,
maintain, repair, assemble, construct, disassemble, purchase and transfer ownership, and in any way, any kind of electromechanical
structure, and substructure in general, components, parts, spares, or parts of equipment, and machines, and execute, develop, advice,
and market, any kind of electromechanical or smelting activities; (g) purchase, transfer ownership, lease, and market any
kind of agro industrial and farm forestry activities, in any way (h) purchase, transfer ownership, lease, and market, in
any way, any kind of urban or rural real estate; (i) render any kind of health services and manage hospitals, private clinics,
or similar facilities; (j) construct, maintain, purchase, transfer ownership, and manage, in any way, any kind of roads,
tunnels, bridges, water supply systems, and other required infrastructure works, without any limitation, regardless of whether
they may be public or private, among others, to participate in bids and enter into any kind of contracts, and to be the legal owner
of the applicable concessions; and (k) purchase, transfer ownership, and market, in any way, any kind of intangible properties
such as stocks, bonds, debentures, financial assets, commercial papers, shares or rights in corporations, and any kind of bearer
securities or instruments, and to administer such investments, acting always within the Investment and Financing Policies approved
by the applicable General Shareholders Meeting. We may comply with the foregoing by acting ourselves or through or with other different
legal entities or natural persons, within the country or abroad, with properties of our own or owned by third parties, and additionally,
in the ways and territories, and with the aforementioned properties and purposes, we may also construct and operate industrial
or agricultural facilities or installations; constitute, administer, purchase, transfer ownership, dissolve, liquidate, transform,
modify, or form part of partnerships, institutions, foundations, corporations, or associations of any kind or nature; perform all
actions, enter into all contracts, and incur in all obligations convenient or necessary for the foregoing; perform any business
or activity related to our properties, assets, or patrimony, or with that of our affiliates, associated companies, or related companies;
and render financial, commercial, technical, legal, auditing, administrative, advisory, and other pertinent services.



104







Directors



As stated in article 9 of the Company's
By-laws, the Company has 8 Directors. One of the Directors must be “independent” as such term is defined in article
50 bis of Law No. 18,046. Moreover, the possession of shares is not a condition necessary to become a Director of the Company.



As stated in article 10 of the Company's
By-laws, the term of the Directors is of three years and they can be reelected indefinitely; thus, there is no age limit for their
retirement.



The Company's By-laws, in articles 16 and
16 bis, essentially establish that the transactions in which a Director has a material interest must comply with the provisions
set forth in articles 136 and 146 to 149 of Law No. 18,046 and the applicable regulations of such Law.



The Board
of Directors duties are remunerated, as stated in article 17 of the Company's By-laws, and the amount of that compensation is fixed
yearly by the Ordinary Shareholders’ Meeting. Therefore, Directors can neither determine nor modify their compensation.



Directors
cannot authorize Company loans on their behalf.



The Board
of Directors must provide shareholders and the public with sufficient, reliable and timely information pertaining to the Company’s
legal, economic and financial situation, as required by the Law or the Chilean Superintendency of Securities and Insurance. The
Board of Directors must adopt the appropriate measures in order to avoid the disclosure of such information to persons other than
those persons who should possess such information as a result of their title, position or activity within the Company before such
information is disclosed to shareholders and the public. The Board of Directors must treat business dealings and other information
about the Company as confidential until such information is officially disclosed. No Director may take advantage of the knowledge
about commercial opportunities that he has obtained through his position as Director.



Independent Directors and Directors
Committee



According
to Chilean Law, SQM must appoint at least one Independent Director and a Directors’ Committee, due to the fact that (a) the
Company has a market capitalization greater than or equal to UF 1,500,000 and (b) at least 12.5% of the Company’s shares
with voting rights are held by shareholders who, on an individual basis, control or possess less than 10% of such shares.



Persons
who have not been involved in any of the circumstances described in the Law at any time during the preceding 18 months are considered
independent. Candidates for the position of Independent Director must be proposed by shareholders representing 1% or more of the
Company’s shares, at least 10 days prior to the date of the Shareholders’ Meeting that has been called in order to
elect the Directors. No less than two days prior to the respective Shareholders’ Meeting, the candidate must provide the
Chief Executive Officer with a sworn statement indicating that he: (a) accepts his candidacy for the position of Independent Director
(b) does not meet any of the conditions that would prevent him from being the Independent Director (c) is not related to the Company,
the other companies of the group to which the Company belongs, the controller of the Company, or any of the Company’s officers
in such a way that would deprive a sensible person of a reasonable degree of autonomy, interfere with his ability to perform his
duties objectively and effectively, generate a potential conflict of interest, or interfere with his independent judgment, and
(d) assumes the commitment to remain independent as long as he holds the position of Director.



105







The Directors’
Committee shall have the following powers and duties: (a) to examine the reports of the external auditors, the balance sheet and
other financial statements presented by the Company’s managers or liquidators to its shareholders and issue an opinion about
the same prior to their submission for the approval of the shareholders (b) to propose to the Board of Directors the external auditors
and risk rating agencies to be proposed to the shareholders at the respective Shareholders’ Meeting. In the event that an
agreement cannot be reached, the Board of Directors shall formulate its own suggestion, and both options shall be submitted for
shareholder consideration at such Shareholders’ Meeting (c) to examine the information relating to operations referred to
in articles 146 to 149 of Law No. 18,046 and to prepare a report about such operations. A copy of such report shall be sent to
the Board of Directors, and such report must be read at the Board Meeting called for the purpose of approving or rejecting the
respective operation or operations (d) to examine the remuneration system and compensation plans for the Company’s management,
officers and employees (e) to prepare an annual report on its activities, including its main recommendations to the shareholders
(f) to inform the Board of Directors about whether or not it is advisable to hire the external audit firm to provide non-audit
services where the audit firm is not prohibited from providing such services because the nature of the same could pose a threat
to the audit firm’s independence, and (g) any other issues indicated in the Company’s by-laws or authorized by a Shareholders’
Meeting or the Board of Directors.



The Directors’
Committee shall be comprised of three members, with at least one independent member. In the event that more than three Directors
have the right to form part of the Committee, these same Directors shall unanimously determine who shall make up the Committee.
In the event that an agreement cannot be reached, the Directors who were elected with a greater percentage of votes by shareholders
controlling or possessing less than 10% of the Company’s shares shall be given priority. If there is only one Independent
Director, this Director shall name the other members of the Committee among the other Directors who are not independent. Such other
members of the Committee shall have all of the rights associated with such position. The members of the Committee shall be compensated
for their role. The amount of their remuneration shall be set annually at the General Shareholders’ Meeting, and it may not
be less than the remuneration set for the Company Directors, plus an additional 1/3 of that amount. The General Shareholders’
Meeting shall determine a budget for the expenses of the Committee and its advisors. Such budget may not be less than the sum of
the annual remunerations of the Committee members. The Committee may need to hire professional advisory services in order to carry
out its duties in accordance with the abovementioned budget. The proposals made by the Committee to the Board of Directors that
are not accepted by the latter must be reported to the Shareholders’ Meeting prior to the vote by shareholders on the corresponding
matter or matters. In addition to the responsibilities that are associated with the position of Director, the members of the Committee
are jointly and severally liable for any damages they cause in performing their duties as such to the shareholders and to the Company.



Shares



Dividends
are annually distributed to the Series A and Series B shareholders of record on the fifth business day prior to the date for payment
of the dividends. The By-laws do not specify a time limit after which dividend entitlement elapses but Chilean regulations establish
that after 5 years, unclaimed dividends are to be donated to the Fire Department.



Article
5 of the Company's By-laws establishes that Series B shares may in no case exceed fifty percent of the issued, outstanding and
paid shares of SQM Series B. SQM Series B shares have a restricted right to vote as they can only elect one Director of the Company,
regardless of their capital stock's share. Series B shares have the right to call for an Ordinary or Extraordinary Shareholders’
Meeting when the shareholders of at least 5% of the Series B issued shares request so and for an Extraordinary Board of Directors
Meeting without the Chairman's authorization when it is requested by the Director elected by the shareholders of the Series B shares.
Series A shares have the option to exclude the Director elected by Series B shareholders from the voting process in which the Chairman
of the Board is to be elected, if there is a tie in the first voting process. However, articles 31 and 31 bis of the Company’s
By-laws establish that in General Shareholders’ Meetings each shareholder will have a right to one vote for each share he
owns or represents and (a) that no shareholder will have the right to vote for himself or on behalf of other shareholders of the
same Series A or Series B shares representing more than 37.5% of the total outstanding shares with right to vote of each Series
and (b) that no shareholder will have the right to vote for himself or on behalf of other shareholders representing more than 32%
of the total outstanding shares with a right to vote. In calculating a single shareholder's ownership of Series A or B shares,
the shareholder's stock and those pertaining to third parties related to them are to be added.



106







Article
5 bis of the Company's By-laws establishes that no person may directly or by means of related third persons concentrate more than
32% of the Company’s total shares with right to vote.



Each
Series A share and Series B share is entitled to share equally in the Company's profits, i.e., they have the same rights on any
dividends declared on the outstanding shares of SQM.



The Company
By-laws do not contain any provision relating to (a) redemption provisions (b) sinking funds or (c) liability to capital calls
by the Company.



As established
in article 103 of Law No. 18,046, a company subject to the supervision of the Superintendency of Securities and Insurance (SVS)
may be liquidated in the following cases:



(a) Expiration
of the duration term, if any, as established in its By-laws;

(b) All
the shares end up in the possession of one individual for more than ten continuous days;

(c) By
agreement of an Extraordinary Shareholders Meeting;

(d) By
abolition, pursuant to applicable laws, of the decree that authorized its existence;

(e) Any
other reason contemplated in its By-laws.



Article
40 of the Company's By-laws states that in the event of liquidation, the Shareholders’ Meeting will appoint a three-member
receiver committee that will have the authority to carry out the liquidation process. Any surplus will be distributed equally among
the shareholders.



The only
way to change the rights of the holders of the SQM shares is by modifying its By-laws, which can only be carried out by an Extraordinary
Shareholders’ Meeting, as established in article 28 of the Company By-laws.



Shareholders’ meetings



Article 29 of the Company's By-laws states
that the call to a Shareholders’ Meeting, either Ordinary or Extraordinary, will be by means of a highlighted public notice
that will be published at least three times, and on different days, in the newspaper of the legal address determined by the Shareholders’
Meeting, and in the way and under the conditions indicated by the regulations. Additionally, a notice will be sent by mail to each
shareholder at least fifteen days prior to the date of the Meeting, which shall include a reference of the matters to be addressed
at the meeting. However, those meetings with the full attendance of the shares with right to vote may be legally held, even if
the foregoing formal notice requirements are not met. Notice of any Shareholders’ Meeting shall be delivered to the SVS at
least fifteen days in advance of such meeting.



Any holder of Series A and/or Series B
shares registered in the Company's shareholder registry on the fifth business day prior to the date of the meeting will have a
right to participate at that meeting.



107







Article 67 of Law No. 18,046 provides that
decisions made at Extraordinary Shareholders’ Meeting on the following matters require the approval of 2/3 of the outstanding
shares with voting rights: (1) transformation or division of the Company and its merger with another company; (2) modification
of the Company’s term of duration, if any; (3) early dissolution of the Company; (4) change of the corporate domicile; (5)
capital decrease; (6) approval of contributions and estimation of non-cash assets; (7) modification of powers reserved for Shareholders
Meetings or limitations on powers of the Board of Directors; (8) reduction in the number of members of the Board of Directors;
(9) disposal of 50% or more of the Company’s assets; formulation or modification of any business plan exceeding the above
percentage; disposal of 50% or more of an asset belonging to a subsidiary that represents at least 20% of the Company’s assets
and disposal of shares of the referred subsidiary such that the parent company would lose its position as controller of the same;
(10) method in which profits are distributed; (11) granting of real or personal guarantees as sureties for third-party obligations
that exceed 50% of the Company assets, except for subsidiaries, in which case approval of the Board of Directors shall suffice;
(12) acquisition of own shares as set forth in articles 27A and 27B of the said law; (13) other matters indicated in the By-laws;
(14) amendment of the Company By-laws as a result of errors in the constitution process and amendments in the By-laws involving
one or more of the matters stated in the preceding numbers; (15) forced sale of shares carried out by the controller who would
acquire more than 95% of the Company’s shares in a tender offer, and (16) approval or ratification of proceedings or contracts
with related parties in accordance with the provisions of articles 44 and 147 of Law No. 18,046.



Amendments
to the By-laws that are intended to create, modify, defer or suspend preferential rights shall be approved by 2/3 of the shares
of the affected Series.



The transformation
of the Company, the merger of the same, the disposal of assets referred to in number (9) above, the constitution of guarantees
set forth in number (11) above, the constitution of preferences or the increase, postponement or decrease of the existing preferences,
the reparation of formal nullities incurred in the By-laws and the possession of more than 95% of the Company’s shares and
other matters contemplated in the Law or in the By-laws, confer “withdrawal rights”.



Foreign shareholders



There
exists no restriction on ownership or share concentration, or limiting the exercise of the related right to vote, by local or foreign
shareholders other than those discussed under Item 2.B. Memorandum and Articles of Association -Shares above.



Change in control



The Company By-laws provide that no shareholder
may hold more than 32% of the Company’s shares, unless the By-laws are modified at an Extraordinary Shareholders’ Meeting.
Moreover, on December 12, 2000, the Chilean Government published the Ley de Oferta Pública de Acciones (“Public Share
Offering Law”) or (OPA law) that seeks to protect the interests of minority shareholders of open stock corporations in transactions
involving a change in control, by requiring that the potential new controller purchase the shares owned by the remaining shareholders
either in total or pro rata. The law applies to those transactions in which the controlling party would receive a material premium
price compared with the price that would be received by the minority shareholders.



There are three conditions that would make
it mandatory to operate under the OPA law:

| | 1) | When an investor wants to take control of a company's stock.
| | -- | ------------------------------------------------------------

| | 2) | When a controlling shareholder holds two-thirds of the company's stock. If such shareholder buys
one more share, it will be mandatory to offer to acquire the rest of the outstanding stock within 30 days of surpassing that threshold.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3) | When an investor wants to take control of a corporation, which, in turn, controls an open stock
corporation that represents 75% or more of the consolidated assets of the former corporation.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Parties interested in taking control of
a company must (i) notify the company of such intention in writing, and notify its controllers, the companies controlled by it,
the SVS and the markets where its stocks are traded and (ii) publish a highlighted public notice in two newspapers of national
circulation at least 10 business days prior to the date of materialization of the OPA.



108







Disclosure of share ownership



The Company's By-laws do not provide for
a minimum threshold at which share ownership must be disclosed.



10.C. Material
Contracts

The following summarizes the terms and
conditions of the main contracts to which SQM or any subsidiary is a party:



| | · | On February 12, 1999, SQM S.A. entered into an Electrical Energy Supply contract with Electroandina
S.A. This contract allowed for two three-year renewal options, at the option of SQM. The two options were exercised. As a result,
the contract extends through March 16, 2016. Early termination of the contract is subject to payment of non-amortized investments.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On March 21, 1997, SQM Salar S.A. entered into an Electricity Supply agreement with Norgener S.A.
The term of this contract extends through March 20, 2017, and early termination is subject to penalties.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On January 13, 1998, SQM Nitratos S.A. entered into an Electrical Energy Supply agreement with
Norgener S.A. The term of this contract extends through January 31, 2013. Early termination of the contract is subject to payment
of non-amortized investments.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | On March 30, 2012, SQM S.A. entered into an Electrical Energy Supply agreement with Norgener S.A. 
The term of this contract extends through December 31, 2030.  Early termination of the contract is subject to an agreement
between both parties, or in case of Force-Majeure extended for more than 12 months.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In addition, the Company, during the normal
course of business, has entered into different contracts, some of which have been described herein, related to its production,
commercial and legal operations. We believe all of these contracts are standard for this type of industry, and none of them is
expected to have a material effect on the Company's results of operations.



10.D. Exchange
Controls

The Central Bank of Chile is responsible
for, among other things, monetary policies and exchange controls in Chile. Appropriate registration of a foreign investment in
Chile permits the investor access to the Formal Exchange Market. Foreign investments can be registered with the Foreign Investment
Committee under Decree Law No. 600 of 1974 or can be registered with the Central Bank of Chile under the Central Bank Act, Law
No 18,840 of October 1989. The Central Bank Act is an organic constitutional law requiring a "special majority" vote
of the Chilean Congress to be modified.



Our 1993, 1995 and 1998 capital increases
were carried out under and subject to the then current legal regulations, whose summary is hereafter included:



A 'Convención Capítulo
XXVI del Título I del Compendio de Normas de Cambios Internacionales' or Compendium of Foreign Exchange Regulations
of the Central Bank of Chile, "Foreign Investment Contract" was entered into and among the Central Bank of Chile, our
Company and the Depositary, pursuant to Article 47 of the Central Bank Act and to Chapter XXVI of the Compendium of Foreign Exchange
Regulations of the Central Bank of Chile, "Chapter XXVI", which addresses the issuance of ADSs by a Chilean company.
Absent the Foreign Investment Contract, under applicable Chilean exchange controls, investors would not be granted access to the
Formal Exchange Market for the purposes of converting from Chilean pesos to U.S. dollars and repatriating from Chile amounts received
in respect to deposited Series B shares, or Series B shares withdrawn from deposit on surrender of ADSs (including amounts received
as cash dividends and proceeds from the sale in Chile of the underlying Series B shares and any rights arising therefrom). The
following is a summary of the material provisions contained in the Foreign Investment Contract. This summary does not purport to
be complete and is qualified in its entirety by reference to Chapter XXVI and the Foreign Investment Contract.



109







Under Chapter XXVI and the Foreign Investment
Contract, the Central Bank of Chile has agreed to grant to the Depositary, on behalf of ADS holders, and to any investor not residing
or not domiciled in Chile who withdraws Series B shares upon delivery of ADSs (such Series B shares being referred to herein as
"Withdrawn Shares") access to the Formal Exchange Market to convert Chilean pesos to U.S. dollars (and remit such U.S.
dollars outside of Chile) in respect of the Withdrawn Shares, including amounts received as (a) cash dividends, (b) proceeds from
the sale in Chile of Withdrawn Shares, or from shares distributed because of the liquidation, merger or consolidation of the Company,
subject to receipt by the Central Bank of Chile of a certificate from the holder of such shares (or from an institution authorized
by the Central Bank of Chile) that such holder's residence and domicile are outside Chile and a certificate from a Chilean stock
exchange (or from a brokerage or securities firm established in Chile) that such shares were sold on a Chilean Exchange, (c) proceeds
from the sale in Chile of preemptive rights to subscribe for additional Series A and Series B shares, (d) proceeds from the liquidation,
merger or consolidation of the Company and (e) other distributions, including without limitation those resulting from any recapitalization,
as a result of holding Withdrawn Shares. Transferees of Withdrawn Shares will not be entitled to any of the foregoing rights under
Chapter XXVI unless the Withdrawn Shares are redeposited with the Depositary. Investors receiving Withdrawn Shares in exchange
for ADSs will have the right to redeposit such shares in exchange for ADSs, provided that the conditions to redeposit described
hereunder are satisfied.



Chapter XXVI provided that access to the
Formal Exchange Market in connection with dividend payments will be conditioned upon certification by the Company to the Central
Bank of Chile that a dividend payment has been made and any applicable tax has been withheld. Chapter XXVI also provided that access
to the Formal Exchange Market in connection with the sale of Withdrawn Shares or distributions thereon will be conditioned upon
receipt by the Central Bank of Chile of certification by the Depositary that such shares have been withdrawn in exchange for ADSs
and receipt of a waiver of the benefit of the Foreign Investment Contract with respect thereto until such Withdrawn Shares are
redeposited.



Chapter XXVI and the Foreign Investment
Contract provide that a person who brings certain types of foreign currency into Chile, including U.S. dollars, to purchase Series
B shares with the benefit of the Foreign Investment Contract must convert it into Chilean pesos on the same date and has 5 banking
business days within which to invest in Series B shares in order to receive the benefits of the Foreign Investment Contract. If
such person decides within such period not to acquire Series B shares, he can access the Formal Exchange Market to reacquire foreign
currency, provided that the applicable request is presented to the Central Bank within 7 banking business days of the initial conversion
into Chilean pesos. Series B shares acquired as described above may be deposited for ADSs and receive the benefits of the Foreign
Investment Contract, subject to receipt by the Central Bank of Chile of a certificate from the Depositary that such deposit has
been effected and that the related ADSs have been issued and receipt by the Custodian of a declaration from the person making such
deposit waiving the benefits of the Foreign Investment Contract with respect to the deposited Series B shares.



Access to the Formal Exchange Market under
any of the circumstances described above is not automatic. Pursuant to Chapter XXVI, such access requires approval of the Central
Bank of Chile based on a request presented through a banking institution established in Chile. The Foreign Investment Contract
will provide that if the Central Bank of Chile has not acted on such request within seven banking days, the request will be deemed
approved.



Under current Chilean law, foreign investments
abiding by the Foreign Investment Contract cannot be changed unilaterally by the Central Bank of Chile. No assurance can be given,
however, that additional Chilean restrictions applicable to the holders of ADSs, the disposition of underlying Series B shares
or the repatriation of the proceeds from such disposition could not be imposed in the future, nor can there be any assessment of
the duration or impact of such restrictions if imposed.



110







As of April 19, 2001, Chapter XXVI of Title
I of the Compendio de Normas de Cambios Internacionales of the Central Bank of Chile was eliminated and new investments
in ADSs by non-residents of Chile, are now governed by Chapter XIV of the Compendio de Normas de Cambios Internacionales
of the Central Bank of Chile. This was made with the purpose of simplifying and facilitating the flow of capital to and from Chile.
According to the new regulations, such investments must be carried out through Chile's Formal Exchange Market and only reported
to the Central Bank of Chile. Foreign investments may still be registered with the Foreign Investment Committee under Decree Law
600 of 1974, as amended, and obtain the benefits of the contract executed under Decree Law 600.



The Central Bank is also responsible for
controlling incurrence of loan obligations to be paid from Chile and by a Chilean borrower to banks and certain other financial
institutions outside Chile. Chapter XIV establishes what type of loans, investments, capital increases and foreign currency transactions
are subject to the current Chapter XIV framework. Foreign currency transactions related to foreign loans must be performed through
the Formal Exchange Market, and such transactions and the subsequent modifications of original loans must be properly informed
to the Central Bank. Transactions prior to April 19, 2001, will continue to be regulated by the previous legal framework, except
in cases where an express request has been presented to the Central Bank resigning previous rights to be regulated by the provisions
of Chapter XIV. This summary does not purport to be complete and is qualified in its entirety by reference to the provisions of
Chapter XIV.



As of December 31, 2013, we had bonds issued
in the international markets under Rule 144A/Regulation S of US$200 million, US$250 million and US$300 million. Additionally, we
had outstanding bilateral loans through wholly owned subsidiaries in the amount of US$240 million, which were fully guaranteed
by us.



Any purchases of U.S. dollars in connection
with payments on these loans will occur with the Formal Exchange Market. There can be no assurance, however, that restrictions
applicable to payments in respect to the loans could not be imposed in the future, nor can there be any assessment of the duration
or impact of such restrictions if imposed.



10.E. Taxation



Chilean Tax Considerations



The following describes the material Chilean
income tax consequences of an investment in SQM ADSs by an individual who is not domiciled or resident in Chile or any legal entity
that is not organized under the laws of Chile and does not have a permanent establishment located in Chile, a ("foreign holder").
This discussion is based upon Chilean income tax laws presently in force, including Ruling No. 324 (1990) of the Chilean Internal
Revenue Service and other applicable regulations and rulings. The discussion is not intended as tax advice to any particular investor,
which can be rendered only in light of that investor's particular tax situation.



Under Chilean law, provisions contained
in statutes such as tax rates applicable to foreign holders, the computation of taxable income for Chilean purposes and the manner
in which Chilean taxes are imposed and collected may only be amended by another statute. In addition, the Chilean tax authorities
issue rulings and regulations of either general or specific application and interpret the provisions of Chilean tax law. Chilean
tax may not be assessed retroactively against taxpayers who act in good faith relying on such rulings, regulations and interpretations,
but Chilean tax authorities may change said rulings, regulations and interpretations prospectively.



111







Cash Dividends and Other Distributions



Cash dividends paid by the Company with
respect to the shares, including shares represented by ADSs held by a U.S. holder will be subject to a 35% Chilean withholding
tax, which is withheld and paid by the Company, the "Withholding Tax.” If the Company has paid corporate income tax,
the "First Category Tax", on the income from which the dividend is paid, a credit for the First Category Tax effectively
reduces the rate of Withholding Tax. When a credit is available, the Withholding Tax is computed by applying the 35% rate to the
pre-tax amount needed to fund the dividend and then subtracting from the tentative withholding tax so determined the amount of
First Category Tax actually paid on the pre-tax income. Under Chilean income tax law, dividends are assumed to have been paid out
of our oldest retained tax profits for purposes of determining the rate at which the First Category Tax was paid.



The effective Withholding Tax rate, after
giving effect to the credit for First Category Tax, generally is:



(Withholding Tax rate) - (First Category
Tax effective rate)
1 - (First Category Tax effective rate)



The effective rate of Withholding Tax to
be imposed on dividends paid by the Company will vary depending upon the amount of the First Category Tax paid by the Company on
the earnings to which the dividends are attributed. The Company distributed an interim dividend in December 2013 corresponding
to the business year 2013. The dividend, paid in December 2013, was considered taxable, and the total tax retention rate was approximately
21.1%.



Dividend distributions made in property
(such as distribution of cash equivalents) would be subject to the same Chilean tax rules as cash dividends. Stock dividends are
not subject to Chilean taxation.



Capital Gains



Gains from the sale or other disposition
by a foreign holder of ADSs outside Chile will not be subject to Chilean taxation. The deposit and withdrawal of the shares in
exchange for ADRs will not be subject to any Chilean taxes.



The tax basis of the shares received in
exchange for ADSs (repatriation) will be the acquisition value of the shares. The shares exchanged for ADSs are valued at the highest
price at which they trade on the Chilean Stock Exchange on the date of the exchange or on either of the two business days preceding
the exchange. Consequently, the conversion of ADSs into the shares and the immediate sale of such shares at a price equal to or
less than the highest price for Series B shares on the Chilean Stock Exchange on such dates will not generate a gain subject to
Chilean taxation.



Gain recognized on a sale or exchange of
shares (as distinguished from sales or exchanges of ADSs representing such shares) will be subject to both the First Category Tax
and the Withholding Tax if either (i) the foreign holder has held the shares for less than one year since exchanging the ADSs for
the shares, (ii) the foreign holder acquired and disposed of the shares in the ordinary course of its business or as a regular
trader of shares, or (iii) the foreign holder and the purchaser of the shares are related parties within the meaning of Chilean
tax law. The amount of the First Category Tax may be credited against the amount of the Withholding Tax. In all other cases, gain
on the disposition of the shares will be subject only to a capital gains tax, which is assessed at the same rate as the First Category
Tax. Gain recognized in the transfer of common shares that have significant trading volumes in the stock exchange, however, is
not subject to capital gains tax in Chile, provided that the common shares are transferred in a local stock exchange authorized
by the SVS, within the process of a public tender of common shares governed by the Chilean Securities Market Act. Law No. 20,448
states that common shares must also have been acquired after April 19, 2001, either on a local stock exchange authorized by the
SVS, within the referred process of public tender of a common shares governed by the Chilean Securities Market Act, in an initial
public offering of common shares resulting from the formation of a corporation or a capital increase of the same, in an exchange
of convertible securities subject to public offer, or in the redemption of mutual funds shares. According to Ruling No. 224 (2008)
of the Chilean Internal Revenue Service, common shares received by exchange of ADRs are also considered as “acquired on a
stock exchange” if the respective ADRs have been acquired on a foreign stock exchange authorized by the SVS (i.e. London
Stock Exchange, New York Stock Exchange and Bolsa de Valores de Madrid). Common shares are considered to have a high presence in
the stock exchange when they: (a) are registered in the Securities Registry, (b) are registered in a Chilean Stock Exchange, (c)
have an adjusted presence equal to or above 25%.



112







As of June 19, 2001, capital gains obtained
in the sale of common shares that are publicly traded in a stock exchange are also exempt from capital gains tax in Chile when
the sale is made by "foreign institutional investors" such as mutual funds and pension funds, provided that the sale
is made in a local stock exchange authorized by the SVS, or in accordance with the provisions of the securities market law (Law
18,045). To qualify as foreign institutional investors, the referred entities must be formed outside of Chile, not have a domicile
in Chile, and they must be an "investment fund" in according with the Chilean tax law.



The exercise of preemptive rights relating
to shares will not be subject to Chilean taxation. Any gain on the sale or assignment of preemptive rights relating to shares will
be subject to both the First Category Tax and the Withholding Tax (the former being creditable against the latter).



Other Chilean Taxes



No Chilean inheritance, gift or succession
taxes apply to the transfer or disposition of the ADSs by a foreign holder, but such taxes generally will apply to the transfer
at death or by gift of the shares by a foreign holder. No Chilean stamp, issue, registration or similar taxes or duties apply to
foreign holders of ADSs or shares.



Withholding Tax Certificates



Upon request, the Company will provide
to foreign holders appropriate documentation evidencing the payment of Chilean withholding taxes.



United States Tax Considerations



The following discussion summarizes the
principal U.S. federal income tax consequences to beneficial owners arising from ownership and disposition of the Series A shares
and the Series B shares, together the "shares" and the ADSs. The discussion which follows is based on the United States
Internal Revenue Code of 1986, as amended, the "Code", the Treasury regulations promulgated thereunder, and judicial
and administrative interpretations thereof, all as in effect and available on the date hereof, and is subject to any changes in
these or other laws occurring after such date. In addition, the summary assumes that the depositary’s activities are clearly
and appropriately defined so as to ensure that the tax treatment of ADSs will be identical to the tax treatment of the underlying
shares.



For purposes of this summary, the term
"U.S. Holder" means a beneficial owner of shares or ADSs that is, for U.S. federal income tax purposes, (a) an individual
who is a United States citizen or resident, (b) a corporation or partnership created or organized under the laws of the United
States or any political subdivision thereof, (c) an estate, the income of which is subject to U.S. federal income tax regardless
of the source, or (d) a trust (i) that validly elects to be treated as a U.S. person for U.S. federal income tax purposes or (ii)(A)
if a court within the U.S. is able to exercise primary supervision over the administration of the trust and (B) one or more U.S.
persons have the authority to control all substantial decisions of the trust.



113







The term "Non-U.S. Holder" means,
for purposes of this discussion, a beneficial owner of shares or ADSs that is not a U.S. Holder.



If a partnership (or any other entity treated
as a partnership for U.S. federal income tax purposes) holds shares or ADSs, the tax treatment of the partnership and a partner
in such partnership generally will depend on the status of the partner and the activities of the partnership. Such a partner or
partnership should consult its own tax advisor as to its consequences.



The discussion that follows is not intended
as tax advice to any particular investor and is limited to investors who will hold the shares or ADSs as "capital assets"
within the meaning of Section 1221 of the Code and whose functional currency is the United States dollar. The summary does not
address the tax treatment of U.S. Holders and Non-U.S. Holders that may be subject to special U.S. federal income tax rules, such
as insurance companies, tax-exempt organizations, financial institutions, persons who are subject to the alternative minimum tax,
or persons who are broker-dealers in securities, who hold the shares or ADSs as a hedge against currency risks, as a position in
a "straddle" for tax purposes, or as part of a conversion or other integrated transaction, or who own (directly, indirectly
or by attribution) 10% or more of the total combined voting power of all classes of the Company's capital stock entitled to vote
or 10% or more of the value of the outstanding capital stock of the Company.



As of this date, there is currently no
applicable income tax treaty in effect between the United States and Chile. However, in 2010, the United States and Chile signed
an income tax treaty that will enter into force once the treaty is ratified by both countries. There can be no assurance that the
treaty will be ratified by either country. The following summary assumes that there is no applicable income tax treaty in effect
between the United States and Chile.



The discussion below does not address the
effect of any United States state, local, estate or gift tax law or foreign tax law on a U.S. Holder or Non-U.S. Holder of the
shares or ADSs. U.S. HOLDERS AND NON-U.S. HOLDERS OF SHARES OR ADSs SHOULD CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE PARTICULAR
CONSEQUENCES UNDER ANY SUCH LAW OF OWNING OR DISPOSING THE SHARES OR ADSs.



For purposes of applying U.S. federal income
tax law, any beneficial owner of an ADS generally will be treated as the owner of the underlying shares represented thereby.



TO ENSURE COMPLIANCE WITH U.S. TREASURY
DEPARTMENT CIRCULAR 230, INVESTORS ARE ADVISED THAT: (A) ANY DISCUSSION OF U.S. FEDERAL TAX ISSUES IN THIS FORM 20-F IS NOT INTENDED
OR WRITTEN TO BE RELIED UPON, AND CANNOT BE RELIED UPON, BY INVESTORS FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED
ON SUCH INVESTORS UNDER THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED; (B) SUCH DISCUSSION IS INCLUDED BY THE COMPANY IN CONNECTION
WITH THE PROMOTION OR MARKETING (WITHIN THE MEANING OF CIRCULAR 230) BY THE COMPANY OF THE TRANSACTIONS OR MATTERS ADDRESSED HEREIN;
AND (C) INVESTORS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.



Cash Dividends and Other Distributions



The U.S. Treasury Department has expressed
concern that depositaries for ADSs, or other intermediaries between the holders of shares of an issuer and the issuer, may be taking
actions that are inconsistent with the claiming of U.S. foreign tax credits by U.S. holders of such receipts or shares. Accordingly,
the analysis regarding the availability of a U.S. foreign tax credit for Chilean taxes and sourcing rules described below could
be affected by future actions that may be taken by the U.S. Treasury Department.



114







The following discussion of cash dividends
and other distributions is subject to the discussion below under “Passive Foreign Investment Company Considerations”.
The gross amount of a distribution with respect to shares or ADSs generally will be treated as a taxable dividend to the extent
of the Company's current and accumulated earnings and profits, computed in accordance with U.S. federal income tax principles.
A dividend distribution will be so included in gross income when received by (or otherwise made available to) (i) the U.S. Holder
in the case of the shares or (ii) the depositary in the case of the ADSs, and in either case will be characterized as ordinary
income for U.S. federal income tax purposes. Distributions in excess of the Company's current and accumulated earnings and profits
will be applied against and will reduce the U.S. Holder's tax basis in the shares or ADRs and, to the extent distributions exceed
such tax basis, the excess will be treated as gain from a sale or exchange of such shares or ADSs. U.S. Holders that are corporations
will not be allowed a deduction for dividends received in respect of distributions on the shares or the ADSs. For example, if the
gross amount of a distribution with respect to the shares or ADSs exceeds the Company's current and accumulated earnings and profits
by US$10.00, such excess will generally not be subject to a U.S. tax to the extent the U.S. Holder's tax basis in the shares or
ADSs equals or exceeds US$10.00. The Company does not maintain calculations of its earnings and profits under U.S. federal income
tax principles. Accordingly, U.S. Holders should assume that any cash distribution made by us will be treated as a dividend for
U.S. federal income tax purposes.



If a dividend distribution is paid in Chilean
pesos, the amount includable in income will generally be the U.S. dollar value, on the date of receipt by the U.S. Holder in the
case of the shares or by the depositary in the case of the ADSs, of the peso amount distributed, regardless of whether the payment
is actually converted into U.S. dollars. The amount of any distribution of property other than cash will be the fair market value
of such property on the date of distribution. Any gain or loss resulting from currency exchange rate fluctuations during the period
from the date the dividend is includable in the income of the U.S. Holder to the date the pesos are converted into U.S. dollars
will be treated as ordinary income or loss.



A dividend distribution will be treated
as foreign source income and will generally be classified as "passive category income" or in the case of certain U.S.
Holders “general category income" for U.S. foreign tax credit purposes. If Chilean withholding taxes are imposed on
a dividend, U.S. Holders will be treated as having actually received the amount of such taxes (net of any credit for the First
Category Tax) and as having paid such amount to the Chilean taxing authorities. As a result, the amount of dividend income included
in gross income by a U.S. Holder will be greater than the amount of cash actually received by the U.S. Holder with respect to such
dividend income. A U.S. Holder may be able, subject to certain generally applicable limitations, to claim a foreign tax credit
or a deduction for Chilean withholding taxes (net of any credit for the First Category Tax) imposed on dividend payments. The rules
relating to the determination of the U.S. foreign tax credit are complex and the calculation of U.S. foreign tax credits and, in
the case of a U.S. Holder that elects to deduct foreign taxes, the availability of deductions, involve the application of rules
that depend on a U.S. Holder's particular circumstances. U.S. Holders should, therefore, consult their own tax advisors regarding
the application of the U.S. foreign tax credit rules to dividend income on the shares or ADSs.



Subject to the discussion below under “Information
Reporting and Backup Withholding”, if you are a Non-U.S. Holder, you generally will not be subject to U.S. federal income
or withholding tax on dividends received by you on your shares or ADSs, unless you conduct a trade or business in the United States
and such income is effectively connected with that trade or business.



115







Capital Gains



A U.S. Holder will generally recognize
gain or loss on the sale, redemption or other disposition of the shares or ADRs in an amount equal to the difference between the
amount realized on the sale or exchange and the U.S. Holder's adjusted basis in such shares or ADSs. Thus, if the U.S. Holder sells
the shares for US$40.00 and such U.S. Holder's tax basis in such shares is US$30.00, such U.S. Holder will generally recognize
a gain of US$10.00 for U.S. federal income tax purposes. Subject to the discussion below under “Passive Foreign Investment
Company Considerations”, gain or loss upon the sale of the shares or ADSs will be capital gain or loss if the shares or ADSs
are capital assets in the hands of the U.S. Holder. Capital gains on the sale of capital assets held for one year or less are subject
to U.S. federal income tax at ordinary income tax rates. Net capital gains derived with respect to capital assets held for more
than one year are eligible for reduced rates of taxation. Gain or loss realized by a U.S. Holder on the sale or exchange of shares
or ADSs will be U.S. source income. In addition, certain limitations exist on the deductibility of capital losses by both corporate
and individual taxpayers. Any tax imposed by Chile directly on the gain from such a sale would generally be eligible for the U.S.
foreign tax credit; however, because the gain would generally be U.S. source, a U.S. Holder might not be able to use the credit
otherwise available. U.S. Holders should consult their own tax advisors regarding the foreign tax credit implications of the sale,
redemption or other disposition of a share or ADS.



Subject to the discussion below under “Information
Reporting and Backup Withholding”, a Non-U.S. Holder of ADSs or shares will not be subject to United States income or withholding
tax on gain from the sale or other disposition of ADSs or shares unless, in general (i) such gain is effectively connected with
the conduct of a trade or business within the United States or (ii) the Non-U.S. Holder is an individual who is present in the
United States for at least 183 days during the taxable year of the dispositionand certain other
conditions are met.



Passive Foreign Investment Company Considerations



A Non-U.S. corporation will be classified
as a “passive foreign investment company”, or a PFIC, for U.S. federal income tax purposes in any taxable year in which,
after applying certain look-through rules, either (i) at least 75% of its gross income is “passive income” or (ii)
at least 50% of the average value of its gross assets is attributable to assets that produce “passive income” or are
held for the production of passive income. Passive income for this purpose generally includes dividends, interest, royalties, rents
and gains from the sale of stock (including gains from the sale of stock of certain subsidiaries), partnership interests, securities
or commodities.



Based on certain estimates of our gross
income and gross assets and the nature of our business, the Company believes that it was not classified as a PFIC in 2013. The
Company’s status in future years will depend on its assets and activities in those years. If the Company were a PFIC for
2013 or for any prior or future taxable year during which a U.S. Holder held shares or ADSs, such U.S. Holder of shares or ADSs
generally would be subject to additional filing requirements, imputed interest charges and other disadvantageous tax treatment
(including the denial of taxation at the lower rates applicable to long-term capital gains with respect to any gain from the sale
or exchange of shares or ADSs).



Information Reporting and Backup Withholding



Payments of dividends on the shares or
ADSs and the proceeds of sale or other disposition of the shares or ADSs within the United States by holders may be subject to
U.S. information reporting and backup withholding. A U.S. Holder generally will be subject to U.S. information reporting and backup
withholding (currently at a rate of 28%) unless the recipient of such payment supplies an accurate taxpayer identification number,
as well as certain other information, or otherwise establishes an exemption, in the manner prescribed by United States law and
applicable regulations. U.S. information reporting and backup withholding of U.S. federal income tax at the same rate may also
apply to Non-U.S. Holders that are not "exempt recipients" and that fail to provide certain information as may be required
by United States law and applicable regulations. Any amount withheld under U.S. backup withholding is not an additional tax and
is generally allowable as a credit against the U.S. Holder's federal income tax liability upon furnishing the required information
to the IRS.



In addition, certain U.S. Holders, electing
nonresident aliens and residents of a U.S. possession may be required to report information with respect to their investment in
shares or, it is assumed, ADSs to the Internal Revenue Service. Investors who fail to report required information could become
subject to substantial penalties and/or an extended statute of limitations.



116







HOLDERS ARE URGED TO CONSULT THEIR OWN
TAX ADVISORS REGARDING THE APPLICATION OF U.S. INFORMATION REPORTING AND BACKUP WITHHOLDING RULES TO THEIR PARTICULAR CIRCUMSTANCES.



10.F.    Dividends
and Paying Agents

Not applicable.



10.G.    Statement
by Experts

Not applicable.



10.H.    Documents
on Display

Documents referred to in this form 20-F
are available to the public at:



http://www.sec.gov/edgar/searchedgar/companysearch.html,
CIK: 909037.



10.I.    Subsidiary
Information

See Item 4.C. Organizational Structure.



ITEM
11.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



As explained elsewhere in this Annual Report,
we transact our businesses in more than 115 countries, thereby rendering our market risk dependent upon the fluctuations of foreign
currencies and local and international interest rates. These fluctuations may generate losses in the value of financial instruments
taken in the normal course of business.



We, from time to time and depending upon
then current market conditions, review and re-establish our financial policies to protect our operations. Management is authorized
by our Board of Directors to engage in certain derivative contracts such as forwards and swaps to specifically hedge the fluctuations
in interest rates and in currencies other than the U.S. dollar.



Derivative instruments used by us are generally
transaction-specific so that a specific debt instrument or contract determines the amount, maturity and other terms of the hedge.
We do not use derivative instruments for speculative purposes.



Interest Rate Risk. As of December
31, 2013, we had approximately 16% of our financial debt effectively priced at LIBOR, and therefore significant increases in the
rate could impact our financial condition.



Interest rate fluctuations, due to the
uncertain future behavior of markets, may have a material impact on our financial results.



We have short and long term debt valued at LIBOR plus a spread.
We are partially exposed to fluctuations of this rate, as we hold hedging derivative instruments to hedge a portion of our liabilities
subject to LIBOR rate fluctuations.



As of December 31, 2013, approximately 13% of our current financial
obligations were subject to LIBOR rate fluctuation and therefore, significant increases in the rate may impact our financial position.



In addition, as of December 31, 2013, our total financial debt
is primarily long-term, with 21% of maturities less than 12 months, which decreases the exposure to changes in the interest rates.



117







Exchange Rate Risk. Although the U.S. dollar is the primary
currency in which we transact our businesses, our operations throughout the world expose us to exchange rate variations for non-U.S.
dollar currencies. Therefore, fluctuations in the exchange rate of such local currencies may affect our financial condition and
results of operations. To lessen these effects, we maintain derivative contracts to protect the net difference between our principal
assets and liabilities for currencies other than the U.S. dollar. These contracts are renewed periodically depending on the amount
covered in each currency. Aside from this, we do not hedge potential future income and expenses in currencies other than the U.S.
dollar with the exception of the Euro and Chilean peso. We estimate annual sales in Euros and expenses in Chilean pesos, and depending
on the circumstances we secure the exchange difference with derivative contracts.



The following is a summary of the aggregate
net monetary assets and liabilities that are denominated in non-U.S. dollar currencies as of December 31, 2013, 2012 and 2011.
Figures do not include our financial hedging positions for year-end:



|                   |  | 2013   |          |   | 2012   |  |          | 2011   | 
|------------------ |  | ------ | -------- | - | ------ |  | -------- | ------ | 
|                   |  | Th US$ |          |   | Th US$ |  |          | Th US$ | 
|Chilean pesos      |  |        | (524,530 | ) |        |  | (473,976 | )      | 
|Brazilian real     |  |        | (1,211   | ) |        |  | (1,421   | )      | 
|Euro               |  |        | 32,776   |   |        |  | 45,809   |        | 
|Japanese yen       |  |        | 1,183    |   |        |  | 954      |        | 
|Mexican pesos      |  |        | 137      |   |        |  | 652      |        | 
|South African rand |  |        | 29,404   |   |        |  | 25,565   |        | 
|Dirhams            |  |        | 24,594   |   |        |  | 17,044   |        | 
|Other currencies   |  |        | 22,924   |   |        |  | 19,443   |        | 
|Total, net         |  |        | (414,723 | ) |        |  | (365,930 | )      | 



Also, we had open forward exchange contracts
to buy U.S. dollars and sell Chilean pesos to hedge our time deposits in Chilean Pesos for approximately US$134.1 million (CH$70,384
million)



The information contained in Item 11. Quantitative
and Qualitative Disclosures About Market Risk, contains statements that may constitute forward-looking statements. See “Cautionary
Statement Regarding Forward-Looking Statements” in this Annual Report, for safe harbor provisions.



ITEM
12.DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES



ITEM 12.A.DEBT SECURITIES



Not applicable.



ITEM 12.B. WARRANTS AND RIGHTS



Not applicable.



ITEM 12.C. OTHER SECURITIES



Not applicable.



118







ITEM 12.D. AMERICAN DEPOSITARY RECEIPTS



Depositary Fees and Charges



The Company’s American Depositary Shares (“ADS”)
program is administered by The Bank of New York Mellon (101 Barclay St., 22 Fl.W., New York, NY 10286), as Depositary. Under the
terms of the Deposit Agreement, an ADS holder may have to pay the following service fees to the Depositary:



|Service Fees                                             |  | Fees           
|-------------------------------------------------------- |  | ---------------
|Execution and delivery of ADSs and the surrender of ADRs |  | $0.05 per share



Depositary Payments Fiscal Year 2013



The Depositary has agreed to reimburse certain expenses related
to the Company’s ADS program and incurred by the Company in connection with the program. In 2013, the Depositary reimbursed
expenses related to investor relations for a total amount of US$42,000.00.



119







PART II



ITEM
13.DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES



Not applicable



ITEM
14.MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS



Not applicable.



ITEM
15.CONTROLS AND PROCEDURES



| | (a) | Disclosure Control and Procedures
| | --- | ---------------------------------



SQM management, with the participation
of the Company's Executive management, including the Company's Chief Executive Officer and Chief Financial Officer, evaluated the
effectiveness of the design and operation of our disclosure controls and procedures, pursuant to Exchange Act Rules 13(a)-15(b),
as of the end of the period covered by this Annual Report. Based upon that evaluation, management with the participation of the
Chief Executive Officer and Chief Financial Officer, have concluded that the Company's disclosure controls and procedures are effective
in providing reasonable assurance that material information is made known to management and that financial and non-financial information
is properly recorded, processed, summarized and reported.



The procedures associated with our internal
controls are designed to provide reasonable assurance that our transactions are properly authorized, assets are safeguarded against
unauthorized or improper use, and transactions are properly recorded and reported. However, through the same design and evaluation
period of the disclosure controls and procedures, the Company's management, including the Company's Chief Executive Officer and
Chief Financial Officer, recognized that there are inherent limitations to the effectiveness of any internal control system regardless
of how well designed and operated. In such a way they can provide only reasonable assurance of achieving the desired control objectives,
and no evaluation can provide absolute assurance that all control issues or instances of fraud, if any, within the Company have
been detected.



There were no significant changes in our
internal controls over financial reporting that occurred during the period covered by this Annual Report that have materially affected,
or are likely to materially affect our internal control over financial reporting.



(b) Management’s Annual
Report on Internal Control Over Financial Reporting



SQM Management is responsible for establishing
and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting
is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial
statements for external purposes in accordance with generally accepted accounting principles.



Because of its inherent limitations, internal
control over financial reporting may not necessarily prevent or detect some misstatements. It can only provide reasonable assurance
regarding financial statement preparation and presentation. Also, projections of any evaluation of effectiveness for future periods
are subject to the risk that controls may become inadequate because of changes in conditions or because the degree of compliance
with the polices or procedures may deteriorate over time.



Management assessed the effectiveness of
its internal control over financial reporting for the year ended December 31, 2013. The assessment was based on criteria established
in the framework “Internal Controls — Integrated Framework (1992)” issued by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO). Based on the assessment, SQM management has concluded that as of December 31, 2013, the
Company’s internal control over financial reporting was effective.



120







(c) Attestation Report of the
Registered Public Accounting Firm



PriceWaterhouseCoopers Consultores, Auditores
y Compañia Limitada (“PWC”), the independent registered public accounting firm that has audited our Consolidated
Financial Statements, has also issued an attestation report on the Company’s internal control over financial reporting as
of December 31, 2013. This attestation report appears on pages F-2 and F-3 under Item 18 Financial Statements.



(d) Changes in internal control
over Financial Reporting



There were no changes in the Company’s
internal control over financial reporting that occurred during 2013 that have materially affected, or are reasonably likely to
materially affect, the Company’s internal control over financial reporting.



ITEM
16.[Reserved]



ITEM 16A.      AUDIT COMMITTEE FINANCIAL
EXPERT



The Board of Directors has determined that
the Company does not have an audit committee financial expert within the meaning of the regulations adopted under the Sarbanes-Oxley
Act of 2002.



Pursuant to Chilean regulations, the Company
has a Directors' Committee whose main duties are similar to those of an audit committee. Each of the members of the Directors'
Committee is a member of the audit committee. See 6.C. Board Practices.



Our Board believes that the members of
the Directors' Committee have the necessary expertise and experience to perform the functions of the Directors' Committee pursuant
to Chilean regulations.



ITEM 16B.    CODE OF ETHICS



We have adopted a Code of Business Conduct
that applies to the Chief Executive Officer, the Chief Financial Officer and the Internal Auditor, as well as, to all our officers
and employees. Our Code adheres to the definition set forth in Item 16B of Form 20-F under the Exchange Act.



No waivers have been granted therefrom
to the officers mentioned above.



The full text of the code is available
on our website at http://www.sqm.com in the Investor Relations section under “Corporate Governance”.



Amendments to, or waivers from one or more
provisions of the code will be disclosed on our website.



121







ITEM 16C.     PRINCIPAL ACCOUNTANT
FEES AND SERVICES



The table shows the amount of fees billed
for each of the last two fiscal years by our independent auditors, PricewaterhouseCoopers Consultores, Auditores y Compañía
Limitada (“PwC”) for the 2013 and 2012 fiscal year, in relation to audit services, audit-related services, tax and
other services provided to us (in thousands of U.S. dollars).



|                   |  | 2013 |       |  | 2012 | 
|------------------ |  | ---- | ----- |  | ---- | 
|Audit fees         |  |      | 1,458 |  |      | 
|Audit-related fees |  |      | -     |  |      | 
|Tax fees           |  |      | 445   |  |      | 
|Other fees         |  |      | 78    |  |      | 
|Total fees         |  |      | 1,981 |  |      | 



Audit fees in the above table are the aggregate
fees billed by PwC in 2013 and 2012, in connection with the audit of our annual Consolidated Financial Statements, as well as the
review of other statutory filings.



Audit-related fees in the above table are
fees billed by PwC in 2013 and 2012 for assurance and related services that are reasonably related to the performance of the audit
or review of our financial statements and are not reported under "Audit Fees."



Total fees in the above table are fees
billed by PwC in the amount of US$1.98 million in 2013, and in the amount of US$1.84 million in 2012.



Directors' Committee Pre-Approval
Policies and Procedures

Chilean law states that public companies
are subject to "pre-approval" requirements under which all audit and non-audit services provided by the independent auditor
must be pre-approved by the Directors’ Committee. Our Directors’ Committee approves all audits, audit-related, tax
and other services provided by our auditors.



Any services provided by our auditors that
are not specifically included within the scope of the audit must be pre-approved by the Directors’ Committee prior to any
engagement.



ITEM 16D.      EXEMPTIONS FROM THE LISTING
STANDARDS FOR AUDIT COMMITTEES



Not applicable.



ITEM 16E.       PURCHASES OF EQUITY SECURITIES
BY THE ISSUER AND AFFILIATED PURCHASERS



Not applicable.



122







ITEM 16F.      CHANGE IN REGISTRANT’S
CERTIFYING ACCOUNTANT



There has been no change in independent
accountants for the Company during the two most recent fiscal years or any subsequent interim period except as previously reported
in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2013, and there have been no
disagreements of the type required to be disclosed by Item 16F (b).



ITEM 16G.      CORPORATE GOVERNANCE



For a summary of the significant differences
between our corporate governance practices and the NYSE corporate governance standards, please see "Item 6. Directors, Senior
Management and Employees-C. Board Practices".



ITEM 16H.      MINE SAFETY AND DISCLOSURE



Not applicable.



123







PART III



ITEM
17.FINANCIAL STATEMENTS



See Item 18. Financial Statements.



ITEM
18.FINANCIAL STATEMENTS



See Item 19.(a) for a list of all financial
statements filed as part of this Form 20-F Annual Report.



ITEM
19.EXHIBITS



(a) Index to Financial Statements



|Reports of Independent Registered Public Accounting Firms                                                              |  | F-1 
|---------------------------------------------------------------------------------------------------------------------- |  | ----
|                                                                                                                       |  |     
|Consolidated Financial Statements:                                                                                     |  |     
|                                                                                                                       |  |     
|Audited Consolidated Statements of Financial Position as of December 31, 2013 and 2012                                 |  | F-2 
|                                                                                                                       |  |     
|Audited Consolidated Statements of Income for each of the three years in the period ended December 31, 2013            |  | F-4 
|                                                                                                                       |  |     
|Audited Consolidated Statement of Comprehensive Income for the three years in the period ended December 31, 2013       |  | F-6 
|                                                                                                                       |  |     
|Audited Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2013        |  | F-7 
|                                                                                                                       |  |     
|Audited Consolidated Statements of Changes in Equity for each of the three years in the period ended December 31, 2013 |  | F-9 
|                                                                                                                       |  |     
|Notes to the Audited Consolidated Financial Statements                                                                 |  | F-12
|                                                                                                                       |  |     
|Supplementary Schedules*                                                                                               |  |     



*All other schedules
have been omitted because they are not applicable or the required information is shown in the consolidated financial statements
or notes thereto.



(b) Exhibits



|Exhibit 
No. |  | Exhibit                                          
|------------ |  | -------------------------------------------------
|             |  |                                                  
|1.1          |  | By-laws (Estatutos) of the Company**             
|             |  |                                                  
|8.1          |  | Significant subsidiaries of the Company          
|             |  |                                                  
|12.1         |  | Section 302 Chief Executive Officer Certification
|             |  |                                                  
|12.2         |  | Section 302 Chief Financial Officer Certification
|             |  |                                                  
|13.1         |  | Section 906 Chief Executive Officer Certification
|             |  |                                                  
|13.2         |  | Section 906 Chief Financial Officer Certification



**Incorporated by reference to
the Company’s Annual Report on Form 20-F for the year ended December 31, 2010 filed with the Securities and Exchange Commission
on June 30, 2011.







124







SIGNATURES



The registrant hereby certifies that it
meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual
report on its behalf.



SOCIEDAD QUIMICA Y MINERA DE CHILE S.A.



(CHEMICAL AND MINING COMPANY OF CHILE
INC.)



/s/ Ricardo Ramos



Ricardo Ramos R.

Chief Financial Officer and

Business Development Senior Vice President



Date: April 28, 2014



125







SOCIEDAD QUIMICA Y MINERA DE CHILE S.A.
AND SUBSIDIARIES



Index to Consolidated Financial Statements



Contents







|Report of Independent Registered
    Public Accounting Firm                                                                  | F-1 
|---------------------------------------------------------------------------------------------------------------------------- | ----
|                                                                                                                             |     
|Consolidated Financial Statements                                                                                            | F-2 
|                                                                                                                             |     
|Audited Consolidated Statements of Financial
    Position as of December 31, 2013 and 2012                                   | F-2 
|Audited Consolidated Statements of Income
    for each of the three years in the period ended December 31, 2013              | F-4 
|Audited Consolidated Statement of Comprehensive
    Income for each of the three years in the period ended December 31, 2013 | F-6 
|Audited Consolidated Statements of Cash
    Flows for each of the three years in the period ended December 31, 2013          | F-7 
|Audited Consolidated Statements of Changes
    in Equity for each of the three years in the period ended December 31, 2013   | F-9 
|Notes to the Audited Consolidated Financial
    Statements                                                                   | F-12





|Ch$   | - | Chilean pesos                                                                                                                                                                      
|----- | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ThCh$ | - | Thousands of Chilean pesos                                                                                                                                                         
|US$   | - | United States dollars                                                                                                                                                              
|ThUS$ | - | Thousands of United States dollars                                                                                                                                                 
|UF    | - | The UF is an inflation-indexed, Chilean peso-denominated monetary unit. The UF rate is set daily in advance, based on the change in the Consumer Price Index of the previous month.



126







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



Tothe Board of Directors and Shareholders
of Sociedad Química y Minera de Chile S.A.



In our opinion, the accompanying consolidated
statement of financial position and the related consolidated statements of income, comprehensive income, cash flows and of changes
in equity present fairly, in all material respects, the financial position of Sociedad Química y Minera de Chile S.A. and
its subsidiaries at December 31, 2013 and December 31, 2012, and the results of their operations and their cash flows for each
of the three years in the period ended December 31, 2013 in conformity with International Financial Reporting Standards as issued
by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control - Integrated
Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management
is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal
Control Over Financial Reporting appearing under Item 15. Our responsibility is to express opinions on these financial statements
and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether
effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements
included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.
Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal
control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our opinions.



A company’s internal control over
financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s
internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.



Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.



/s/ PricewaterhouseCoopers

Santiago, Chile

April 28, 2014



F-1







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED CLASSIFIED STATEMENT OF FINANCIAL POSITION






|                                                    |  | Note |      |  | As of December 31, 2013 ThUS$ |  |           | As of December 31, 2012 ThUS$ | 
|--------------------------------------------------- |  | ---- | ---- |  | ----------------------------- |  | --------- | ----------------------------- | 
|ASSETS                                              |  |      |      |  |                               |  |           |                               | 
|                                                    |  |      |      |  |                               |  |           |                               | 
|Current assets                                      |  |      |      |  |                               |  |           |                               | 
|Cash and cash equivalents                           |  |      | 7.1  |  |                               |  | 476,622   |                               | 
|Other current financial assets                      |  |      | 10.1 |  |                               |  | 460,173   |                               | 
|Other current non-financial assets                  |  |      | 25   |  |                               |  | 44,230    |                               | 
|Trade and other receivables, current                |  |      | 10.2 |  |                               |  | 330,992   |                               | 
|Trade receivables due from related parties, current |  |      | 9.5  |  |                               |  | 128,026   |                               | 
|Current inventories                                 |  |      | 8    |  |                               |  | 955,530   |                               | 
|Current tax assets                                  |  |      | 28.1 |  |                               |  | 59,476    |                               | 
|Total current assets                                |  |      |      |  |                               |  | 2,455,049 |                               | 
|                                                    |  |      |      |  |                               |  |           |                               | 
|Non-current assets                                  |  |      |      |  |                               |  |           |                               | 
|Other non-current financial assets                  |  |      | 10.1 |  |                               |  | 95        |                               | 
|Other non-current non-financial assets              |  |      | 25   |  |                               |  | 36,505    |                               | 
|Trade receivables, non-current                      |  |      | 10.2 |  |                               |  | 1,282     |                               | 
|Investments in associates                           |  |      | 11   |  |                               |  | 51,075    |                               | 
|Investments in joint ventures                       |  |      | 12   |  |                               |  | 25,943    |                               | 
|Intangible assets other than goodwill               |  |      | 13.1 |  |                               |  | 104,363   |                               | 
|Goodwill                                            |  |      | 13.1 |  |                               |  | 38,388    |                               | 
|Property, plant and equipment                       |  |      | 14.1 |  |                               |  | 2,054,377 |                               | 
|Deferred tax assets                                 |  |      | 28.4 |  |                               |  | 531       |                               | 
|Total non-current assets                            |  |      |      |  |                               |  | 2,312,559 |                               | 
|Total assets                                        |  |      |      |  |                               |  | 4,767,608 |                               | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-2







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED CLASSIFIED
STATEMENT OF FINANCIAL POSITION, (continued)





|                                               |  | Note |      |  | As of December 31, 2013 ThUS$ |  |           | As of December 31, 2012 ThUS$ | 
|---------------------------------------------- |  | ---- | ---- |  | ----------------------------- |  | --------- | ----------------------------- | 
|Liabilities and Equity                         |  |      |      |  |                               |  |           |                               | 
|                                               |  |      |      |  |                               |  |           |                               | 
|Liabilities                                    |  |      |      |  |                               |  |           |                               | 
|Current liabilities                            |  |      |      |  |                               |  |           |                               | 
|Other current financial liabilities            |  |      | 10.4 |  |                               |  | 401,426   |                               | 
|Trade and other payables, current              |  |      | 10.5 |  |                               |  | 150,960   |                               | 
|Trade payables due to related parties, current |  |      | 9.6  |  |                               |  | -         |                               | 
|Other current provisions                       |  |      | 18.1 |  |                               |  | 17,953    |                               | 
|Current tax liabilities                        |  |      | 28.2 |  |                               |  | 31,707    |                               | 
|Provisions for employee benefits, current      |  |      | 15.1 |  |                               |  | 25,236    |                               | 
|Other current non-financial liabilities        |  |      | 18.3 |  |                               |  | 95,353    |                               | 
|Total current liabilities                      |  |      |      |  |                               |  | 722,635   |                               | 
|                                               |  |      |      |  |                               |  |           |                               | 
|Non-current liabilities                        |  |      |      |  |                               |  |           |                               | 
|Other non-current financial liabilities        |  |      | 10.4 |  |                               |  | 1,417,390 |                               | 
|Other non-current provisions                   |  |      | 18.1 |  |                               |  | 8,633     |                               | 
|Deferred tax liabilities                       |  |      | 28.4 |  |                               |  | 154,295   |                               | 
|Provisions for employee benefits, non-current  |  |      | 15.1 |  |                               |  | 32,414    |                               | 
|Total non-current liabilities                  |  |      |      |  |                               |  | 1,612,732 |                               | 
|Total liabilities                              |  |      |      |  |                               |  | 2,335,367 |                               | 
|                                               |  |      |      |  |                               |  |           |                               | 
|Equity                                         |  |      | 17   |  |                               |  |           |                               | 
|Share capital                                  |  |      |      |  |                               |  | 477,386   |                               | 
|Retained earnings                              |  |      |      |  |                               |  | 1,909,725 |                               | 
|Other reserves                                 |  |      |      |  |                               |  | (10,491   | )                             | 
|Equity attributable to owners of the Parent    |  |      |      |  |                               |  | 2,376,620 |                               | 
|Non-controlling interests                      |  |      |      |  |                               |  | 55,621    |                               | 
|Total equity                                   |  |      |      |  |                               |  | 2,432,241 |                               | 
|Total liabilities and equity                   |  |      |      |  |                               |  | 4,767,608 |                               | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-3







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED STATEMENT OF INCOME BY FUNCTION








|                                                                                       |  |      |      |  | January to December | 
|-------------------------------------------------------------------------------------- |  | ---- | ---- |  | ------------------- | 
|                                                                                       |  | Note |      |  | 2013 ThUS$          | 
|                                                                                       |  |      |      |  |                     | 
|Revenue                                                                                |  |      | 20   |  |                     | 
|Cost of sales                                                                          |  |      | 27.2 |  |                     | 
|Gross profit                                                                           |  |      |      |  |                     | 
|                                                                                       |  |      |      |  |                     | 
|Other income                                                                           |  |      | 27.3 |  |                     | 
|Administrative expenses                                                                |  |      | 27.4 |  |                     | 
|Other expenses by function                                                             |  |      | 27.5 |  |                     | 
|Other gains (losses)                                                                   |  |      | 27.6 |  |                     | 
|Profit (loss) from operating activities                                                |  |      |      |  |                     | 
|Finance income                                                                         |  |      |      |  |                     | 
|Finance costs                                                                          |  |      | 22   |  |                     | 
|Share of profit of associates and joint ventures accounted for using the equity method |  |      |      |  |                     | 
|Foreign currency translation differences                                               |  |      | 23   |  |                     | 
|Profit (loss) before taxes                                                             |  |      |      |  |                     | 
|Income tax expense, continuing operations                                              |  |      | 28.4 |  |                     | 
|                                                                                       |  |      |      |  |                     | 
|Profit (loss) from continuing operations                                               |  |      |      |  |                     | 
|                                                                                       |  |      |      |  |                     | 
|Profit for the year                                                                    |  |      |      |  |                     | 
|Profit attributable to                                                                 |  |      |      |  |                     | 
|Owners of the Parent                                                                   |  |      |      |  |                     | 
|Non-controlling interests                                                              |  |      |      |  |                     | 
|Profit for the year                                                                    |  |      |      |  |                     | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-4







Sociedad
Química y Minera de Chile S.A. and Subsidiaries





CONSOLIDATED STATEMENT
OF INCOME BY FUNCTION (continued)





|                                                                      |  |      |    |  | January to December | 
|--------------------------------------------------------------------- |  | ---- | -- |  | ------------------- | 
|                                                                      |  | Note |    |  | 2013                | 
|                                                                      |  |      |    |  | US$                 | 
|Earnings per share                                                    |  |      |    |  |                     | 
|Common shares                                                         |  |      |    |  |                     | 
|Basic earnings per share (US$ per share)                              |  |      | 21 |  |                     | 
|                                                                      |  |      |    |  |                     | 
|Basic earnings per share (US$ per share) from continuing operations   |  |      |    |  |                     | 
|                                                                      |  |      |    |  |                     | 
|Diluted common shares                                                 |  |      |    |  |                     | 
|Diluted earnings per share (US$ per share)                            |  |      | 21 |  |                     | 
|                                                                      |  |      |    |  |                     | 
|Diluted earnings per share (US$ per share) from continuing operations |  |      |    |  |                     | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-5







Sociedad
Química y Minera de Chile S.A. and Subsidiaries







CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME





|                                                                                                   |  | January to December |        
|-------------------------------------------------------------------------------------------------- |  | ------------------- | -------
|                                                                                                   |  | 2013                |        
|                                                                                                   |  | ThUS$               |        
|Statement of comprehensive income                                                                  |  |                     |        
|                                                                                                   |  |                     |        
|Profit for the year                                                                                |  |                     | 474,570
|Components of other comprehensive income before taxes and foreign currency translation differences |  |                     |        
|Gain (loss) from foreign currency translation differences, before taxes                            |  |                     | (3,559 
|Other comprehensive income before taxes and foreign currency translation differences               |  |                     | (3,559 
|Cash flow hedges                                                                                   |  |                     |        
|(Gain) loss from cash flow hedges before taxes                                                     |  |                     | 15,778 
|Other comprehensive income before taxes and cash flow hedges                                       |  |                     | 15,778 
|Other comprehensive income before taxes and actuarial gains (losses) from defined benefit plans    |  |                     | 1,012  
|Other miscellaneous reserves                                                                       |  |                     | -      
|Other components of other comprehensive income before taxes                                        |  |                     | 13,231 
|                                                                                                   |  |                     |        
|Income taxes associated with components of other comprehensive income                              |  |                     |        
|Income taxes associated with cash flow hedges in other comprehensive income                        |  |                     | (3,022 
|Income taxes associated with components of other comprehensive income                              |  |                     | (3,022 
|                                                                                                   |  |                     |        
|Other comprehensive income                                                                         |  |                     | 10,209 
|                                                                                                   |  |                     |        
|Total comprehensive income                                                                         |  |                     | 484,779
|                                                                                                   |  |                     |        
|Comprehensive income attributable to                                                               |  |                     |        
|Owners of the Parent                                                                               |  |                     | 477,394
|Non-controlling interests                                                                          |  |                     | 7,385  
|Total comprehensive income                                                                         |  |                     | 484,779



The accompanying notes form an integral part of these consolidated
financial statements.



F-6







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED STATEMENT OF CASH FLOWS



|                                                                            |  | 12/31/2013 ThUS$ |            |   | 12/31/2012 ThUS$ |  |            | 12/31/2011 ThUS$ | 
|--------------------------------------------------------------------------- |  | ---------------- | ---------- | - | ---------------- |  | ---------- | ---------------- | 
|Statements of cash flows                                                    |  |                  |            |   |                  |  |            |                  | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Cash flows from (used in) operating activities                              |  |                  |            |   |                  |  |            |                  | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Types of receipts from operating activities                                 |  |                  |            |   |                  |  |            |                  | 
|Cash receipts from sales of goods and rendering of services                 |  |                  | 2,392,696  |   |                  |  | 2,387,979  |                  | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Types of payments                                                           |  |                  |            |   |                  |  |            |                  | 
|Cash payments to suppliers for the provision of goods and services          |  |                  | (1,496,053 | ) |                  |  | (1,447,970 | )                | 
|Cash payments to and on behalf of employees                                 |  |                  | (48,033    | ) |                  |  | (44,429    | )                | 
|Other payments related to operating activities                              |  |                  | (24,774    | ) |                  |  | (8,396     | )                | 
|Dividends received                                                          |  |                  | 16,423     |   |                  |  | 15,126     |                  | 
|Interest paid                                                               |  |                  | (87,018    | ) |                  |  | (59,509    | )                | 
|Interest received                                                           |  |                  | 12,696     |   |                  |  | 24,368     |                  | 
|Reimbursed (paid) income taxes                                              |  |                  | (119,107   | ) |                  |  | (250,201   | )                | 
|Other cash inflows (outflows)                                               |  |                  | 4,883      |   |                  |  | 33,238     |                  | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Net cash generated from (used in) operating activities                      |  |                  | 651,713    |   |                  |  | 650,206    |                  | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Cash flows from investing activities                                        |  |                  |            |   |                  |  |            |                  | 
|Cash receipts from the loss of control of subsidiaries and other businesses |  |                  | -          |   |                  |  | 961        |                  | 
|Other cash payments made to acquire interests in joint ventures             |  |                  | (69        | ) |                  |  | (197       | )                | 
|Proceeds from the sale of property, plant and equipment                     |  |                  | 216        |   |                  |  | 2,050      |                  | 
|Proceeds from sale of intangible assets                                     |  |                  | 86,157     |   |                  |  | -          |                  | 
|Acquisition of property, plant and equipment                                |  |                  | (386,495   | ) |                  |  | (449,984   | )                | 
|Cash advances and loans granted to third parties                            |  |                  | 528        |   |                  |  | (623       | )                | 
|Other cash inflows (outflows) (*)                                           |  |                  | (187,722   | ) |                  |  | (115,092   | )                | 
|                                                                            |  |                  |            |   |                  |  |            |                  | 
|Net cash generated from (used in) investing activities                      |  |                  | (487,385   | ) |                  |  | (562,885   | )                | 



(*)Includes other cash receipts (payments)
associated with, investments and redemptions of time deposits and other financial instruments, which do not qualify as cash and
cash equivalents in accordance with IAS 7.7 as they have a maturity date greater than 90 days at the time of acquisition. Investments
and redemptions are reported net as they are typically rolled over upon maturity.



The accompanying notes form an integral part of these consolidated
financial statements.



F-7







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED STATEMENT OF CASH FLOWS (continued)



|                                                                                                       |  | 12/31/2013 ThUS$ |          |   | 12/31/2012 ThUS$ |  |          | 12/31/2011 ThUS$ | 
|------------------------------------------------------------------------------------------------------ |  | ---------------- | -------- | - | ---------------- |  | -------- | ---------------- | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Cash flows from (used in) financing activities                                                         |  |                  |          |   |                  |  |          |                  | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Proceeds from long-term borrowings                                                                     |  |                  | 300,000  |   |                  |  | 366,502  |                  | 
|Proceeds from short-term borrowings                                                                    |  |                  | 160,000  |   |                  |  | -        |                  | 
|Total proceeds from borrowings                                                                         |  |                  | 460,000  |   |                  |  | 366,502  |                  | 
|Repayment of borrowings                                                                                |  |                  | (176,485 | ) |                  |  | (220,000 | )                | 
|Dividends paid                                                                                         |  |                  | (279,668 | ) |                  |  | (334,762 | )                | 
|Other cash receipts (payments)                                                                         |  |                  | (6,132   | ) |                  |  | (9,437   | )                | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Net cash generated from (used in) financing activities                                                 |  |                  | (2,285   | ) |                  |  | (197,697 | )                | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Net increase (decrease) in cash and cash equivalents before the effect of changes in the exchange rate |  |                  | 162,043  |   |                  |  | (110,376 | )                | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Effects of exchange rate fluctuations on cash held                                                     |  |                  | (9,774   | ) |                  |  | (10,263  | )                | 
|Net (decrease) increase in cash and cash equivalents                                                   |  |                  | 152,269  |   |                  |  | (120,639 | )                | 
|                                                                                                       |  |                  |          |   |                  |  |          |                  | 
|Cash and cash equivalents at beginning of period                                                       |  |                  | 324,353  |   |                  |  | 444,992  |                  | 
|Cash and cash equivalents at end of period                                                             |  |                  | 476,622  |   |                  |  | 324,353  |                  | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-8







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



STATEMENT OF CHANGES IN
EQUITY



|2013                                                   |  | Share capital |         |  | Foreign currency translation
    difference reserves |  |        | Cash flow hedge reserves |  |  | Actuarial gains (losses)
    from defined benefit plans |   |  | Other miscellaneous reserves |        |   | Other reserves |  |        | Retained earnings |  |  | Equity attributable to owners of
    the Parent |   |  | Non-controlling interests |           |   | Total | 
|------------------------------------------------------ |  | ------------- | ------- |  | ---------------------------------------------------- |  | ------ | ------------------------ |  |  | ------------------------------------------------------- | - |  | ---------------------------- | ------ | - | -------------- |  | ------ | ----------------- |  |  | ----------------------------------------------- | - |  | ------------------------- | --------- | - | ----- | 
|                                                       |  | ThUS$         |         |  | ThUS$                                                |  |        | ThUS$                    |  |  | ThUS$                                                   |   |  | ThUS$                        |        |   | ThUS$          |  |        | ThUS$             |  |  | ThUS$                                           |   |  | ThUS$                     |           |   | ThUS$ | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity at beginning of the year                        |  |               | 477,386 |  |                                                      |  | (330   | )                        |  |  | (16,522                                                 | ) |  |                              | (2,243 | ) |                |  | (1,677 | )                 |  |  | (20,772                                         | ) |  |                           | 1,676,169 |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Profit for the year                                    |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | 467,113   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Other comprehensive income                             |  |               | -       |  |                                                      |  | (3,487 | )                        |  |  | 12,756                                                  |   |  |                              | 1,012  |   |                |  | -      |                   |  |  | 10,281                                          |   |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Comprehensive income                                   |  |               | -       |  |                                                      |  | (3,487 | )                        |  |  | 12,756                                                  |   |  |                              | 1,012  |   |                |  | -      |                   |  |  | 10,281                                          |   |  |                           | 467,113   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Dividends                                              |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | (233,557  | ) |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in transfers and other
    changes |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in equity                          |  |               | -       |  |                                                      |  | (3,487 | )                        |  |  | 12,756                                                  |   |  |                              | 1,012  |   |                |  | -      |                   |  |  | 10,281                                          |   |  |                           | 233,556   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity As of December 31, 2013                         |  |               | 477,386 |  |                                                      |  | (3,817 | )                        |  |  | (3,766                                                  | ) |  |                              | (1,231 | ) |                |  | (1,677 | )                 |  |  | (10,491                                         | ) |  |                           | 1,909,725 |   |       | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-9







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY



|2012                                                   |  | Share capital |         |  | Foreign currency translation
    difference reserves |  |        | Cash flow hedge reserves |  |  | Actuarial gains (losses)
    from defined benefit plans |   |  | Other miscellaneous reserves |        |   | Other reserves |  |        | Retained earnings |  |  | Equity attributable to owners of
    the Parent |   |  | Non-controlling interests |           |   | Total | 
|------------------------------------------------------ |  | ------------- | ------- |  | ---------------------------------------------------- |  | ------ | ------------------------ |  |  | ------------------------------------------------------- | - |  | ---------------------------- | ------ | - | -------------- |  | ------ | ----------------- |  |  | ----------------------------------------------- | - |  | ------------------------- | --------- | - | ----- | 
|                                                       |  | ThUS$         |         |  | ThUS$                                                |  |        | ThUS$                    |  |  | ThUS$                                                   |   |  | ThUS$                        |        |   | ThUS$          |  |        | ThUS$             |  |  | ThUS$                                           |   |  | ThUS$                     |           |   | ThUS$ | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity at beginning of the year                        |  |               | 477,386 |  |                                                      |  | (1,251 | )                        |  |  | (10,230                                                 | ) |  |                              | (2,954 | ) |                |  | (1,677 | )                 |  |  | (16,112                                         | ) |  |                           | 1,351,560 |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Profit for the year                                    |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           | 649,167   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Other comprehensive income                             |  |               | -       |  |                                                      |  | 921    |                          |  |  | (6,292                                                  | ) |  |                              | 711    |   |                |  | -      |                   |  |  | (4,660                                          | ) |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Comprehensive income                                   |  |               | -       |  |                                                      |  | 921    |                          |  |  | (6,292                                                  | ) |  |                              | 711    |   |                |  | -      |                   |  |  | (4,660                                          | ) |  |                           | 649,167   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Dividends                                              |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | (324,558  | ) |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in transfers and other
    changes |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in equity                          |  |               | -       |  |                                                      |  | 921    |                          |  |  | (6,292                                                  | ) |  |                              | 711    |   |                |  | -      |                   |  |  | (4,660                                          | ) |  |                           | 324,609   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity As of December 31, 2012                         |  |               | 477,386 |  |                                                      |  | (330   | )                        |  |  | (16,522                                                 | ) |  |                              | (2,243 | ) |                |  | (1,677 | )                 |  |  | (20,772                                         | ) |  |                           | 1,676,169 |   |       | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-10







Sociedad
Química y Minera de Chile S.A. and Subsidiaries



CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY



|2011                                                   |  | Share capital |         |  | Foreign currency translation
    difference reserves |  |        | Cash flow hedge reserves |  |  | Actuarial gains (losses)
    from defined benefit plans |   |  | Other miscellaneous reserves |        |   | Other reserves |  |        | Retained earnings |  |  | Equity attributable to owners of
    the Parent |   |  | Non-controlling interests |           |   | Total | 
|------------------------------------------------------ |  | ------------- | ------- |  | ---------------------------------------------------- |  | ------ | ------------------------ |  |  | ------------------------------------------------------- | - |  | ---------------------------- | ------ | - | -------------- |  | ------ | ----------------- |  |  | ----------------------------------------------- | - |  | ------------------------- | --------- | - | ----- | 
|                                                       |  | ThUS$         |         |  | ThUS$                                                |  |        | ThUS$                    |  |  | ThUS$                                                   |   |  | ThUS$                        |        |   | ThUS$          |  |        | ThUS$             |  |  | ThUS$                                           |   |  | ThUS$                     |           |   | ThUS$ | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity at beginning of the year                        |  |               | 477,386 |  |                                                      |  | 1,530  |                          |  |  | (9,207                                                  | ) |  |                              | (2,036 | ) |                |  | -      |                   |  |  | (9,713                                          | ) |  |                           | 1,155,131 |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Profit for the year                                    |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           | 545,758   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Other comprehensive income                             |  |               | -       |  |                                                      |  | (2,781 | )                        |  |  | (1,023                                                  | ) |  |                              | (918   | ) |                |  | (1,677 | )                 |  |  | (6,399                                          | ) |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Comprehensive income                                   |  |               | -       |  |                                                      |  | (2,781 | )                        |  |  | (1,023                                                  | ) |  |                              | (918   | ) |                |  | (1,677 | )                 |  |  | (6,399                                          | ) |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Dividends                                              |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | (349,329  | ) |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in transfers and other
    changes |  |               | -       |  |                                                      |  | -      |                          |  |  | -                                                       |   |  |                              | -      |   |                |  | -      |                   |  |  | -                                               |   |  |                           | -         |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Increase (decrease) in equity                          |  |               | -       |  |                                                      |  | (2,781 | )                        |  |  | (1,023                                                  | ) |  |                              | (918   | ) |                |  | (1,677 | )                 |  |  | (6,399                                          | ) |  |                           | 196,429   |   |       | 
|                                                       |  |               |         |  |                                                      |  |        |                          |  |  |                                                         |   |  |                              |        |   |                |  |        |                   |  |  |                                                 |   |  |                           |           |   |       | 
|Equity As of December 31, 2011                         |  |               | 477,386 |  |                                                      |  | (1,251 | )                        |  |  | (10,230                                                 | ) |  |                              | (2,954 | ) |                |  | (1,677 | )                 |  |  | (16,112                                         | ) |  |                           | 1,351,560 |   |       | 



The accompanying notes form an integral part of these consolidated
financial statements.



F-11







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 1 – Identification and Activities
of the Company and Subsidiaries



| | 1.1 | Historical background
| | --- | ---------------------



Sociedad Química y Minera de Chile
S.A. "SQM" is an open stock corporation organized under the laws of the Republic of Chile, Tax Identification No.93.007.000-9.

The Company was incorporated through a
public deed dated June 17, 1968 by the notary public of Santiago MR. Sergio Rodríguez Garcés. Its existence was approved
by Decree No. 1,164 of June 22, 1968 of the Ministry of Finance, and it was registered on June 29, 1968 in the Registry of Commerce
of Santiago, on page 4,537 No. 1,992. SQM's headquarters are located at El Trovador 4285, Fl. 6, Las Condes, Santiago, Chile. The
Company's telephone number is +56 2 2425-2000.

The Company is registered with the Securities
Registry of the Chilean Superintendence of Securities and Insurance (SVS) under No. 0184 dated March 18. 1983 and is subject to
the inspection of the SVS.



| | 1.2 | Main domicile where the Company performs its production activities
| | --- | ------------------------------------------------------------------



The Company’s main domiciles are:
Calle Dos Sur sitio No. 5 - Antofagasta; Arturo Prat 1060 - Tocopilla; Edificio Administración w/n - Maria Elena; Edificio
Administración s/n Pedro de Valdivia - María Elena, Anibal Pinto 3228 - Antofagasta, kilometro 1378 Ruta 5 Norte
- Antofagasta, Coya Sur Plant s/n - Maria Elena, kilometro 1760 Ruta 5 Norte - Pozo Almonte, Planta Cloruro de Potasio Salar de
Atacama s/n - San Pedro de Atacama, Planta Sulfato de Potasio Salar de Atacama s/n – San Pedro de Atacama, Campamento Minsal
s/n Planta CL, Potasio – San Pedro de Atacama, Ex Oficina Salitrera Iris S/N, Comuna de Pozo Almonte, Iquique.



| | 1.3 | Codes of main activities
| | --- | ------------------------



The codes of the main activities as established
by the Chilean Superintendence of Securities and Insurance are as follows:



| | - | 1700 (Mining)
| | - | -------------

| | - | 2200 (Chemical products)
| | - | ------------------------

| | - | 1300 (Investment)
| | - | -----------------



| | 1.4 | Description of the nature of operations and main activities
| | --- | -----------------------------------------------------------



Our products are mainly derived from mineral
deposits found in northern Chile. We mine and process caliche ore and brine deposits. The caliche ore in northern Chile contains
the largest known nitrate and iodine deposits in the world and is the world’s largest commercially exploited source of natural
nitrates. The brine deposits of the Salar de Atacama, a salt-encrusted depression within the Atacama desert in northern Chile,
contain high concentrations of lithium and potassium as well as significant concentrations of sulfate and boron.



F-12







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
1 – Identification and Activities of the Company and Subsidiaries (continued)



| | 1.4 | Description of the nature of operations and main activities, continued
| | --- | ----------------------------------------------------------------------



From our caliche ore deposits located in
the north of Chile, we produce a wide range of nitrate-based products used for specialty plant nutrients and industrial applications,
as well as iodine and iodine derivatives. At the Salar de Atacama, we extract brines rich in potassium, lithium, sulfate and boron
in order to produce potassium chloride, potassium sulfate, lithium solutions, boric acid and bischofite (magnesium chloride). We
produce lithium carbonate and lithium hydroxide at our plant near the city of Antofagasta, Chile, from the solutions brought from
the Salar de Atacama. We market all of these products through an established worldwide distribution network.



We sell our products in over 100 countries
worldwide through our global distribution network and generate our revenue mainly from abroad.



Our products are divided into six categories:
specialty plant nutrition, iodine and its derivatives, lithium and its derivatives, industrial chemicals, potassium and other products
and services, described as follows:



Specialty plant nutrition: SQM produces
and sells four types of specialty plant nutrition in this line of business: potassium nitrate, sodium nitrate, sodium potassium
nitrate, and specialty mixes. This business is characterized by maintaining closer relations with its customers for which it has
specialized staff who provide expert advisory in best practices for fertilization according to each type of crop, soil and climate.
Within this line of business, potassium derivative products and specialty potassium nitrate have had a leading role given their
unique charateristcs that allow an improvement in post-crop life in addition to improving quality, flavor and fruit color. The
potassium nitrate, which is sold in multiple formats and as a part of other specialty mixtures, is complemented by sodium nitrate,
potassium sodium nitrate, and more than 200 fertilizer mixtures.



Iodine: The Company is a major producer
of iodine at a global level. Iodine is widely used in the pharmaceutical industry, technology and nutrition. Additionally, iodine
is used as an X ray contrast media and as polarizing film for LCD displays.



Lithium: the Company’s lithium
is mainly used for manufacturing rechargeable batteries for cell phones, cameras and notebooks. Through the manufacturing of lithium-based
products, SQM provides significant materials to face great challenges such as the efficient use of energy and raw materials. Lithium
is not only used for rechargeable batteries and in new technologies for electric vehicles, but is also used in industrial applications
to lower melting temperature and to help save costs and energy.



F-13







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
1 – Identification and Activities of the Company and Subsidiaries (continued)



| | 1.4 | Description of the nature of operations and main activities, continued
| | --- | ----------------------------------------------------------------------



Industrial Chemicals: Industrial
chemicals are products used as supplies for a large number of production processes. SQM has participated in this line of business
for years producing sodium nitrate, potassium nitrate, boric acid and potassium chloride. Industrial nitrates have become increasingly
important over the last few years due to their use as storage means for thermal energy at solar energy plants, which are widely
used in countries as Spain and the United States as they look to decrease CO2emissions



Potassium: The potassium is a primary
essential macro-nutrient, that although does not form part of the plant’s structure, has a significant role in the development
of its basic functions, ensuring the quality of a crop, increasing post-crop life, improving the crop flavor, its vitamin content
and its physical appearance. Within this business line, SQM has also potassium chlorate and potassium sulfate, both extracted from
the salt layer located under the Salar de Atacama (the Atacama Saltpeter Deposit.)



Other products and services: This
business line includes revenue from commodities, services, interests, royalties and dividends.



| | 1.5 | Other background:
| | --- | -----------------



Staff



As of December 31, 2013 and December 31,
2012, staff was detailed as follows:



|                |  | 12/31/2013 |       |  | 12/31/2012 | 
|--------------- |  | ---------- | ----- |  | ---------- | 
|                |  |            |       |  |            | 
|Permanent staff |  |            | 4,792 |  |            | 



F-14







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
1 – Identification and Activities of the Company and subsidiaries (continued)



| | 1.5 | Other background, continued
| | --- | ---------------------------



Main
shareholders



The table below establishes certain information
about the beneficial property of Series A and Series B shares of SQM as of December 31, 2013 and December 31, 2012, in respect
to each shareholder which has interest of more than 5% of outstanding Series A or B shares. The information below is taken from
our records and reports controlled in the Central Securities Depository and reported to the Superintendence of Securities and Insurance
(SVS) and the Chilean Stock Exchange, whose main shareholders are as follows:



|Shareholder as of December 31, 2013                    |  | No. of Series A
    with ownership |            |  | % of Series A
    shares |  |       | No. of Series B
    with ownership |  |  | % of Series B
    shares |  |  | % of total
    shares |      
|------------------------------------------------------ |  | ---------------------------------- | ---------- |  | ------------------------ |  | ----- | ---------------------------------- |  |  | ------------------------ |  |  | --------------------- | -----
|The Bank of New York Mellon, ADRs                      |  |                                    | -          |  |                          |  | -     |                                    |  |  | 56,302,367               |  |  |                       | 46.77
|Sociedad de Inversiones Pampa Calichera S.A.(*)        |  |                                    | 44,758,830 |  |                          |  | 31.34 | %                                  |  |  | 6,971,799                |  |  |                       | 5.79 
|Inversiones El Boldo Limitada                          |  |                                    | 29,225,196 |  |                          |  | 20.46 | %                                  |  |  | 18,028,676               |  |  |                       | 14.98
|Inversiones RAC Chile Limitada                         |  |                                    | 19,200,242 |  |                          |  | 13.44 | %                                  |  |  | 2,202,773                |  |  |                       | 1.83 
|Potasios de Chile S.A.(*)                              |  |                                    | 18,179,147 |  |                          |  | 12.73 | %                                  |  |  | -                        |  |  |                       | -    
|BTG Pactual Chile S.A. C de B                          |  |                                    | 15,593,709 |  |                          |  | 10.92 | %                                  |  |  | 797,393                  |  |  |                       | 0.66 
|Inversiones Global Mining (Chile) Limitada (*)         |  |                                    | 8,798,539  |  |                          |  | 6.16  | %                                  |  |  | -                        |  |  |                       | -    
|Banco Itau on behalf of foreign investors              |  |                                    | 20,950     |  |                          |  | 0.01  | %                                  |  |  | 5,428,234                |  |  |                       | 4.51 
|Banco de Chile on behalf of non-resident third parties |  |                                    | -          |  |                          |  | -     |                                    |  |  | 5,234,823                |  |  |                       | 4.35 
|Inversiones La Esperanza Limitada                      |  |                                    | 3,693,977  |  |                          |  | 2.59  | %                                  |  |  | -                        |  |  |                       | -    



(*) Total Pampa Group 29.9%



|Shareholder as of December 31, 2012                    |  | No. of Series A
    with ownership |            |  | % of Series A
    shares |  |       | No. of Series B
    with ownership |  |  | % of Series B
    shares |  |  | % of total
    shares |      
|------------------------------------------------------ |  | ---------------------------------- | ---------- |  | ------------------------ |  | ----- | ---------------------------------- |  |  | ------------------------ |  |  | --------------------- | -----
|Inversiones El Boldo Limitada                          |  |                                    | 44,751,196 |  |                          |  | 31.33 | %                                  |  |  | 17,571,676               |  |  |                       | 14.60
|Sociedad de Inversiones Pampa Calichera S.A.(*)        |  |                                    | 44,558,830 |  |                          |  | 31.20 | %                                  |  |  | 9,003,799                |  |  |                       | 7.48 
|The Bank of New York                                   |  |                                    | -          |  |                          |  | -     |                                    |  |  | 46,559,106               |  |  |                       | 38.68
|Inversiones RAC Chile Limitada                         |  |                                    | 19,200,242 |  |                          |  | 13.44 | %                                  |  |  | 2,699,773                |  |  |                       | 2.24 
|Potasios de Chile S.A.(*)                              |  |                                    | 17,919,147 |  |                          |  | 12.55 | %                                  |  |  | -                        |  |  |                       | -    
|Inversiones Global Mining (Chile) Limitada (*)         |  |                                    | 8,798,539  |  |                          |  | 6.16  | %                                  |  |  | -                        |  |  |                       | -    
|Banco Itau on behalf of investors                      |  |                                    | -          |  |                          |  | -     |                                    |  |  | 4,579,293                |  |  |                       | 3.80 
|Inversiones La Esperanza Limitada                      |  |                                    | 3,693,977  |  |                          |  | 2.59  | %                                  |  |  | -                        |  |  |                       | -    
|Banco Santander on behalf of foreign investors         |  |                                    | -          |  |                          |  | -     |                                    |  |  | 3,238,105                |  |  |                       | 2.69 
|Banco de Chile on behalf of non-resident third parties |  |                                    | -          |  |                          |  | -     |                                    |  |  | 3,082,612                |  |  |                       | 2.56 



(*) Total Pampa Group 30.50%



On December 31, 2013 the total number of shareholders had decreased
to 1,331 from 1,483 on December 31, 2012.



F-15







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements



| | 2.1 | Accounting period
| | --- | -----------------



These consolidated financial statements
cover the following periods



| | - | Consolidated Statement of Financial Position
as of December 31, 2013 and December 31, 2012.
| | - | -------------------------------------------------------------------------------------------



| | - | Consolidated Statement of Changes in Equity
for the years ended December 31, 2013, 2012 and 2011.
| | - | -------------------------------------------------------------------------------------------------



| | - | Consolidated Statement of Comprehensive
Income for the years ended December 31, 2013, 2012 and 2011.
| | - | ----------------------------------------------------------------------------------------------------



| | - | Consolidated Statement of Cash Flows –Direct
method for the years ended December 31, 2013, 2012 and 2011.
| | - | ---------------------------------------------------------------------------------------------------------



F-16







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.2 | Financial statements
| | --- | --------------------



The consolidated financial statements of
Sociedad Química y Minera de Chile S.A. and Subsidiaries, have been prepared in accordance with International Financial
Reporting Standards (hereinafter “IFRS”) and represent the full, explicit and unreserved application of the aforementioned
international standards issued by the International Accounting Oversight Board (IASB).



These annual consolidated financial statements
reflect fairly the Company’s equity and financial position and the results of its operations, changes in the statement of
recognized revenue and expenses and cash flows, which have occurred during the periods then ended.



IFRS establish certain alternatives for
their application. Those applied by the Company and its subsidiaries are included in detail in this Note.



The accounting policies used in the preparation
of these consolidated financial accounts comply with each IFRS in force at their date of presentation. Certain reclassifications
have been made for comparative purposes, refer to Note 14.6.



| | 2.3 | Basis of measurement
| | --- | --------------------



The consolidated financial statements have
been prepared on the historical cost basis except for the following material items:



| | - | inventories are recorded at the lower
of cost and net realizable value;
| | - | -----------------------------------------------------------------------

| | - | other current and non-current asset and
financial liabilities at amortized cost;
| | - | --------------------------------------------------------------------------------

| | - | financial derivatives at fair value; and
| | - | ----------------------------------------

| | - | staff severance indemnities and pension
commitments at actuarial value.
| | - | -----------------------------------------------------------------------



F-17







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.4 | Accounting pronouncements
| | --- | -------------------------



New
accounting pronouncements.



| | a) | The following standards, interpretations and amendments are mandatory for the first time for the
annual periods beginning on January 1, 2013:
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------



|Standards and interpretations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Mandatory forannual periodsbeginning on
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                        
|Revised IAS 19 Employee Benefitswas adopted on January 1, 2013, with retrospective effect. The revision eliminates the use of the corridor method of accounting for actuarial gains and losses and the return on plan assets arising in connection with defined benefit plans and introduces changes to the way in which such plans are accounted for in income and other comprehensive income.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                        
|IAS 27, “Separate Financial Statements”, now contains accounting and disclosure requirements for investments in subsidiaries, joint ventures and associates only when an entity prepares separate financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                        
|IFRS 10, “Consolidated Financial Statements”, which replaces parts of IAS 27, “Consolidated and Separate Financial Statements” and all of SIC-12, “Consolidation – Special Purpose Entities”, builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                        
|IFRS 11 ‘Joint Arrangements’
        In May 2011, the IASB issued IFRS 11 ‘Joint
        Arrangements’, one of a suite of standards relating to interests in other entities and related disclosures. IFRS 11 establishes
        a principle that applies to the accounting for all joint arrangements, whereby parties to the arrangement account for their underlying
        contractual rights and obligations relating to the joint arrangement. IFRS 11 identifies two types of joint arrangements. A ‘joint
        venture’ is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets
        of the arrangement. A ‘joint operation’ is a joint arrangement whereby the parties that have joint control of the arrangement
        have rights to the assets, and obligations for the liabilities, relating to the arrangement. Investments in joint ventures are
        accounted for using the equity method. Investments in joint operations are accounted for by recognizing the group’s assets,
        liabilities, revenue and expenses relating to the joint operation. |  | 01/01/2013                             



F-18







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Standards and interpretations                                                                                                                                                                                                                                                                                                                                                                                                         |  | Mandatory forannual periodsbeginning on
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                        
|IFRS 12 ‘Disclosures of Interests in Other Entities’ combines all the disclosure requirements for an entity’s interests in subsidiaries, joint arrangements, associates and structured entities into one comprehensive disclosure standard.                                                                                                                                                                                           |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                        
|IFRS 13 Fair Value Measurementwas adopted on January 1, 2013, with prospective effect. The standard affects nearly all instances where assets and liabilities are currently recognised or disclosed at fair value, primarily by refining the measurement concept to reflect an asset or liability’s exit value. The standard also introduces certain additional considerations to the measurement process and additional disclosures. |  | 01/01/2013                             



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                |  | Mandatory forannual periodsbeginning on
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                           |  |                                        
|Revised IAS 1 Presentation
of Financial Statements changes the presentation of items in the Consolidated Statement of Comprehensive Income to distinguish
between those items of other comprehensive income that under other accounting standards may be reclassified to income in later
periods and those that are not.                                                                   |  | 07/01/2012                             
|                                                                                                                                                                                                                                                                                                                                                                                           |  |                                        
|IAS 28, “Investments in Associates and Joint Ventures”, was amended as a consequence of the issuance of IFRS 11. In addition to prescribing the accounting for investment in associates, it now sets out the requirements for the application of the equity method when accounting for joint ventures. The application of the equity method has not changed as a result of this amendment. |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                           |  |                                        
|Revised IFRS 7 Financial Instruments: Disclosuresintroduces disclosures relating to the offsetting of certain financial assets and financial liabilities, principally derivative contracts and trade receivables and payables.                                                                                                                                                             |  | 01/01/2013                             



F-19







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | Mandatory forannual periodsbeginning on
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                        
|IFRS 10 “Consolidated Financial Statements”,
        NIIF 11 “Joint Arrangements” and IFRS 12 “Disclosure of Interests in Other Entities”
        Clarifies the transitional provisions for
        IFRS 10 indicating changes should be applied on the first day of the annual period in which the standard is adopted. Therefore,
        it may be necessary to make amendments to comparative information presented in such a period, if the evaluation of control over
        investments differs from that recognized in accordance with IAS 27/SIC 12.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | 01/01/2013                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                        
|Improvements to International Financial
        Reporting Standards (2011)
        Issued in May 2012.
        
        IFRS 1 “First-time Adoption of International
        Financial Reporting Standards” – clarifies that an entity may apply IFRS 1 more than once under certain circumstances.
        IFRS 1 “First-time Adoption of International
        Financial Reporting Standards” – clarifies that an entity may adopt IAS 23, "Borrowing Costs" on the transition
        date or from an earlier date.
        IAS 1 “Presentation of Financial
        Statements” – clarifies the requirements for comparative information when an entity presents a third column in the
        balance sheet.
        IFRS 1 “First-time Adoption of International
        Financial Reporting Standards” – clarifies that an entity adopting IFRS for the first time may present information
        in footnotes for all periods presented.
        IAS 16 “Property, Plant and Equipment”
        – clarifies that spare-parts and service equipment should be classified as Property, Plant and Equipment as opposed to inventories
        when they meet the definition of Property, Plant and Equipment.
        IAS 32 “Financial Instruments: Presentation”
        – clarifies the treatment of income tax related to distribution and transaction costs.
        IAS 34 “Interim Financial Reporting”
        – clarifies the disclosure requirements of assets and liabilities by segments at interim periods, conforming to the same
        requirements applicable to annual financial statements. |  | 01/01/2013                             



The adoption of the standards, interpretations
and amendments above had no significant impact on the Company’s consolidated financial statements.



F-20







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



| | b) | The new standards, interpretations and amendments issued not yet effective for the annual period
2013 which have not been early adopted are listed below.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------



|Standards and interpretations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | Mandatory forannual periodsbeginning on
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                        
|IFRS 9 ‘Financial Instruments: Classification and Measurement’ introduces new requirements for classifying and measuring financial assets and financial liabilities and, when finalized, will address hedge accounting and impairment of financial assets. The effective date for IFRS 9 is not expected to be before 1 January 2017. The amendments to existing accounting standards that are effective from 1 January 2014, ‘Offsetting Financial Assets and Financial Liabilities’ (Amendments to IAS 32) and ‘Recoverable Amount Disclosures for Non-Financial Assets’ (Amendments to IAS 36). |  | Not yet determined                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                        
|IFRIC 21 Levies, issued in May 2013, addresses the accounting for liabilities to pay levies that are within the scope of IAS 37 Provisions, contingent liabilities and contingent assets.                                                                                                                                                                                                                                                                                                                                                                                                          |  | 01/01/2014                             



|Amendments and improvements                                                                                                                                                                            |  | Mandatory forannual periodsbeginning on
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------
|                                                                                                                                                                                                       |  |                                        
|The amendments to IAS 32 Financial Instruments: Presentation, issued in December 2011, clarify the requirements for offsetting financial assets and financial liabilities in the financial statements. |  | 01/01/2014                             



F-21







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Mandatory forannual periodsbeginning on
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                        
|IAS 27 “Separate Financial Statements”;
        IFRS 10 “Consolidated Financial Statements” and IFRS 12 “Disclosure of Interests in Other entities”
        Issued in October 2012, the IASB published
        “Investment Entities (amendments to IFRS 10, IFRS 12 and IAS 27)”, providing an exemption for the consolidation of
        subsidiaries under IFRS 10 Consolidated Financial Statements for entities meeting the definition for an “investment entity”,
        such as investment funds. The amendments require the use of fair value through profit or loss in conformity with IFRS 9 Financial
        Instruments in its consolidated and separate financial statements. The amendment also introduces new disclosure requirements relative
        to investment entities in IFRS 12 and IAS 27. |  | 01/01/2014                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                        
|IAS 36 “Impairment of Assets”,
        when events or changes in market conditions indicate that tangible or intangible assets may be impaired, such assets are reviewed
        in detail to determine whether their carrying value is higher than their recoverable value (i.e. the higher of value in use and
        fair value less costs to sell), which could lead to recording an impairment loss.
        Value in use is estimated by calculating
        the present value of the future cash flows expected to be derived from the asset. Fair value less costs to sell is based on the
        most reliable information available (such as market statistics and recent transactions).                                                                                                                 |  | 01/01/2014                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                        
|IAS 39 “Financial Instruments: Recognition and Measurement” Issued in June 2013, under the amendments there would be no need to discontinue hedge accounting if a hedging derivative was novated, provided certain criteria are met.  The amendments are effective for annual periods beginning on or after 1 January 2014, with earlier application being permitted. The amendments also include changes in contractual guarantee requirements, right of offset for trade receivables also payables, taxes and levies.                                                                                                                                                                                                                                                                                              |  | 01/01/2014                             



F-22







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Mandatory forannual periodsbeginning on
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                        
|IFRS 9 "Financial Instruments" Issued in November 2013, amendments primarily include a substantial review of hedge accounting to allow entities to better reflect their risk management activities in the financial statements. This amendment also allows entities to early adopt  the requirement of recognizing changes in the fair value attributable to changes in the entity's credit risk in other comprehensive income (for financial liabilities that are recorded under the fair value option). Such an amendment may be applied without having to adopt the remainder of IFRS 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | Not yet determined                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                        
|IAS 19 “Employee Benefits”
        Issued in November 2013, this
amendment applies to employee or third party contributions to defined benefit plans. The objective of this amendment is to simplify
the accounting recognition of contributions that are independent of the number of years of employee service; i.e., employees’
contributions that are calculated in accordance with a fixed salary percentage.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | 07/01/2014                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                        
|Improvements to Information Financial
        Reporting Standards (2012)
        Issued in December 2013.
        
        IFRS 2 “Share-based Payment”
        – clarifies the definition of “vesting conditions and “market conditions” and defines separately “performance
        conditions” and “service conditions.” Such an amendment should be applied prospectively on share-based payment
        transactions whose grant date is July 1, 2014 or after. Early adoption is permitted.
        
        IFRS 3, "Business Combinations"
        - Clarifies that the obligation to pay contingent consideration in the form of a financial instrument is classified as a financial
        liability or equity, on the basis of the definitions in IAS 32, "Financial Instruments: Presentation." The standard was
        additionally amended to clarify that all non equity contingent consideration, both financial and non-financial, be measured at
        fair value at each reporting date through profit or loss. Consequently, there are also changes to IFRS 9, IAS 37 and IAS 39.The
        amendment is applicable prospectively for business combinations with an acquisition date on or after July 1, 2014. Early adoption
        is permitted provided that amendments of IFRS 9 and IAS 37 also issued as part of the 2012 improvement plan are applied. |  | 07/01/2014                             



F-23







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Mandatory forannual periodsbeginning on
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                        
|IFRS 8 “Operating Segments”
        – The standard is amended to include the requirement to disclose the judgments made by management in the aggregation of operating
        segments. This includes a description of segments that have been aggregated and economic indicators that have been assessed in
        the determination that aggregated segments share similar economic characteristics. The standard was additionally modified to require
        a reconciliation of assets of each segment to total assets of an entity, when assets are reported by segment. Early adoption is
        permitted.
        
        IFRS
        13 "Fair Value Measurement” – When IFRS 13 was applied, paragraphs B5.4.12 of IFRS 9 and AG79 of IAS 39 were eliminated.
        This raised a doubt as to whether entities no longer had the ability to measure short-term receivables and payables at
        their nominal amounts if the effect was not significant. IASB has modified the basis of the conclusions of IFRS 13 to clarify that
        it did not intend to eliminate the ability to measure short-term receivables and payables at nominal amounts in such cases.
        
        IAS 16, "Property, Plant and Equipment"
        and IAS 38 "Intangible Assets" – Both standards are amended to clarify the treatment of the gross carrying amount
        and accumulated depreciation when an entity uses the revaluation model. In such cases the carrying amount of the asset is adjusted
        to the revalued amount and the division of such revaluation between the gross carrying amount and accumulated depreciation is treated
        as follows: 1) either adjusting the gross carrying amount in a manner consistent with the revaluation of the carrying amount and
        accumulated depreciation is adjusted to equal the difference between the gross carrying amount and carrying amount after taking
        into consideration any accumulated impairment losses; or 2) accumulated depreciation is eliminated against the gross carrying amount
        of the asset. Early adoption is permitted. |  | 07/01/2014                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                        
|IAS 24 "Related Party Disclosures" – The standard is modified to include, as a related party, an entity that provides key management personnel services to the reporting entity or the Parent of the reporting entity (“the managing entity”). The reporting entity is not obliged to disclose the compensation paid to the managing entity ́s employees or managers, but is required to disclose amounts charged to the reporting entity by the managing entity for key management personnel services rendered. Early adoption is permitted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | 07/01/2014                             



F-24







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation of the consolidated financial statements (continued)



| | 2.4 | Accounting Standards, Interpretations and Amendments, (continued)
| | --- | -----------------------------------------------------------------



|Amendments and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | Mandatory forannual periodsbeginning on
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                        
|Improvements to Information Financial
        Reporting Standards (2013)
        Issued in December 2013.
        
        IFRS 1 “First-time Adoption of International
        Financial Reporting Standards” – clarifies that when a new version of a standard is not yet mandatory but is available
        for early adoption, a first-time adopter of IFRS may opt to apply the older version of the standard, provided that the same standard
        is applied to all periods presented.
        
        IFRS 3 “Business Combinations”
        – the standard is modified to clarify that IFRS 3 is not applicable to the accounting recognition of the formation of a new
        joint arrangement under IFRS 11. This amendment also clarifies that only the scope exemption is applied to the financial statements
        of the joint arrangement.
        
        IFRS 13 “Fair Value Measurement”
        – clarifies that the portfolio exception in IFRS 13, that allows an entity to measure the fair value of a group of financial
        assets and financial liabilities at their net amount applies to all contracts (including non-financial contracts) within the scope
        of IAS 39 or IFRS 9.
        The amendment is mandatory for annual periods
        beginning on or after July 1, 2014. An entity must apply the amendments prospectively from the start of the first annual period
        in which this standard is applied.
        
        IAS 40 “Investment Property”
        – the standard is modified to clarify that IAS 40 and IFRS 3 are not mutually exclusive. IAS 40 provides a guide to distinguish
        between investment property and properties occupied by their owners. In preparing the financial information, the application guide
        to IFRS 3 should be considered to determine whether the acquisition of investment property is or is a business combination. This
        amendment is applicable for annual periods beginning on or after July 1, 2014, but can be applied to individual acquisitions of
        investment property prior to such date if and only if the information required to apply the amendment is available. |  | 07/01/2014                             



The adoption of the standards, amendments
and interpretations described above are under evaluation and are not expected to have a significant impact on the Consolidated
Financial Statements of the Company.



F-25







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.5 | Basis of consolidation
| | --- | ----------------------



| | (a) | Subsidiaries
| | --- | ------------



Relate to all the entities on which Sociedad
Química y Minera de Chile S.A. hasthe ability to manage financial and operating activities, which is general are accompanied
by share holdings, greater than half the voting rights. Subsidiaries are included in consolidation from the date in which control
of the Company is transferred and are excluded from consolidation on the date where such control ceases. Subsidiaries apply the
same accounting policies of their Parent.



To account for the acquisition, the Company
uses the acquisition method. Under this method the acquisition cost is the fair value of assets delivered, equity securities issued
and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable
assets acquired and liabilities and contingencies assumed in a business combination are measured initially at fair value at the
acquisition date. For each business combination, the Company will measure non-controlling interest of the acquire either at fair
value or as proportional share of net identifiable assets of the acquiree.



F-26







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.5 | Basis of consolidation, continued
| | --- | ---------------------------------



Companies
included in consolidation:





|           |  |                                                      |  |                |  |                         |  |  | Ownership interest | 
|---------- |  | ---------------------------------------------------- |  | -------------- |  | ----------------------- |  |  | ------------------ | 
|           |  |                                                      |  | Country of     |  |                         |  |  | 12/31/2013         | 
|TAX ID No. |  | Foreign
    subsidiaries                             |  | origin         |  | Functional
    currency |  |  | Direct             | 
|Foreign    |  | Nitratos Naturais Do Chile
    Ltda.                 |  | Brazil         |  | US$                     |  |  |                    | 
|Foreign    |  | Nitrate Corporation Of Chile Ltd.                    |  | United Kingdom |  | US$                     |  |  |                    | 
|Foreign    |  | SQM North America Corp.                              |  | USA            |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Europe N.V.                                      |  | Belgium        |  | US$                     |  |  |                    | 
|Foreign    |  | Soquimich S.R.L. Argentina                           |  | Argentina      |  | US$                     |  |  |                    | 
|Foreign    |  | Soquimich European Holding B.V.                      |  | Netherlands    |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Corporation N.V.                                 |  | Dutch Antilles |  | US$                     |  |  |                    | 
|Foreign    |  | SQI Corporation N.V.                                 |  | Dutch Antilles |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Comercial De México S.A.
    de C.V.             |  | Mexico         |  | US$                     |  |  |                    | 
|Foreign    |  | North American Trading Company                       |  | USA            |  | US$                     |  |  |                    | 
|Foreign    |  | Administración Y Servicios Santiago
    S.A. de C.V. |  | Mexico         |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Peru S.A.                                        |  | Peru           |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Ecuador S.A.                                     |  | Ecuador        |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Nitratos Mexico S.A. de C.V.                     |  | Mexico         |  | US$                     |  |  |                    | 
|Foreign    |  | SQMC Holding Corporation L.L.P.                      |  | USA.           |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Investment Corporation N.V.                      |  | Dutch Antilles |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Brasil Limitada                                  |  | Brazil         |  | US$                     |  |  |                    | 
|Foreign    |  | SQM France S.A.                                      |  | France         |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Japan Co. Ltd.                                   |  | Japan          |  | US$                     |  |  |                    | 
|Foreign    |  | Royal Seed Trading Corporation A.V.V.                |  | Aruba          |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Oceania Pty Limited                              |  | Australia      |  | US$                     |  |  |                    | 
|Foreign    |  | Rs Agro-Chemical Trading Corporation
    A.V.V.      |  | Aruba          |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Indonesia S.A.                                   |  | Indonesia      |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Virginia L.L.C.                                  |  | USA            |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Italia SRL                                       |  | Italy          |  | US$                     |  |  |                    | 
|Foreign    |  | Comercial Caimán Internacional
    S.A.              |  | Panama         |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Africa Pty.                                      |  | South Africa   |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Lithium Specialties LLC                          |  | USA            |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Iberian S.A.                                     |  | Spain          |  | US$                     |  |  |                    | 
|Foreign    |  | Iodine Minera B.V. (c)                               |  | Netherlands    |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Agro India Pvt.Ltd.                              |  | India          |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Beijing Commercial Co. Ltd.                      |  | China          |  | US$                     |  |  |                    | 
|Foreign    |  | SQM Thailand Limited (b)                             |  | Thailand       |  | US$                     |  |  |                    | 







F-27







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.5 | Basis of consolidation, continued
| | --- | ---------------------------------



Companies included in consolidation:





|               |  |                                                                   |  |            |  |                         |  |  | Ownership interest | 
|-------------- |  | ----------------------------------------------------------------- |  | ---------- |  | ----------------------- |  |  | ------------------ | 
|               |  |                                                                   |  | Country of |  |                         |  |  | 12/31/2013         | 
|TAX
    ID No. |  | Domestic
    subsidiaries                                         |  | origin     |  | Functional
    currency |  |  | Direct             | 
|96.801.610-5   |  | Comercial Hydro  S.A.                                             |  | Chile      |  | US$                     |  |  |                    | 
|96.651.060-9   |  | SQM Potasio S.A.                                                  |  | Chile      |  | US$                     |  |  |                    | 
|96.592.190-7   |  | SQM Nitratos S.A.                                                 |  | Chile      |  | US$                     |  |  |                    | 
|96.592.180-K   |  | Ajay SQM Chile S.A.                                               |  | Chile      |  | US$                     |  |  |                    | 
|86.630.200-6   |  | SQMC Internacional  Ltda.                                         |  | Chile      |  | Ch$                     |  |  |                    | 
|79.947.100-0   |  | SQM Industrial S.A.                                               |  | Chile      |  | US$                     |  |  |                    | 
|79.906.120-1   |  | Isapre Norte Grande Ltda.                                         |  | Chile      |  | Ch$                     |  |  |                    | 
|79.876.080-7   |  | Almacenes y Depósitos Ltda.                                       |  | Chile      |  | Ch$                     |  |  |                    | 
|79.770.780-5   |  | Servicios Integrales de Tránsitos
    y Transferencias S.A.       |  | Chile      |  | US$                     |  |  |                    | 
|79.768.170-9   |  | Soquimich Comercial S.A.                                          |  | Chile      |  | US$                     |  |  |                    | 
|79.626.800-K   |  | SQM Salar S.A.                                                    |  | Chile      |  | US$                     |  |  |                    | 
|78.053.910-0   |  | Proinsa Ltda.                                                     |  | Chile      |  | Ch$                     |  |  |                    | 
|76.534.490-5   |  | Sociedad Prestadora de Servicios de
    Salud Cruz del Norte S.A. |  | Chile      |  | Ch$                     |  |  |                    | 
|76.425.380-9   |  | Exploraciones Mineras S.A.                                        |  | Chile      |  | US$                     |  |  |                    | 
|76.064.419-6   |  | Comercial Agrorama Ltda.(a)                                       |  | Chile      |  | Ch$                     |  |  |                    | 
|76.145.229-0   |  | Agrorama S.A.                                                     |  | Chile      |  | Ch$                     |  |  |                    | 
|76.359.919-1   |  | Orcoma Estudios SPA (d)                                           |  | Chile      |  | US$                     |  |  |                    | 
|76.360.575-2   |  | Orcoma SPA ( e)                                                   |  | Chile      |  | US$                     |  |  |                    | 





| | (a) | Comercial Agrorama Ltda. was consolidated given that
the Company has control through the subsidiary Soquimich Comercial S.A.
| | --- | ----------------------------------------------------------------------------------------------------------------------------



| | (b) | During the first half of 2013 Soquimich European Holdings BV purchased shares of SQM Thailand Limited,
acquiring 99.996% of this company.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------



| | (c) | During the first half of the year, Iodine Minera was absorbed into Soquimich European Holdings.
| | --- | -----------------------------------------------------------------------------------------------



| | (d) | On December 31, 2013, the subsidiary Orcoma Estudios SPA was incorporated into the company Sociedad
Quimica y Minera de Chile S.A. making a capital contribution of US$ 1,500, acquiring 100% ownership.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | On December 31, 2013, the subsidiary Orcoma SPA, was incorporated into the company Sociedad Quimica
y Minera de Chile S.A. making a capital contribution of ThUS$ 2,358, acquiring 100% ownership.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-28







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
2 -	Basis of presentation for the consolidated financial statements (continued)



| | 2.5 | Basis of consolidation, continued
| | --- | ---------------------------------



Subsidiaries are consolidated using the
line-by-line method adding the items that represent assets, liabilities, revenues and expenses of similar content and eliminating
those related to intragroup transactions.



Profit or loss dependent on companies acquired
or disposed of during the year are included in consolidated profit or loss accounts consolidated from the effective date of acquisition
or up to the effective date of disposal, as applicable.



Non-controlling interest represents the
equity of a subsidiary not directly or indirectly attributable to the Parent.



| | 2.6 | Significant accounting judgments, estimates and assumptions
| | --- | -----------------------------------------------------------



Management of Sociedad Química y
Minera de Chile S.A. and its subsidiaries is responsible for the information contained in these consolidated financial statements,
which expressly indicate that all the principles and criteria included in IFRSs as issued by the International Accounting Standard
Board (IASB) have been applied in full.



In preparing the consolidated financial
statements of Sociedad Química y Minera de Chile S.A. and its subsidiaries Management has made judgments and estimates to
quantify certain assets, liabilities, revenues, expenses and commitments included therein. Basically, these estimates refer to:



| | - | The useful lives of property, plant and
equipment and intangible assets and their residual value;
| | - | -------------------------------------------------------------------------------------------------

| | - | Impairment losses of certain assets, including
trade receivables;
| | - | -----------------------------------------------------------------

| | - | Assumptions used in calculating the actuarial
amount of pension-related and severance indemnity payment benefit commitments;
| | - | ----------------------------------------------------------------------------------------------------------------------------

| | - | Provisions for commitments assumed with
third parties and contingent liabilities;
| | - | ---------------------------------------------------------------------------------

| | - | Provisions on the basis of technical studies
that cover the different variables affecting products in stock (density, moist, among others), and allowance for slow-moving spare-parts
in stock;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | Future cost for closure of mining sites;
| | - | ----------------------------------------

| | - | The determination of the fair value of
certain financial assets and derivative instruments;
| | - | -------------------------------------------------------------------------------------------

| | - | The determination and assignment of fair
values in business combinations.
| | - | -------------------------------------------------------------------------



Despite the fact that these estimates have
been made on the basis of the best information available on the date of preparation of these consolidated financial statements,
certain events may occur in the future and oblige their amendment (upwards or downwards) over the next few years, which would be
made prospectively, recognizing the effects of the change in estimates in the related future consolidated financial statements.



F-29







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies



| | 3.1 | Classification of balances as current and non-current
| | --- | -----------------------------------------------------



In the attached consolidated statement
of financial position, balances are classified in consideration of their remaining maturity; i.e., those maturing on a date equal
to or less than twelve months are classified as current and those with maturity dates exceeding the aforementioned period are classified
as non-current.



The exception to the foregoing relates
to deferred taxes, which are classified as non-current, regardless of their maturity.



| | 3.2 | Functional and presentation currency
| | --- | ------------------------------------



The Company’s consolidated financial
statements are presented in United States dollars (“U.S. dollars” or “US$”), which is the Company’s
functional and presentation currency and is the currency of the main economic environment in which it operates.



Consequently, the term foreign currency
is defined as any currency other than U.S. dollar.



The consolidated financial statements are
presented in thousands of United States dollars without decimals.



| | 3.3 | Foreign currency translation
| | --- | ----------------------------



| | (a) | Domestic entities:
| | --- | ------------------



Assets and liabilities denominated in Chilean
pesos and other currencies other than the functional currency (U.S. dollar) as of December 31, 2013 and December 31, 2012 have
been translated to U.S. dollars at the exchange rates prevailing at those dates. The corresponding Chilean pesos were converted
at Ch$524.61 per US$1.00 as of December 31, 2013, and Ch$479.96 per US$1.00 as of December 31, 2012.



The values of the UF (a Chilean peso-denominated,
inflation-indexed monetary unit) used to convert the UF denominated assets and liabilities as of December 31, 2013 amounted to
Ch$23,309.56 (US$44.43), and as of December 31, 2012 amounted to Ch$22,840.75 (US$47.59).



F-30









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.3 | Foreign currency translation, continued
| | --- | ---------------------------------------



| | (b) | Foreign entities:
| | --- | -----------------



The translation of the financial statements
of foreign companies with functional currency other than U.S. dollars is performed as follows:



| | - | Assets and liabilities using the exchange
rate effective on the closing date of the consolidated financial statements.
| | - | ----------------------------------------------------------------------------------------------------------------------

| | - | Statement of income account items using
the average exchange rate for the year.
| | - | -------------------------------------------------------------------------------

| | - | Equity accounts are stated at the historical
exchange rate effective at acquisition date.
| | - | -----------------------------------------------------------------------------------------



Foreign currency translation differences
which arise from the effective of financial statements are recorded in the account “Foreign currency translation differences"
within equity.



The exchange rates used to translate the
monetary assets and liabilities expressed in foreign currency at the closing date of each period in respect to the U.S. dollar
are detailed as follows:



|                   |  | 12/31/2013 |        |  | 12/31/2012 | 
|------------------ |  | ---------- | ------ |  | ---------- | 
|                   |  | US$        |        |  | US$        | 
|                   |  |            |        |  |            | 
|Brazilian real     |  |            | 2.34   |  |            | 
|New Peruvian sol   |  |            | 2.75   |  |            | 
|Argentine peso     |  |            | 6.48   |  |            | 
|Japanese yen       |  |            | 105.39 |  |            | 
|Euro               |  |            | 0.73   |  |            | 
|Mexican peso       |  |            | 13.07  |  |            | 
|Australian dollar  |  |            | 1.12   |  |            | 
|Pound Sterling     |  |            | 0.61   |  |            | 
|South African rand |  |            | 10.56  |  |            | 
|Ecuadorian dollar  |  |            | 1.00   |  |            | 
|Chilean peso       |  |            | 524.61 |  |            | 
|UF                 |  |            | 44.43  |  |            | 



F-31







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.3 | Foreign currency translation, continued
| | --- | ---------------------------------------



| | (c) | Transactions and balances
| | --- | -------------------------



Non-monetary transactions in currencies
other than the functional currency (U.S. dollar) (foreign currencies) are translated to the respective functional currencies of
Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies
at the reporting date are retranslated to the functional currency at the exchange rate at that date. All differences are recorded
in the statement of income except for all monetary items that provide effective hedge for a net investment in a foreign operation.
These items are recognized in other comprehensive income on the disposal of the investment; at the time they are recognized in
the statement of income. Charges and credits attributable to foreign currency translation differences on those hedge monetary items
are also recognized in other comprehensive income.



Non-monetary assets and liabilities that
are measured using historical cost in a foreign currency are translated to the functional currency at the historical exchange rate
of the transaction. Non-monetary items that are measured based on fair value in a foreign currency are translated using the exchange
rate at the date at which the fair value is determined.



| | (d) | Group entities
| | --- | --------------



The revenue and expenses, assets and liabilities
of all entities that have a functional currency other than the presentation currency are converted to the presentation currency
as follows



| | - | Assets and liabilities are converted at
the closing exchange rate prevailing on the reporting date.
| | - | ---------------------------------------------------------------------------------------------------

| | - | Revenues and expenses of each profit or
loss account are converted at monthly average exchange rates.
| | - | -----------------------------------------------------------------------------------------------------

| | - | All resulting foreign currency translation
gains and losses are recognized as a separate component in translation reserves.
| | - | ---------------------------------------------------------------------------------------------------------------------------



In consolidation, foreign currency differences
arising from the translation of a net investment in foreign entities are recorded in equity (other reserves). At the date of disposal,
such foreign currency translation differences are recognized in the statement of income as part of the loss or gain from the sale.



F-32







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.4 | Subsidiaries
| | --- | ------------



SQM
S.A. consolidates those subsidiaries for which it exercises control. The Company has control when it is exposed to, or has rights
to, variable returns from its involvement with the entity and has the ability to affect those variable returns through its power
over the entity.



The Company prepares the consolidated financial
statements using consistent accounting policies for the entire Group, the consolidation of a subsidiary commences when the Company
has control over the subsidiary and stops when control ceases.



| | 3.5 | Consolidated statement of cash flows
| | --- | ------------------------------------



Cash equivalents correspond to highly-liquid
short-term investments that are easily convertible into known amounts of cash and subject to insignificant risk of changes in their
value and mature in less than three months from the date of acquisition of the instrument.



For the purposes of preparing the statement
of cash flows, cash comprise cash and cash equivalents as defined above.



For the year ended December 31, 2013, the
statement of cash flows was prepared using the direct method, which is a change in the method of presentation from previously issued
consolidated financial statements. Prior year amounts have been restated to conform with the direct method.



| | 3.6 | Financial assets
| | --- | ----------------



Management determines the classification
of its financial assets at the time of initial recognition, on the basis of the business model, for the management of financial
assets and the characteristics of contractual cash flows from the financial assets. In accordance with IFRS 9, financial assets
are measured initially at fair value plus transaction costs that may have been incurred and are directly attributable to the acquisition
of the financial asset. Subsequently, financial assets are measured at amortized cost or fair value.



F-33







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.6 | Financial assets, continued
| | --- | ---------------------------



Management assesses at each reporting date,
whether there is objective evidence that an asset or group of assets is impaired. An asset or group of financial assets is impaired
if and only if, there is evidence of impairment as a result or one or more events occurred after the initial recognition of the
asset or group of assets. For the recognition of impairment, the loss event has to have an impact on the estimate of future cash
flows from the asset or groups of financial assets.



| | 3.7 | Financial liabilities
| | --- | ---------------------



Management determines the classification
of its financial liabilities at the time of initial recognition. As established in IFRS 9, financial liabilities at the time of
initial recognition are measured at fair value, less transaction costs that may have been incurred and are directly attributable
to the issue of the financial liability. Subsequently, these are measured at amortized cost using the effective interest method.
For financial liabilities that have been initially recognized at fair value through profit or loss, these will be measured subsequently
at fair value.



| | 3.8 | Financial instruments at fair value through profit or loss
| | --- | ----------------------------------------------------------



Management will irrevocably determine,
at the time of initial recognition, the designation of a financial instrument at fair value through profit or loss, if by doing
so eliminates or significantly reduces a measurement or recognition inconsistency, that would otherwise arise from the measurement
of assets or liabilities or from the recognition of the gains and losses from them on different bases.



| | 3.9 | Financial instrument offsetting
| | --- | -------------------------------



The Company offsets an asset and liability
if and only if it has at the time of the legal right to offset the amounts recognized and has the intent of net settling the related
asset and liability.



F-34







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.10 | Reclassification of financial instruments
| | ---- | -----------------------------------------



At the time at which the Company changes
its business model for managing financial assets, it will reclassify the financial assets affected by the new business model.



In the case of financial liabilities, these
will not be able to be reclassified.



| | 3.11 | Derivative financial instruments
| | ---- | --------------------------------



Derivatives are recognized initially at
fair value as of the date at which the derivatives contract is signed and subsequently they are valued at fair value. The method
for recognizing the resulting loss or gain depends on whether the derivative has been specified as an accounting hedge instrument
and if so, it depends on the type of hedging, which may be as follows:



(a)    Fair value hedge of assets and liabilities
recognized (fair value hedges);



(b)    Hedging of a specific risk associated
with an asset or liability recognized or a highly possible foreseen transaction (cash flow hedge);



At the beginning of the transaction, the
Company documents the relationship existing between hedging instruments and those items hedged, as well as their objectives for
risk management purposes and the strategy to conduct different hedging operations.



The Company also documents its evaluation
both at the beginning and the end of each period of whether derivatives used in hedging transactions are highly effective to offset
changes in the fair value or in cash flows of hedged items.



The fair value of derivative instruments
used for hedging purposes is shown in Note 10.3 (hedging assets and liabilities). Changes in the cash flow hedge reserve are classified
as a non-current asset or liability if the remaining expiration period of the hedged item is higher than 12 months and as a current
asset or liability if the remaining expiration period of the entry is lower than 12 months.



Investing derivatives are classified as a current asset or liability,
and the change in their fair value is recognized directly in profit or loss.



F-35







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.11 | Derivative and hedging financial instruments, continued
| | ---- | -------------------------------------------------------



(a)    Fair value hedge



Changes in the fair value of a derivative
are recognized with a debit or credit to profit or loss, as applicable. The change in the fair value of the hedged entry attributable
to hedged risk is recognized as part of the carrying value of the hedged entry and is also recognized with a debit or credit to
profit or loss.



For fair value hedges related to items
recorded at amortized cost, the adjustment of the fair value is amortized against profit or loss during the period through maturity.
Any adjustment to the carrying value of a hedged financial instrument for which the effective rate is used is amortized with a
debit or credit to profit or loss at its fair value attributable to the risk being covered.



If the hedged entry is derecognized, the
associated fair value not amortized is immediately recognized in profit or loss.



(b)    Cash flow hedges



The effective portion of gains or losses
from the hedge instrument is initially recognized with a debit or credit to other comprehensive income, whereas any ineffective
portion is immediately recognized with a debit or credit to profit or loss, as applicable.



The amount recognized in equity is transferred
to profit or loss when the hedged transaction affects profit or loss, as when the hedged interest income or expense is recognized
when a projected sale occurs. When the hedged entry is the cost of a non-financial asset or liability, amounts taken to other reserves
are transferred to the initial carrying value of the non-financial asset or liability.



Should the expected transaction or firm
commitment no longer be expected to occur, the amounts previously recognized in equity are transferred to profit or loss. If a
hedge instrument expires, is sold, finished and exercised without any replacement, or if a rollover is performed or if its designation
as a hedging is revoked, the amounts previously recognized in other reserves are maintained in equity until the expected firm transaction
or commitment occurs.



F-36







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.12 | Derecognition of financial instruments
| | ---- | --------------------------------------



In accordance with IFRS 9, the Company
derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights
to receive the contractual cash flows in a transaction in which all the risks and rewards of ownership of the financial asset have
been substaintially transferred; and the control of the financial assets has not been retained.



The Company derecognizes a financial liability
when its contractual obligations or a part of these are discharged, paying to the creditor or the main liability associated has
been legally discharged.



| | 3.13 | Derivative financial instruments
| | ---- | --------------------------------



The Company maintains derivative financial
instruments to hedge its risk in foreign currency. Derivative financial instruments are recognized initially at fair value; attributable
transaction costs are recognized when incurred. Subsequent to initial recognition, changes in fair value of such derivatives are
recognized in profit or loss as part of gains and losses.



The Company assesses the existence of embedded
derivatives both in its contracts and financial instruments. As of December 31, 2013 and 2012, there are no embedded derivatives.



| | 3.14 | Fair value measurements
| | ---- | -----------------------



At the initial recognition, the Company
measures its assets and liabilities at fair value plus or minus transaction costs incurred that are directly attributable to the
acquisition of a financial asset or issuance of a financial liability.



| | 3.15 | Leases
| | ---- | ------



(a)    Lease - Finance lease



Leases are classified as finance leases
when the Company holds substantially all the risks and rewards derived from the ownership of the asset. Finance leases are capitalized
at the beginning of the lease at the lower of the fair value of the leased asset or the present value of minimum lease payments.



F-37







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.15 | Lease, continued
| | ---- | ----------------



Each lease payment is distributed between
the liability and the interest expenses to obtain ongoing interest on the pending balance of the debt. The respective lease obligations,
net of interest expense, are included in other non-current liabilities. The interest element of finance cost is debited in the
consolidated statement of income during the lease period so that a regular ongoing interest rate is obtained on the remaining balance
of the liability for each year. The asset acquired through a finance lease is subject to depreciation over its useful life or the
life of the agreement, whichever is shorter.



(b)    Lease – Operating lease



Leases in which the lesser holds a significant
part of the risks and rewards derived from the ownership are classified as operating leases. Operating lease payments (net of any
incentive received from the lesser) are debited to the statement of income or capitalized (as applicable) on a straight-line basis
over the lease period.



| | 3.16 | Deferred acquisition costs from insurance contracts
| | ---- | ---------------------------------------------------



Acquisition costs from insurance contracts
are classified as prepayments and correspond to insurance contracts in force, recognized using the straight-line method and on
an accrual basis, and are recognized under Other non-financial assets.



These are recognized in expenses in the
proportion with the period of time they cover, regardless of the related payment dates.



| | 3.17 | Trade and other receivables
| | ---- | ---------------------------



Trade and other receivables relate to non-derivative
financial assets with fixed and determinable payments and are not listed in any active market. These arise from sales operations
involving the products and/or services which the Company provides directly to its customers



These assets are initially recognized at
their fair value and subsequently at amortized cost according to the effective interest rate method less a provision for impairment
loss. An allowance for impairment loss is established for trade receivables when there is objective evidence that the Company will
not be able to collect all the amounts which are owed to it according to the original terms of receivables.



Implicit interest in installment sales
is recognized as interest income when interest is accrued over the term of the operation.



F-38







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.18 | Inventory measurement
| | ---- | ---------------------



The Company recognizes inventories for
the lower of cost and net realizable value. The cost of finished products and products in progress includes direct costs of materials
and; as applicable, labor costs, indirect costs incurred to transform raw materials into finished products and general expenses
incurred in carrying inventories to their current location and conditions. The method used to determine the cost of inventories
is weighted average cost.



Commercial discounts, rebates obtained
and other similar entries are deducted in the determination of the acquisition price.



The net realizable value represents the
estimate of the sales price less all estimated finishing costs and costs which will be incurred in market, sales and distribution
processes.



The Company conducts an evaluation of the
net realizable value of inventories at the end of each year recording an estimate charge to income when these are overstated. When
the circumstances, which previously caused the rebate to cease to exist, or when there is clear evidence of an increase in the
net realizable value due to a change in the economic circumstances or prices of main raw materials, the estimate made previously
is modified.



The valuation of obsolete, impaired or
slow-moving products relates to their net estimated net realizable value.



Provisions on the Company's inventories
have been made based on a technical study which covers the different variables which affect products in stock (density, humidity,
among others.)



Raw materials, supplies and materials are
recorded at the lower of acquisition cost or market value. Acquisition cost is calculated according to the average price method.



F-39







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 - Significant accounting policies (continued)



| | 3.19 | Investments in associates and joint ventures
| | ---- | --------------------------------------------



Interests in companies over which joint
control is exercised (joint venture) or where an entity has significant influence (associates), are recognized using the equity
method of accounting. Significant influence is presumed to exist when interest greater than 20% is held in the capital of an issuer.



Under this method, the investment is recognized
in the statement of financial position at cost plus changes subsequent to the acquisition based on the proportional share in the
equity of the associate, using for such purposes, the interest percentage in the ownership of the associate. The associated goodwill
acquired is included in the carrying amount of the investment and is not amortized. The debit or credit to profit or loss reflects
the proportional share in the profit or loss of the associate.



Unrealized gains for transactions with
affiliates or associates are eliminated based on the percentage of interest that the Company has on such entities. Unrealized losses
are also eliminated, except in the case that the transaction provides evidence of impairment loss of the transferred asset.



Changes in the equity of associates are
recognized based onthe proportional amounts with a debit or credit to “Other reserves” and classified based on their
origin.



Reporting dates of the associate and the
Company and related policies are similar for equivalent transactions and events under similar circumstances.



In the event that the significant influence
is lost or the investment is sold or is held as available for sale, the equity method is discontinued suspending the recognition
of proportional share of profit or loss.



If the resulting amount according to the
equity method is negative, the share of investment or losses are reflected at zero value in the consolidated financial statements,
unless a commitment exists by the Company to reinstate the Company’s equity position, in which case the related provision
for risks and expenses is recorded.



Dividends received by these companies are
recorded by reducing the equity value and the proportional share of profit or loss recognized in conformity with the share of equity
are included in the consolidated profit or loss accounts in the caption “Equity share of profit (loss) of associates and
joint ventures that are accounted for using the equity method of accounting”.



F-40







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 3 – Significant accounting
policies (continued)



| | 3.20 | Transactions with non-controlling interests
| | ---- | -------------------------------------------



Non-controlling interests are recorded
in the consolidated statement of financial position within equity separate from equity attributable to the owners of the Parent.



| | 3.21 | Related party transactions
| | ---- | --------------------------



Transactions between the Company and its
subsidiaries are part of the Company’s normal operations within its scope of business activities. Conditions for such transactions
are those normally effective for those types of operations in regard to terms and market prices. Also, these transactions have
been eliminated in consolidation. Expiration conditions for each case vary by virtue of the originating transaction.



| | 3.22 | Property, plant and equipment
| | ---- | -----------------------------



Tangible property, plant and equipment
assets are stated at acquisition cost, net of the related accumulated depreciation, amortization and impairment losses that they
might have experienced.



In addition to the price paid for the acquisition
of tangible property, plant and equipment, the Company has considered the following concepts as part of the acquisition cost, as
applicable:



1.Accrued interest expenses during the construction period which are directly attributable to the acquisition, construction or production
of qualifying assets, which are those that require a substantial period prior to being ready for use. The interest rate used is
that related to the project’s specific financing or, should this not exist, the average financing rate of the investor company.



F-41









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 3 – Significant accounting
policies (continued)



| | 3.22 | Property, plant equipment, continued
| | ---- | ------------------------------------



2.     The future costs that the Company
will have to incur related to the closure of its facilities at the end of their useful life are included at the present value of
disbursements expected to be required to settle the obligation.

Construction-in-progress is transferred
to property, plant and equipment in operation once the assets are available for use and the related depreciation and amortization
begins on that date.



Extension, modernization or improvement
costs that represent an increase in productivity, ability or efficiency or an extension of the useful lives of property, plant
and equipment are capitalized as a higher cost of the related assets. All the remaining maintenance, preservation and repair expenses
are charged to expense as incurred.



The replacement of full assets which increase
the asset’s useful life or its economic capacity, are recorded as a higher value of property, plant and equipment with the
related derecognition of replaced or renewed elements.



Based on the impairment analysis conducted
by the Company’s management it has been concluded that the carrying value of assets does not exceed the net recoverable value
of such assets.



Gains or losses which are generated from
the sale or disposal of property, plant and equipment are recognized as income (or loss) in the period and calculated as the difference
between the asset’s sales value and its net carrying value.



Costs derived from daily maintenance of
property, plant and equipment are recognized when incurred.



F-42









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.23 | Depreciation of property, plant and equipment
| | ---- | ---------------------------------------------



Property, plant and equipment are depreciated
through the straight-line distribution of cost over the estimated technical useful life of the asset which is the period in which
the Company expects to use the asset. When components of one item of property, plant and equipment have different useful lives,
they are recorded as separate assets. Useful lives are reviewed on an annual basis.



The useful lives used for the depreciation
and amortization of assets included in property, plant and equipment are presented below.



|Types of property, plant and equipment |  | Minimum life or rate |  | maximum life or rate
|-------------------------------------- |  | -------------------- |  | --------------------
|                                       |  |                      |  |                     
|Buildings                              |  | 3                    |  | 60                  
|Plant and equipment                    |  | 3                    |  | 35                  
|Information technology equipment       |  | 3                    |  | 10                  
|Fixtures and fittings                  |  | 3                    |  | 35                  
|Motor vehicles                         |  | 5                    |  | 10                  
|Other property, plant and equipment    |  | 2                    |  | 30                  



| | 3.24 | Intangible assets
| | ---- | -----------------



Intangible assets mainly relate to goodwill
acquired, water rights, trademarks, and rights of way related to electric lines, development expenses, and computer software licenses.



(a)     Goodwill acquired



Goodwill acquired represents the excess
in acquisition cost on the fair value of the Company's ownership of the net identifiable assets of the subsidiary on the acquisition
date. Goodwill acquired related to acquisitions of subsidiaries is included in goodwill, which is subject to impairment tests every
time consolidated financial statements are issued and is stated at cost less accumulated impairment losses. Gains and losses related
to the sale of an entity include the carrying value of goodwill related to the entity sold.



F-43







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.24 | Intangible assets, continued
| | ---- | ----------------------------



This intangible asset is assigned to cash-generating
units with the purpose of testing impairment losses. It is allocated based on cash-generating units expected to obtain benefits
from the business combination from which the aforementioned goodwill acquired arose.



| | 3.25 | Intangible assets other than goodwill
| | ---- | -------------------------------------



| | (a) | Water rights
| | --- | ------------



Water rights acquired by the Company relate
to water from natural sources and are recorded at acquisition cost. Given that these assets represent perpetual legal rights granted
to the Company, they are not amortized, however, they are evaluated for impairment annually.



| | (b) | Right of way for electric lines
| | --- | -------------------------------



As required for the operation of industrial
plants, the Company has paid rights of way in order to install wires for the different electric lines in third party land. These
rights are presented under Intangible assets. Amounts paid are capitalized at the date of the agreement and charged to income according
to the duration of the contract.



| | (c) | Computer software
| | --- | -----------------



Licenses for IT programs acquired are capitalized
based on costs that have been incurred to acquire them and prepare them to use the specific program. These costs are amortized
over their estimated useful lives.



Expenses related to the development or
maintenance of IT programs are recognized as an expense as and when incurred. Costs directly related to the production of unique
and identifiable IT programs controlled by the Group and which will probably generate economic benefits that are higher than costs
during more than a year, are recognized as intangible assets. Direct costs include expenses incurred for employees who develop
IT programs and an adequate percentage of general expenses.



The costs of development for IT programs
recognized as assets are amortized over their estimated useful lives.



F-44









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.25 | Intangible assets other than goodwill, continued
| | ---- | ------------------------------------------------



| | (d) | Mining property and concession right
| | --- | ------------------------------------



The Company holds mining property and concession
rights from the Chilean Government. Property rights are usually obtained with no initial cost (other than the payment of mining
patents and minor recording expenses) and upon obtaining rights on these concessions, these are retained by the Company while annual
patents are paid. Such patents, which are paid annually, are recorded as prepaid assets and amortized over the following twelve
months. Amounts attributable to mining concessions acquired from third parties not associated with the Chilean Government are recorded
at acquisition cost within intangible assets.



No impairment of intangible assets exists
as of December 31, 2013 and December 31, 2012, and December 31, 2011.



| | 3.26 | Research and development expenses
| | ---- | ---------------------------------



Research and development expenses are charged
to profit or loss in the period in which the disbursement was made.



| | 3.27 | Prospecting expenses
| | ---- | --------------------



The Company has mining property and concession
rights acquired both from the Chilean Government and from third parties, which are intended for the exploitation and development
of caliche ore and saltpeter deposits.

Upon obtaining these rights, the Company
initially records disbursements directly associated with the exploration and evaluation of deposits associated with commercially
viable reserves as asset at cost. Such disbursements include the following concepts:



| | - | Disbursements for geological reconnaissance
evaluation
| | - | ------------------------------------------------------

| | - | Disbursements for drilling work and sampling
| | - | --------------------------------------------

| | - | Disbursements for activities related to
technical assessment and commercial studies, and of drilling work
| | - | ---------------------------------------------------------------------------------------------------------

| | - | Disbursement directly related to specific
projects associated with finding mining resources.
| | - | --------------------------------------------------------------------------------------------



F-45







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.27 | Prospecting expenses, continued
| | ---- | -------------------------------



Subsequently, the Company distinguishes
exploration and evaluation projects according to the economic feasibility of the mineral extracted in the area or exploration,
among those that finally will deliver future benefits to the Company (profitable projects) and those projects for which it is not
probable that economic benefit will flow to the Company in the future (i.e., when the mine site has low ore grade and its exploitation
is not economically profitable).



If technical studies determine that the
ore grade is not economically suitable for exploitation, the asset is recorded directly as an expense. Otherwise, it is kept in
the other non-current assets, reclassifying the portion related to the area to be exploited in the year in the entry inventories
and this amount is amortized as production cost on the basis of estimated tons to be extracted.



The technical reasons for this classification
are due to the fact that this is an identifiable non-monetary asset that is owned to be used in the production of our processes
as main raw material.



Paragrap17 of IFRS 6 establishes that an
asset for exploitation and evaluation should be classified as such when it loses the technical feasibility for extraction and therefore,
must be impaired. Because disbursements correspond to reserves used as main raw material in our production processes these costs
are presented as inventories that will be developed within the commercial year, with the remainder as presented as development
and exploration costs, and Other non-current assets.



F-46







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.28 | Impairment of non-financial assets
| | ---- | ----------------------------------



Assets subject to depreciation and amortization
are subject to impairment testing, provided that an event or change in the circumstances indicates that the amounts in the accounting
records may not be recoverable. An impairment loss is recognized for the excess of the book value of the asset over its recoverable
amount.



The recoverable amount of an asset is the
higher between the fair value of an asset or cash generating unit (“CGU”) less costs of sales and its value in use,
and is determined for an individual asset unless the asset does not generate any cash inflows that are clearly independent from
other assets or groups of assets.



When the carrying value of an asset exceeds
its recoverable amount, the asset is considered an impaired asset and is reduced to its net recoverable amount.



In evaluating value in use, estimated future
cash flows are discounted using a discount rate before taxes which reflects current market evaluation on the time value of money
and specific asset risks.



An appropriate valuation model is used
to determine the fair value less selling costs. These calculations are confirmed by valuation multiples, quoted share prices for
subsidiaries quoted publicly or other available fair value indicators.



Impairment losses from continuing operations
are recognized with a debit to profit or loss in the categories of expenses associated with the impaired asset function, except
for properties reevaluated previously where the revaluation was taken to equity. In this case impairment is also recognized with
a debit to equity up to the amount of any previous revaluation.



As of December 31, 2013, as explained in
Note 14 the Company has recorded an impairment loss. As of December 31, 2012 and December 31, 2011, the Company was unaware of
any indication of impairment with respect to its assets.



For assets other than acquired goodwill,
an annual evaluation is conducted of whether there exists impairment loss indicators recognized previously that might have already
ceased to exist or decreased. The recoverable amount is estimated if such indicators exist. An impairment loss previously recognized
is reversed only if there have been changes in estimates used to determine the asset’s recoverable amount from the last time
in which an impairment loss was recognized. If this is the case, the carrying value of the asset is increased to its recoverable
amount. This increased amount cannot exceed the carrying value that would have been determined net of depreciation if an asset
impairment loss would have not been recognized in prior years. This reversal is recognized with a credit to profit or loss unless
an asset is recorded at the revalued amount. Should this be the case, the reversal is treated as an increase in revaluation.



F-47







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.29 | Minimum dividend
| | ---- | ----------------



As required by the Shareholders’
Corporations Act, unless decided otherwise by the unanimous vote by the shareholders of subscribed and paid shares, a public company
must distribute dividends as agreed by the shareholders at the General Shareholders’ Meeting held each year with a minimum
of 30% of its profit for the year ended December 31, 2013, except when the Company records unabsorbed losses from prior years.

However, the Company defines as policy
the distribution of 50% of its profit for the year ended December 31, 2013.



| | 3.30 | Earnings per share
| | ---- | ------------------



The net basic earnings per share amounts
are calculated by dividing profit for the year attributable to ordinary owners of the parent by the weighted average number of
ordinary shares outstanding during the year.



The Company has not conducted any type
of operation of potential dilutive effect that assumes diluted earnings per share other than the basic earnings per share.



| | 3.31 | Trade and other payables
| | ---- | ------------------------



Trade and other payables are measured at
fair value plus all costs associated with the transaction. Subsequently, these are carried at amortized cost using the effective
interest rate method.



| | 3.32 | Interest-bearing borrowings
| | ---- | ---------------------------



At initial recognition interest-bearing
borrowings are measured at fair value. Subsequently, they are measured at amortized cost using the effective interest rate method.
Amortized cost is calculated considering any premium or discount from the acquisition and includes costs of transactions which
are an integral part of the effective interest rate.



These are recorded as non-current when
their expiration period exceeds twelve months and as current when the term is lower than such term. Interest expense is calculated
in the year in which they are accrued following a financial criterion.



F-48







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.33 | Other provisions
| | ---- | ----------------



Provisions are recognized when:



| | - | The Company has a present obligation as the result of a past event.
| | - | -------------------------------------------------------------------



| | - | It is more likely than not that an outflow of resources will be required to settle the obligation.
| | - | --------------------------------------------------------------------------------------------------



| | - | A reliable estimate can be made of the amount of the obligation.
| | - | ----------------------------------------------------------------



In the event that the provision or a portion
of it is reimbursed, the reimbursement is recognized as a separate asset solely if there is certainty of income.



In the consolidated statement of income,
the expense for any provision is presented net of any reimbursement.



Should the effect of the time value of
money be significant, provisions are discounted using a discount rate before taxes that reflects the liability’s specific
risks. When a discount rate is used, the increase in the provision over time is recognized as a finance cost.



The Company’s policy is to maintain
provisions to cover risks and expenses based on a better estimate to deal with possible or certain and quantifiable responsibilities
from current litigation, compensations or obligations, pending expenses for which the amount has not yet been determined, collaterals
and other similar guarantees for which the Company is responsible. These are recorded at the time the responsibility or the obligation
that determines the compensation or payment is generated.



F-49







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.34 | Obligations related to employee termination benefits and pension commitments
| | ---- | ----------------------------------------------------------------------------



Obligations with the Company’s employees
are established in accordance with current collective bargaining agreements and individual employment contracts, except for the
United States, which is regulated in accordance with pension plans in force up to 2002.



These obligations are valued using actuarial
calculations, according to the projected unit credit method which considers such assumptions as the mortality rate, employee turnover,
interest rates, retirement dates, effects related to increases in employees salaries, as well as the effects on variations in services
derived from variations in the inflation rate. This considering criteria in force contained in IAS 19 revised.



Actuarial gains and losses that may be
generated by variations in defined pre-established obligations are directly recorded in profit or loss for the year and not within
Other comprehensive income considering their insignificant amount.



Actuarial losses and gains have their origin
in departures between the estimate and the actual behavior of actuarial assumptions or in the reformulation of established actuarial
assumptions.



The discount rate used by the Company for
calculating the obligation was 6% for the periods ended December 31, 2013 and December 31, 2012.



The Company’s subsidiary SQM North
America has established pension plans for its retired employees that are calculated by measuring the projected obligation using
a net salary progressive rate net of adjustments for inflation, mortality and turnover assumptions, deducting the resulting amounts
at present value using a 6.5% interest rate for 2013 and 2012. The net balance of this obligation is presented under the non-current
provisions for employee benefits.



F-50









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.35 | Compensation plans
| | ---- | ------------------



Compensation plans implemented through
benefits in share-based payments settled in cash, which have been provided, are recognized in the financial statements at their
fair value, in accordance with International Financial Reporting Standard No. 2 "Share-based Payments.” Changes in the
fair value of options granted are recognized with a debit to payroll on a straight-line basis during the period between the date
on which these options are granted and the payment date. (See Note No.16).



| | 3.36 | Revenue recognition
| | ---- | -------------------



Revenue includes the fair value of considerations
received or receivable for the sale of goods and services during performance of the Company's activities. Revenue is presented
net of value added tax, estimated returns, rebates and discounts and after the elimination of sales among subsidiaries.



Revenue is recognized when its amount can
be stated reliably, when it is possible that the future economic rewards will flow to the entity and the specific conditions for
each type of activity related revenue are complied with, as follows:



(a)     Sale of goods



Sales of goods are recognized when the
Company has delivered products to the customer, and there is no pending obligation that could affect the acceptance of products
by the customer. The delivery does not occur until products have been shipped to the customer or collected by customers, and when
the related risks of obsolescence and loss have been transferred to the customer and the customer has accepted products in accordance
with the conditions established in the sale, the acceptance period has ended or there is objective evidence that those criteria
required for acceptance have been met.



Sales are recognized in consideration of
the price set in the sales agreement, net of volume discounts and estimated returns at the date of the sale. Volume discounts are
evaluated in consideration of annual foreseen purchases and in accordance with the criteria defined in agreements.



F-51







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.36 | Revenue recognition, continued
| | ---- | ------------------------------



(b)     Sales of services



Revenue associated with the rendering of
services is recognized considering the degree of completion of the service as of the date of presentation of the consolidated classified
statement of financial position, provided that the result from the transaction can be estimated reliably.



(c)     Interest income



Interest income is recognized when interest
is accrued in consideration of the principal pending payment using the effective interest rate method.



(d)     Income from dividends



Income from dividends is recognized when
the right to receive the payment is established.



| | 3.37 | Finance income and finance costs
| | ---- | --------------------------------



Finance income is mainly composed of interest
income in financial instruments such as time deposits and mutual fund deposits. Interest income is recognized in profit or loss
at amortized cost, using the effective interest rate method.



Finance costs are mainly composed of interest
expense in bank borrowings, interest on bonds issued and interest capitalized for borrowing costs for the acquisition, construction
or production or qualifying assets.

Borrowing costs and bonds issued are recognized
in profit or loss using the effective interest rate method.



Finance costs accrued during the construction
period that are directly attributable to the acquisition, construction or production of qualifying assets using the effective interest
rate related to the project’s specific financing; if none exists, the average financing rate of the subsidiary that makes
the investment if used.



Borrowing and financing costs that are
directly attributable to the acquisition, construction or production of an asset are capitalized as part of that asset’s
cost.



F-52







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.38 | Income tax and deferred taxes
| | ---- | -----------------------------



Corporate income tax for the year is determined
as the sum of current taxes from the different consolidated companies.

Current taxes are based on the application
of the various types of taxes attributable to taxable income for the year.



Differences between the book value of assets
and liabilities and their tax basis generate deferred tax assets or liabilities, which are calculated using the tax rates expected
to be applicable when the assets and liabilities are realized.



In conformity with current Chilean tax
regulations, the provision for corporate income tax and taxes on mining activity is recognized on an accrual basis, presenting
the net balances of accumulated monthly tax provisional payments for the fiscal period and associated credits. The balances of
these accounts are presented in current income taxes recoverable or current taxes payable, as applicable.



Income tax and variations in deferred tax
assets or liabilities that are not the result of business combinations are recorded in the statement of income or in the consolidated
statement of financial position, based on the origin of the gains or losses which generated them.



At each reporting period, the carrying
amount of deferred tax assets has been reviewed and reduced to the extent there will not be sufficient taxable income to allow
the recovery of all or part of the deferred tax assets. Likewise, as of the date of the consolidated financial statements, deferred
tax assets that are not recognized are evaluated and recognized in a way that future taxable income will allow for the recovery
of the deferred tax asset.



With respect to deductible temporary differences
associated with investments in subsidiaries, associated companies and interest in joint ventures, deferred tax assets are recognized
solely provided that it is more likely than not that the temporary differences will be reversed in the near future and that there
will be taxable income with which they may be used.



The deferred income tax related to entries directly recognized
in equity is recognized with an effect on equity and not with an effect on profit or loss.



Deferred tax assets and liabilities are
offset if there is a legal right to offset tax assets against tax liabilities and the deferred tax is related to the same tax entity
and tax authority.



F-53







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
3 -	Significant accounting policies (continued)



| | 3.39 | Segment reporting
| | ---- | -----------------



IFRS 8 requires that companies adopt a
“management approach” to disclose information on the operations generated by its operating segments. In general, this
is the information that management uses internally for the evaluation of segment performance and to make the decision on how to
allocate resources for this purpose.



An operating segment is a group of assets
and operations responsible for providing products or services subject to risks and performance different from those of other business
segments. A geographical segment is responsible for providing products or services in a given economic environment subject to risks
and performance different from those of other segments that operate in other economic environments.



For assets and liabilities the allocation
to each segment is not possible given that these are associated with more than one segment, except for depreciation, amortization
and impairment of assets, which are directly allocated to the applicable segments, in accordance with the criteria established
in the costing process for product inventories.



The following operating segments have been
identified by the Company:



| | - | Specialty
plant nutrients
| | - | -------------------------

| | - | Industrial
chemicals
| | - | --------------------

| | - | Iodine
and derivatives
| | - | ----------------------

| | - | Lithium
and derivatives
| | - | -----------------------

| | - | Potassium
| | - | ---------

| | - | Other
products and services
| | - | ---------------------------



| | 3.40 | Environment
| | ---- | -----------



In general, the Company follows the criteria
of considering amounts spent on environmental protection and improvement as environmental expenses. However, the cost of facilities,
machinery and equipment used for the same purpose are considered property, plant and equipment, depending on the case.



F-54







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
4 -	Financial risk management



| | 4.1 | Financial risk management policy
| | --- | --------------------------------



The Financial Risk Management Policy of
the Company is oriented towards safeguarding the stability and sustainability of Sociedad Química y Minera de Chile S.A.
and Subsidiaries in relation to all such relevant components of the financial uncertainty.



The operations of the Company are subject
to certain financial risk factors that may affect the financial position or results of the same. Among these risks, the most relevant
are market risk, liquidity risk, currency risk, bad debt risk, and interest rate risk



There may be additional risks that are
currently unknown to us or other known risks that we currently believe are not significant, which could also affect the commercial
operations, the business, the financial position or the results of the Company.



The financial risk management structure
includes identifying, determining, analyzing, quantifying, measuring and controlling these events. The Management, in particular
the Finance Management, is responsible for constantly assessing the financial risk. The Company uses derivatives to cover a significant
portion of these risks.



F-55







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
4 -	Financial risk management (continued)



| | 4.2 | Risk factors
| | --- | ------------



| | 4.2.1 | Market risk
| | ----- | -----------



Market risks are those uncertainties associated
with fluctuations in market variables that affect the assets and liabilities of the Company, such as:



| | a) | Country risk: The economic position of the countries where the Company has a presence may
affect its financial position. For example, the sales carried out in emerging markets expose SQM to risks related to economic conditions
and trends in those countries. On the other hand, inventories may also be affected by the economic situation of these countries
and/ or the global economy, amongst other probable economic impacts.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) | Price volatility risk: The prices of the products of the Company are affected by the fluctuations
of international prices of fertilizers and chemical products and changes in productive capacities or market demand, all of which
might affect the Company’s business, financial condition and operational results.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) | Commodity Price risk: The Company is exposed to changes in the prices of raw materials and
energy which may have an impact on its production costs, thus giving rise to instability in the results.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Currently,
the Company has a direct annual expense close to US$140 million on account of petrol, gas and equivalents and close to US$54 million
on account of electricity.

Variations
of 10% in the prices of energy the Company required to operate, may involve in the short-term movements in costs of approximately
US$17 million.



As expressed in the Company’s
2012 annual report, the markets in which the Company operates are unpredictable, are exposed to significant variations in supply
and demand, and have volatile prices. Additionally, the supply of certain fertilizers or chemical products, including certain products
which the Company trades, vary mainly depending on the production of the top producers and their respective business strategies.
Therefore, the Company cannot predict with certainty changes in demand, the responses of the competition, and the fluctuations
in the final price of its products. These factors can lead to significant impacts on sale volumes of its products, the financial
situation of the Company and its share price.



F-56







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
4 -	Financial risk management (continued)



| | 4.2.1 | Market risk, continued
| | ----- | ----------------------



| | d) | Quality standards: In those markets where we operate, customers might impose quality standards
for our products and/or governments could enact more stringent for the distribution and/or use of our products. As a result, we
could not be able to sell our products if we are not able to meet those new standards. In addition, our production costs might
increase to meet the new standards. Not being able to sell our products in one or more markets or to significant customers might
significantly affect our business, financial position or the results of our operations.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.2.2 | Doubtful accounts risk
| | ----- | ----------------------



A contraction of the global economy and
the potentially negative effects in the financial position of our clients may extend the receivables collection time for SQM, increasing
the bad debt exposure. While measures have been taken in order to minimize risk, the global economy may trigger losses that might
have a material adverse effect on the business, financial position or the results of the Company’s operations.



To mitigate these risks, SQM actively controls
debt collection and uses measures such as, loan insurance, letters of credit, and prepayments as a part of trade receivables.



| | 4.2.3 | Currency risk
| | ----- | -------------



As a result of its influence in determining
price level, of its relationship with sales costs and due to the fact that a significant part of the business of the Company is
carried out in that in United States Dollar, this is the functional currency of the Company. However, the global business activities
of the Company expose create exposure to the foreign exchange fluctuations of several currencies with respect to the US dollar.
Therefore, SQM has hedge contracts to mitigate the exposure generated by its main mismatches (assets net of liabilities) in currencies
other than the US dollar against the foreign exchange fluctuation. Those contracts are periodically updated depending upon the
mismatch amount to be covered in these currencies. Occasionally and subject to the Board of Directors’ approval, the Company
insures cash flows from certain items in currencies other than U.S. dollar at shortterm.



A significant portion of the costs of the
Company, particularly payroll, is related to the Chilean peso. Therefore, an increase or decrease in the exchange rate against
the dollar would affect the net income of SQM. Approximately US$ 470 million cost of the Company are related to the Chilean peso.
A significant part of the effect of such obligations in the statement of financial position is covered by operations of derivative
instruments that hedge the mismatch of balance in this currency.



F-57







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
4 -	Financial risk management (continued)



| | 4.2.3 | Currency risk, continued
| | ----- | ------------------------



As of December 31, 2012, the Company had
derivative instruments classified as hedges against currency and interest rate associated with all the obligations denominated
bonds both in Chilean pesos and UF, with a fair value of US$ 100.6 million. As of December 31, 2013, this value amounts to US$
23.6 million, both in favor of SQM.



As of December 31, 2013, the Chilean peso
to US dollar Exchange rate was Ch$ 524.61 per US$1.00, and as of December 31, 2012 it was Ch$ 479.96 per US$ 1.00.



| | 4.2.4 | Interest rate risk
| | ----- | ------------------



Interest rate fluctuations, due to the
uncertain future behavior of markets, may have a material impact on the financial results of the Company.



The Company has short and long-term debts
valued at LIBOR plus a spread. The Company is partially exposed to fluctuations of said rate, as SQM currently holds hedging derivative
instruments to hedge a portion of its liabilities subject to the LIBOR rate fluctuations.



As of December 31, 2013, approximately
16% of the Company’s financial obligations are valued at LIBOR; therefore significant increases in the rate may impact its
financial position. A 100 base point variation in this rate may trigger variations in the financial expenses close to US$ 1 million.
Notwithstanding, this effect is significantly counterbalanced by the returns of the Company’s investments that also relate
to LIBOR.



In addition, as of December 31, 2013, the
Company's financial debt is mainly in the long-term, with 21% with maturities of less than 12 months which decreases the exposure
to changes in the interest rates.



F-58







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 4 -	Financial risk management
(continued)



| | 4.2.5 | Liquidity risk
| | ----- | --------------



Liquidity risk is related to the fund requirements
to comply with payment obligations. The object of the Company is to keep financial flexibility by comfortably balancing the fund
requirements and the flows from the regular business conduct, bank loans, public bonds, short term investments, and negotiable
instruments, amongst other.



The company has an important capital expenditure
program which is subject to change over time.



On the other hand, world financial markets
go through contraction and expansion periods that are not foreseeable in the long-term and may affect SQM’s access to financial
resources. These factors may have a material adverse impact on the business, financial position, and results of operations of the
Company.



SQM constantly monitors obligations and
investments to ensure they match, taking care of the obligations and investments maturities from a conservative perspective as
part of its financial risk management and strategy. As of December 31, 2013, the Company had non-committed and available bank credit
lines for working capital for a total of approximately US$555 million.



The position in other cash and cash equivalents
so generated by the Company is invested in highly liquid mutual funds which have an AAA risk rating.



| | 4.3 | Risk measurement
| | --- | ----------------



The Company has methods to measure the
effectiveness and efficiency of financial risk hedging strategies, both prospectively and retrospectively. Those methods are consistent
with the risk management profile of the Group.



F-59







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 5 -	Changes in
accounting estimates and policies (consistent presentation)



| | 5.1 | Changes in accounting estimates
| | --- | -------------------------------



There are no changes in accounting estimates
as of the closing date of the consolidated financial statements.



| | 5.2 | Changes in accounting policies
| | --- | ------------------------------



As of December 31, 2013, the Company’s
consolidated financial statements present no changes in accounting policies or estimates compared to the prior period.



The consolidated classified statements
of financial position as of December 31, 2013 and December 31, 2012 and the statements of comprehensive income, equity and cash
flows for the periods ended December 31, 2013 and December 31, 2012, have been prepared in accordance with IFRS, and accounting
principles and criteria have been applied consistently.



F-60







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation



| | 6.1 | Parent’s stand-alone assets and liabilities
| | --- | -------------------------------------------



|                     |  | 12/31/2013 |            |   | 12/31/2012 | 
|-------------------- |  | ---------- | ---------- | - | ---------- | 
|                     |  | ThUS$      |            |   | ThUS$      | 
|                     |  |            |            |   |            | 
|Assets               |  |            | 4,269,749  |   |            | 
|Liabilities          |  |            | (1,893,129 | ) |            | 
|Assets (liabilities) |  |            | 2,376,620  |   |            | 



| | 6.2 | Parent entity
| | --- | -------------



As provided in the Company’s by-laws,
no shareholder can hold more than 32% of the Company’s voting right shares and therefore there is no controlling entity.



| | 6.3 | Joint arrangements of controlling interest
| | --- | ------------------------------------------



Sociedad de Inversiones Pampa Calichera
S.A., Potasios de Chile S.A., and Inversiones Global Mining (Chile) Limitada, collectively the Pampa Group, are the owners of a
number of shares that are equivalent to 29.9% as of December 31, 2013 of the current total amount of shares issued, subscribed
and fully-paid of the Company. In addition, Kowa Company Ltd., Inversiones La Esperanza (Chile) Limitada, Kochi S.A. and La Esperanza
Delaware Corporation, collectively the Kowa Group, are the owners of a number of shares equivalent to 2.09% of the total amount
of issued, subscribed and fully-paid shares of SQM S.A.



The Pampa Group and the Kowa Group have
informed SQM S.A., the Chilean SVS and the relevant stock exchanges in Chile and abroad that they are not and have never been related
parties. In addition, this is regardless of the fact that both Groups on December 21, 2006 have entered into a Joint Action Agreement
(JAA) related to those shares. Consequently, the Pampa Group, by itself, does not concentrate more than 32% of the voting right
capital of SQM S.A., and the Kowa Group does not concentrate by itself more than 32% of the voting right capital of SQM S.A.



Likewise, the Joint Action Agreement has
not transformed the Pampa and Kowa Groups into related parties between them. The Joint Action Agreement has only transformed the
current controller of SQM S.A., composed of the Pampa Group, and the Kowa Group into related parties of SQM S.A.



F-61







Notes
to the Consolidated Financial Statements as of December 31, 2013



| | 6.3 | Joint arrangements of controlling interest, continued
| | --- | -----------------------------------------------------



Detail of effective concentration



|Tax ID No.        |  | Name                                         |  | Ownership interest % |      
|----------------- |  | -------------------------------------------- |  | -------------------- | -----
|96.511.530-7      |  | Sociedad de Inversiones Pampa Calichera S.A. |  |                      | 19.65
|96.863.960-9      |  | Inversiones Global Mining (Chile) Limitada   |  |                      | 3.34 
|76.165.311-5      |  | Potasios de Chile S.A.                       |  |                      | 6.91 
|Total Pampa Group |  |                                              |  |                      | 29.90
|                  |  |                                              |  |                      |      
|79,798,650-k      |  | Inversiones la Esperanza (Chile)  Ltda.      |  |                      | 1.40 
|59.046.730-8      |  | Kowa Co Ltd.                                 |  |                      | 0.30 
|96.518.570-4      |  | Kochi S.A.                                   |  |                      | 0.30 
|59.023.690-k      |  | La Esperanza Delaware Corporation            |  |                      | 0.09 
|Total Kowa Group  |  |                                              |  |                      | 2.09 



F-62







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.4 | General information on consolidated subsidiaries
| | --- | ------------------------------------------------



As of December 31, 2013 and December 31,
2012 the general information of the companies on which the Company exercises control and significant influence is as follows:



|                                                              |  |              |  |                                                                                                           |  |                          |  |                     |  |  | Ownership interest | 
|------------------------------------------------------------- |  | ------------ |  | --------------------------------------------------------------------------------------------------------- |  | ------------------------ |  | ------------------- |  |  | ------------------ | 
|Subsidiary                                                    |  | Tax ID       |  | Address                                                                                                   |  | Country of incorporation |  | Functional currency |  |  | Direct             | 
|                                                              |  |              |  |                                                                                                           |  |                          |  |                     |  |  |                    | 
|SQM Nitratos S.A.                                             |  | 96.592.190-7 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|Proinsa Ltda.                                                 |  | 78.053.910-0 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|SQMC Internacional Ltda.                                      |  | 86.630.200-6 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|SQM Potasio S.A.                                              |  | 96.651.060-9 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|Serv. Integrales de Tránsito y Transf. S.A.                   |  | 79.770.780-5 |  | Arturo Prat 1060, Tocopilla                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|Isapre Norte Grande Ltda.                                     |  | 79.906.120-1 |  | Anibal Pinto 3228, Antofagasta                                                                            |  | Chile                    |  | Ch$                 |  |  |                    | 
|Ajay SQM Chile S.A.                                           |  | 96.592.180-K |  | Av. Pdte. Eduardo Frei 4900, Santiago                                                                     |  | Chile                    |  | US$                 |  |  |                    | 
|Almacenes y Depósitos Ltda.                                   |  | 79.876.080-7 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|SQM Salar S.A.                                                |  | 79.626.800-K |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|SQM Industrial S.A.                                           |  | 79.947.100-0 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|Exploraciones Mineras S.A.                                    |  | 76.425.380-9 |  | Los Militares 4290 Las Condes                                                                             |  | Chile                    |  | US$                 |  |  |                    | 
|Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A. |  | 76.534.490-5 |  | Anibal Pinto 3228, Antofagasta                                                                            |  | Chile                    |  | Ch$                 |  |  |                    | 
|Soquimich Comercial S.A.                                      |  | 79.768.170-9 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | US$                 |  |  |                    | 
|Comercial Agrorama Ltda. (a)                                  |  | 76.064.419-6 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|Comercial Hydro S.A.                                          |  | 96.801.610-5 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|Agrorama S.A.                                                 |  | 76.145.229-0 |  | El Trovador 4285 Las Condes                                                                               |  | Chile                    |  | Ch$                 |  |  |                    | 
|Orcoma Estudios SPA                                           |  | 76.359.919-1 |  | Apoquindo 3721 Of.131 Las Condes                                                                          |  | Chile                    |  | US$                 |  |  |                    | 
|Orcoma SPA                                                    |  | 76.360.575-2 |  | Apoquindo 3721 Of.131 Las Condes                                                                          |  | Chile                    |  | US$                 |  |  |                    | 
|SQM North America Corp.                                       |  | Foreign      |  | 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA                                              |  | United States            |  | US$                 |  |  |                    | 
|RS Agro Chemical.Trading Corporation A.V.V.                   |  | Foreign      |  | Caya Ernesto O. Petronia 17, Orangestad                                                                   |  | Aruba                    |  | US$                 |  |  |                    | 
|Nitratos Naturais do Chile Ltda.                              |  | Foreign      |  | Al. Tocantis 75, 6° Andar, Conunto 608 Edif. West Gate, Alphaville
    Barureri, CEP 06455-020, Sao Paulo |  | Brazil                   |  | US$                 |  |  |                    | 
|Nitrate Corporation of Chile Ltd.                             |  | Foreign      |  | 1 More London Place London SE1 2AF                                                                        |  | United Kingdom           |  | US$                 |  |  |                    | 
|SQM Corporation N.V.                                          |  | Foreign      |  | Pietermaai 123, P.O. Box 897, Willemstad, Curacao                                                         |  | Dutch Antilles           |  | US$                 |  |  |                    | 
|SQM Peru S.A.                                                 |  | Foreign      |  | Avenida Camino Real N° 348 of. 702, San Isidro, Lima                                                      |  | Peru                     |  | US$                 |  |  |                    | 
|SQM Ecuador S.A.                                              |  | Foreign      |  | Av. José Orrantia y Av. Juan Tanca Marengo Edificio Executive
    Center Piso 2 Oficina 211               |  | Ecuador                  |  | US$                 |  |  |                    | 
|SQM Brasil Ltda.                                              |  | Foreign      |  | Al. Tocantis 75, 6° Andar, Conunto 608 Edif. West Gate, Alphaville
    Barureri, CEP 06455-020, Sao Paulo |  | Brazil                   |  | US$                 |  |  |                    | 





F-63









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.4 | General information on consolidated subsidiaries
| | --- | ------------------------------------------------



|                                                 |  |         |  |                                                                                                                            |  |                          |  |                     |  |  | Ownership interest | 
|------------------------------------------------ |  | ------- |  | -------------------------------------------------------------------------------------------------------------------------- |  | ------------------------ |  | ------------------- |  |  | ------------------ | 
|Subsidiary                                       |  | Tax ID  |  | Address                                                                                                                    |  | Country of incorporation |  | Functional currency |  |  | Direct             | 
|                                                 |  |         |  |                                                                                                                            |  |                          |  |                     |  |  |                    | 
|SQI Corporation N.V.                             |  | Foreign |  | Pietermaai 123, P.O. Box 897, Willemstad, Curacao                                                                          |  | Dutch Antilles           |  | US$                 |  |  |                    | 
|SQMC Holding Corporation L.L.P.                  |  | Foreign |  | 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta                                                                   |  | United States            |  | US$                 |  |  |                    | 
|SQM Japan Co. Ltd.                               |  | Foreign |  | From 1st Bldg 207, 5-3-10 Minami-
    Aoyama, Minato-ku, Tokyo                                                             |  | Japan                    |  | US$                 |  |  |                    | 
|SQM Europe N.V.                                  |  | Foreign |  | Sint Pietersvliet 7 bus 8, 2000. Antwerp                                                                                   |  | Belgium                  |  | US$                 |  |  |                    | 
|SQM Italia SRL                                   |  | Foreign |  | Via A. Meucci, 5 500 15 Grassina Firenze                                                                                   |  | Italy                    |  | US$                 |  |  |                    | 
|SQM Indonesia S.A.                               |  | Foreign |  | Perumahan Bumi Dirgantara Permai, Jl Suryadarma Blok Aw No 15 Rt
    01/09 17436 Jatisari Pondok Gede                      |  | Indonesia                |  | US$                 |  |  |                    | 
|North American Trading Company                   |  | Foreign |  | 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA                                                               |  | United States            |  | US$                 |  |  |                    | 
|SQM Virginia LLC                                 |  | Foreign |  | 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA                                                               |  | United States            |  | US$                 |  |  |                    | 
|SQM Comercial de México S.A. de C.V.             |  | Foreign |  | Calle Industria Eléctrica s/n Lote 30, Manzana A Parque Industrial
    Bugambilias CP 45645, Trajomulco de Zuñiga, Jalisco |  | Mexico                   |  | US$                 |  |  |                    | 
|SQM Investment Corporation N.V.                  |  | Foreign |  | Pietermaai 123, P.O. Box 897, Willemstad, Curacao                                                                          |  | Dutch Antilles           |  | US$                 |  |  |                    | 
|Royal Seed Trading Corporation A.V.V.            |  | Foreign |  | Caya Ernesto O. Petronia 17, Orangestad                                                                                    |  | Aruba                    |  | US$                 |  |  |                    | 
|SQM Lithium Specialties LLP                      |  | Foreign |  | 2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA                                                               |  | United States            |  | US$                 |  |  |                    | 
|Soquimich SRL Argentina                          |  | Foreign |  | Espejo 65 Oficina 6 – 5500 Mendoza                                                                                         |  | Argentina                |  | US$                 |  |  |                    | 
|Comercial Caimán Internacional S.A.              |  | Foreign |  | Edificio Plaza Bancomer  Calle 50                                                                                          |  | Panama                   |  | US$                 |  |  |                    | 
|SQM France S.A.                                  |  | Foreign |  | ZAC des Pommiers  27930   FAUVILLE                                                                                         |  | France                   |  | US$                 |  |  |                    | 
|Administración y Servicios Santiago S.A. de C.V. |  | Foreign |  | Calle Industria Eléctrica s/n Lote 30, Manzana A Parque Industrial
    Bugambilias CP 45645, Trajomulco de Zuñiga, Jalisco |  | Mexico                   |  | US$                 |  |  |                    | 
|SQM Nitratos México S.A. de C.V.                 |  | Foreign |  | Calle Industria Eléctrica s/n Lote 30, Manzana A Parque Industrial
    Bugambilias CP 45645, Trajomulco de Zuñiga, Jalisco |  | Mexico                   |  | US$                 |  |  |                    | 



F-64







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.4 | General information on consolidated subsidiaries
| | --- | ------------------------------------------------



|                                |  |         |  |                                                                                                   |  |                          |  |                     |  |  | Ownership interest | 
|------------------------------- |  | ------- |  | ------------------------------------------------------------------------------------------------- |  | ------------------------ |  | ------------------- |  |  | ------------------ | 
|Subsidiary                      |  | Tax ID  |  | Address                                                                                           |  | Country of incorporation |  | Functional currency |  |  | Direct             | 
|                                |  |         |  |                                                                                                   |  |                          |  |                     |  |  |                    | 
|Soquimich European Holding B.V. |  | Foreign |  | Loacalellikade 1 Parnassustoren 1076 AZ Amsterdan                                                 |  | Netherlands              |  | US$                 |  |  |                    | 
|SQM Iberian S.A                 |  | Foreign |  | Provenza 251 Principal 1a CP 08008, Barcelona                                                     |  | Spain                    |  | US$                 |  |  |                    | 
|Iodine Minera B.V. (b)          |  | Foreign |  | Loacalellikade 1 Parnassustoren 1076 AZ Amsterdan                                                 |  | Netherlands              |  | US$                 |  |  |                    | 
|SQM Africa Pty Ltd.             |  | Foreign |  | Tramore House, 3 Wterford Office Park, Waterford Drive, 2191 Fourways,
    Johannesburg           |  | South Africa             |  | US$                 |  |  |                    | 
|SQM Oceania Pty Ltd.            |  | Foreign |  | Level 9, 50 Park Street, Sydney NSW 2000, Sydney                                                  |  | Australia                |  | US$                 |  |  |                    | 
|SQM  Agro India Pvt. Ltd.       |  | Foreign |  | C 30 Chiragh Enclave New Dehli, 110048                                                            |  | India                    |  | US$                 |  |  |                    | 
|SQM Beijing Commercial Co. Ltd. |  | Foreign |  | Room 1001C, CBD International Mansion N 16 Yong An Dong Li, Jian
    Wai Ave Beijing 100022, P.R. |  | China                    |  | US$                 |  |  |                    | 
|SQM Thailand Limited            |  | Foreign |  | Unit 2962, Level 29, N° 388, Exchange Tower Sukhumvit Road,
    Klongtoey Bangkok                 |  | Thailand                 |  | US$                 |  |  |                    | 



| | (a) | Comercial Agrograma is 70% owned by Soquimich Comercial S.A.
| | --- | ------------------------------------------------------------

| | (b) | During the first half of 2013, Iodine Minera was absorbed by Soquimich European Holding B.V.
| | --- | --------------------------------------------------------------------------------------------



F-65







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.5 | Information attributable to non-controlling interests
| | --- | -----------------------------------------------------



|Subsidiary                       |  | % of interests in
    the ownership held by non-controlling interests |            |   | Profit (loss) attributable to non-
    controlling interests |  |        | Equity, non-controlling interests |  |  | Dividends paid to non-controlling
    interests |  
|-------------------------------- |  | --------------------------------------------------------------------- | ---------- | - | ------------------------------------------------------------ |  | ------ | --------------------------------- |  |  | ----------------------------------------------- | -
|                                 |  |                                                                       |            |   | 12/31/2013                                                   |  |        | 12/31/2012                        |  |  | 12/31/2013                                      |  
|                                 |  |                                                                       |            |   | ThUS$                                                        |  |        | ThUS$                             |  |  | ThUS$                                           |  
|                                 |  |                                                                       |            |   |                                                              |  |        |                                   |  |  |                                                 |  
|Proinsa Ltda.                    |  |                                                                       | 0.1        | % |                                                              |  | -      |                                   |  |  | -                                               |  
|SQM Potasio S.A.                 |  |                                                                       | 0.0000001  | % |                                                              |  | -      |                                   |  |  | -                                               |  
|Ajay SQM Chile S.A.              |  |                                                                       | 49         | % |                                                              |  | (3,389 | )                                 |  |  | (4,890                                          | )
|SQM Indonesia S.A.               |  |                                                                       | 20         | % |                                                              |  | -      |                                   |  |  | -                                               |  
|SQM Nitratos México S.A. de C.V. |  |                                                                       | 0          | % |                                                              |  | -      |                                   |  |  | -                                               |  
|Soquimich Comercial S.A.         |  |                                                                       | 39.3616784 | % |                                                              |  | (4,051 | )                                 |  |  | (3,367                                          | )
|Comercial Agrorama Ltda.         |  |                                                                       | 30         | % |                                                              |  | (18    | )                                 |  |  | 56                                              |  
|Agrorama S.A.                    |  |                                                                       | 0.001      | % |                                                              |  | -      |                                   |  |  | -                                               |  
|SQM (Thailand) Limited           |  |                                                                       | 0.004      | % |                                                              |  | -      |                                   |  |  | -                                               |  
|Total                            |  |                                                                       |            |   |                                                              |  | (7,458 | )                                 |  |  | (8,201                                          | )



F-66









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.6 | Information on consolidated subsidiaries
| | --- | ----------------------------------------



|12/31/2013                                                   
|-------------------------------------------------------------
|                                                             
|Subsidiary                                                   
|                                                             
|                                                             
|SQM Nitratos S.A.                                            
|Proinsa Ltda.                                                
|SQMC Internacional Ltda.                                     
|SQM Potasio S.A.                                             
|Serv. Integrales de Tránsito y Transf. S.A.                  
|Isapre Norte Grande Ltda                                     
|Ajay SQM Chile S.A.                                          
|Almacenes y Depósitos Ltda.                                  
|SQM Salar S.A.                                               
|SQM Industrial S.A.                                          
|Exploraciones Mineras S.A.                                   
|Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A.
|Soquimich Comercial S.A.                                     
|Comercial Agrorama Ltda.                                     
|Comercial Hydro S.A.                                         
|Agrorama S.A.                                                
|Orcoma SpA                                                   
|Orcoma Estudio SpA                                           
|SQM North América Corp.                                      
|RS Agro Chemical Trading  Corporation A.V.V.                 
|Nitratos Naturais do Chile Ltda.                             
|Nitrate Corporation of Chile Ltd.                            
|SQM Corporation N.V.                                         
|SQM Perú S.A.                                                
|SQM Ecuador S.A.                                             
|SQM Brasil Ltda.                                             
|SQI Corporation N.V.                                         
|SQMC Holding Corporation L.L.P.                              
|SQM Japan Co. Ltd.                                           



F-67









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.6 | Information on consolidated subsidiaries, continued
| | --- | ---------------------------------------------------



|12/31/2013                                       | 
|------------------------------------------------ | 
|                                                 | 
|Subsidiary                                       | 
|                                                 | 
|                                                 | 
|SQM Europe N.V.                                  | 
|SQM Italia SRL                                   | 
|SQM Indonesia S.A.                               | 
|North American Trading Company                   | 
|SQM Virginia LLC                                 | 
|SQM Comercial de México S.A. de C.V.             | 
|SQM Investment Corporation N.V.                  | 
|Royal Seed Trading Corporation A.V.V.            | 
|SQM Lithium Specialties LLP                      | 
|Soquimich SRL Argentina                          | 
|Comercial Caimán Internacional S.A.              | 
|SQM France S.A.                                  | 
|Administración y Servicios Santiago S.A. de C.V. | 
|SQM Nitratos México S.A. de C.V.                 | 
|Soquimich European Holding B.V.                  | 
|SQM Iberian S.A                                  | 
|SQM Africa Pty Ltd.                              | 
|SQM Oceanía Pty Ltd.                             | 
|SQM  Agro India Pvt. Ltd.                        | 
|SQM Beijing Commercial Co. Ltd.                  | 
|SQM Thailand Limited                             | 
|Total                                            | 



F-68







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.6 | Information on consolidated subsidiaries, continued
| | --- | ---------------------------------------------------



|                                                              |  | 12/31/2012 |           |  | 12/31/2012  | 
|------------------------------------------------------------- |  | ---------- | --------- |  | ----------- | 
|                                                              |  | Assets     |           |  | Liabilities | 
|Subsidiary                                                    |  | Current    |           |  | Non-current | 
|                                                              |  | ThUS$      |           |  | ThUS$       | 
|                                                              |  |            |           |  |             | 
|SQM Nitratos S.A.                                             |  |            | 610,140   |  |             | 
|Proinsa Ltda.                                                 |  |            | 220       |  |             | 
|SQMC Internacional Ltda.                                      |  |            | 292       |  |             | 
|SQM Potasio S.A.                                              |  |            | 19,134    |  |             | 
|Serv. Integrales de Tránsito y Transf. S.A.                   |  |            | 272,955   |  |             | 
|Isapre Norte Grande Ltda.                                     |  |            | 786       |  |             | 
|Ajay SQM Chile S.A.                                           |  |            | 25,125    |  |             | 
|Almacenes y Depósitos Ltda.                                   |  |            | 398       |  |             | 
|SQM Salar S.A.                                                |  |            | 700,153   |  |             | 
|SQM Industrial S.A.                                           |  |            | 1,273,599 |  |             | 
|Exploraciones Mineras S.A.                                    |  |            | 469       |  |             | 
|Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A. |  |            | 890       |  |             | 
|Soquimich Comercial S.A.                                      |  |            | 167,089   |  |             | 
|Comercial Agrorama Ltda.                                      |  |            | 15,515    |  |             | 
|Comercial Hydro S.A.                                          |  |            | 7,882     |  |             | 
|Agrorama S.A.                                                 |  |            | 14,086    |  |             | 
|SQM North America Corp.                                       |  |            | 303,666   |  |             | 
|RS Agro Chemical Trading Corporation A.V.V.                   |  |            | 5,214     |  |             | 
|Nitratos Naturais do Chile Ltda.                              |  |            | 8         |  |             | 
|Nitrate Corporation of Chile Ltd.                             |  |            | 5,076     |  |             | 
|SQM Corporation N.V.                                          |  |            | 669       |  |             | 
|SQM Peru S.A.                                                 |  |            | 867       |  |             | 
|SQM Ecuador S.A.                                              |  |            | 19,321    |  |             | 
|SQM Brasil Ltda.                                              |  |            | 672       |  |             | 
|SQI Corporation N.V.                                          |  |            | -         |  |             | 
|SQMC Holding Corporation L.L.P.                               |  |            | 5,685     |  |             | 



F-69







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.6 | Information on consolidated subsidiaries, continued
| | --- | ---------------------------------------------------



|                                                 |  | 12/31/2012 |           |  | 12/31/2012  | 
|------------------------------------------------ |  | ---------- | --------- |  | ----------- | 
|                                                 |  | Assets     |           |  | Liabilities | 
|Subsidiary                                       |  | Current    |           |  | Non-current | 
|                                                 |  | ThUS$      |           |  | ThUS$       | 
|                                                 |  |            |           |  |             | 
|SQM Japan Co. Ltd.                               |  |            | 2,190     |  |             | 
|SQM Europe N.V.                                  |  |            | 391,321   |  |             | 
|SQM Italia SRL                                   |  |            | 1,360     |  |             | 
|SQM Indonesia S.A.                               |  |            | 5         |  |             | 
|North American Trading Company                   |  |            | 160       |  |             | 
|SQM Virginia LLC                                 |  |            | 14,829    |  |             | 
|SQM Comercial de México S.A. de C.V.             |  |            | 77,811    |  |             | 
|SQM Investment Corporation N.V.                  |  |            | 63,933    |  |             | 
|Royal Seed Trading Corporation A.V.V.            |  |            | 241,921   |  |             | 
|SQM Lithium Specialties LLP                      |  |            | 15,782    |  |             | 
|Soquimich SRL Argentina                          |  |            | 422       |  |             | 
|Comercial Caimán Internacional S.A.              |  |            | 333       |  |             | 
|SQM France S.A.                                  |  |            | 345       |  |             | 
|Administración y Servicios Santiago S.A. de C.V. |  |            | 50        |  |             | 
|SQM Nitratos México S.A. de C.V.                 |  |            | 29        |  |             | 
|Soquimich European Holding B.V.                  |  |            | 70,432    |  |             | 
|SQM Iberian S.A                                  |  |            | 81,420    |  |             | 
|Iodine Minera B.V.                               |  |            | 16,929    |  |             | 
|SQM Africa Pty Ltd.                              |  |            | 97,915    |  |             | 
|SQM Oceania Pty Ltd.                             |  |            | 5,621     |  |             | 
|SQM  Agro India Pvt. Ltd.                        |  |            | 17        |  |             | 
|SQM Beijing Commercial Co. Ltd.                  |  |            | 3,512     |  |             | 
|Total                                            |  |            | 4,536,248 |  |             | 



F-70







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 6 -	Background
of companies included in consolidation (continued)



| | 6.7 | Detail of transactions between consolidated companies
| | --- | -----------------------------------------------------



| | a) | Transactions carried out in 2013
| | -- | --------------------------------



On December 31, 2013, the subsidiary Orcoma
Estudios SPA was incorporated into the company with Sociedad Quimica y Minera de Chile S.A. making a capital contribution of US$
1,500, acquiring 100% ownership.



On December 31, 2013, the subsidiary Orcoma
SPA was incorporated into the company with Sociedad Quimica y Minera de Chile S.A. made a capital contribution of ThUS$ 2,358,
acquiring 100% ownership.



On March 25, 2013, SQM Industrial S.A.
increased by ThUS$ 1,500 the capital of its subsidiary SQM Beijing Commercial Co. Ltd.



During the first half of the year Iodine
Minera was absorbed into Soquimich European Holdings.



During the first half of 2013 Soquimich
European Holdings B.V. purchased shares of SQM Thailand Limited, acquiring 99.996% of this company.



Transactions conducted in 2012



On November 30, 2012, SQM S.A. transferred
and made a capital contribution of the 99% of the ownership interest in Minera Nueva Victoria Limitada to SQM Potasio S.A.; therefore,
SQM Potasio S.A. obtains 100% of the ownership. As a result of the above, Minera Nueva Victoria Limitada merged into SQM Potasio
S.A., which generates the dissolution of Minera Nueva Victoria Limitada.



F-71







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 7 -	Cash and cash
equivalents



| | 7.1 | Types of cash
                                         and cash equivalents
| | --- | ---------------------------------------------------------------------------



As of
December 31, 2013 and December 31, 2012, cash and cash equivalents are detailed as follows:



|a)   Cash             |  | 12/31/2013 |        |  | 12/31/20121 | 
|--------------------- |  | ---------- | ------ |  | ----------- | 
|                      |  | ThUS$      |        |  | ThUS$       | 
|                      |  |            |        |  |             | 
|Cash on hand          |  |            | 119    |  |             | 
|Cash in banks         |  |            | 29,671 |  |             | 
|Other demand deposits |  |            | 3,625  |  |             | 
|Total cash            |  |            | 33,415 |  |             | 



|b)   Cash equivalents                                  |  | 12/31/2013 |         |  | 12/31/2012 | 
|------------------------------------------------------ |  | ---------- | ------- |  | ---------- | 
|                                                       |  | ThUS$      |         |  | ThUS$      | 
|                                                       |  |            |         |  |            | 
|Short-term deposits, classified as cash equivalents    |  |            | 158,208 |  |            | 
|Short-term investments, classified as cash equivalents |  |            | 284,999 |  |            | 
|Total cash equivalents                                 |  |            | 443,207 |  |            | 
|                                                       |  |            |         |  |            | 
|Total cash and cash equivalents                        |  |            | 476,622 |  |            | 



F-72







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 7 -	Cash and cash
equivalents (continued)



| | 7.2 | Short-term investments, classified as cash equivalents
| | --- | ------------------------------------------------------



As of December 31, 2013 and December 31,
2012, short-term investments, classified as cash and cash equivalents relate to mutual funds (investment liquidity funds) for investments
in:



|Institution                                            |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|------------------------------------------------------ |  | ---------------- | ------- |  | ---------------- | 
|Legg Mason - Western Asset Institutional Cash Reserves |  |                  | 95,941  |  |                  | 
|BlackRock - Institutional US Dollar Liquidity Fund     |  |                  | 94,726  |  |                  | 
|JP Morgan US dollar Liquidity Fund Institutional       |  |                  | 94,332  |  |                  | 
|Total                                                  |  |                  | 284,999 |  |                  | 



Short-term investments are highly liquid mutual funds that are
basically invested in short-term fixed rate notes as cash equivalents in the U.S. market.



| | 7.3 | Information on cash and cash equivalents by currency
| | --- | ----------------------------------------------------



As of
December 31, 2013 and December 31, 2012, information on cash and cash equivalents by currency is detailed as follows:



|Original currency  |  | 12/31/2013 |         |  | 12/31/2012 | 
|------------------ |  | ---------- | ------- |  | ---------- | 
|                   |  | ThUS$      |         |  | ThUS$      | 
|Chilean Peso (*)   |  |            | 25,391  |  |            | 
|U.S. dollar        |  |            | 430,263 |  |            | 
|Euro               |  |            | 9,230   |  |            | 
|Mexican Peso       |  |            | 429     |  |            | 
|South African Rand |  |            | 7,229   |  |            | 
|Japanese Yen       |  |            | 1,435   |  |            | 
|Peruvian Sol       |  |            | 2       |  |            | 
|Brazilian Real     |  |            | 73      |  |            | 
|Chinese Yuan       |  |            | 384     |  |            | 
|Indonesian Rupiah  |  |            | 4       |  |            | 
|Indian rupee       |  |            | 7       |  |            | 
|Thai baht          |  |            | 2,161   |  |            | 
|Pound sterling     |  |            | 14      |  |            | 
|Total              |  |            | 476,622 |  |            | 



(*) The Company maintains financial derivative policies which
allow dollarizing these term deposits in Chilean pesos.



F-73







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 7 -	Cash and cash
equivalents (continued)



| | 7.4 | Amount of significant restricted (unavailable) cash balances
| | --- | ------------------------------------------------------------



Cash on hand and in current bank accounts
are available resources, and their carrying value is equal to their fair value.



As of December 31, 2013 and December 31,
2012, the Company has no significant cash balances with any type of restriction.



F-74







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 7 -	Cash and cash
equivalents (continued)



| | 7.5 | Short-term deposits,
                                         classified as cash equivalents
| | --- | --------------------------------------------------------------------------------------------



The detail at the end of each period is
as follows:



|Receiver of the deposit     |  | Type of deposit |  | Original Currency |  |  | Interest rate |  |      | Placement date |  |  | Expiration date |  |  | Principal ThUS$ |            |  | Interest accrued
    to-date
    ThUS$ |  |         | 31/12/2013  ThUS$ |  |  | 31/12/2012 ThUS$ | 
|--------------------------- |  | --------------- |  | ----------------- |  |  | ------------- |  | ---- | -------------- |  |  | --------------- |  |  | --------------- | ---------- |  | -------------------------------------- |  | ------- | ----------------- |  |  | ---------------- | 
|Banco BBVA Chile            |  | Fixed term      |  | US$               |  |  |               |  | 0.50 |                |  |  | 12/20/2013      |  |  |                 | 01/09/2014 |  |                                        |  | 10,000  |                   |  |  | 2                | 
|Banco BBVA Chile            |  | Fixed term      |  | US$               |  |  |               |  | -    |                |  |  | 12/20/2013      |  |  |                 | 01/09/2014 |  |                                        |  | 10,000  |                   |  |  | 2                | 
|Banco BBVA Chile            |  | Fixed term      |  | US$               |  |  |               |  | -    |                |  |  | 12/20/2013      |  |  |                 | 01/09/2014 |  |                                        |  | 10,000  |                   |  |  | 2                | 
|Banco Crédito e Inversiones |  | Fixed term      |  | US$               |  |  |               |  | 0.40 |                |  |  | 12/16/2013      |  |  |                 | 01/16/2014 |  |                                        |  | 20,000  |                   |  |  | 3                | 
|Banco Crédito e Inversiones |  | Fixed term      |  | US$               |  |  |               |  | 0.48 |                |  |  | 12/16/2013      |  |  |                 | 02/06/2014 |  |                                        |  | 20,000  |                   |  |  | 4                | 
|Banco Crédito e Inversiones |  | Fixed term      |  | US$               |  |  |               |  | 0.50 |                |  |  | 10/17/2013      |  |  |                 | 01/03/2014 |  |                                        |  | 10,093  |                   |  |  | 10               | 
|Banco Crédito e Inversiones |  | Fixed term      |  | US$               |  |  |               |  | 0.58 |                |  |  | 12/16/2013      |  |  |                 | 03/11/2014 |  |                                        |  | 20,000  |                   |  |  | 5                | 
|Banco Crédito e Inversiones |  | Fixed term      |  | Ch$               |  |  |               |  | 0.37 |                |  |  | 12/30/2013      |  |  |                 | 01/13/2014 |  |                                        |  | 4,384   |                   |  |  | -                | 
|Banco Crédito e Inversiones |  | Fixed term      |  | Ch$               |  |  |               |  | 0.38 |                |  |  | 12/27/2013      |  |  |                 | 01/09/2014 |  |                                        |  | 4,193   |                   |  |  | 2                | 
|Banco Santander - Santiago  |  | Fixed term      |  | US$               |  |  |               |  | 0.48 |                |  |  | 12/09/2013      |  |  |                 | 01/23/2014 |  |                                        |  | 20,314  |                   |  |  | 6                | 
|Banco Santander - Santiago  |  | Fixed term      |  | US$               |  |  |               |  | 0.52 |                |  |  | 12/04/2013      |  |  |                 | 01/03/2014 |  |                                        |  | 10,104  |                   |  |  | 4                | 
|Banco Santander - Santiago  |  | Fixed term      |  | Ch$               |  |  |               |  | 0.43 |                |  |  | 10/21/2013      |  |  |                 | 01/03/2014 |  |                                        |  | 14,352  |                   |  |  | 148              | 
|IDBI Bank                   |  | Fixed term      |  | Indian rupee      |  |  |               |  | -    |                |  |  | 12/31/2013      |  |  |                 | 03/31/2014 |  |                                        |  | 2       |                   |  |  | -                | 
|Citibank New York           |  | Overnight       |  | US$               |  |  |               |  | 0.01 |                |  |  | 12/31/2013      |  |  |                 | 01/02/2014 |  |                                        |  | 444     |                   |  |  | -                | 
|Citibank New York           |  | Overnight       |  | US$               |  |  |               |  | 0.01 |                |  |  | 12/31/2013      |  |  |                 | 01/02/2014 |  |                                        |  | 640     |                   |  |  | -                | 
|Citibank New York           |  | Overnight       |  | US$               |  |  |               |  | 0.01 |                |  |  | 12/31/2013      |  |  |                 | 01/02/2014 |  |                                        |  | 1,301   |                   |  |  | -                | 
|ABN Amro Bank               |  | Fixed term      |  | Euro              |  |  |               |  | -    |                |  |  | 12/31/2013      |  |  |                 | 01/31/2014 |  |                                        |  | 2,193   |                   |  |  | -                | 
|Banco Security              |  | Fixed term      |  | US$               |  |  |               |  | -    |                |  |  | -               |  |  |                 | -          |  |                                        |  | -       |                   |  |  | -                | 
|Corpbanca                   |  | Demand deposit  |  | US$               |  |  |               |  | -    |                |  |  | -               |  |  |                 | -          |  |                                        |  | -       |                   |  |  | -                | 
|                            |  |                 |  |                   |  |  |               |  |      |                |  |  |                 |  |  |                 |            |  |                                        |  |         |                   |  |  |                  | 
|Total                       |  |                 |  |                   |  |  |               |  |      |                |  |  |                 |  |  |                 |            |  |                                        |  | 158,020 |                   |  |  | 188              | 



F-75







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 8 -	Inventories



The composition of inventory at each period-end is as follows:



|Type of inventory                |  | 12/31/2013 |         |  | 12/31/2012 | 
|-------------------------------- |  | ---------- | ------- |  | ---------- | 
|                                 |  | ThUS$      |         |  | ThUS$      | 
|                                 |  |            |         |  |            | 
|Raw material reserves            |  |            | 8,552   |  |            | 
|Supplies for production reserves |  |            | 42,366  |  |            | 
|Products-in-progress reserves    |  |            | 400,824 |  |            | 
|Finished product reserves        |  |            | 503,788 |  |            | 
|Total                            |  |            | 955,530 |  |            | 





Inventory provisions recognized as of December
31, 2013 amount to ThUS$97,248, and ThUS$72,687 as of December 31, 2012. Inventory provisions have been made based on a technical
study that covers the different variables affecting products in stock (density, humidity, among others). Additionally, reserves
are recognized if goods are sold cheaper than the related cost, and for differences that arise from inventory counts.



The total amount recorded as cost of sale
related to inventory in the statement of income amounts to ThUS$1,314,276 and to ThUS$1,093,075 as of December 31, 201 and 2012,
respectively.



The breakdown of inventory reserves is detailed as follows:



|Type of inventory                |  | 12/31/2013 |        |  | 12/31/2012 | 
|-------------------------------- |  | ---------- | ------ |  | ---------- | 
|                                 |  | ThUS$      |        |  | ThUS$      | 
|                                 |  |            |        |  |            | 
|Raw material reserves            |  |            | 93     |  |            | 
|Supplies for production reserves |  |            | 500    |  |            | 
|Products-in-progress reserves    |  |            | 65,768 |  |            | 
|Finished product reserves        |  |            | 30,887 |  |            | 
|                                 |  |            |        |  |            | 
|Total                            |  |            | 97,248 |  |            | 



The Company has not delivered inventory
as collateral for the periods indicated above.



F-76







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures



| | 9.1 | Related party disclosures
| | --- | -------------------------



Balances pending at period-end are not
guaranteed, accrue no interest and are settled in cash. No guarantees have been delivered or received for trade and other receivables
due from related parties or trade and other payables due to related parties. For the period ended December 31, 2013, the Company
has not recorded any impairment in accounts receivable related to amounts owed by related parties. This evaluation is conducted
every year through an examination of the financial position of the related party in the market in which it operates.



| | 9.2 | Relationships between the parent and the entity
| | --- | -----------------------------------------------



According to the Company’s by-laws,
no shareholder can own more than 32% of the Company’s voting right shares.



Sociedad de Inversiones Pampa Calichera
S.A., Potasios de Chile S.A., and Inversiones Global Mining (Chile) Ltda., collectively the Pampa Group, are the owners of a number
of shares that are equivalent to 29.9% as of December 31, 2013 of the current total amount of shares issued, subscribed and fully-paid
of the Company. In addition, Kowa Company Ltd., Inversiones La Esperanza (Chile) Limitada, Kochi S.A. and La Esperanza Delaware
Corporation, collectively the Kowa Group, are the owners of a number of shares equivalent to 2.09% of the total amount of shares
of SQM S.A. issued, subscribed and fully-paid.



The Pampa Group and the Kowa Group have
informed SQM S.A., the Chilean SVS and the relevant stock exchanges in Chile and abroad that they are not and have never been related
parties between them. In addition, this is regardless of the fact that both Groups on December 21, 2006 have entered into a Joint
Action Agreement (JAA) related to those shares. Consequently, the Pampa Group, by itself, does not concentrate more than 32% of
the voting right capital of SQM S.A., and the Kowa Group does not concentrate by itself more than 32% of the voting right capital
of SQM S.A.



Likewise, the Joint Action Agreement has
not transformed the Pampa and Kowa Groups into related parties between them. The Joint Action Agreement has only transformed the
current controller of SQM S.A., composed of the Pampa Group, and the Kowa Group into related parties of SQM S.A.



F-77









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.2 | Relationship between the Parent and the entity
| | --- | ----------------------------------------------



Detail of effective concentration



|Tax ID No.        |  | Name                                         |  | Ownership interest % |      
|----------------- |  | -------------------------------------------- |  | -------------------- | -----
|96.511.530-7      |  | Sociedad de Inversiones Pampa Calichera S.A. |  |                      | 19.65
|96.863.960-9      |  | Inversiones Global Mining (Chile) Ltda.      |  |                      | 3.34 
|76.165.311-5      |  | Potasios de Chile S.A.                       |  |                      | 6.91 
|Total Pampa Group |  |                                              |  |                      | 29.90
|                  |  |                                              |  |                      |      
|79,798,650-k      |  | Inversiones la Esperanza (Chile) Ltda.       |  |                      | 1.40 
|59.046.730-8      |  | Kowa Co Ltd.                                 |  |                      | 0.30 
|96.518.570-4      |  | Kochi S.A.                                   |  |                      | 0.30 
|59.023.690-k      |  | La Esperanza Delaware Corporation            |  |                      | 0.09 
|Total Kowa Group  |  |                                              |  |                      | 2.09 



| | 9.3 | Detailed identification of the link between the Parent
and subsidiary
| | --- | ---------------------------------------------------------------------



As of December 31, 2013 and December 31,
2012, the detail of entities that are a related parties of the SQM S.A: Group is as follows:



|Tax ID No. |  | Name                                             |  | Country of origin |  | Functional currency |  | Nature    
|---------- |  | ------------------------------------------------ |  | ----------------- |  | ------------------- |  | ----------
|Foreign    |  | Nitratos Naturais Do Chile Ltda.                 |  | Brazil            |  | US$                 |  | Subsidiary
|Foreign    |  | Nitrate Corporation Of Chile Ltd.                |  | United Kingdom    |  | US$                 |  | Subsidiary
|Foreign    |  | SQM North America Corp.                          |  | United States     |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Europe N.V.                                  |  | Belgium           |  | US$                 |  | Subsidiary
|Foreign    |  | Soquimich S.R.L. Argentina                       |  | Argentina         |  | US$                 |  | Subsidiary
|Foreign    |  | Soquimich European Holding B.V.                  |  | The Netherlands   |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Corporation N.V.                             |  | Dutch Antilles    |  | US$                 |  | Subsidiary
|Foreign    |  | SQI Corporation N.V.                             |  | Dutch Antilles    |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Comercial De México S.A. de C.V.             |  | Mexico            |  | US$                 |  | Subsidiary
|Foreign    |  | North American Trading Company                   |  | United States     |  | US$                 |  | Subsidiary
|Foreign    |  | Administración y Servicios Santiago S.A. de C.V. |  | Mexico            |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Peru S.A.                                    |  | Peru              |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Ecuador S.A.                                 |  | Ecuador           |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Nitratos Mexico S.A. de C.V.                 |  | Mexico            |  | US$                 |  | Subsidiary
|Foreign    |  | SQMC Holding Corporation L.L.P.                  |  | United States     |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Investment Corporation N.V.                  |  | Dutch Antilles    |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Brasil Limitada                              |  | Brazil            |  | US$                 |  | Subsidiary
|Foreign    |  | SQM France S.A.                                  |  | France            |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Japan Co.  Ltd.                              |  | Japan             |  | US$                 |  | Subsidiary
|Foreign    |  | Royal Seed Trading Corporation A.V.V.            |  | Aruba             |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Oceania Pty Limited                          |  | Australia         |  | US$                 |  | Subsidiary
|Foreign    |  | Rs Agro-Chemical Trading Corporation A.V.V.      |  | Aruba             |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Indonesia S.A.                               |  | Indonesia         |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Virginia L.L.C.                              |  | United States     |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Italia SRL                                   |  | Italy             |  | US$                 |  | Subsidiary
|Foreign    |  | Comercial Caiman Internacional S.A.              |  | Panamá            |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Africa Pty. Ltd.                             |  | South Africa      |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Lithium Specialties LLC                      |  | United States     |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Iberian S.A.                                 |  | Spain             |  | US$                 |  | Subsidiary
|Foreign    |  | Iodine Minera B.V. (a)                           |  | The Netherlands   |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Agro India Pvt. Ltd.                         |  | India             |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Beijing Commercial Co. Ltd.                  |  | China             |  | US$                 |  | Subsidiary
|Foreign    |  | SQM Thailand Limited (b)                         |  | Thailand          |  | US$                 |  | Subsidiary



F-78







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.3 | Detailed identification of the link between the Parent and subsidiary, continued
| | --- | --------------------------------------------------------------------------------



As of December 31, 2013 and December 31, 2012, the detail of
entities that are a related parties of the SQM S.A: Group is as follows:



|Tax ID No.   |  | Name                                                          |  | Country oforigin     |  | Functional currency  |  | Nature                                
|------------ |  | ------------------------------------------------------------- |  | -------------------- |  | -------------------- |  | --------------------------------------
|96.801.610-5 |  | Comercial Hydro  S.A.                                         |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|96.651.060-9 |  | SQM Potasio S.A.                                              |  | Chile                |  | US$                  |  | Subsidiary                            
|96.592.190-7 |  | SQM Nitratos S.A.                                             |  | Chile                |  | US$                  |  | Subsidiary                            
|96.592.180-K |  | Ajay SQM Chile S.A.                                           |  | Chile                |  | US$                  |  | Subsidiary                            
|86.630.200-6 |  | SQMC Internacional Ltda.                                      |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|79.947.100-0 |  | SQM Industrial S.A.                                           |  | Chile                |  | US$                  |  | Subsidiary                            
|79.906.120-1 |  | Isapre Norte Grande Ltda.                                     |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|79.876.080-7 |  | Almacenes y Depósitos Ltda.                                   |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|79.770.780-5 |  | Servicios Integrales de Tránsitos y Transferencias S.A.       |  | Chile                |  | US$                  |  | Subsidiary                            
|79.768.170-9 |  | Soquimich Comercial S.A.                                      |  | Chile                |  | US$                  |  | Subsidiary                            
|79.626.800-K |  | SQM Salar S.A.                                                |  | Chile                |  | US$                  |  | Subsidiary                            
|78.053.910-0 |  | Proinsa Ltda.                                                 |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|76.534.490-5 |  | Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A. |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|76.425.380-9 |  | Exploraciones Mineras S.A.                                    |  | Chile                |  | US$                  |  | Subsidiary                            
|76.064.419-6 |  | Comercial Agrorama Ltda.                                      |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|76.145.229-0 |  | Agrorama S.A.                                                 |  | Chile                |  | Chilean peso         |  | Subsidiary                            
|76.359.919-1 |  | Orcoma Estudios SPA (c )                                      |  | Chile                |  | US$                  |  | Subsidiary                            
|76.360.575-2 |  | Orcoma SPA ( d )                                              |  | Chile                |  | US$                  |  | Subsidiary                            
|77.557.430-5 |  | Sales de Magnesio Ltda.                                       |  | Chile                |  | Chilean peso         |  | Associate                             
|Foreign      |  | Abu Dhabi Fertilizer Industries WWL                           |  | United Arab Emirates |  | Arab Emirates dirham |  | Associate                             
|Foreign      |  | Doktor Tarsa Tarim Sanayi AS                                  |  | Turkey               |  | Turkish lira         |  | Associate                             
|Foreign      |  | Ajay North America                                            |  | United States        |  | US$                  |  | Associate                             
|Foreign      |  | Ajay Europe SARL                                              |  | France               |  | Euro                 |  | Associate                             
|Foreign      |  | SQM Eastmed Turkey                                            |  | Turkey               |  | Euro                 |  | Associate                             
|Foreign      |  | Charlee SQM Thailand Co. Ltd.                                 |  | Thailand             |  | Thai baht            |  | Associate                             
|Foreign      |  | Sichuan SQM Migao Chemical Fertilizers
    Co Ltda.           |  | China                |  | US$                  |  | Joint venture                         
|Foreign      |  | Coromandel SQM                                                |  | India                |  | Indian rupee         |  | Joint venture                         
|Foreign      |  | SQM Vitas Fzco.                                               |  | Arab Emirates        |  | Arab Emirates dirham |  | Joint venture                         
|Foreign      |  | SQM Star Qingdao Crop Nutrition Co.,
    Ltd.                 |  | China                |  | US$                  |  | Joint venture                         
|Foreign      |  | SQM Vitas Spain                                               |  | Spain                |  | Euro                 |  | Joint venture                         
|Foreign      |  | SQM Vitas Holland                                             |  | Dutch Antilles       |  | Euro                 |  | Joint venture                         
|Foreign      |  | SQM Vitas Plantacote B.V                                      |  | Dutch Antilles       |  | Euro                 |  | Joint venture                         
|Foreign      |  | Kowa Company Ltd.                                             |  | Japan                |  | US$                  |  | Other related parties                 
|96.511.530-7 |  | Sociedad de Inversiones Pampa Calichera                       |  | Chile                |  | US$                  |  | Other related parties                 
|96.529.340-k |  | Norte Grande S.A.                                             |  | Chile                |  | Chilean peso         |  | Other related parties                 
|79.049.778-9 |  | Callegari Agricola S.A.                                       |  | Chile                |  | Chilean peso         |  | Other related parties                 
|Foreign      |  | Coromandel Internacional                                      |  | India                |  | Indian rupee         |  | Other related parties                 
|Foreign      |  | Vitas Roullier SAS                                            |  | France               |  | Euro                 |  | Other related parties                 
|Foreign      |  | SQM Vitas Brasil Agroindustria                                |  | Brazil               |  | US$                  |  | Joint control or significant influence
|Foreign      |  | SQM Vitas Peru S.A.C.                                         |  | Peru                 |  | US$                  |  | Joint control or significant influence
|Foreign      |  | SQM Vitas Southern Africa Pty.                                |  | South Africa         |  | US$                  |  | Joint control or significant influence



F-79







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party disclosures (continued)



| | 9.3 | Detailed identification of the link between the Parent and subsidiary, continued
| | --- | --------------------------------------------------------------------------------



| | (a) | During the first half of 2013 Iodine Minera S.A. was absorbed into Soquimich European Holdings
B.V.
| | --- | ---------------------------------------------------------------------------------------------------



| | (b) | During the first half of 2013 Soquimich European Holdings B.V. purchased shares of SQM Thailand
Limited, acquiring 99.996% of the company.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | On December 31, 2013, the subsidiary Orcoma Estudios SPA was incorporated into the company Sociedad
Química y Minera de Chile S.A. making a capital contribution of US$ 1,500, acquiring 100% ownership.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | On December 31, 2013, the subsidiary Orcoma SPA was incorporated into the company Sociedad Química
y Minera de Chile S.A. making a capital contribution of ThUS$ 2,358, acquiring 100% ownership.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-80







Notes
to the Consolidated Financial Statements as of December 31, 2013



| | 9.4 | Detail of related parties and related party transactions
| | --- | --------------------------------------------------------



Transactions between the Parent and its
subsidiaries are part of the Company's common transactions. Their conditions are those customary for this type of transactions
in respect of terms and market prices. In addition, these have been eliminated in consolidation and are not detailed in this note.



Maturity terms for each case vary by virtue
of the transaction giving rise to them.



As of December 31, 2013 and December 31,
2012, there are no allowances for doubtful accounts related to balances pending of transactions with related parties as there is
no impairment in them.



As of December 31, 2013 and December 31,
2012, the detail of transactions with related parties is as follows:



|Tax ID No.   |  | Company                             |  | Nature    |  | Country of origin    |  | Transaction        |  | 12/31/2013 ThUS$ |        |  | 12/31/2012 ThUS$ |  |        | 12/31/2011 ThUS$ | 
|------------ |  | ----------------------------------- |  | --------- |  | -------------------- |  | ------------------ |  | ---------------- | ------ |  | ---------------- |  | ------ | ---------------- | 
|Foreign      |  | Doktor Tarsa Tarim Sanayi As        |  | Associate |  | Turkey               |  | Sale of products   |  |                  | 13,844 |  |                  |  | 9,587  |                  | 
|Foreign      |  | Doktor Tarsa Tarim Sanayi As        |  | Associate |  | Turkey               |  | Other Transactions |  |                  | 740    |  |                  |  | -      |                  | 
|Foreign      |  | Ajay Europe S.A.R.L.                |  | Associate |  | France               |  | Sale of products   |  |                  | 35,884 |  |                  |  | 37,232 |                  | 
|Foreign      |  | Ajay Europe S.A.R.L.                |  | Associate |  | France               |  | Dividends          |  |                  | 5,093  |  |                  |  | 3,564  |                  | 
|Foreign      |  | Ajay North America LLC.             |  | Associate |  | United States        |  | Sale of products   |  |                  | 40,605 |  |                  |  | 42,081 |                  | 
|Foreign      |  | Ajay North America LLC.             |  | Associate |  | United States        |  | Dividends          |  |                  | 10,437 |  |                  |  | 10,175 |                  | 
|Foreign      |  | Abu Dhabi Fertilizer Industries WWL |  | Associate |  | United Arab Emirates |  | Sale of products   |  |                  | 7,908  |  |                  |  | 6,285  |                  | 
|Foreign      |  | Charlee SQM Thailand Co.Ltd.        |  | Associate |  | Thailand             |  | Sale of products   |  |                  | 5,669  |  |                  |  | 10,203 |                  | 
|77.557.430-5 |  | Sales de Magnesio Ltda.             |  | Associate |  | Chile                |  | Sale of products   |  |                  | 1,186  |  |                  |  | 1,472  |                  | 



F-81







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party disclosures (continued)



| | 9.4 | Detail of related parties and transactions with related parties, continued
| | --- | --------------------------------------------------------------------------



|Tax ID No.   |  | Company                                         |  | Nature                                 |  | Country of origin    |  | Transaction      |  | 12/31/2013 ThUS$ |        |  | 12/31/2012 ThUS$ |  |         | 12/31/2011 ThUS$ | 
|------------ |  | ----------------------------------------------- |  | -------------------------------------- |  | -------------------- |  | ---------------- |  | ---------------- | ------ |  | ---------------- |  | ------- | ---------------- | 
|77.557.430-5 |  | Sales de Magnesio Ltda.                         |  | Associate                              |  | Chile                |  | Dividends        |  |                  | 892    |  |                  |  | 1,052   |                  | 
|96.529.340-k |  | Norte Grande S.A.                               |  | Other related parties                  |  | Chile                |  | Sale of services |  |                  | 140    |  |                  |  | -       |                  | 
|Foreign      |  | Kowa Company Ltd.                               |  | Other related parties                  |  | Japan                |  | Sale of products |  |                  | 77,176 |  |                  |  | 123,581 |                  | 
|Foreign      |  | SQM Vitas Brasil Agroindustria                  |  | Joint control or significant influence |  | Brazil               |  | Sale of products |  |                  | 52,901 |  |                  |  | 40,518  |                  | 
|Foreign      |  | SQM Vitas Peru S.A.C.                           |  | Joint control or significant influence |  | Peru                 |  | Sale of products |  |                  | 21,255 |  |                  |  | 26,123  |                  | 
|Foreign      |  | SQM Vitas Southern Africa Pty.                  |  | Joint control or significant influence |  | South Africa         |  | Sale of products |  |                  | 17,908 |  |                  |  | 10,930  |                  | 
|Foreign      |  | SQM Vitas Fzco.                                 |  | Joint venture                          |  | United Arab Emirates |  | Sale of products |  |                  | 289    |  |                  |  | 120     |                  | 
|Foreign      |  | SQM Vitas Fzco.                                 |  | Joint venture                          |  | United Arab Emirates |  | Sale of services |  |                  | 98     |  |                  |  | -       |                  | 
|Foreign      |  | Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  | Joint venture                          |  | China                |  | Sale of products |  |                  | 56,254 |  |                  |  | -       |                  | 
|Foreign      |  | Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  | Joint venture                          |  | China                |  | Sale of services |  |                  | 282    |  |                  |  | 62      |                  | 
|Foreign      |  | Coromandel SQM                                  |  | Joint venture                          |  | India                |  | Sale of products |  |                  | 5,242  |  |                  |  | 2,300   |                  | 
|Foreign      |  | SQM Star Qingdao Crop Nutrition Co., Ltd.       |  | Joint venture                          |  | China                |  | Sale of services |  |                  | 148    |  |                  |  | -       |                  | 
|Foreign      |  | SQM Vitas Spain                                 |  | Joint venture                          |  | Spain                |  | Sale of products |  |                  | 1,624  |  |                  |  | -       |                  | 



F-82







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.5 | Trade receivables due from related parties, current:
| | --- | ----------------------------------------------------



|Tax ID No.    |  | Company                                         |  | Nature                |  | Country of origin    |  | Currency             |  |  | 12/31/2013 ThUS$ |  |        | 12/31/2012 ThUS$ | 
|------------- |  | ----------------------------------------------- |  | --------------------- |  | -------------------- |  | -------------------- |  |  | ---------------- |  | ------ | ---------------- | 
|77.557.430-5  |  | Sales de Magnesio Ltda.                         |  | Associate             |  | Chile                |  | Ch$                  |  |  |                  |  | 147    |                  | 
|Foreign       |  | Charlee SQM Thailand Co. Ltd.                   |  | Associate             |  | Thailand             |  | US$                  |  |  |                  |  | 331    |                  | 
|Foreign       |  | Doktor Tarsa Tarim Sanayi AS                    |  | Associate             |  | Turkey               |  | US$                  |  |  |                  |  | 11     |                  | 
|Foreign       |  | Ajay Europe S.A.R.L.                            |  | Associate             |  | France               |  | Euro                 |  |  |                  |  | 4,974  |                  | 
|Foreign       |  | Ajay North America LLC.                         |  | Associate             |  | United States        |  | US$                  |  |  |                  |  | 4,166  |                  | 
|Foreign       |  | Abu Dhabi Fertilizer Industries WWL             |  | Associate             |  | United Arab Emirates |  | Arab Emirates dirham |  |  |                  |  | 2,958  |                  | 
|Foreign       |  | Kowa Company Ltd.                               |  | Other related parties |  | Japan                |  | US$                  |  |  |                  |  | 22,960 |                  | 
|96.511.530-7  |  | Soc.de Inversiones Pampa Calichera              |  | Other related parties |  | Chile                |  | US$                  |  |  |                  |  | 8      |                  | 
|Foreign       |  | SQM  Star Qingdao Crop Nutrition Co., Ltd       |  | Joint venture         |  | China                |  | US$                  |  |  |                  |  | -      |                  | 
|Foreign       |  | SQM Vitas Brasil Agroindustria                  |  | Joint venture         |  | Brazil               |  | US$                  |  |  |                  |  | 18,205 |                  | 
|Foreign       |  | SQM Vitas Peru S.A.C.                           |  | Joint venture         |  | Peru                 |  | US$                  |  |  |                  |  | 17,840 |                  | 
|Foreign       |  | SQM Vitas Southern Africa PTY                   |  | Joint venture         |  | South Africa         |  | US$                  |  |  |                  |  | 4,553  |                  | 
|Foreign       |  | Coromandel SQM                                  |  | Joint venture         |  | India                |  | Indian rupee         |  |  |                  |  | 2,271  |                  | 
|Foreign       |  | Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  | Joint venture         |  | China                |  | US$                  |  |  |                  |  | 47,910 |                  | 
|79.049.778-9  |  | Callegari Agrícola S.A.                         |  | Other related parties |  | Chile                |  | Ch$                  |  |  |                  |  | 363    |                  | 
|Foreign       |  | Coromandel Internacional                        |  | Other related parties |  | India                |  | Indian rupee         |  |  |                  |  | -      |                  | 
|Foreign       |  | SQM Vitas Fzco.                                 |  | Joint venture         |  | United Arab Emirates |  | Arab Emirates dirham |  |  |                  |  | 436    |                  | 
|Foreign       |  | SQM Vitas Spain                                 |  | Joint venture         |  | Spain                |  | Euro                 |  |  |                  |  | 760    |                  | 
|Foreign       |  | SQM Vitas Plantacote B.V                        |  | Joint venture         |  | Dutch Antilles       |  | Euro                 |  |  |                  |  | 133    |                  | 
|Total to-date |  |                                                 |  | 128,026               |  |                      |  | 101,372              | 



F-83







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.6 | Trade payables due to related parties, current:
| | --- | -----------------------------------------------



|Tax ID No.          |  | Company         |  | Nature         |  | Country of origin    |  | Currency             |  |  | 12/31/2013 ThUS$ |  |   | 12/31/2012 ThUS$ | 
|------------------- |  | --------------- |  | -------------- |  | -------------------- |  | -------------------- |  |  | ---------------- |  | - | ---------------- | 
|                    |  |                 |  |                |  |                      |  |                      |  |  |                  |  |   |                  | 
|Foreign             |  | SQM Vitas Fzco. |  | Joint ventures |  | United Arab Emirates |  | Arab Emirates dirham |  |  |                  |  | - |                  | 
|Total as of to-date |  |                 |  | -              |  |                      |  | 19                   | 



F-84







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.7 | Board of Directors and Senior Management
| | --- | ----------------------------------------



| | 1) | Board of directors
| | -- | ------------------



The Company is managed by a Board of Directors
which is composed of eight regular directors who are elected for a three-year period. The present Board of Directors was elected
by the shareholders at the Ordinary Shareholders' Meeting of April 25, 2013.



As of December 31, 2013, the Company has
an Audit Committee made up of three members of the Board of Directors. This Committee performs those duties provided in Article
50 bis of Law No. 18,046 on Shareholders Company, the Shareholders’ Corporations Act.



During the periods covered by these financial
statements, there are no pending balances receivable and payable between the Company, its directors or members of Senior Management
other than those related to remuneration, fee allowances and profit-sharing. In addition, there were no transactions conducted
between the Company, its directors or members of Senior Management.



| | 2) | Directors’ Compensation
| | -- | -----------------------



| | 2.1.1 | Board of Directors
| | ----- | ------------------



Directors’ compensation is detailed
as follows:



| | a) | A payment of a monthly fixed gross amount of UF 300 in favor of the Chairman of the Company’s
Board of Directors and UF 50 in favor of the seven remaining board members regardless of their attendance at Board meetings or
the number of meetings attended during the respective month.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) | A payment in domestic currency in favor of the Chairman of the Company’s Board of Directors
consisting of a variable and gross amount equivalent to 0.35% of profit for the period effectively earned by the Company during
fiscal year 2013.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) | A payment in domestic currency in favor of each Company’s directors excluding the Chairman
of the Board, consisting of a variable and gross amount equivalent to 0.04% of profit for the period effectively earned by the
Company during fiscal years 2013.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-85









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.7 | Board of Directors and Senior Management, continued
| | --- | ---------------------------------------------------



| | d) | The fixed and variable amounts indicated above will not be subject to any charge between them,
and those expressed as a percentage will be paid immediately after the shareholders at the respective Annual General Shareholders’
Meeting of the Company approve the statement of financial position (balance sheet), the financial statements, the annual report,
the report by the account inspectors and the report of external auditors for the fiscal years ending December 31, 2013.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | e) | Therefore, the remunerations and profit sharing paid to members of the Board of Directors and Audit
Committee during 2013 amount to ThUS$4,827 (ThUS$ 3,973 as of December 31, 2012).
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



2.1.2 AuditCommittee



The remuneration of Directors Committee is composed of:



| | a) | A payment of a monthly, fixed and gross amount of UF 17 in favor of each of the three Directors
who are a part of the Company’s Audit Committee regardless of the number of meetings conducted during the respective month.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) | A payment in domestic currency and in favor of each of the three Directors of a variable and gross
amount equivalent to 0.013% of the Company’s profit for the period effectively earned by the Company during fiscal years
2013.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-86







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 9 -	Related party
disclosures (continued)



| | 9.7 | Board of Directors and Senior Management, continued
| | --- | ---------------------------------------------------



| | 3) | No guarantees have been constituted in favor of the directors.
| | -- | --------------------------------------------------------------



| | 4) | Senior management compensation
| | -- | ------------------------------



As of December 31, 2013, the
global compensation paid to the 117 main executives amounts to ThUS$24,150 (ThUS$32,888 as of December 31, 2012). This includes
monthly fixed salary and variable performance bonuses.



The Company has a bonuses intermediate
and bi-intermediate plan for compliance target and level of individual contribution to the Company’s profit or loss. These
benefits are structured in a minimum and maximum of gross remunerations which are paid once a year or every two years.



| | 5) | Additionally, the Company has retention bonuses for the Company’s executives. The amount
of these bonuses is linked to the price of the Company’s share and is payable in cash between 2012 and 2016 (See Note 16).
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6) | No guarantees have been constituted in favor of the Company’s management.
| | -- | -------------------------------------------------------------------------



| | 7) | The Company’s Managers and Directors do not receive or have not received any benefit during
the period ended December 31, 2013 and the year ended December 31, 2012 or compensation for the concept of pensions, life insurance,
paid time off, profit sharing, incentives, or benefits due to disability other than those mentioned in the preceding points.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 8) | In accordance with IAS 24, we should report that the Company's Director Mr. Wolf Von Appen B. is
member of the Ultramar Group. During the period ended December 31, 2013, the amount of operations with this Group is approximately
ThUS$16,850 (ThUS$22,577 as of December 31, 2012).
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 9.8 | Key management personnel compensation
| | --- | -------------------------------------



|                                      |  | 12/31/2013 |        |  | 12/31/2012 | 
|------------------------------------- |  | ---------- | ------ |  | ---------- | 
|                                      |  | ThUS$      |        |  | ThUS$      | 
|                                      |  |            |        |  |            | 
|Key management personnel compensation |  |            | 24,150 |  |            | 



F-87







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments



Financial assets in conformity with IAS 39 are detailed as follows:



| | 10.1 | Types of other financial assets
| | ---- | -------------------------------



|Description of other financial assets    |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|---------------------------------------- |  | ---------------- | ------- |  | ---------------- | 
|                                         |  |                  |         |  |                  | 
|Other current financial assets (1)       |  |                  | 431,883 |  |                  | 
|Derivatives (2)                          |  |                  | 3,283   |  |                  | 
|Hedging assets, current                  |  |                  | 25,007  |  |                  | 
|Total other current financial assets     |  |                  | 460,173 |  |                  | 
|                                         |  |                  |         |  |                  | 
|Other non-current financial assets       |  |                  | 95      |  |                  | 
|Hedging assets, non-current              |  |                  | -       |  |                  | 
|Total other non-current financial assets |  |                  | 95      |  |                  | 



| | (1) | Relates to term deposits with maturities exceeding 90 days and less than 360 days from the investment date.
| | --- | -----------------------------------------------------------------------------------------------------------



| | (2) | Relate to forwards and options that were not classified as hedging instruments (see detail in Note 10.3).
| | --- | ---------------------------------------------------------------------------------------------------------



Detail of other current financial assets



|Institution                    |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|------------------------------ |  | ---------------- | ------- |  | ---------------- | 
|Banco Santander                |  |                  | 131,534 |  |                  | 
|BBVA                           |  |                  | 80,206  |  |                  | 
|Banco de Crédito e Inversiones |  |                  | 79,530  |  |                  | 
|Banco de Chile                 |  |                  | 42,095  |  |                  | 
|Corpbanca                      |  |                  | 61,244  |  |                  | 
|Banco Scotiabank               |  |                  | -       |  |                  | 
|Banco Itaú                     |  |                  | 30,207  |  |                  | 
|Banco Security                 |  |                  | 7,067   |  |                  | 
|Total                          |  |                  | 431,883 |  |                  | 



| | 10.2 | Trade and other receivables, current and non-current
| | ---- | ----------------------------------------------------



|                                  |  | 12/31/2013 |         |  | 12/31/2012   | 
|--------------------------------- |  | ---------- | ------- |  | ------------ | 
|                                  |  | Current    |         |  | Non- current | 
|                                  |  | ThUS$      |         |  | ThUS$        | 
|                                  |  |            |         |  |              | 
|Trade receivables                 |  |            | 314,151 |  |              | 
|Prepayments                       |  |            | 12,127  |  |              | 
|Other receivables                 |  |            | 4,714   |  |              | 
|Total trade and other receivables |  |            | 330,992 |  |              | 



F-88







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments, (continued)



| | 10.2 | Trade and other receivables, continued
| | ---- | --------------------------------------



|                                                  |  | 12/31/2013               |         |  | 12/31/2012                               | 
|------------------------------------------------- |  | ------------------------ | ------- |  | ---------------------------------------- | 
|                                                  |  | Assets before allowances |         |  | Allowance for doubtful trade receivables | 
|                                                  |  | ThUS$                    |         |  | ThUS$                                    | 
|Receivables related to credit operations, current |  |                          | 330,052 |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Trade receivables, current                        |  |                          | 330,052 |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Prepayments, current                              |  |                          | 14,927  |  |                                          | 
|Other receivables, current                        |  |                          | 6,663   |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Current trade and other receivables               |  |                          | 351,642 |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Other receivables, non-current                    |  |                          | 1,282   |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Non-current receivables                           |  |                          | 1,282   |  |                                          | 
|                                                  |  |                          |         |  |                                          | 
|Total trade and other receivables                 |  |                          | 352,924 |  |                                          | 



F-89







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



| | 10.2 | Trade and other receivables, continued
| | ---- | --------------------------------------



Portfolio stratification, continued



The Company’s policy is to require
guarantees (such as letters of credit, guarantee clauses and others) and/or maintaining insurance policies for certain accounts
as deemed necessary by management.



Unsecuritized portfolio



As of December 31, 2013 and December 31, 2012, the detail of
the unsecuritized portfolio is as follows:



|12/31/2013                                                    
|--------------------------------------------------------------
|                                                              
|                                                              
|Number of customers, portfolio under no renegotiated
    terms
|Portfolio under no renegotiated terms                         
|Number of customers under renegotiated terms portfolio        
|                                                              
|Portfolio under renegotiated terms, gross                     
|                                                              
|Total gross portfolio                                         



|12/31/2012                                                    
|--------------------------------------------------------------
|                                                              
|                                                              
|Number of customers, portfolio under no renegotiated
    terms
|Portfolio under no renegotiated terms                         
|Number of customers under renegotiated terms portfolio        
|                                                              
|Portfolio under renegotiated
    terms, gross                 
|                                                              
|Total gross portfolio                                         



F-90







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments, (continued)



| | 10.2 | Trade and other receivables, continued
| | ---- | --------------------------------------



Movement in the allowances is as follows:



|Allowance and write-offs                        |  | 12/31/2013 |        |   | 12/31/2012 |  |        | 12/31/2011 | 
|----------------------------------------------- |  | ---------- | ------ | - | ---------- |  | ------ | ---------- | 
|                                                |  | ThUS$      |        |   | ThUS$      |  |        | ThUS$      | 
|                                                |  |            |        |   |            |  |        |            | 
|Balance at January 1                            |  |            | 18,793 |   |            |  | 18,673 |            | 
|Provisions for impairment and other adjustments |  |            | 2,377  |   |            |  | 1,518  |            | 
|Write-offs for the period                       |  |            | (520   | ) |            |  | (1,398 | )          | 
|Balance as of December 31                       |  |            | 20,650 |   |            |  | 18,793 |            | 



| | a) | Credit risk concentration
| | -- | -------------------------



Credit risk concentrations with respect
to trade receivables are reduced due to the great number of entities included in the Company’s client database and their
distribution throughout the world.



F-91







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



| | 10.3 | Hedging assets and liabilities
| | ---- | ------------------------------



The balance represents derivative instruments
measured at fair value which have been classified as hedges from exchange and interest rate risks related to the total obligations
relating to bonds of the Company in Chilean pesos and UF (and the exchange risk in Chilean pesos of the Company’s investment
plans). As of December 31, 2013, the face value of cash flows in Cross Currency Swap contracts agreed upon in US dollars amounted
to ThUS$555,303 as of December 31, 2012 such contracts amounted to ThUS$515,156, and as of December 31, 2011, such contracrs amounted
to thUS$405,486.



|Hedging assets    |  | Derivative instruments (CCS) |         |  | Effect on profit or loss for the period Derivative instruments |  |         | Hedging reserve in gross equity |  |  | Deferred tax hedging reserve in equity |   |  | Hedging reserve in equity |      
|----------------- |  | ---------------------------- | ------- |  | -------------------------------------------------------------- |  | ------- | ------------------------------- |  |  | -------------------------------------- | - |  | ------------------------- | -----
|                  |  | ThUS$                        |         |  | ThUS$                                                          |  |         | ThUS$                           |  |  | ThUS$                                  |   |  | ThUS$                     |      
|                  |  |                              |         |  |                                                                |  |         |                                 |  |  |                                        |   |  |                           |      
|December 31, 2013 |  |                              | 23,602  |  |                                                                |  | (45,312 | )                               |  |  | (3,307                                 | ) |  |                           | 661  
|                  |  |                              |         |  |                                                                |  |         |                                 |  |  |                                        |   |  |                           |      
|December 31, 2012 |  |                              | 100,647 |  |                                                                |  | 49,853  |                                 |  |  | (18,419                                | ) |  |                           | 3,684
|                  |  |                              |         |  |                                                                |  |         |                                 |  |  |                                        |   |  |                           |      
|December 31, 2011 |  |                              | 56,108  |  |                                                                |  | (39,718 | )                               |  |  | (12,184                                | ) |  |                           | 2,104



|Hedging liabilities |  | Derivative instruments (IRS) |       |  | Effect on profit or loss for the period Derivative instruments |  |      | Hedging reserve in gross equity |  |  | Deferred tax hedging reserve in equity |   |  | Hedging reserve in equity |  
|------------------- |  | ---------------------------- | ----- |  | -------------------------------------------------------------- |  | ---- | ------------------------------- |  |  | -------------------------------------- | - |  | ------------------------- | -
|                    |  | ThUS$                        |       |  | ThUS$                                                          |  |      | ThUS$                           |  |  | ThUS$                                  |   |  | ThUS$                     |  
|                    |  |                              |       |  |                                                                |  |      |                                 |  |  |                                        |   |  |                           |  
|December 31, 2013   |  |                              | 1,339 |  |                                                                |  | (93  | )                               |  |  | (1,153                                 | ) |  |                           | -
|                    |  |                              |       |  |                                                                |  |      |                                 |  |  |                                        |   |  |                           |  
|December 31, 2012   |  |                              | 1,879 |  |                                                                |  | 27   |                                 |  |  | (1,786                                 | ) |  |                           | -
|                    |  |                              |       |  |                                                                |  |      |                                 |  |  |                                        |   |  |                           |  
|December 31, 2011   |  |                              | 270   |  |                                                                |  | (120 | )                               |  |  | (150                                   | ) |  |                           | -



The balances in the effect on profit or
loss column consider the interim effects of the contracts in force as of December 31, 2013, 2012 and 2011.



F-92







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.3 | Hedging assets and liabilities, continued
| | ---- | -----------------------------------------



Derivative contract maturities are detailed
as follows:



|Series |  | Contract amount |         |  | Currency |              | Maturity date
|------ |  | --------------- | ------- |  | -------- | ------------ | -------------
|       |  |                 | ThUS$   |  |          |              |              
|C      |  |                 | 66,710  |  |          | UF           |              
|G      |  |                 | 33,673  |  |          | Chilean peso |              
|H      |  |                 | 191,638 |  |          | UF           |              
|I      |  |                 | 56,041  |  |          | UF           |              
|J      |  |                 | 92,440  |  |          | Chilean peso |              
|M      |  |                 | 46,463  |  |          | UF           |              
|O      |  |                 | 68,338  |  |          | UF           |              



The Company uses cross currency swap derivative
instruments to hedge the possible financial risk associated with the volatility of the exchange rate associated with Chilean pesos
and UF. The objective is to hedge against the exchange rate financial risks associated with bonds payable. Hedges are documented
and tested to measure their effectiveness.



Based on a comparison of critical terms,
hedging is highly effective, given that the hedged amount is consistent with obligations maintained for bonds denominated in Chilean
pesos and UF. Likewise, hedging contracts are denominated in the same currencies and have the same expiration dates of bond principal
and interest payments.



Hedge Accounting



The Company classifies derivative instruments
as hedging that may include derivative or embedded derivatives either as fair value hedge derivative instruments, cash flow hedge
derivative instruments, or hedge derivative instruments for net investment in a business abroad.



a) Fair value hedge



Changes in fair values of derivative instruments
classified as fair value hedge derivative instruments are accounted for in gains and losses immediately along with any change in
the fair value of the hedged item that is attributable to the risk being hedged.



The Company documents the relationship
between hedge instruments and the hedged item along with the objectives of its risk management and strategy to carry out different
hedging transactions. In addition, upon commencement of the period hedged and then on a quarterly basis the Company documents whether
hedge instruments have been efficient and met the objective of hedging market fluctuations for the purpose of which we use the
effectiveness test. A hedge instrument is deemed effective if the effectiveness test result is between 80% to 120%.



The hedge instruments are classified as
effective or not effective on the basis of the effectiveness test results. To date, hedges are classified as effective on the basis
of the effectiveness tests. This note includes the detail of fair values of derivatives classified as hedging instruments.



F-93







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.3 | Hedging assets and liabilities, continued
| | ---- | -----------------------------------------



b) Cash flow hedges



Cash flow hedges cover exposure to the
cash flow variations attributable to a risk associated with a specific transaction that is very likely to be executed, that may
have material effects on the results of the Company.



| | 10.4 | Financial liabilities
| | ---- | ---------------------



Other current and non-current financial liabilities



As of December 31, 2013 and
December 31, 2012, the detail is as follows:



|                            |  | 12/31/2013 |         |  | 12/31/2012   | 
|--------------------------- |  | ---------- | ------- |  | ------------ | 
|                            |  | Current    |         |  | Non- current | 
|                            |  | ThUS$      |         |  | ThUS$        | 
|Bank borrowings             |  |            | 171,347 |  |              | 
|Obligations with the public |  |            | 227,652 |  |              | 
|Derivatives                 |  |            | 1,088   |  |              | 
|Hedging liabilities         |  |            | 1,339   |  |              | 
|Total                       |  |            | 401,426 |  |              | 



Current and non-current borrowings



As of December 31, 2013 and December 31, 2012, the detail is
as follows:



|                                                             |  | 12/31/2013 |         |  | 12/31/2012 | 
|------------------------------------------------------------ |  | ---------- | ------- |  | ---------- | 
|                                                             |  | ThUS$      |         |  | ThUS$      | 
|                                                             |  |            |         |  |            | 
|Long-term borrowings                                         |  |            | 309,489 |  |            | 
|                                                             |  |            |         |  |            | 
|Short-term borrowings                                        |  |            | 100,135 |  |            | 
|Current portion of long-term borrowings                      |  |            | 71,212  |  |            | 
|Short-term loans and current portion of long-term borrowings |  |            | 171,347 |  |            | 
|Total borrowings assumed                                     |  |            | 480,836 |  |            | 



F-94









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



| | a) | Bank loans, current:
| | -- | --------------------



As of December 31, 2013 and December 31, 2012, the
detail of this caption is as follows:



|Debtor          |  | Creditor                              |  |         |  |              |  |                                                       |  |                |  |                              |  | 12/31/2013 Current maturities |       
|--------------- |  | ------------------------------------- |  | ------- |  | ------------ |  | ----------------------------------------------------- |  | -------------- |  | ---------------------------- |  | ----------------------------- | ------
|Tax ID No.      |  | Subsidiary                            |  | Country |  | Tax ID No.   |  | Financial institution                                 |  | Country        |  | Currency or adjustment index |  | Repayment                     |       
|93.007.000-9    |  | SQM.S.A.                              |  | Chile   |  | 97.018.000-1 |  | Scotiabank Sud Americano                              |  | Chile          |  | US$                          |  | Upon maturity                 |       
|93.007.000-9    |  | SQM.S.A.                              |  | Chile   |  | 97.018.000-1 |  | Scotiabank Sud Americano                              |  | Chile          |  | US$                          |  | Upon maturity                 |       
|93.007.000-9    |  | SQM S.A.                              |  | Chile   |  | Foreign      |  | Banco Estado NY Branch                                |  | United States  |  | US$                          |  | Upon maturity                 |       
|79.626.800-K    |  | SQM Salar S.A.                        |  | Chile   |  | 97.030.000-7 |  | Banco Estado                                          |  | Chile          |  | US$                          |  | Upon maturity                 |       
|79.626.800-K    |  | SQM Salar S.A.                        |  | Chile   |  | 97.018.000-1 |  | Scotiabank Sud Americano                              |  | Chile          |  | US$                          |  | Upon maturity                 |       
|79.947.100-0    |  | SQM Industrial S.A.                   |  | Chile   |  | 97.030.000-7 |  | Banco Estado                                          |  | Chile          |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Bank of America                                       |  | United States  |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Export Development Canada                             |  | Canada         |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Scotiabank & Trust (Cayman) Ltd.                      |  | Cayman Islands |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Scotiabank & Trust (Cayman) Ltd.                      |  | Cayman Islands |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | The Bank of Tokyo-Mitsubishi UFJ, Lda. (New
    York) |  | United States  |  | US$                          |  | Upon maturity                 |       
|                |  |                                       |  |         |  |              |  |                                                       |  |                |  |                              |  |                               |       
|Borrowing costs |  |                                       |  |         |  |              |  |                                                       |  |                |  |                              |  |                               | (26   
|Total           |  |                                       |  |         |  |              |  |                                                       |  |                |  |                              |  |                               | 21,229



F-95







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



|Debtor          |  | Creditor                              |  |         |  |              |  |                                                   |  |                |  |                              |  | 12/31/2012 Current maturities |       
|--------------- |  | ------------------------------------- |  | ------- |  | ------------ |  | ------------------------------------------------- |  | -------------- |  | ---------------------------- |  | ----------------------------- | ------
|Tax ID No.      |  | Subsidiary                            |  | Country |  | Tax ID No.   |  | Financial institution                             |  | Country        |  | Currency or adjustment index |  | Repayment                     |       
|93.007.000-9    |  | SQM.S.A.                              |  | Chile   |  | 97.030.000-7 |  | Banco Estado                                      |  | Chile          |  | US$                          |  | Upon maturity                 |       
|93.007.000-9    |  | SQM.S.A.                              |  | Chile   |  | 97.030.000-7 |  | Banco Estado                                      |  | Chile          |  | US$                          |  | Upon maturity                 |       
|93.007.000-9    |  | SQM S.A.                              |  | Chile   |  | Foreign      |  | Banco Estado NY Branch                            |  | United States  |  | US$                          |  | Upon maturity                 |       
|79.626.800-K    |  | SQM Salar S.A.                        |  | Chile   |  | 97.032.000-8 |  | Banco BBVA Chile                                  |  | Chile          |  | US$                          |  | Upon maturity                 |       
|79.626.800-K    |  | SQM Salar S.A.                        |  | Chile   |  | 97.018.000-1 |  | Scotiabank Sud Americano                          |  | Chile          |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Bank of America                                   |  | United States  |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Export Development Canada                         |  | Canada         |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Scotiabank & Trust (Cayman) Ltd.                  |  | Cayman Islands |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | Scotiabank & Trust (Cayman) Ltd.                  |  | Cayman Islands |  | US$                          |  | Upon maturity                 |       
|Foreign         |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign      |  | The Bank of Tokyo-Mitsubishi UFJ, Lda. (New York) |  | United States  |  | US$                          |  | Upon maturity                 |       
|79.947.100-0    |  | SQM Industrial S.A.                   |  | Chile   |  | 97.030.000-7 |  | Banco Estado                                      |  | Chile          |  | US$                          |  | Upon maturity                 |       
|79.947.100-0    |  | SQM Industrial S.A.                   |  | Chile   |  | 97.018.000-1 |  | Scotiabank Sud Americano                          |  | Chile          |  | US$                          |  | Upon maturity                 |       
|Total           |  |                                       |  |         |  |              |  |                                                   |  |                |  |                              |  |                               | 41,454
|Borrowing costs |  |                                       |  |         |  |              |  |                                                   |  |                |  |                              |  |                               | (26   
|Total           |  |                                       |  |         |  |              |  |                                                   |  |                |  |                              |  |                               | 41,428



F-96







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



| | b) | Unsecured obligations, current:
| | -- | -------------------------------



As of December 31, 2013 and December 31,
2012, the detail of current unsecured interest-bearing obligations is composed of promissory notes and bonds, as follows:



Bonds



|Debtor       |  |            |  |         |  |                                                    |                                                              |  |        |              | Periodicity   |            |                              |     |                     |  |            |           | 12/31/2013 Current maturities |               
|------------ |  | ---------- |  | ------- |  | -------------------------------------------------- | ------------------------------------------------------------ |  | ------ | ------------ | ------------- | ---------- | ---------------------------- | --- | ------------------- |  | ---------- | --------- | ----------------------------- | --------------
|Tax ID No.   |  | Subsidiary |  | Country |  | Number of registration or
    ID of the instrument |                                                              |  | Series |              | Maturity date |            | Currency or adjustment index |     | Payment of interest |  |            | Repayment |                               | Effective rate
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | -                                                            |  |        | ThUS$200,000 |               | 04/15/2014 |                              | US$ |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | -                                                            |  |        | ThUS$250,000 |               | 04/21/2014 |                              | US$ |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | -                                                            |  |        | ThUS$300,000 |               | 04/03/2014 |                              | US$ |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 446                                                          |  |        | C            |               | 06/01/2014 |                              | UF  |                     |  | Semiannual |           |                               | Semiannual    
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                                                          |  |        | G            |               | 01/05/2014 |                              | $   |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 564                                                          |  |        | H            |               | 01/05/2014 |                              | UF  |                     |  | Semiannual |           |                               | Semiannual    
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                                                          |  |        | I            |               | 04/01/2014 |                              | UF  |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                                                          |  |        | J            |               | 04/01/2014 |                              | $   |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 700                                                          |  |        | M            |               | 02/01/2014 |                              | UF  |                     |  | Semiannual |           |                               | Upon maturity 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 699                                                          |  |        | O            |               | 02/01/2014 |                              | UF  |                     |  | Semiannual |           |                               | Upon maturity 
|             |  |            |  |         |  |                                                    | Total                                                        |  |        |              |               |            |                              |     |                     |  |            |           |                               |               
|             |  |            |  |         |  |                                                    | Bond
                                         issuance costs |  |        |              |               |            |                              |     |                     |  |            |           |                               |               
|             |  |            |  |         |  |                                                    | Total                                                        |  |        |              |               |            |                              |     |                     |  |            |           |                               |               



Effective rates of bonds in Chilean pesos and UF are expressed
and calculated in U.S. dollars based on the flows agreed in Cross Currency Swap Agreements.



F-97









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



10.4	Financial liabilities, continued



|Debtor       |  |            |  |         |  |                                                    |                     |  |        |              | Periodicity                         |           |                              |     |                     |  |            |           | 12/31/2013 Current maturities |                
|------------ |  | ---------- |  | ------- |  | -------------------------------------------------- | ------------------- |  | ------ | ------------ | ----------------------------------- | --------- | ---------------------------- | --- | ------------------- |  | ---------- | --------- | ----------------------------- | ---------------
|Tax ID No.   |  | Subsidiary |  | Country |  | Number of registration or
    ID of the instrument |                     |  | Series |              | Maturity date 
Payment of 
interest |           | Currency or adjustment index |     | Payment of interest |  |            | Repayment |                               | Effective rate 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | -                   |  |        | ThUS$200,000 |                                     | 4/15/2013 |                              | US$ |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | -                   |  |        | ThUS$250,000 |                                     | 4/21/2013 |                              | US$ |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 446                 |  |        | C            |                                     | 6/1/2013  |                              | UF  |                     |  | Semiannual |           |                               | Semiannual     
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                 |  |        | G            |                                     | 7/5/2013  |                              | Ch$ |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 564                 |  |        | H            |                                     | 7/5/2013  |                              | UF  |                     |  | Semiannual |           |                               | Semiannual     
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                 |  |        | I            |                                     | 4/1/2013  |                              | UF  |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 563                 |  |        | J            |                                     | 4/1/2013  |                              | Ch$ |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 700                 |  |        | M            |                                     | 8/1/2013  |                              | UF  |                     |  | Semiannual |           |                               | Upon expiration
|93.007.000-9 |  | SQM S.A    |  | Chile   |  |                                                    | 699                 |  |        | O            |                                     | 8/1/2013  |                              | UF  |                     |  | Semiannual |           |                               | Upon expiration
|             |  |            |  |         |  |                                                    | Total               |  |        |              |                                     |           |                              |     |                     |  |            |           |                               |                
|             |  |            |  |         |  |                                                    | Bond issuance costs |  |        |              |                                     |           |                              |     |                     |  |            |           |                               |                
|             |  |            |  |         |  |                                                    | Total               |  |        |              |                                     |           |                              |     |                     |  |            |           |                               |                



F-98







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



| | c) | Types of interest-bearing borrowings, non-current
| | -- | -------------------------------------------------



Non-current interest-bearing borrowings
as of December 31, 2013 and December 31, 2012 are detailed as follows:



|Debtor       |  | Creditor                              |  |         |  |            |  |                                                      |  |                |  |                              |  | 12/31/2013 Years to maturity |      |                |      |  
|------------ |  | ------------------------------------- |  | ------- |  | ---------- |  | ---------------------------------------------------- |  | -------------- |  | ---------------------------- |  | ---------------------------- | ---- | -------------- | ---- | -
|Tax ID No.   |  | Subsidiary                            |  | Country |  | Tax ID No. |  | Financial institution                                |  | Country        |  | Currency or adjustment index |  | Repayment                    |      | Effective rate |      |  
|             |  |                                       |  |         |  |            |  |                                                      |  |                |  |                              |  |                              |      |                |      |  
|93.007.000-9 |  | SQM S.A.                              |  | Chile   |  | Foreign    |  | Banco Estado NY Branch                               |  | United States  |  | US$                          |  | Upon maturity                |      |                | 3.10 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Scotiabank & Trust (Cayman) Ltd.                     |  | Cayman Islands |  | US$                          |  | Upon maturity                |      |                | 1.35 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Bank of America                                      |  | United States  |  | US$                          |  | Upon maturity                |      |                | 1.75 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Export Development Canada                            |  | Canada         |  | US$                          |  | Upon maturity                |      |                | 1.69 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | The Bank of Tokyo-Mitsubishi
    UFJ, Ltd (New York) |  | United States  |  | US$                          |  | Upon maturity                |      |                | 1.37 | %
|Total        |  |                                       |  |         |  |            |  |                                                      |  |                |  |                              |  |                              |      |                |      |  
|             |  | Borrowings costs                      |  |         |  |            |  |                                                      |  |                |  |                              |  |                              | (441 | )              |      |  
|Total        |  |                                       |  |         |  |            |  |                                                      |  |                |  |                              |  |                              |      |                |      |  



|Debtor       |  | Creditor                              |  |         |  |            |  |                                                      |  |                |  |                              |  | 12/31/2012 Years to maturity |      |                |      |  
|------------ |  | ------------------------------------- |  | ------- |  | ---------- |  | ---------------------------------------------------- |  | -------------- |  | ---------------------------- |  | ---------------------------- | ---- | -------------- | ---- | -
|Tax ID No.   |  | Subsidiary                            |  | Country |  | Tax ID No. |  | Financial institution                                |  | Country        |  | Currency or adjustment index |  | Repayment                    |      | Effective rate |      |  
|93.007.000-9 |  | SQM S.A.                              |  | Chile   |  | Foreign    |  | Banco Estado NY Branch                               |  | United States  |  | US$                          |  | Upon maturity                |      |                | 3.01 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Scotiabank & Trust (Cayman) Ltd.                     |  | Cayman Islands |  | US$                          |  | Upon maturity                |      |                | 1.60 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Scotiabank & Trust (Cayman) Ltd.                     |  | Cayman Islands |  | US$                          |  | Upon maturity                |      |                | 1.92 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Bank of America                                      |  | United States  |  | US$                          |  | Upon maturity                |      |                | 1.83 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | Export Development Canada                            |  | Canada         |  | US$                          |  | Upon maturity                |      |                | 1.81 | %
|Foreign      |  | Royal Seed Trading Corporation A.V.V. |  | Aruba   |  | Foreign    |  | The Bank of Tokyo-Mitsubishi UFJ, Ltd (New
    York) |  | United States  |  | US$                          |  | Upon maturity                |      |                | 1.49 | %
|Total        |  |                                       |  |         |  |            |  |                                                      |  |                |  |                              |  |                              |      |                |      |  
|             |  | Borrowings
    costs                  |  |         |  |            |  |                                                      |  |                |  |                              |  |                              | (235 | )              |      |  
|Total        |  |                                       |  |         |  |            |  |                                                      |  |                |  |                              |  |                              |      |                |      |  



F-99







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 – Financial
instruments (continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



| | d) | Non-current unsecured interest-bearing bonds
| | -- | --------------------------------------------



The breakdown of non-current unsecured
interest-bearing bonds as of December 31, 2013 and December 31, 2012 is detailed as follows:



|Debtor       |  |            |  |         |  |                                                    |  |              |  | Periodicity   |  |                              |   |                     |  |               |   |                |      |         | 12/31/2013 Current maturities | 
|------------ |  | ---------- |  | ------- |  | -------------------------------------------------- |  | ------------ |  | ------------- |  | ---------------------------- | - | ------------------- |  | ------------- | - | -------------- | ---- | ------- | ----------------------------- | 
|Tax ID No.   |  | Subsidiary |  | Country |  | Number of registration or ID
    of the instrument |  | Series       |  | Maturity date |  | Currency or adjustment index |   | Payment of interest |  | Repayment     |   | Effective rate |      |         | Nominal rate                  | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | -                                                  |  | ThUS$200,000 |  | 04/15/2016    |  | US$                          |   | Semiannual          |  | Upon maturity |   |                | 6.32 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | -                                                  |  | ThUS$250,000 |  | 04/21/2020    |  | US$                          |   | Semiannual          |  | Upon maturity |   |                | 5.70 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | -                                                  |  | ThUS$300,000 |  | 04/03/2023    |  | US$                          |   | Semiannual          |  | Upon maturity |   |                | 3.87 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 446                                                |  | C            |  | 12/01/2026    |  | UF                           |   | Semiannual          |  | Semiannual    |   |                | 4.44 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 564                                                |  | H            |  | 01/05/2030    |  | UF                           |   | Semiannual          |  | Semiannual    |   |                | 5.10 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 700                                                |  | M            |  | 02/01/2017    |  | UF                           |   | Semiannual          |  | Upon maturity |   |                | 3.62 | %       |                               | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 699                                                |  | O            |  | 02/01/2033    |  | UF                           |   | Semiannual          |  | Upon maturity |   |                | 3.95 | %       |                               | 
|             |  |            |  |         |  | Total                                              |  |              |  |               |  | 213,328                      |   |                     |  | 57,760        |   |                |      | 847,699 |                               | 
|             |  |            |  |         |  | Bond issuance costs                                |  |              |  |               |  | (737                         | ) |                     |  | (593          | ) |                |      | (10,961 | )                             | 
|             |  |            |  |         |  | Total                                              |  |              |  |               |  | 212,591                      |   |                     |  | 57,167        |   |                |      | 836,738 |                               | 



|Debtor       |  |            |  |         |  |                                                    |  |              |         | Periodicity   |  |                              |         |                     |            |  |           |               |                |  |           | 12/31/2013 Current maturities | 
|------------ |  | ---------- |  | ------- |  | -------------------------------------------------- |  | ------------ | ------- | ------------- |  | ---------------------------- | ------- | ------------------- | ---------- |  | --------- | ------------- | -------------- |  | --------- | ----------------------------- | 
|Tax ID No.   |  | Subsidiary |  | Country |  | Number of registration or ID
    of the instrument |  | Series       |         | Maturity date |  | Currency or adjustment index |         | Payment of interest |            |  | Repayment |               | Effective rate |  |           | Nominal rate                  | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | -                                                  |  | ThUS$200,000 |         | 04/15/2016    |  | US$                          |         |                     | Semiannual |  |           | Upon maturity |                |  | 6.32      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | -                                                  |  | ThUS$250,000 |         | 04/21/2020    |  | US$                          |         |                     | Semiannual |  |           | Upon maturity |                |  | 5.70      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 446                                                |  | C            |         | 12/01/2026    |  | UF                           |         |                     | Semiannual |  |           | Semiannual    |                |  | 4.44      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 564                                                |  | H            |         | 01/05/2030    |  | UF                           |         |                     | Semiannual |  |           | Semiannual    |                |  | 7.5       | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 563                                                |  | G            |         | 01/05/2014    |  | Ch$                          |         |                     | Semiannual |  |           | Upon maturity |                |  | 5.10      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 563                                                |  | I            |         | 04/01/2014    |  | UF                           |         |                     | Semiannual |  |           | Upon maturity |                |  | 3.35      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 563                                                |  | J            |         | 04/01/2014    |  | Ch$                          |         |                     | Semiannual |  |           | Upon maturity |                |  | 6.23      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 700                                                |  | M            |         | 02/01/2017    |  | UF                           |         |                     | Semiannual |  |           | Upon maturity |                |  | 3.62      | %                             | 
|93.007.000-9 |  | SQM S.A    |  | Chile   |  | 699                                                |  | O            |         | 02/01/2033    |  | UF                           |         |                     | Semiannual |  |           | Upon maturity |                |  | 3.95      | %                             | 
|             |  |            |  |         |  | Total                                              |  |              | 237,812 |               |  |                              | 261,880 |                     |            |  | 576,061   |               |                |  | 1,075,753 |                              
|             |  |            |  |         |  | Bond issuance costs                                |  |              | (631    | )             |  |                              | (1,420  | )                   |            |  | (6,627    | )             |                |  | (8,678    | )                            
|             |  |            |  |         |  | Total                                              |  |              | 237,181 |               |  |                              | 260,460 |                     |            |  | 569,434   |               |                |  | 1,067,075 |                              



F-100







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



| | e) | Additional information
| | -- | ----------------------



Bonds



On the 31th of December 2013 and the 31st
of December 2012, short term bonds of MUS$ 227,652 and MUS$ 20,135 respectively were classified as short-term, consisting of the
current portion due plus accrued interest to date, excluding bond issue costs. The non-current portion consisted of MUS$1,106,496
on the 31th December 2013 and MUS$1,067,075 on the 31st December 2012, corresponding to the issuance of series
C bonds, Single series bonds (ThUS$ 200), series G bonds, series H bonds, series I bonds, series J bonds, second issue single series
bonds (ThUS$ 250), series M bonds, series O bonds and third issue single series bonds (ThUS$ 300), excluding debt issue costs.



As of December 31, 2013 and December 31,
2012, the details of each issuance are as follows



Series “C” bonds



On January 24, 2006, the Company placed
Series C bonds for UF 3,000,000 (ThUS$101,918) at an annual rate of 4.00%.



As of December 31, 2013 and December 31,
2012, and December 31 2011, the Company has made the following payments towards the Series C bonds:



|Payments made    |  | 12/31/2013 |       |  | 12/31/2012 |  |       | 12/31/2011 | 
|---------------- |  | ---------- | ----- |  | ---------- |  | ----- | ---------- | 
|                 |  | ThUS$      |       |  | ThUS$      |  |       | ThUS$      | 
|Principal        |  |            | 6,780 |  |            |  | 6,858 |            | 
|Interest payment |  |            | 3,694 |  |            |  | 4,004 |            | 



Single series first issue ThUS$200,000



On April 5, 2006, the Company issued Single
Series bonds for ThUS$200,000 at an annual rate of 6.125% under "Rule 144 and regulation S of the U.S. Securities Act of 1933."



As of December 31, 2013 and December 31,
2012, and December 31 2011, the Company has made the following payments with a charge to the Single Series bonds:



|Payments made        |  | 12/31/2013 |        |  | 12/31/2012 |  |        | 12/31/2011 | 
|-------------------- |  | ---------- | ------ |  | ---------- |  | ------ | ---------- | 
|                     |  | ThUS$      |        |  | ThUS$      |  |        | ThUS$      | 
|Payments of interest |  |            | 12,250 |  |            |  | 12,250 |            | 



F-101







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



Series “G” and “H”
bonds



On January, 13, 2009, the Company placed
two bond series in the domestic market. Series H for UF 4,000,000 (ThUS$139,216) at an annual interest rate of 4.9% at a term of
21 years with payment of principal beginning in 2019 and Series G for ThCh$ 21,000,000 (ThUS$34,146), which was issued at a term
of 5 years with a single payment at the maturity of the term and an annual interest rate of 7%.



As of December 31, 2013 and December 31,
2012, and December 31 2011, the Company has made the following payments on the Series G and H bonds:



|Payments made                        |  | 12/31/2013 |       |  | 12/31/2012 |  |       | 12/31/2011 | 
|------------------------------------ |  | ---------- | ----- |  | ---------- |  | ----- | ---------- | 
|                                     |  | ThUS$      |       |  | ThUS$      |  |       | ThUS$      | 
|Payments of interest, Series G bonds |  |            | 2,962 |  |            |  | 2,845 |            | 
|Payments of interest, Series H bonds |  |            | 9,062 |  |            |  | 8,565 |            | 



Series “J” and “I” bonds



On May 8, 2009, the Company placed two
bond series in the domestic market. Series J for ThCh$52,000,000 (ThUS$92,456) which was issued at a term of 5 years with single
payment at the expiration date of the term and annual interest rate of 5.5% and Series I for UF 1,500,000 (ThUS$56,051) which was
issued at a term of 5 years with single payment at the maturity of the term and annual interest rate of 3.00%.



As of December 31, 2013 and December 31,
2012, and December 31 2011, the Company has made the following payments with on the Series J and I bonds:



|Payments made                       |  | 12/31/2013 |       |  | 12/31/2012 |  |       | 12/31/2011 | 
|----------------------------------- |  | ---------- | ----- |  | ---------- |  | ----- | ---------- | 
|                                    |  | ThUS$      |       |  | ThUS$      |  |       | ThUS$      | 
|Payment of interest, Series J bonds |  |            | 5,790 |  |            |  | 5,879 |            | 
|Payment of interest, Series I bonds |  |            | 2,106 |  |            |  | 2,100 |            | 



F-102







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.4 | Financial liabilities, continued
| | ---- | --------------------------------



Single series bonds, second issue ThUS$250,000



On April 21, 2010, the Company informed
the Chilean Superintendence of Securities and Insurance of its placement in international markets of an unsecured bond of ThUS$250,000
with a maturity of 10 years beginning on the aforementioned date with an annual interest rate of 5.5% for the purpose of refinancing
long-term liabilities.



As of December 31, 2013 and December 31,
2012 the detail of payments charged to the line of single series bond, second issue is as follows:



|Payments made    |  | 12/31/2013 |        |  | 12/31/2012 |  |        | 12/31/2011 | 
|---------------- |  | ---------- | ------ |  | ---------- |  | ------ | ---------- | 
|                 |  | ThUS$      |        |  | ThUS$      |  |        | ThUS$      | 
|Interest payment |  |            | 13,750 |  |            |  | 13,750 |            | 



Series “M” and “O” bonds



In April 2012, the Company issued two bond
series in the domestic market. Series M for UF 1,000,000 (ThUS$46,601) was issued at a term of 5 years with a single payment at
the maturity of the term and an annual interest rate of 3.3%, and Series O for UF 1,500,000 (ThUS$69,901) was issued at a term
of 21 years with a single payment at the maturity of the term and an annual interest rate of 3.80%



As of December 31, 2013, and December 31,
2012 the Company has made the following payments with a charge to the Series M and O bonds:



|Payments made                       |  | 12/31/2013 |       |  | 12/31/2012 | 
|----------------------------------- |  | ---------- | ----- |  | ---------- | 
|                                    |  | ThUS$      |       |  | ThUS$      | 
|Payment of interest, Series M bonds |  |            | 1,522 |  |            | 
|Payment of interest, Series O bonds |  |            | 2,626 |  |            | 



Single series bonds, third issue ThUS$300,000

On April 3, 2013, the Company issued in the United States a
non-guaranteed bond with a value of US$ 300 million. The bond is for a 10 year term with an annual coupon rate of 3.625% and an
annual yield of 3.716%. This rate equates to a difference of 180 basis points to comparable US Treasury bonds. The funds raised
will be used to refinance long term liabilities and finance general corporate objectives.



|Payments made       |  | 12/31/2013 |       |  | 12/31/2012 | 
|------------------- |  | ---------- | ----- |  | ---------- | 
|                    |  | ThUS$      |       |  | ThUS$      | 
|Payment of interest |  |            | 5,438 |  |            | 



F-103







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.5 | Trade and other payables
| | ---- | ------------------------



|                       |  | 12/31/2013 |         |  | 12/31/2012   | 
|---------------------- |  | ---------- | ------- |  | ------------ | 
|                       |  | Current    |         |  | Non- current | 
|                       |  | ThUS$      |         |  | ThUS$        | 
|                       |  |            |         |  |              | 
|Accounts payable       |  |            | 150,322 |  |              | 
|Deferred income        |  |            | -       |  |              | 
|Retained  (or accrued) |  |            | 638     |  |              | 
|Total                  |  |            | 150,960 |  |              | 



Purchase commitments held by the Company
are recognized as liabilities when the goods and services are received by the Company. As of December 31, 2013, the Company has
purchase orders amounting to ThUS$29,395 (ThUS$127,484 as of December 31, 2012).



| | 10.6 | Financial liabilities at fair value through profit
or loss
| | ---- | ----------------------------------------------------------



This balance relates to derivative instruments
measured at their fair value, which has generated balances against the Company. The detail of this type of instrument is as follows:



|Financial liabilities at fair value through profit or loss |  | 12/31/2013 |       |  | Effect on profit or loss as of 12/31/2013 |  |       | 12/31/2012 |  |  | Effect on profit or loss as of 12/31/2012 | 
|---------------------------------------------------------- |  | ---------- | ----- |  | ----------------------------------------- |  | ----- | ---------- |  |  | ----------------------------------------- | 
|                                                           |  | ThUS$      |       |  | ThUS$                                     |  |       | ThUS$      |  |  | ThUS$                                     | 
|Current                                                    |  |            |       |  |                                           |  |       |            |  |  |                                           | 
|Derivative instruments (forward)                           |  |            | 423   |  |                                           |  | 5,100 |            |  |  | 5,612                                     | 
|Derivative instruments (options)                           |  |            | 665   |  |                                           |  | 1,827 |            |  |  | 2,492                                     | 
|Derivative instruments (IRS)                               |  |            | 1,339 |  |                                           |  | 251   |            |  |  | 2,231                                     | 
|                                                           |  |            | 2,427 |  |                                           |  | 7,178 |            |  |  | 10,335                                    | 



|Financial liabilities at fair value through profit or loss |  | 12/31/2011 |       |  | Effect on profit or loss as of 12/31/2011 | 
|---------------------------------------------------------- |  | ---------- | ----- |  | ----------------------------------------- | 
|                                                           |  | ThUS$      |       |  | ThUS$                                     | 
|Current                                                    |  |            |       |  |                                           | 
|Derivative instruments (forward)                           |  |            | 1,053 |  |                                           | 
|Derivative instruments (options)                           |  |            | 1,036 |  |                                           | 
|Derivative instruments (IRS)                               |  |            | 354   |  |                                           | 
|                                                           |  |            | 2,443 |  |                                           | 



Balances in the column effect on profit
or loss consider the annual effects of agreements which were in force as of December 31, 2013.



F-104







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments (continued)



| | 10.7 | Financial asset and liability categories
| | ---- | ----------------------------------------



| | a) | Financial Assets
| | -- | ----------------



|                                                                  |  | 12/31/2013   |         |  | 12/31/2012   | 
|----------------------------------------------------------------- |  | ------------ | ------- |  | ------------ | 
|                                                                  |  | Current      |         |  | Non-current  | 
|                                                                  |  | Amount ThUS$ |         |  | Amount ThUS$ | 
|Description of financial assets                                   |  |              |         |  |              | 
|                                                                  |  |              |         |  |              | 
|Financial assets measured at amortized cost                       |  |              | 431,883 |  |              | 
|Investments held-to-maturity measured at amortized cost           |  |              | -       |  |              | 
|Loans and receivables measured at amortized cost                  |  |              | 330,992 |  |              | 
|Total financial assets measured at amortized cost                 |  |              | 762,875 |  |              | 
|                                                                  |  |              |         |  |              | 
|Financial assets at fair value through profit or loss             |  |              | 3,283   |  |              | 
|Financial assets at fair value through other comprehensive income |  |              | 25,007  |  |              | 
|Total financial assets at fair value                              |  |              | 28,290  |  |              | 
|Total financial assets                                            |  |              | 791,165 |  |              | 



F-105







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.7 | Financial asset and liability categories (continued)
| | ---- | ----------------------------------------------------



| | b) | Financial liabilities
| | -- | ---------------------



|                                                           |  | 12/31/2013   |         |  | 12/31/2012   | 
|---------------------------------------------------------- |  | ------------ | ------- |  | ------------ | 
|                                                           |  | Current      |         |  | Non-current  | 
|                                                           |  | Amount ThUS$ |         |  | Amount ThUS$ | 
|Description of financial liabilities                       |  |              |         |  |              | 
|                                                           |  |              |         |  |              | 
|Financial liabilities at fair value through profit or loss |  |              | 2,427   |  |              | 
|Financial liabilities at fair value through profit or loss |  |              | 2,427   |  |              | 
|                                                           |  |              |         |  |              | 
|Financial liabilities measured at amortized cost           |  |              | 549,959 |  |              | 
|Total financial liabilities measured at amortized cost     |  |              | 549,959 |  |              | 
|Total financial liabilities                                |  |              | 552,386 |  |              | 



F-106







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.8 | Fair Value Measurement of Assets and Liabilities
| | ---- | ------------------------------------------------



Financial assets and liabilities measured
at fair value consist of Options and Forwards hedging the mismatch in the balance sheet and cash flows, Cross Currency Swaps (CCS)
to hedge against bonds issued in local currency ($/UF), and Interest Rate Swaps (IRS) to against hedge LIBOR rate debt issued.

The value of the Company’s assets
and liabilities recognised by CCS contracts is calculated as the difference between the present value of discounted cash flows
of the asset (pesos/UF) and liability (USD) parts of the derivative. In the case of the IRS, the asset value recognised is calculated
as the difference between the discounted cash flows of the asset (variable rate) and liability (fixed rate) parts of the derivative.
Forwards: Are calculated as the difference between the strike price of the contract and the spot price plus the forwards points
at the date of the contract. Options: The value recognised is calculated using the Black-Scholes method.

In the case of CCS, the entry data used
for the valuation models are UF, peso, and basis swap rates. In the case of fair value calculations for IRS, the FRA (Forward Rate
Agreement) rate and ICVS 23 Curve (Bloomberg: cash/deposits rates, futures, swaps). In the case of forwards, the forwards curve
for the currency in question is used. Finally, with options, the spot price, risk-free rate and volatility of exchange rate are
used, all in accordance with the currencies used in each valuation. The financial information used as entry data for the Company’s
valuation models is obtained from Bloomberg, the well-known financial software company. Conversely, the fair value provided by
the counterparties of derivatives contracts is used only as a control and not for valuation.

The effects on profit or loss of movements
in these amounts may be recognized within Finance costs, foreign currency translation gain (loss) or cash flow hedges in the statement
of comprehensive income, depending on each particular case.



The fair value measurement of debt is only
performed to determine the actual market value of guaranteed and non-guaranteed long-term obligations; bonds denominated in local
currency ($/UF) and foreign currency (USD), credits denominated in foreign currency (USD).

The value of the Company’s reported
liabilities is calculated as the present value of discounted cash flows at market rates at the time of valuation, taking into account
the maturity date and exchange rate. The entry data used for the model includes the UF and peso rates, which are obtained using
Bloomberg, the well-known financial software company and the ‘Asociación de Bancos e Instituciones Financieras’
(ABIF) (Association of Banks and Financial Institutions’).



F-107









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.9 | Financial assets pledged as guarantee
| | ---- | -------------------------------------



On November 4, 2004, Isapre Norte Grande
maintains a guarantee equivalent to the total amount owed to its members and healthcare providers, which is managed and maintained
by Banco de Chile.



As of December 31, 2013 and December 31,
2012, assets pledged as guarantees are as follows:



|Restricted cash           |  | 12/31/2013 |     |  | 12/31/2012 | 
|------------------------- |  | ---------- | --- |  | ---------- | 
|                          |  | ThUS$      |     |  | ThUS$      | 
|Isapre Norte Grande Ltda. |  |            | 708 |  |            | 
|Total                     |  |            | 708 |  |            | 



| | 10.10 | Estimated fair value of financial instruments and
financial derivatives
| | ----- | -----------------------------------------------------------------------



As required by IFRS 7, the following information
is presented for the disclosure of the estimated fair value of financial assets and liabilities.



Although inputs represent Management's
best estimate, they are subjective and involve significant estimates related to the current economic and market conditions, as
well as risk features.



Methodologies and assumptions used depend
on the risk terms and characteristics of instruments and include the following as a summary:



| | - | Cash equivalent approximates fair value
due to the short-term maturities of these instruments.
| | - | ----------------------------------------------------------------------------------------------

| | - | Other current financial liabilities are
considered at fair value equal to their carrying values.
| | - | ------------------------------------------------------------------------------------------------

| | - | For interest-bearing liabilities such
as bank loans and unsecured obligations with original maturity of more than a year, fair values are calculated at discounting contractual
cash flows at current market with similar terms (level 2).
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | For forward and swap contracts, fair value
is determined using quoted market prices of financial instruments with similar characteristics.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



F-108







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.10 | Estimated fair value of financial instruments and financial derivatives, continued
| | ----- | ----------------------------------------------------------------------------------



The detail of the Company’s instruments at carrying value
and estimated fair value is as follows:



|                                         |  | 12/31/2013           |           |  | 12/31/2012        | 
|---------------------------------------- |  | -------------------- | --------- |  | ----------------- | 
|                                         |  | Carrying value ThUS$ |           |  | Fair  value ThUS$ | 
|Cash and cash equivalents                |  |                      | 476,622   |  |                   | 
|Current trade and other receivables      |  |                      | 330,992   |  |                   | 
|Other financial assets, current:         |  |                      |           |  |                   | 
|- Time deposits                          |  |                      | 431,883   |  |                   | 
|- Derivative instruments                 |  |                      | 3,283     |  |                   | 
|- Current hedging assets                 |  |                      | 25,007    |  |                   | 
|Total other current financial assets     |  |                      | 460,173   |  |                   | 
|Non-Current Trade Receivables            |  |                      | 1,282     |  |                   | 
|Other non-current financial assets:      |  |                      | 95        |  |                   | 
|Non-current hedging assets               |  |                      | -         |  |                   | 
|Other non-current financial assets:      |  |                      | 95        |  |                   | 
|Other financial liabilities, current:    |  |                      |           |  |                   | 
|- Bank loans                             |  |                      | 171,347   |  |                   | 
|- Derivative instruments                 |  |                      | 1,088     |  |                   | 
|- Hedging liabilities                    |  |                      | 1,339     |  |                   | 
|- Unsecured obligations                  |  |                      | 227,652   |  |                   | 
|Other financial liabilities, current     |  |                      | 401,426   |  |                   | 
|Current and non-current accounts payable |  |                      | 150,960   |  |                   | 
|Other non-current financial liabilities: |  |                      |           |  |                   | 
|- Bank loans                             |  |                      | 309,489   |  |                   | 
|- Unsecured obligations                  |  |                      | 1,106,496 |  |                   | 
|- Non-current hedging liabilities        |  |                      | 1,405     |  |                   | 
|Other non-current financial liabilities: |  |                      | 1,417,390 |  |                   | 



Fair value hierarchy



Fair value hierarchies are as follows:



| | - | Level 1: When only quoted (unadjusted) prices have been used in active markets.
| | - | -------------------------------------------------------------------------------

| | - | Level 2: When in a phase in the valuation process variable other than prices quoted in Level
1 have been used which are directly observable in markets.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------

| | - | Level 3: When in a phase in the valuation process variable which are not based in observable
market data have been used.
| | - | ------------------------------------------------------------------------------------------------------------------------



The valuation techniques used to determine
the fair value of our hedging instruments, bank loans, and unsecurable obligations are level 2 fair value instruments based on
discounted cash flows using market based rates as of year-end. .



F-109







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 10 - Financial instruments
(continued)



| | 10.11 | Nature and scope of risks arising from financing instruments
| | ----- | ------------------------------------------------------------



As indicated in paragraphs 33 to 42 of
IFRS 7 the disclosure of information associated with the nature and scope of risks arising from financial instruments is presented
in Note 4 - Financial Risk Management.



F-110







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 11 – Equity-accounted
investees



| | 11.1 | Investments in associated companies recognized according
to the equity method of accounting
| | ---- | -------------------------------------------------------------------------------------------



As of December 31, 2013 and December 31,
2012, in accordance with criteria established in Note 2.6 and Note 3.19, investment in associated companies recognized according
to the equity method of accounting are as follows:



|Associated Companies                |  | Equity-accounted investees |        |  | Share on profit (loss) of 
associates and joint
    ventures accounted for
 using the equity method |  |        | Share on other comprehensive
    income of associated companies and joint ventures accounted for using the equity
    method, net of tax |  |  | Share on total other comprehensive 
    income of associated companies 
and joint ventures accounted 
for using the equity method | 
|----------------------------------- |  | -------------------------- | ------ |  | --------------------------------------------------------------------------------------------------- |  | ------ | ---------------------------------------------------------------------------------------------------------------------------------------- |  |  | --------------------------------------------------------------------------------------------------------------------------------- | 
|                                    |  | 12/31/2013                 |        |  | 12/31/2012                                                                                          |  |        | 12/31/2013                                                                                                                               |  |  | 12/31/2012                                                                                                                        | 
|                                    |  | ThUS$                      |        |  | ThUS$                                                                                               |  |        | ThUS$                                                                                                                                    |  |  | ThUS$                                                                                                                             | 
|                                    |  |                            |        |  |                                                                                                     |  |        |                                                                                                                                          |  |  |                                                                                                                                   | 
|Sales de Magnesio Ltda.             |  |                            | 1,649  |  |                                                                                                     |  | 1,656  |                                                                                                                                          |  |  | 1,005                                                                                                                             | 
|Abu Dhabi Fertilizer Industries WWL |  |                            | 11,453 |  |                                                                                                     |  | 9,890  |                                                                                                                                          |  |  | 1,596                                                                                                                             | 
|Doktor Tarsa Tarim Sanayi AS        |  |                            | 15,193 |  |                                                                                                     |  | 15,346 |                                                                                                                                          |  |  | 2,192                                                                                                                             | 
|Ajay North America                  |  |                            | 13,125 |  |                                                                                                     |  | 15,357 |                                                                                                                                          |  |  | 7,919                                                                                                                             | 
|Ajay Europe SARL                    |  |                            | 7,924  |  |                                                                                                     |  | 8,495  |                                                                                                                                          |  |  | 3,825                                                                                                                             | 
|SQM Eastmed Turkey                  |  |                            | 142    |  |                                                                                                     |  | 85     |                                                                                                                                          |  |  | 132                                                                                                                               | 
|Charlee SQM Thailand Co. Ltd.       |  |                            | 1,589  |  |                                                                                                     |  | 126    |                                                                                                                                          |  |  | 237                                                                                                                               | 
|Nutrisi Holding N.V.                |  |                            | -      |  |                                                                                                     |  | -      |                                                                                                                                          |  |  | -                                                                                                                                 | 
|Total                               |  |                            | 51,075 |  |                                                                                                     |  | 50,955 |                                                                                                                                          |  |  | 16,906                                                                                                                            | 



|                                    |  | Description of the nature of the                                                        |  |                                                                 |  | Country of           |  | Share of
    ownership in
    associated |    |   | Dividends received | 
|----------------------------------- |  | --------------------------------------------------------------------------------------- |  | --------------------------------------------------------------- |  | -------------------- |  | ---------------------------------------- | -- | - | ------------------ | 
|Associated Companies                |  | Relationship                                                                            |  | Domicile                                                        |  | incorporation        |  | Companies                                |    |   | 12/31/2013         | 
|                                    |  |                                                                                         |  |                                                                 |  |                      |  |                                          |    |   | ThUS$              | 
|Sales de Magnesio Ltda.             |  | Commercialization of magnesium salts.                                                   |  | El Trovador 4285, Las Condes                                    |  | Chile                |  |                                          | 50 | % |                    | 
|Abu Dhabi Fertilizer Industries WWL |  | Distribution and commercialization of specialty plant nutrients
    in the Middle East. |  | PO Box 71871, Abu Dhabi                                         |  | United Arab Emirates |  |                                          | 50 | % |                    | 
|Doktor Tarsa Tarim Sanayi AS        |  | Distribution and commercialization of specialty plant nutrients
    in Turkey.          |  | Organize Sanayi Bolgesi, Ikinci Kisim, 22 cadde TR07100 Antalya |  | Turkey               |  |                                          | 50 | % |                    | 
|Ajay North America                  |  | Production and commercialization of iodine derivatives.                                 |  | 1400 Industry RD Power Springs GA 30129                         |  | United States        |  |                                          | 49 | % |                    | 
|Ajay Europe SARL                    |  | Production and commercialization of iodine derivatives.                                 |  | Z.I. du Grand Verger BP 227 53602 Evron Cedex                   |  | France               |  |                                          | 50 | % |                    | 
|SQM Eastmed Turkey                  |  | Production and commercialization of specialty products.                                 |  | Organize Sanayi Bolgesi, Ikinci Kisim, 22 cadde TR07100 Antalya |  | Turkey               |  |                                          | 50 | % |                    | 
|Charlee SQM Thailand Co. Ltd.       |  | Distribution and commercialization of specialty plant nutrients.                        |  | 31 Soi 138 (Meesuk) LLapdrawrd, Bangkapi, 10240 Bangkok         |  | Thailand             |  |                                          | 40 | % |                    | 



F-111







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 11 – Equity-accounted investees (continued)



| | 11.2 | Assets, liabilities, revenue and expenses of associated
companies
| | ---- | -----------------------------------------------------------------



|                                    |  | 12/31/2013 |         |  | 12/31/2013   | 
|----------------------------------- |  | ---------- | ------- |  | ------------ | 
|                                    |  | Assets     |         |  | Liabilities  | 
|                                    |  | Current    |         |  | Non- current | 
|                                    |  | ThUS$      |         |  | ThUS$        | 
|                                    |  |            |         |  |              | 
|Sales de Magnesio Ltda.             |  |            | 4,519   |  |              | 
|Abu Dhabi Fertilizer Industries WWL |  |            | 26,645  |  |              | 
|Doktor Tarsa Tarim Sanayi AS        |  |            | 67,603  |  |              | 
|Ajay North America                  |  |            | 23,728  |  |              | 
|Ajay Europe SARL                    |  |            | 22,247  |  |              | 
|SQM Eastmed Turkey                  |  |            | 149     |  |              | 
|Charlee SQM Thailand Co. Ltd.       |  |            | 6,104   |  |              | 
|Total                               |  |            | 150,995 |  |              | 



|                                    |  | 12/31/2012 |         |  | 12/31/2012   | 
|----------------------------------- |  | ---------- | ------- |  | ------------ | 
|                                    |  | Assets     |         |  | Liabilities  | 
|                                    |  | Current    |         |  | Non- current | 
|                                    |  | ThUS$      |         |  | ThUS$        | 
|                                    |  |            |         |  |              | 
|Sales de Magnesio Ltda.             |  |            | 4,662   |  |              | 
|Abu Dhabi Fertilizer Industries WWL |  |            | 21,885  |  |              | 
|Doktor Tarsa Tarim Sanayi AS        |  |            | 67,345  |  |              | 
|Ajay North America                  |  |            | 28,914  |  |              | 
|Ajay Europe SARL                    |  |            | 27,587  |  |              | 
|SQM Eastmed Turkey                  |  |            | 16      |  |              | 
|Charlee SQM Thailand Co. Ltd.       |  |            | 12,898  |  |              | 
|Total                               |  |            | 163,307 |  |              | 



F-112







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
11 – Investment in Associates (continued)



| | 11.2 | Assets, liabilities, revenue and expenses of associates,
continued
| | ---- | ------------------------------------------------------------------



|                                    |  | 12/31/2011 |         |  | 12/31/2011   | 
|----------------------------------- |  | ---------- | ------- |  | ------------ | 
|                                    |  | Assets     |         |  | Liabilities  | 
|                                    |  | Current    |         |  | Non- current | 
|                                    |  | ThUS$      |         |  | ThUS$        | 
|                                    |  |            |         |  |              | 
|Sales de Magnesio Ltda.             |  |            | 4,428   |  |              | 
|Abu Dhabi Fertilizer Industries WWL |  |            | 19,701  |  |              | 
|Doktor Tarsa Tarim Sanayi AS        |  |            | 67,683  |  |              | 
|Ajay North America                  |  |            | 31,332  |  |              | 
|Ajay Europe SARL                    |  |            | 25,400  |  |              | 
|SQM Eastmed Turkey                  |  |            | 16      |  |              | 
|Charlee SQM Thailand Co. Ltd.       |  |            | 3,550   |  |              | 
|Total                               |  |            | 152,110 |  |              | 



| | 11.3 | Other information
| | ---- | -----------------



The Company has no participation in unrecognized
losses in investments in associates.



The Company presents no investments not
accounted for according to the equity method of accounting.



The equity method was applied to the Statement
of Financial Position as of December 31, 2013 and December 31, 2012.



The basis of preparation of the financial
information of associates corresponds to the amounts included in the financial statements in conformity with the entity’s
IFRS.



F-113







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures



| | 12.1 | Policy for the accounting for equity accounted investment in joint ventures
| | ---- | ---------------------------------------------------------------------------



The method for the recognition of joint
ventures in which participation is initially recorded at cost and subsequently adjusted considering changes after the acquisition
in the portion of the entity’s net assets of the entity which correspond to the investor. Profit or loss for the period of
the investor will collect the portion which belongs to it in the results of the controlled entity as a whole



| | 12.2 | Disclosures of interest in joint ventures
| | ---- | -----------------------------------------



| | a) | Operations conducted in 2013
| | -- | ----------------------------



As of December 31, there are no changes in the composition of
the interest in joint ventures.



| | b) | Operations conducted in 2012
| | -- | ----------------------------



In March 2012, the Company Coromandel SQM
increased its capital by ThUS$394. This Company has an ownership of 50% in Soquimich European Holding B.V.



| | c) | Operations conducted in 2011
| | -- | ----------------------------



In January 2011, the Company SQM Industrial
S.A increased its capital by ThUS$2.500, in the Company Sichuan SQM Migao Chemical Fertilizer Co.



F-114







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures
(continued)



| | 12.3 | Investment in joint ventures accounted for under the equity method of accounting:
| | ---- | ---------------------------------------------------------------------------------



|                                                    |  |                                                                                                      |  |                                                                                               |  | Country of           |  | Share of interest |       |   | Dividends received | 
|--------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------- |  | -------------------- |  | ----------------- | ----- | - | ------------------ | 
|Joint venture                                       |  | Description of the nature of the relationship                                                        |  | Domicile                                                                                      |  | Incorporation        |  | in ownership      |       |   | 12/31/2013         | 
|                                                    |  |                                                                                                      |  |                                                                                               |  |                      |  |                   |       |   | ThUS$              | 
|                                                    |  |                                                                                                      |  |                                                                                               |  |                      |  |                   |       |   |                    | 
|Sichuan SQM Migao Chemical Fertilizers
    Co Ltda. |  | Production and distribution of soluble fertilizers.                                                  |  | Huangjing Road, Dawan Town, Qingbaijiang District, Chengdu
    Municipality, Sichuan Province |  | China                |  |                   | 50    | % |                    | 
|Coromandel SQM                                      |  | Production and distribution of potassium nitrate.                                                    |  | 1-2-10,  Sardar Patel Road, Secunderabad – 500003
    Andhra Pradesh                          |  | India                |  |                   | 50    | % |                    | 
|SQM Vitas Fzco.                                     |  | Production and commercialization of specialty plant and animal
    nutrition and industrial hygiene. |  | Jebel ALI Free Zone P.O. Box 18222, Dubai                                                     |  | United Arab Emirates |  |                   | 50    | % |                    | 
|SQM Star Qingdao Crop Nutrition Co., Ltd.           |  | Production and distribution of nutrient plant solutions with
    specialties NPK soluble             |  | Longquan Town, Jimo City, Qingdao Municipality, Shangdong Province                            |  | China                |  |                   | 50    | % |                    | 
|SQM Vitas Brazil Agroindustria                      |  | Production and commercialization of specialty plant and animal nutrition
    and industrial hygiene. |  | Via Cndeias, Km. 01 Sem Numero, Lote 4, Bairro Cia Norte, Candeias,
    Bahia.                |  | Brazil               |  |                   | 49.99 | % |                    | 
|SQM Vitas Peru S.A.C                                |  | Production and commercialization of specialty plant and animal nutrition
    and industrial hygiene  |  | Av. Juan de Arona 187, Torre B, Oficina 301-II, San Isidro, Lima                              |  | Peru                 |  |                   | 50    | % |                    | 
|SQM Vitas Southern Africa Pty                       |  | Production and commercialization of specialty plant and animal nutrition
    and industrial hygiene  |  | 33 Waterford Office Park Waterford Drive Fourways, 2055 South Africa                          |  | South Africa         |  |                   | 50    | % |                    | 
|SQM Vitas Spain                                     |  | Production and commercialization of specialty plant nutrition                                        |  | C/Manuel Echeverria Manzana 2 Muelle de la Cab ( Puerto Real )                                |  | Spain                |  |                   | 50    | % |                    | 
|SQM Vitas Holland                                   |  | Without information                                                                                  |  | Herikerbergweg 238, 1101 CM Amsterdam Zuidoost                                                |  | Dutch Antilles       |  |                   | 50    | % |                    | 
|SQM Vitas Plantacote B.V.                           |  | Production and commercialization of controlled-released fertilizers                                  |  | Herikerbergweg 238, 1101 CM Amsterdam Zuidoost                                                |  | Dutch Antilles       |  |                   | 50    | % |                    | 



F-115







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures (continued)



| | 12.3 | Investment in joint ventures accounted for under the equity method of accounting:
| | ---- | ---------------------------------------------------------------------------------



|Joint Venture                                   |  | Equity-accounted investees |        |   | Share on profit (loss) of associated companies and
    joint ventures accounted for using the equity method | 
|----------------------------------------------- |  | -------------------------- | ------ | - | ----------------------------------------------------------------------------------------------------------- | 
|                                                |  | 12/31/2013                 |        |   | 12/31/2012                                                                                                  | 
|                                                |  | ThUS$                      |        |   | ThUS$                                                                                                       | 
|                                                |  |                            |        |   |                                                                                                             | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |                            | 11,504 |   |                                                                                                             | 
|Coromandel SQM                                  |  |                            | 801    |   |                                                                                                             | 
|SQM Vitas Fzco.                                 |  |                            | 12,762 |   |                                                                                                             | 
|SQM Star Qingdao Crop Nutrition Co., Ltd.       |  |                            | 1,475  |   |                                                                                                             | 
|SQM Vitas Holland                               |  |                            | (599   | ) |                                                                                                             | 
|                                                |  |                            | 25,943 |   |                                                                                                             | 



|Joint Venture                                   |  | Share on other comprehensive income of
    associated companies and joint ventures accounted for using the equity method, net of tax |      |   | Share on total other comprehensive income of
    associated companies and joint ventures accounted for using the equity method | 
|----------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------ | ---- | - | ------------------------------------------------------------------------------------------------------------------------------ | 
|                                                |  | 12/31/2013                                                                                                                           |      |   | 12/31/2012                                                                                                                     | 
|                                                |  | ThUS$                                                                                                                                |      |   | ThUS$                                                                                                                          | 
|                                                |  |                                                                                                                                      |      |   |                                                                                                                                | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |                                                                                                                                      | 13   |   |                                                                                                                                | 
|Coromandel SQM                                  |  |                                                                                                                                      | -    |   |                                                                                                                                | 
|SQM Vitas Fzco.                                 |  |                                                                                                                                      | (339 | ) |                                                                                                                                | 
|SQM Star Qingdao Crop Nutrition Co., Ltd.       |  |                                                                                                                                      | -    |   |                                                                                                                                | 
|SQM Vitas Holland                               |  |                                                                                                                                      | -    |   |                                                                                                                                | 
|                                                |  |                                                                                                                                      | (326 | ) |                                                                                                                                | 



The following companies are subsidiaries of SQM Vitas Fzco.



|                          |  | Equity-accounted investees |        |  | Share on profit (loss) of associated companies and
    joint ventures accounted for using the equity method | 
|------------------------- |  | -------------------------- | ------ |  | ----------------------------------------------------------------------------------------------------------- | 
|                          |  | 12/31/2013                 |        |  | 12/31/2012                                                                                                  | 
|                          |  | ThUS$                      |        |  | ThUS$                                                                                                       | 
|                          |  |                            |        |  |                                                                                                             | 
|SQM Vitas Brazil          |  |                            | 4,747  |  |                                                                                                             | 
|SQM Vitas Peru            |  |                            | 4,314  |  |                                                                                                             | 
|SQM Vitas Southern Africa |  |                            | 1,096  |  |                                                                                                             | 
|SQM Vitas Spain           |  |                            | -      |  |                                                                                                             | 
|SQM Vitas Plantacote B.V. |  |                            | -      |  |                                                                                                             | 
|Total                     |  |                            | 10,157 |  |                                                                                                             | 



F-116







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures (continued)



| | 12.3 | Investment in joint ventures accounted for under the equity method of accounting, continued:
| | ---- | --------------------------------------------------------------------------------------------



|                          |  | Share on other comprehensive income of associated companies and joint ventures accounted for using the equity method, net of tax |   |  | Share on total other comprehensive income of
    associated companies and joint ventures accounted for using the equity method | 
|------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------- | - |  | ------------------------------------------------------------------------------------------------------------------------------ | 
|                          |  | 12/31/2013                                                                                                                       |   |  | 12/31/2012                                                                                                                     | 
|                          |  | ThUS$                                                                                                                            |   |  | ThUS$                                                                                                                          | 
|                          |  |                                                                                                                                  |   |  |                                                                                                                                | 
|SQM Vitas Brazil          |  |                                                                                                                                  | - |  |                                                                                                                                | 
|SQM Vitas Peru            |  |                                                                                                                                  | - |  |                                                                                                                                | 
|SQM Vitas Southern Africa |  |                                                                                                                                  | - |  |                                                                                                                                | 
|SQM Vitas Spain           |  |                                                                                                                                  | - |  |                                                                                                                                | 
|SQM Vitas Plantacote B.V. |  |                                                                                                                                  | - |  |                                                                                                                                | 
|Total                     |  |                                                                                                                                  | - |  |                                                                                                                                | 



| | 12.4 | Assets, liabilities, revenue and expenses from Joint
Ventures:
| | ---- | --------------------------------------------------------------



|                                                |  | 12/31/2013 |        
|----------------------------------------------- |  | ---------- | -------
|                                                |  | Assets     |        
|                                                |  | Current    |        
|                                                |  | ThUS$      |        
|                                                |  |            |        
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |            | 68,241 
|Coromandel SQM                                  |  |            | 4,545  
|SQM Vitas Fzco,                                 |  |            | 12,790 
|SQM  Star Qingdao Crop Nutrition Co. Ltda.      |  |            | 3,570  
|SQM Vitas Brazil                                |  |            | 31,243 
|SQM Vitas Peru                                  |  |            | 21,481 
|SQM Vitas Southern Africa                       |  |            | 5,164  
|SQM Vitas Spain                                 |  |            | 1,318  
|SQM Vitas Holland                               |  |            | 95     
|SQM Vitas Plantacote B.V.                       |  |            | 1,323  
|Total                                           |  |            | 149,770



F-117







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures (continued)



| | 12.4 | Assets, liabilities, revenue and expenses from Joint
Ventures, continued:
| | ---- | -------------------------------------------------------------------------



|                                                |  | 12/31/2012 |        |  | 12/31/2012       | 
|----------------------------------------------- |  | ---------- | ------ |  | ---------------- | 
|                                                |  | Assets     |        |  | Liabilities      | 
|                                                |  | Current    |        |  | Non-
    current | 
|                                                |  | ThUS$      |        |  | ThUS$            | 
|                                                |  |            |        |  |                  | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |            | 21,843 |  |                  | 
|Coromandel SQM                                  |  |            | 4,388  |  |                  | 
|SQM Vitas Fzco.                                 |  |            | 4,568  |  |                  | 
|SQM  Star Qingdao Crop Nutrition Co., Ltd.      |  |            | 1,986  |  |                  | 
|SQM Vitas Brazil                                |  |            | 36,874 |  |                  | 
|SQM Vitas Peru                                  |  |            | 23,308 |  |                  | 
|SQM Vitas Southern Africa                       |  |            | 2,730  |  |                  | 
|SQM Vitas Spain                                 |  |            | -      |  |                  | 
|Total                                           |  |            | 95,697 |  |                  | 



|                                                |  | 12/31/2011 |        |  | 12/31/2011       | 
|----------------------------------------------- |  | ---------- | ------ |  | ---------------- | 
|                                                |  | Assets     |        |  | Liabilities      | 
|                                                |  | Current    |        |  | Non-
    current | 
|                                                |  | ThUS$      |        |  | ThUS$            | 
|                                                |  |            |        |  |                  | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |            | 18,014 |  |                  | 
|Coromandel SQM                                  |  |            | 559    |  |                  | 
|SQM Vitas Fzco.                                 |  |            | 14,164 |  |                  | 
|SQM  Star Qingdao Crop Nutrition Co., Ltd.      |  |            | 1,974  |  |                  | 
|SQM Vitas Brazil                                |  |            | 31,426 |  |                  | 
|SQM Vitas Peru                                  |  |            | 17,579 |  |                  | 
|SQM Vitas Southern Africa                       |  |            | 2,695  |  |                  | 
|Total                                           |  |            | 86,411 |  |                  | 



F-118







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures
(continued)



| | 12.5 | Other Joint Venture disclosures:
| | ---- | --------------------------------



|                                                |  | Cash and cash equivalents |        |  | Other current financial liabilities |  |        | Other non-current financial liabilities | 
|----------------------------------------------- |  | ------------------------- | ------ |  | ----------------------------------- |  | ------ | --------------------------------------- | 
|                                                |  | 12/31/2013                |        |  | 12/31/2012                          |  |        | 12/31/2013                              | 
|                                                |  | ThUS$                     |        |  | ThUS$                               |  |        | ThUS$                                   | 
|                                                |  |                           |        |  |                                     |  |        |                                         | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |                           | 8,049  |  |                                     |  | 485    |                                         | 
|Coromandel SQM                                  |  |                           | 197    |  |                                     |  | 248    |                                         | 
|SQM Vitas Fzco.                                 |  |                           | 10,605 |  |                                     |  | 7,977  |                                         | 
|SQM  Star Qingdao Crop Nutrition Co., Ltd.      |  |                           | 1,988  |  |                                     |  | 524    |                                         | 
|SQM Vitas Brazil                                |  |                           | 854    |  |                                     |  | 549    |                                         | 
|SQM Vitas Peru                                  |  |                           | 1,166  |  |                                     |  | 286    |                                         | 
|SQM Vitas Southern Africa                       |  |                           | 351    |  |                                     |  | 179    |                                         | 
|SQM Vitas Spain                                 |  |                           | 310    |  |                                     |  | -      |                                         | 
|SQM Vitas Holland                               |  |                           | 26     |  |                                     |  | -      |                                         | 
|SQM Vitas Plantacote B.V.                       |  |                           | 109    |  |                                     |  | -      |                                         | 
|Total                                           |  |                           | 23,655 |  |                                     |  | 10,248 |                                         | 



F-119







Notes to the Consolidated Financial Statements as of December 31, 2013



Note 12 - Joint Ventures
(continued)



| | 12.5 | Other Joint Venture disclosures, continued:
| | ---- | -------------------------------------------



|                                                |  | Depreciation
                                         and amortization expense |        |   |            |  |        | Interest expense |  |  |            |   |  | Income
                                         tax expense, continuing operations |        |   |            | 
|----------------------------------------------- |  | ------------------------------------------------------------------------------ | ------ | - | ---------- |  | ------ | ---------------- |  |  | ---------- | - |  | ---------------------------------------------------------------------------------- | ------ | - | ---------- | 
|                                                |  | 12/31/2013                                                                     |        |   | 12/31/2012 |  |        | 12/31/2011       |  |  | 12/31/2013 |   |  | 12/31/2012                                                                         |        |   | 12/31/2011 | 
|                                                |  | ThUS$                                                                          |        |   | ThUS$      |  |        | ThUS$            |  |  | ThUS$      |   |  | ThUS$                                                                              |        |   | ThUS$      | 
|                                                |  |                                                                                |        |   |            |  |        |                  |  |  |            |   |  |                                                                                    |        |   |            | 
|Sichuan SQM Migao Chemical Fertilizers Co Ltda. |  |                                                                                | (549   | ) |            |  | (702   | )                |  |  | (734       | ) |  |                                                                                    | (813   | ) |            | 
|Coromandel SQM                                  |  |                                                                                | (2     | ) |            |  | (91    | )                |  |  | (75        | ) |  |                                                                                    | (87    | ) |            | 
|SQM Vitas Fzco.                                 |  |                                                                                | (1,001 | ) |            |  | (982   | )                |  |  | (939       | ) |  |                                                                                    | (16    | ) |            | 
|SQM  Star Qingdao Crop Nutrition Co., Ltd.      |  |                                                                                | (71    | ) |            |  | (74    | )                |  |  | (95        | ) |  |                                                                                    | -      |   |            | 
|SQM Vitas Brazil                                |  |                                                                                | (328   | ) |            |  | (247   | )                |  |  | (357       | ) |  |                                                                                    | (931   | ) |            | 
|SQM Vitas Peru                                  |  |                                                                                | (82    | ) |            |  | (32    | )                |  |  | (32        | ) |  |                                                                                    | (445   | ) |            | 
|SQM Vitas Southern Africa                       |  |                                                                                | (67    | ) |            |  | (29    | )                |  |  | (29        | ) |  |                                                                                    | (104   | ) |            | 
|SQM Vitas Spain                                 |  |                                                                                | -      |   |            |  | -      |                  |  |  | -          |   |  |                                                                                    | (14    | ) |            | 
|SQM Vitas Holland                               |  |                                                                                | -      |   |            |  | -      |                  |  |  | -          |   |  |                                                                                    | (2     | ) |            | 
|SQM Vitas Plantacote B.V.                       |  |                                                                                | -      |   |            |  | -      |                  |  |  | -          |   |  |                                                                                    | (176   | ) |            | 
|Total                                           |  |                                                                                | (2,100 | ) |            |  | (2,157 | )                |  |  | (2261      | ) |  |                                                                                    | (2,588 | ) |            | 



The basis of preparation of the financial
information of joint ventures corresponds to the amounts included in the financial statements in conformity with the entity’s
IFRS.



F-120







Notes to the Consolidated Financial Statements as of December 31, 2013



Note 13 - Intangible assets
and goodwill



| | 13.1 | Balances
| | ---- | --------



|                                      |  | 12/31/2013 |         |  | 12/31/2012 |  |         | 12/31/2011 | 
|------------------------------------- |  | ---------- | ------- |  | ---------- |  | ------- | ---------- | 
|                                      |  | ThUS$      |         |  | ThUS$      |  |         | ThUS$      | 
|                                      |  |            |         |  |            |  |         |            | 
|Intangible assets other than goodwill |  |            | 104,363 |  |            |  | 99,754  |            | 
|Goodwill                              |  |            | 38,388  |  |            |  | 38,388  |            | 
|                                      |  |            |         |  |            |  |         |            | 
|Total                                 |  |            | 142,751 |  |            |  | 138,142 |            | 



| | 13.2 | Disclosures on intangible assets and goodwill
| | ---- | ---------------------------------------------



Intangible assets relate to goodwill, water
rights, trademarks, industrial patents, rights of way, software, and mining claims which correspond to exploitation rights acquired
from third-parties.



Balances and movements in the main classes
of intangible assets as of December 31, 2013 and December 31, 2012 are detailed as follows:



|                                                                                                       |  |              |  | 12/31/2013         |        
|------------------------------------------------------------------------------------------------------ |  | ------------ |  | ------------------ | -------
|Intangible assets and goodwill                                                                         |  | Useful life  |  | Gross amount ThUS$ |        
|                                                                                                       |  |              |  |                    |        
|Trademarks                                                                                             |  | Finite       |  |                    | 3,821  
|Software                                                                                               |  | Finite       |  |                    | 5,342  
|Intellectual property rights, patents and other industrial property rights, service and mineral rights |  | Finite       |  |                    | 1,576  
|Intellectual property rights, patents and other industrial property rights, service and mineral rights |  | Intermidiate |  |                    | 97,392 
|Other intangible assets                                                                                |  | Intermidiate |  |                    | 4,081  
|Intangible assets other than goodwill                                                                  |  |              |  |                    | 112,212
|                                                                                                       |  |              |  |                    |        
|Goodwill                                                                                               |  | Intermidiate |  |                    | 38,388 
|                                                                                                       |  |              |  |                    |        
|Total intangible assets and goodwill                                                                   |  |              |  |                    | 150,600



F-121







Notes to the Consolidated Financial Statements as of December 31, 2013



Note 13 - Intangible assets
and goodwill (continued)



| | 13.2 | Disclosures on intangible assets and goodwill, continued
| | ---- | --------------------------------------------------------



|                                                                                                       |  |              |  | 12/31/2012         |        
|------------------------------------------------------------------------------------------------------ |  | ------------ |  | ------------------ | -------
|Intangible assets and goodwill                                                                         |  | Useful life  |  | Gross amount ThUS$ |        
|                                                                                                       |  |              |  |                    |        
|Trademarks                                                                                             |  | Finite       |  |                    | 3,821  
|Software                                                                                               |  | Finite       |  |                    | 3,765  
|Intellectual property rights, patents and other industrial property rights, service and mineral rights |  | Finite       |  |                    | 1,198  
|Intellectual property rights, patents and other industrial property rights, service and mineral rights |  | Intermidiate |  |                    | 96,366 
|Other intangible assets                                                                                |  | Intermidiate |  |                    | 1,360  
|Intangible assets other than goodwill                                                                  |  |              |  |                    | 106,510
|                                                                                                       |  |              |  |                    |        
|Goodwill                                                                                               |  | Intermidiate |  |                    | 38,388 
|                                                                                                       |  |              |  |                    |        
|Total intangible assets and goodwill                                                                   |  |              |  |                    | 144,898



| | a) | Estimated useful lives or amortization rates used for finite identifiable intangible assets
| | -- | -------------------------------------------------------------------------------------------



Finite useful life, measures the lifetime
or the number of productive units or other similar which constitute its useful life.



The estimated useful life for software
is 3 years for other finite useful life assets, the period in which they are amortized relate to periods defined by contracts or
rights which generate them.



Intellectual property rights, patents and
other industrial property rights, service and exploitation rights, mainly relate to water rights and have a finite useful life
when they are subject to a fixed term contract, and indefinite otherwise.



| | b) | Method used to express the amortization of identifiable intangible assets (life or rate)
| | -- | ----------------------------------------------------------------------------------------



The method used to express the amortization is useful life,
and in the case of mining claims estimated tons to be extracted.



F-122







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
13 - Intangible assets and goodwill (continued)



| | 13.2 | Disclosures on intangible assets and goodwill, continued
| | ---- | --------------------------------------------------------



| | c) | Minimum and maximum amortization lives or rates of intangible assets:
| | -- | ---------------------------------------------------------------------



|Estimated useful lives or amortization rate                                                                 |  | Minimum life or rate |  | Maximum life or rate
|----------------------------------------------------------------------------------------------------------- |  | -------------------- |  | --------------------
|                                                                                                            |  |                      |  |                     
|Intellectual property rights, patents and other industrial property rights, service and exploitation rights |  | Indefinite           |  | Indefinite          
|                                                                                                            |  |                      |  |                     
|Intangible assets other than goodwill                                                                       |  | Indefinite           |  | Indefinite          
|                                                                                                            |  |                      |  |                     
|Intellectual property rights, patents and other industrial property rights, service and exploitation rights |  | 1 year               |  | 16 years            
|                                                                                                            |  |                      |  |                     
|Trademarks                                                                                                  |  | 1 year               |  | 5 years             
|                                                                                                            |  |                      |  |                     
|Software                                                                                                    |  | 2 years              |  | 3 years             



| | d) | Information to be disclosed on assets generated internally
| | -- | ----------------------------------------------------------



The Company has no internally generated intangible assets.



| | e) | Other information to disclose on intangible assets
| | -- | --------------------------------------------------



SQM has property rights and mining concessions
of the Chilean Government, intended for the exploration and exploitation of saltpeter and brine. Such rights, have had no initial
cost over registration costs, which are insignificant.



Also, SQM has acquired from third-parties
other than the Chilean Government, mining concessions, which have been recognized at acquisition cost, which are amortized as the
corresponding area is exploited based on the tons estimated to be extracted.



Costs incurred prior to obtaining mining
concessions, are expensed when incurred.



F-123







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
13 - Intangible assets and goodwill (continued)



| | 13.2 | Disclosures on intangible assets and goodwill, continued
| | ---- | --------------------------------------------------------



| | f) | Movements in identifiable intangible assets as of December 31, 2013:
| | -- | --------------------------------------------------------------------



|Movements in identifiable intangible assets |  | Trademarks Net ThUS$ |   |  | Software Net ThUS$ |  |        | Intellectual
                                         property rights, patents
                                         and other industrial property
                                         rights, service and exploitation
                                         right, rights of way,
                                         Net ThUS$ |  |  | Intellectual
                                         property rights, patents
                                         and other industrial property
                                         rights, service and exploitation
                                         right, rights of way,
                                         Net ThUS$ |   |  | Other intangible assets,
                                         Net ThUS$ |        |   | Goodwill, Net ThUS$ |  |       | Identifiable intangible assets,
                                         Net ThUS$ | 
|------------------------------------------- |  | -------------------- | - |  | ------------------ |  | ------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - |  | --------------------------------------------------------------------------- | ------ | - | ------------------- |  | ----- | ---------------------------------------------------------------------------------- | 
|                                            |  |                      |   |  |                    |  |        |                                                                                                                                                                                                                                                                                                                                                   |  |  |                                                                                                                                                                                                                                                                                                                                                   |   |  |                                                                             |        |   |                     |  |       |                                                                                    | 
|Opening balance                             |  |                      | - |  |                    |  | 1,650  |                                                                                                                                                                                                                                                                                                                                                   |  |  | 378                                                                                                                                                                                                                                                                                                                                               |   |  |                                                                             | 96,366 |   |                     |  | 1,360 |                                                                                    | 
|Additions                                   |  |                      |   |  |                    |  | 1,577  |                                                                                                                                                                                                                                                                                                                                                   |  |  | 377                                                                                                                                                                                                                                                                                                                                               |   |  |                                                                             | 3,394  |   |                     |  | 2,721 |                                                                                    | 
|Amortization                                |  |                      |   |  |                    |  | (1,019 | )                                                                                                                                                                                                                                                                                                                                                 |  |  | (61                                                                                                                                                                                                                                                                                                                                               | ) |  |                                                                             | (12    | ) |                     |  | -     |                                                                                    | 
|Other increases (decreases)                 |  |                      |   |  |                    |  | (12    | )                                                                                                                                                                                                                                                                                                                                                 |  |  | -                                                                                                                                                                                                                                                                                                                                                 |   |  |                                                                             | (2,356 | ) |                     |  | -     |                                                                                    | 
|Final balance                               |  |                      | - |  |                    |  | 2,196  |                                                                                                                                                                                                                                                                                                                                                   |  |  | 694                                                                                                                                                                                                                                                                                                                                               |   |  |                                                                             | 97,392 |   |                     |  | 4,081 |                                                                                    | 



| | g) | Movements in identifiable intangible assets as of December 31, 2012:
| | -- | --------------------------------------------------------------------



|Movements in identifiable intangible assets |  | Trademarks Net ThUS$ |   |  | Software Net ThUS$ |  |       | Intellectual property rights, patents and other industrial property rights, service and exploitation right, rights of way, Net ThUS$ |  |  | Intellectual property rights, patents and other industrial property rights, service and exploitation right, rights of way, Net ThUS$ |   |  | Other intangible assets, Net ThUS$ |        |  | Goodwill, Net ThUS$ |  |       | Identifiable intangible assets, Net ThUS$ | 
|------------------------------------------- |  | -------------------- | - |  | ------------------ |  | ----- | ------------------------------------------------------------------------------------------------------------------------------------ |  |  | ------------------------------------------------------------------------------------------------------------------------------------ | - |  | ---------------------------------- | ------ |  | ------------------- |  | ----- | ----------------------------------------- | 
|                                            |  |                      |   |  |                    |  |       |                                                                                                                                      |  |  |                                                                                                                                      |   |  |                                    |        |  |                     |  |       |                                           | 
|Opening balance                             |  |                      | - |  |                    |  | 1,938 |                                                                                                                                      |  |  | 440                                                                                                                                  |   |  |                                    | 77,282 |  |                     |  | 396   |                                           | 
|Additions                                   |  |                      |   |  |                    |  | 501   |                                                                                                                                      |  |  | -                                                                                                                                    |   |  |                                    | 19,080 |  |                     |  | 964   |                                           | 
|Amortization                                |  |                      |   |  |                    |  | (789  | )                                                                                                                                    |  |  | (62                                                                                                                                  | ) |  |                                    | -      |  |                     |  | -     |                                           | 
|Other increases (decreases)                 |  |                      |   |  |                    |  | -     |                                                                                                                                      |  |  | -                                                                                                                                    |   |  |                                    | 4      |  |                     |  | -     |                                           | 
|Final balance                               |  |                      | - |  |                    |  | 1,650 |                                                                                                                                      |  |  | 378                                                                                                                                  |   |  |                                    | 96,366 |  |                     |  | 1,360 |                                           | 



F-124







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
13 - Intangible assets and goodwill (continued)



| | 13.2 | Disclosures on intangible assets and goodwill, continued
| | ---- | --------------------------------------------------------



| | h) | Movements in identifiable intangible assets as of December 31, 2011:
| | -- | --------------------------------------------------------------------



|Movements in identifiable intangible assets |  | Trademarks Net ThUS$ |    |   | Software Net ThUS$ |  |       | Intellectual property rights, patents and other industrial property rights, service and exploitation right, rights of way, Net ThUS$ |  |  | Intellectual property rights, patents and other industrial property rights, service and exploitation right, rights of way, Net ThUS$ |   |  | Other intangible assets, Net ThUS$ |        |  | Goodwill, Net ThUS$ |  |     | Identifiable intangible assets, Net ThUS$ | 
|------------------------------------------- |  | -------------------- | -- | - | ------------------ |  | ----- | ------------------------------------------------------------------------------------------------------------------------------------ |  |  | ------------------------------------------------------------------------------------------------------------------------------------ | - |  | ---------------------------------- | ------ |  | ------------------- |  | --- | ----------------------------------------- | 
|                                            |  |                      |    |   |                    |  |       |                                                                                                                                      |  |  |                                                                                                                                      |   |  |                                    |        |  |                     |  |     |                                           | 
|Opening balance                             |  |                      | 4  |   |                    |  | 823   |                                                                                                                                      |  |  | 501                                                                                                                                  |   |  |                                    | 1,546  |  |                     |  | 396 |                                           | 
|Additions                                   |  |                      | -  |   |                    |  | 1,812 |                                                                                                                                      |  |  | -                                                                                                                                    |   |  |                                    | -      |  |                     |  | -   |                                           | 
|Amortization                                |  |                      | (4 | ) |                    |  | (697  | )                                                                                                                                    |  |  | (61                                                                                                                                  | ) |  |                                    | -      |  |                     |  | -   |                                           | 
|Other increases (decreases)                 |  |                      | -  |   |                    |  | -     |                                                                                                                                      |  |  | -                                                                                                                                    |   |  |                                    | 75,736 |  |                     |  | -   |                                           | 
|Final balance                               |  |                      | -  |   |                    |  | 1,938 |                                                                                                                                      |  |  | 440                                                                                                                                  |   |  |                                    | 77,282 |  |                     |  | 396 |                                           | 



F-125







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 14 - Property, plant
and equipment



As of December 31, 2013 and December 31, 2012, the detail of
property, plant and equipment is as follows:



| | 14.1 | Types of property, plant and equipment
| | ---- | --------------------------------------



|Description of types of property, plant and equipment |  | 12/31/2013 ThUS$ |           |  | 12/31/2012 ThUS$ | 
|----------------------------------------------------- |  | ---------------- | --------- |  | ---------------- | 
|                                                      |  |                  |           |  |                  | 
|Property, plant and equipment, net                    |  |                  |           |  |                  | 
|                                                      |  |                  |           |  |                  | 
|Land                                                  |  |                  | 33,812    |  |                  | 
|Buildings                                             |  |                  | 190,529   |  |                  | 
|Machinery                                             |  |                  | 465,327   |  |                  | 
|Transport equipment                                   |  |                  | 105,979   |  |                  | 
|Furniture and fixtures                                |  |                  | 9,534     |  |                  | 
|Office equipment                                      |  |                  | 6,062     |  |                  | 
|Constructions in progress                             |  |                  | 415,740   |  |                  | 
|Other property, plant and equipment (1)               |  |                  | 827,394   |  |                  | 
|Total                                                 |  |                  | 2,054,377 |  |                  | 
|                                                      |  |                  |           |  |                  | 
|Property, plant and equipment, gross                  |  |                  |           |  |                  | 
|                                                      |  |                  |           |  |                  | 
|Land                                                  |  |                  | 33,812    |  |                  | 
|Buildings                                             |  |                  | 364,695   |  |                  | 
|Machinery                                             |  |                  | 1,179,860 |  |                  | 
|Transport equipment                                   |  |                  | 263,268   |  |                  | 
|Furniture and fixtures                                |  |                  | 27,575    |  |                  | 
|Office equipment                                      |  |                  | 39,142    |  |                  | 
|Constructions in progress                             |  |                  | 415,740   |  |                  | 
|Other property, plant and equipment                   |  |                  | 1,506,708 |  |                  | 
|Total                                                 |  |                  | 3,830,800 |  |                  | 



F-126







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 14 - Property, plant
and equipment (continued)



| | 14.1 | Types of property, plant and equipment, continued
| | ---- | -------------------------------------------------



|                                                                                      |  | 12/31/2013 |           |  | 12/31/2012 | 
|------------------------------------------------------------------------------------- |  | ---------- | --------- |  | ---------- | 
|                                                                                      |  | ThUS$      |           |  | ThUS$      | 
|Accumulated depreciation and value impairment of property, plant and equipment, total |  |            |           |  |            | 
|Accumulated depreciation and value impairment of buildings                            |  |            | 174,166   |  |            | 
|Accumulated depreciation and value impairment of machinery                            |  |            | 714,533   |  |            | 
|Accumulated depreciation and value impairment of transport equipment                  |  |            | 157,289   |  |            | 
|Accumulated depreciation and value impairment of furniture and fixtures               |  |            | 18,041    |  |            | 
|Accumulated depreciation and value impairment of office equipment                     |  |            | 33,080    |  |            | 
|Accumulated depreciation and value impairment of other property, plant and equipment  |  |            | 679,314   |  |            | 
|Total                                                                                 |  |            | 1,776,423 |  |            | 



| | (1) | The detail of other property, plant and equipment is as follows:
| | --- | ----------------------------------------------------------------



|Other property, plant and equipment, net |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|---------------------------------------- |  | ---------------- | ------- |  | ---------------- | 
|                                         |  |                  |         |  |                  | 
|Conveyor belt                            |  |                  | 53,783  |  |                  | 
|Tank (TK)                                |  |                  | 25,781  |  |                  | 
|Geomembrane / liner                      |  |                  | 169,255 |  |                  | 
|Electric facilities                      |  |                  | 21,889  |  |                  | 
|Lights                                   |  |                  | 28,748  |  |                  | 
|Other constructions                      |  |                  | 62,390  |  |                  | 
|Piping                                   |  |                  | 22,499  |  |                  | 
|Pool                                     |  |                  | 181,844 |  |                  | 
|Well (water)                             |  |                  | 39,963  |  |                  | 
|Pipes / HD lines                         |  |                  | 101,886 |  |                  | 
|Railroad track                           |  |                  | 21,628  |  |                  | 
|Other property, plant and equipment      |  |                  | 97,728  |  |                  | 
|Total                                    |  |                  | 827,394 |  |                  | 



F-127







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 14 - Property, plant
and equipment (continued)



| | 14.2 | Reconciliation of changes in property, plant and equipment by type as of December 31, 2013 and December 31, 2012:
| | ---- | -----------------------------------------------------------------------------------------------------------------



|Reconciliation entries of changes in property, plant and equipment by type as of December 31, 2013 |  | Land  |        |   | Buildings, net |  |         | Machinery, net |  |  | Transport equipment, net |   |  | Furniture and fixtures, net |         |   | Office equipment, net |  |        | Constructions in progress |  |  | Other property, plant and equipment, net |   |  | Property, plant and equipment, net |         
|-------------------------------------------------------------------------------------------------- |  | ----- | ------ | - | -------------- |  | ------- | -------------- |  |  | ------------------------ | - |  | --------------------------- | ------- | - | --------------------- |  | ------ | ------------------------- |  |  | ---------------------------------------- | - |  | ---------------------------------- | --------
|                                                                                                   |  | ThUS$ |        |   | ThUS$          |  |         | ThUS$          |  |  | ThUS$                    |   |  | ThUS$                       |         |   | ThUS$                 |  |        | ThUS$                     |  |  | ThUS$                                    |   |  | ThUS$                              |         
|                                                                                                   |  |       |        |   |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Opening balance                                                                                    |  |       | 33,320 |   |                |  | 169,731 |                |  |  | 438,331                  |   |  |                             | 88,954  |   |                       |  | 6,736  |                           |  |  | 5,249                                    |   |  |                                    | 423,184 
|                                                                                                   |  |       |        |   |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Changes                                                                                            |  |       |        |   |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Additions                                                                                          |  |       | 778    |   |                |  | 47      |                |  |  | 2,100                    |   |  |                             | 3       |   |                       |  | 60     |                           |  |  | 845                                      |   |  |                                    | 416,471 
|Divestitures                                                                                       |  |       | -      |   |                |  | (14     | )              |  |  | (49                      | ) |  |                             | (35     | ) |                       |  | -      |                           |  |  | -                                        |   |  |                                    | (5,045  
|Depreciation expense                                                                               |  |       | -      |   |                |  | (14,520 | )              |  |  | (87,989                  | ) |  |                             | (21,787 | ) |                       |  | (2,112 | )                         |  |  | (2,055                                   | ) |  |                                    | -       
|Increase(decrease) in foreign currency exchange                                                    |  |       | (36    | ) |                |  | (12     | )              |  |  | (12                      | ) |  |                             | (15     | ) |                       |  | -      |                           |  |  | (36                                      | ) |  |                                    | -       
|Reclassification                                                                                   |  |       | -      |   |                |  | 35,700  |                |  |  | 115,281                  |   |  |                             | 38,845  |   |                       |  | 4,874  |                           |  |  | 2,156                                    |   |  |                                    | (366,516
|Other increases (decreases) (*)                                                                    |  |       | (250   | ) |                |  | (403    | )              |  |  | (2,335                   | ) |  |                             | 14      |   |                       |  | (24    | )                         |  |  | (97                                      | ) |  |                                    | (52,354 
|                                                                                                   |  |       |        |   |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Total changes                                                                                      |  |       | 492    |   |                |  | 20,798  |                |  |  | 26,996                   |   |  |                             | 17,025  |   |                       |  | 2,798  |                           |  |  | 813                                      |   |  |                                    | (7,444  
|Final balance                                                                                      |  |       | 33,812 |   |                |  | 190,529 |                |  |  | 465,327                  |   |  |                             | 105,979 |   |                       |  | 9,534  |                           |  |  | 6,062                                    |   |  |                                    | 415,740 



(*) The net balance of Other increases
(decreases) corresponds to: 1) investment plan expenses which are charged to profit or loss (as a component of cost of sales and
other expenses per function, as appropriate), 2) the variation representing the purchase and use of materials and spare parts and
3) projects corresponding mainly to exploration expenditures and mine development.



F-128







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 14 - Property, plant
and equipment (continued)



| | 14.2 | Reconciliation of changes in property, plant and equipment by type as of December 31, 2013 and December 31, 2012, continued:
| | ---- | ----------------------------------------------------------------------------------------------------------------------------



|Reconciliation entries of changes in property,
plant and equipment by  type
 as of December 31, 2012 |  | Land  |        |  | Buildings, net |  |         | Machinery, net |  |  | Transport equipment, net |   |  | Furniture and fixtures, net |         |   | Office equipment, net |  |        | Constructions in progress |  |  | Other property, plant and equipment, net |   |  | Property, plant and equipment, net |         
|---------------------------------------------------------------------------------------------------- |  | ----- | ------ |  | -------------- |  | ------- | -------------- |  |  | ------------------------ | - |  | --------------------------- | ------- | - | --------------------- |  | ------ | ------------------------- |  |  | ---------------------------------------- | - |  | ---------------------------------- | --------
|                                                                                                     |  | ThUS$ |        |  | ThUS$          |  |         | ThUS$          |  |  | ThUS$                    |   |  | ThUS$                       |         |   | ThUS$                 |  |        | ThUS$                     |  |  | ThUS$                                    |   |  | ThUS$                              |         
|                                                                                                     |  |       |        |  |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Opening balance                                                                                      |  |       | 33,252 |  |                |  | 146,532 |                |  |  | 424,460                  |   |  |                             | 82,822  |   |                       |  | 5,015  |                           |  |  | 5,312                                    |   |  |                                    | 297,996 
|                                                                                                     |  |       |        |  |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Changes                                                                                              |  |       |        |  |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Additions                                                                                            |  |       | 36     |  |                |  | -       |                |  |  | 1,092                    |   |  |                             | 34      |   |                       |  | 70     |                           |  |  | 323                                      |   |  |                                    | 443,349 
|Divestitures                                                                                         |  |       | -      |  |                |  | -       |                |  |  | (115                     | ) |  |                             | -       |   |                       |  | (67    | )                         |  |  | (12                                      | ) |  |                                    | (2,936  
|Depreciation expense                                                                                 |  |       | -      |  |                |  | (14,800 | )              |  |  | (79,534                  | ) |  |                             | (18,400 | ) |                       |  | (1,858 | )                         |  |  | (1,857                                   | ) |  |                                    | -       
|Increase(decrease) in foreign currency exchange                                                      |  |       | 32     |  |                |  | (1      | )              |  |  | 5                        |   |  |                             | 15      |   |                       |  | -      |                           |  |  | (13                                      | ) |  |                                    | -       
|Reclassification                                                                                     |  |       | -      |  |                |  | 37,916  |                |  |  | 92,441                   |   |  |                             | 24,535  |   |                       |  | 3,576  |                           |  |  | 1,478                                    |   |  |                                    | (287,291
|Other increases (decreases) (*)                                                                      |  |       | -      |  |                |  | 84      |                |  |  | (18                      | ) |  |                             | (52     | ) |                       |  | -      |                           |  |  | 18                                       |   |  |                                    | (27,934 
|                                                                                                     |  |       |        |  |                |  |         |                |  |  |                          |   |  |                             |         |   |                       |  |        |                           |  |  |                                          |   |  |                                    |         
|Total changes                                                                                        |  |       | 68     |  |                |  | 23,199  |                |  |  | 13,871                   |   |  |                             | 6,132   |   |                       |  | 1,721  |                           |  |  | (63                                      | ) |  |                                    | 125,188 
|Final balance                                                                                        |  |       | 33,320 |  |                |  | 169,731 |                |  |  | 438,331                  |   |  |                             | 88,954  |   |                       |  | 6,736  |                           |  |  | 5,249                                    |   |  |                                    | 423,184 



(*) The net balance of Other increases
(decreases) corresponds to: 1) investment plan expenses which are charged to profit or loss (as a component of cost of sales and
other expenses per function, as appropriate), 2) the variation representing the purchase and use of materials and spare parts and
3) projects corresponding mainly to exploration expenditures and stain development.



F-129







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 14 - Property, plant
and equipment (continued)



| | 14.3 | Detail of property, plant and equipment pledged as guarantee
| | ---- | ------------------------------------------------------------



There are no restrictions in title or guarantees
for the compliance with obligations which affect property, plant and equipment.



| | 14.4 | Additional information
| | ---- | ----------------------



Interest capitalized in construction-in-progress:



The amount capitalized for this concept
amounted to ThUS$17,232 as of December 31, 2013 and ThUS$ 14,153 as of December 31, 2012.



Financing costs are not capitalized for
periods which exceed the normal term of acquisition, construction or installation of the asset, such as the case of delays, interruptions
or temporary suspension of the project due to technical, financial or other issues, which prevent that the asset is maintained
in good conditions for its use.



| | 14.5 | Impairment of assets
| | ---- | --------------------



As stated in Note 3.22, the recoverable
amount of property, plant and equipment is measured whenever there is an indication that the asset may be impaired. As of December
31, 2013, certain assets have suffered impairment for which a provision has been recognized for an amount of ThUS$10,085. As of
December 31, 2012, and 2011, no impairment adjustments were generated.



| | 14.6 | Reclassifications
| | ---- | -----------------



For comparative purposes, ThUS$75,740 were
reclassified from the caption property, plant and equipment (land) to intangible assets (indeterminable mineral rights). These
assets represent mining concessions SQM acquired from third-parties, which have been recorded at acquisition cost, and are amortized
as the corresponding property is developed based on the tons estimated to be extracted over the life of the property. These mining
concessions are comprised of land and their associated mineral rights, which can be legally separated and were reclassificed to
conform with the presentation and disclosure requirements of the SVS.



F-130







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 - Employee benefits



| | 15.1 | Provisions for employee benefits
| | ---- | --------------------------------



|Classes of benefits and expenses by |  | 12/31/2013 |        |  | 12/31/2012 | 
|----------------------------------- |  | ---------- | ------ |  | ---------- | 
|employee                            |  | ThUS$      |        |  | ThUS$      | 
|Current                             |  |            |        |  |            | 
|Profit sharing and bonuses          |  |            | 25,236 |  |            | 
|Total                               |  |            | 25,236 |  |            | 
|                                    |  |            |        |  |            | 
|Non-current                         |  |            |        |  |            | 
|Profit sharing and bonuses          |  |            | 277    |  |            | 
|Severance indemnity payments        |  |            | 32,137 |  |            | 
|Pension Plan                        |  |            | -      |  |            | 
|Total                               |  |            | 32,414 |  |            | 



F-131







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 Employee benefits
(continued)



| | 15.2 | Policies on defined benefit plan
| | ---- | --------------------------------



This policy is applied to all benefits
received for services provided by the Company's employees.



Short-term benefits for active employees
are represented by salaries, social welfare benefits, paid time-off, sickness leaves and other leaves, profit sharing and incentives
and non-monetary benefits; e.g., healthcare service, housing, subsidized or free goods or services. These will be paid in a term
which does not exceed twelve months.



The Company only provides compensation
and benefits to active employees, with the exception of SQM North America which applies the definitions under 15.4 below.



SQM maintains incentive programs for its
employees based on the personal performance, the Company’s performance and other short-term, mid-term and long-term indicators.



For each incentive bonus delivered to the
Company’s employees, there will be a disbursement in the first quarter of the following year based on Profit at the end of
each period applying a rate obtained subsequent to the employee’s evaluation.



Employee benefits include retention bonuses
for the Company’s executives, which are linked to the Company’s share price and paid in cash. The short-term portion
is presented as a provision for current employee benefits and the long-term portion.



The bonus provided to the Company’s
directors is calculated based on Profit for the period at each year-end and will consider the application of a percentage factor.



The benefit related to vacations (short-term
benefits to employees, current), which is provided in accordance with the Labor Laws that indicate that employees with more than
a year of service will be entitled to annual holidays for a period not less than fifteen business days. The Company provides the
benefit of two additional vacation days.



Staff severance indemnities are agreed
and payable based on the last salary for each year of service for the Company or with certain maximum limits in respect to the
number of years to be considered or in respect to monetary terms. In general, this benefit is payable when the employee or worker
ceases to provide his/her services to the Company and the right for its collection can be acquired because of different causes,
as indicated in the respective agreements; e.g., retirement, dismissal, voluntary retirement, incapacity or disability, death,
etc.



Law No. 19,728 published on May 14, 2001
which became effective on October 1, 2002 required “Compulsory Unemployment Insurance” in favor of all depending employees
regulated by the Chilean Labor Code. Article 5 of this law establishes the financing of this insurance through monthly contributions
and payments by both the employee and the employer.



F-132







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 - Employee benefits
(continued)



| | 15.3 | Other long-term benefits
| | ---- | ------------------------



The other long-term benefits relate to staff severance indemnities
and are recorded at their actuarial value.



|                                               |  | 12/31/2013 |        |  | 12/31/2012 | 
|---------------------------------------------- |  | ---------- | ------ |  | ---------- | 
|Staff severance indemnities at actuarial value |  | ThUS$      |        |  | ThUS$      | 
|Staff severance indemnities, Chile             |  |            | 31,470 |  |            | 
|Other obligations in companies elsewhere       |  |            | 667    |  |            | 
|Total other non-current liabilities            |  |            | 32,137 |  |            | 
|                                               |  |            |        |  |            | 
|SQM North America’s pensions plan              |  |            | -      |  |            | 
|Total post-employment obligations              |  |            | -      |  |            | 



Staff severance indemnities have been calculated
under the actuarial assessment method of the Company’s obligations with respect to staff severance indemnities, which relate
to defined benefit plans which consist of days of remuneration per year served at the time of retirement under conditions agreed
in the respective agreements established between the Company and its employees.



Under this benefit plan, the Company retains
the obligation for the payment of staff severance indemnities related to retirements without establishing a separate fund with
specific assets, which is referred to as not funded. The discount interest rate of expected flows is 6%.



Benefit payment conditions



The staff severance indemnity benefit relates
to remuneration days for year worked for the Company with no limit of salary or years of services for the Company, when employees
cease to work for the Company due to turnover or death. In this case, the maximum age for men is 65 years and 60 years old for
women, which are the usual ages for retirement due to achieving the senior citizen age according to the Chilean pensions system
provided in Decree 3.500 of 1980.



Methodology



The determination of the obligation for
benefits under IAS 19, Projected Benefit Obligation (PBO) is described as follows:



The Company’s total liability is
based on an actuarial model applied to each employee on an individual basis.



F-133







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 - Employee benefits
(continued)



| | 15.3 | Other long-term benefits, continued
| | ---- | -----------------------------------



This model considered months as discrete
time; i.e., the Company determined the age of each person and his/her salary on a monthly basis according to the growth rate. Thus,
information on each person was developed from the beginning of the life of his/her employment contract or when he/she started earning
benefits up to the month in which it reaches the normal retirement age, generating in each period the possible retirement according
to the Company’s turnover rate and the mortality rate according to the age reached. When he/she reaches the retirement age,
the employee finishes his/her service for the Company and receives indemnity related to retirement.



The following methodology to determine
the accrual for all the employees included in the agreements has considered turnover rates and the mortality rate RV-2010 established
by the Chilean Superintendence of Securities and Insurance to calculate pension-related life insurance reserves in Chile according
to the Accumulated Benefit Valuation or Accrued Cost of Benefit Method. This methodology is established in IAS 19 on Retirement
Benefit Costs.



| | 15.4 | Post-employment benefit obligations
| | ---- | -----------------------------------



Our subsidiary SQM North America, has established
with its employees a pension plan until 2002 called “SQM North America Retirement Income Plan”, of which an obligation
is calculated measuring the expected future forecasted staff severance indemnity obligation using salary rate adjusted for inflation,
mortality and turnover assumptions discounted to their present value using the interest rate defined by the authorities.



Since 2003, SQM North America has offered
its employees a 401K system, which does not generate obligations for the Company.



The table below shows the plan financing
status and the amounts recognized in the consolidated Statement of Financial Position.



|Reconciliation table                 |  | 2013  |       |   | 2012  |  |       | 2011  | 
|------------------------------------ |  | ----- | ----- | - | ----- |  | ----- | ----- | 
|                                     |  | ThUS$ |       |   | ThUS$ |  |       | ThUS$ | 
|Variation in the benefit obligation: |  |       |       |   |       |  |       |       | 
|Benefit obligation at January 1      |  |       | 6,482 |   |       |  | 6,620 |       | 
|Service cost                         |  |       | 1     |   |       |  | 1     |       | 
|Interest cost                        |  |       | 412   |   |       |  | 406   |       | 
|Actuarial gain (loss)                |  |       | 387   |   |       |  | (236  | )     | 
|Benefits paid                        |  |       | (360  | ) |       |  | (309  | )     | 
|Benefit obligation at December 31    |  |       | 6,922 |   |       |  | 6,482 |       | 



F-134







Notes
to the Consolidated Financial Statements as of December 31, 2013



Nota  15 - Employee
benefits (continued)



| | 15.4 | Other long-term benefits, continued
| | ---- | -----------------------------------



|                                                                                 |  | 2013  |        |   | 2012  |  |        | 2011  | 
|-------------------------------------------------------------------------------- |  | ----- | ------ | - | ----- |  | ------ | ----- | 
|                                                                                 |  | ThUS$ |        |   | ThUS$ |  |        | ThUS$ | 
|Variation in plan assets:                                                        |  |       |        |   |       |  |        |       | 
|Fair value of plan assets as of January 1                                        |  |       | 6,073  |   |       |  | 5,206  |       | 
|Employer contributions                                                           |  |       | 453    |   |       |  | 436    |       | 
|Actual return (loss) on plan assets                                              |  |       | 1,743  |   |       |  | 740    |       | 
|Benefits paid                                                                    |  |       | (360   | ) |       |  | (309   | )     | 
|Fair value of plan assets as of December 31                                      |  |       | 7,909  |   |       |  | 6,073  |       | 
|                                                                                 |  |       |        |   |       |  |        |       | 
|Funding status                                                                   |  |       | 987    |   |       |  | (409   | )     | 
|Items not yet recognized as net periodical pension and healthcare cost elements: |  |       |        |   |       |  |        |       | 
|Net actuarial loss at the beginning of the period                                |  |       | (2,243 | ) |       |  | (2,954 | )     | 
|Amortization during the period                                                   |  |       | 109    |   |       |  | 131    |       | 
|                                                                                 |  |       |        |   |       |  |        |       | 
|Net profit or loss expected to occur during the period                           |  |       | 903    |   |       |  | 580    |       | 
|Adjustment to recognize a minimum pension and healthcare obligation              |  |       | (1,231 | ) |       |  | (2,243 | )     | 



As of December 31, 2013, 2012 and 2011, the net periodical pension
and healthcare expense comprised the following elements.



|                                                          |  | 2013  |        |   | 2012  |  |      | 2011  | 
|--------------------------------------------------------- |  | ----- | ------ | - | ----- |  | ---- | ----- | 
|Reconciliation                                            |  | ThUS$ |        |   | ThUS$ |  |      | ThUS$ | 
|                                                          |  |       |        |   |       |  |      |       | 
|Cost of benefits from services obtained during the period |  |       | 2      |   |       |  | 2    |       | 
|Interest cost on benefit obligation                       |  |       | 412    |   |       |  | 406  |       | 
|Actual return on plan assets                              |  |       | 1,743  |   |       |  | 739  |       | 
|Amortization for prior period losses                      |  |       | 109    |   |       |  | 131  |       | 
|Net loss during the period                                |  |       | (1,290 | ) |       |  | (344 | )     | 
|Net periodic provisional expense                          |  |       | 69     |   |       |  | 142  |       | 



F-135







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 - Employee benefits
(continued)



| | 15.5 | Staff severance indemnities
| | ---- | ---------------------------



As of December 31, 2013 and December 31,
2012, severance indemnities calculated at the actuarial value are as follows:



|                              |  | 2013 ThUS$ |         |   | 2012 ThUS$ |  |         | 2011 ThUS$ | 
|----------------------------- |  | ---------- | ------- | - | ---------- |  | ------- | ---------- | 
|Opening balance               |  |            | (34,431 | ) |            |  | (28,188 | )          | 
|Current cost of service       |  |            | (107    | ) |            |  | (8,087  | )          | 
|Interest cost                 |  |            | (2,248  | ) |            |  | (1,037  | )          | 
|Actuarial gain/loss           |  |            | (127    | ) |            |  | 40      |            | 
|Exchange rate difference      |  |            | 2,946   |   |            |  | (2,237  | )          | 
|Benefits paid during the year |  |            | 1,830   |   |            |  | 5,078   |            | 
|Balance                       |  |            | (32,137 | ) |            |  | (34,431 | )          | 



F-136







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 15 - Employee benefits
(continued)



| | 15.5 | Staff severance indemnities, continued
| | ---- | --------------------------------------



The liability recorded for staff severance indemnity is valued
the actuarial value method, using the following actuarial assumptions:



|                                    |  | 12/31/2013 |      |   | 12/31/2012 |  |      | 12/31/2011 |  |  |     
|----------------------------------- |  | ---------- | ---- | - | ---------- |  | ---- | ---------- |  |  | ----
|Mortality rate                      |  | RV - 2012  |      |   | RV - 2011  |  |      | RV - 2010  |  |  |     
|Actual annual interest rate         |  |            | 6    | % |            |  | 6    | %          |  |  | 6   
|Voluntary retirement rotation rate: |  |            |      |   |            |  |      |            |  |  |     
|Men                                 |  |            | 0.96 | % |            |  | 0.9  | %          |  |  | 0.9 
|Women                               |  |            | 1.36 | % |            |  | 1.53 | %          |  |  | 1.53
|Salary increase                     |  |            | 3.0  | % |            |  | 3.0  | %          |  |  | 3.0 
|Retirement age:                     |  |            |      |   |            |  |      |            |  |  |     
|Men                                 |  |            | 65   |   |            |  | 65   |            |  |  | 65  
|Women                               |  |            | 60   |   |            |  | 60   |            |  |  | 60  



Note 16 - Executive compensation
plan



The Company has established two compensation
plans to motivate the Company’s executives and encourage them to stay in the Company, by granting payments based on the changes
in SQM’s share price.



| | 1) | Shares
| | -- | ------



Liquidated in cash, executives are able
to exercise their rights until 2016.



Characteristics of the plan



This compensation plan is related to the
Company’s performance through SQM Series B share price(Santiago Stock Exchange).



Participants in this plan



This compensation plan includes 10 executives
of the Company who are entitled to this benefit, provided that they stay with the Company during the dates these options are executed.
The dates for exercising the options will be the first 7 calendar days of May following the fiscal year.



F-137







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 16 - Executive compensation
plan (continued)



Compensation



The compensation for each executive is
the difference between the average share prices of the share during April of each year compared to the base price established by
Company’s management. The base price fixed by the Company for this compensation plan amounts to US$ 50 per share. The Company
reserves the right to exchange that benefit by shares or share options.



The movement of the options in effect for
the period, the average prices for the fiscal year of the options and the average contractual life of the options in effect as
of December 31, 2013 and December 31, 2012 are the following:



|Movement for the period                |  | 2013 |           |   | 2012 | 
|-------------------------------------- |  | ---- | --------- | - | ---- | 
|In effect as of January 1              |  |      | 2,200,500 |   |      | 
|Granted during the fiscal year         |  |      | 45,000    |   |      | 
|Redundant workers                      |  |      | (187,500  | ) |      | 
|Exercised during the fiscal year       |  |      | -         |   |      | 
|Changes in benefit plan                |  |      | (522,000  | ) |      | 
|In circulation as of December 31, 2013 |  |      | 1,536,000 |   |      | 
|Average contractual life               |  |      | 28 months |   |      | 
|Executives                             |  |      | 10        |   |      | 



The amounts accrued by the plan, as of
December 31, 2013 and December 31, 2012, amount to:



|Effect on profit or loss |  | 2013 ThUS$ |       |  | 2012 ThUS$ | 
|------------------------ |  | ---------- | ----- |  | ---------- | 
|Effect on profit or loss |  |            | 8,200 |  |            | 



| | 2) | Executive Shares
| | -- | ----------------



Plan characteristics



This compensation plan was established
in 2013 and is also related to the Company’s performance through the SQM Series B share price (Santiago Stock Exchange).



Plan participants



This compensation plan includes 30 of the
Company’s top executives, who obtain this benefit, provided they remain in the Company at the payment dates. The payments
dates, if any, will be the first of January 2016, 2017 and 2018.



Compensation



The compensation for each executive is
the difference between the average share price during each of the months of December 2015, December 2016 and December 2017, respectively,
in its equivalent in US dollars and the reference prices, with the latter being the value between US$28 and the average weighted
price of the trading of SQM Series B shares in the Santiago Stock Exchange during December 2014. The difference cannot exceed US$15.00
and will be multiplied by 5,000. If the amount calculated is negative or zero, no bonus will be paid during that period, but in
such case, the bonus payable in the following period to the employee, will be equal to the product of multiplying the difference
by 10,000. If the value was negative or zero in December 2015 and also in December 2016, for calculating the bond of December 2017,
the differential will be multiplied by 15,000.



F-138







Notes
to the Consolidated Financial Statements as of December 31, 2013



The movement of the options in effect for
the period, the average prices for the fiscal year of the options and the average contractual life of the options in effect as
of December 31, 2013 and December 31, 2012 are the following:



|Movement for the period                |  | 2013* |          
|-------------------------------------- |  | ----- | ---------
|In effect as of January 1              |  |       | -        
|Granted during the fiscal year         |  |       | 450,000  
|In circulation as of December 31, 2013 |  |       | 450,000  
|Average weighted contractual life      |  |       | 48 months
|Executives                             |  |       | 30       



*Plan was adopted in 2013.



F-139







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity



Detail and changes in equity accounts are
shown in the consolidated statement of changes in equity.



| | 17.1 | Capital management
| | ---- | ------------------



The main object of capital management relative
to the administration of the Company’s financial debt and equity is to ensure the regular conduct of operations and business
continuity in the long term, with the constant intention of maintaining an adequate level of liquidity and in compliance with the
financial safeguards established in the debt contracts in force. Within this framework, decisions are made in order to maximize
the value of SQM.



Capital management must comply with, among
others, the limits contemplated in the Financing Policy approved Board of Directors, which establish a maximum consolidated debt
level of 1.5 times the debt/equity. This limit can be exceeded only if the Company’s management has a written and previously
granted authorization issued at the Extraordinary Shareholders’ Meeting.



In addition, capital management must comply
with the external capital requirements imposed (or covenants) in its financial obligations, which regulate the debt level in 1.4
times, in its more strict level.



In conjunction with the level of indebtedness,
it is also important for the Company to maintain a comfortable profile of maturities for its financial obligations, to oversee
the relation between its short-term financial obligations and the long-term maturities, and the relation they have with the Company’s
asset distribution. Consequently, the Company has maintained a liquidity level of 2,8 times during the last periods.



The Company’s management controls
capital management based on the following ratios:



|CAPITAL MANAGEMENT        |  | 12/31/2013 |         |   | 12/31/2012 |  |         | Description
    (1) |  | Calculation
    (1)                                                                                           
|------------------------- |  | ---------- | ------- | - | ---------- |  | ------- | ------------------- |  | --------------------------------------------------------------------------------------------------------------
|Net Financial Debt MUS$   |  |            | 882,020 |   |            |  | 929,197 |                     |  | Financial Debt – Financial Resources                                                                          
|Liquidity                 |  |            | 3.40    |   |            |  | 3.69    |                     |  | Current Asset divided by Current Liability                                                                    
|Net Debt / Capitalization |  |            | 0.27    |   |            |  | 0.30    |                     |  | Net Financial Debt divided by Total Equity                                                                    
|ROE                       |  |            | 19.5    | % |            |  | 30.1    | %                   |  | Income divided by Total Equity                                                                                
|ROA                       |  |            | 16.4    | % |            |  | 25.1    | %                   |  | EBITDA – Depreciation divided by Net Total Assets of financial
    resources less  related parties investments
|Indebtedness              |  |            | 0.96    |   |            |  | 1.02    |                     |  | Total Liability on Equity                                                                                     



| | (1) | Assumes
the absolute value of the accounting records
| | --- | ----------------------------------------------------





F-140







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.1 | Capital management, continued
| | ---- | -----------------------------



The Company’s capital requirements
change depending on variables such as: work capital requirements, new investment financing and dividends, among others. The Company
manages its capital structure and makes adjustments on the basis of the predominant economic conditions so as to mitigate the risks
associated with adverse market conditions and to take advantage of the opportunities there may be to improve the liquidity position.



There have been no changes in the capital
management objectives or policy within the years reported in this document. No breaches of external requirements of capital imposed
(or covenants) have been recorded.



| | 17.2 | Disclosures on preferred share capital
| | ---- | --------------------------------------



Issued share capital is divided into 263,196,524
fully paid and subscribed shares with no par value composed of 142,819,552 Series "A" shares and 120,376,972 Series “B”
shares, where both series are preferred shares.



The preferential voting rights for each
series are detailed as follows:



Series “A”:



If the election of the Company’s
President results in a tie vote, the Company's directors may vote once again, without the vote of the director elected by the Series
B shareholders.



Series “B”:



1)         A
general or extraordinary shareholders' meeting may be called at the request of shareholders representing 5% of the Company's Series
B shares.



2)         An
extraordinary meeting of the Board of Directors may be called with or without the agreement of the Company's President, at the
request of the director elected by Series B shareholders.



As of December 31, 2013, 2012 and 2011,
the Group does not hold any treasury shares either directly or through its companies in which it has investments.



F-141







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.2 | Disclosures on preferred share capital, continued
| | ---- | -------------------------------------------------



Detail of types of capital in preference shares:



|Type of capital in preferred shares                    |  | 12/31/2013 |             |  | 12/31/2012 |  |             | 12/31/2011 | 
|------------------------------------------------------ |  | ---------- | ----------- |  | ---------- |  | ----------- | ---------- | 
|Description of type of capital in preferred
    shares |  | Series A   |             |  | Series B   |  |             | Series A   | 
|Number of authorized shares                            |  |            | 142,819,552 |  |            |  | 120,376,972 |            | 
|Number of fully subscribed and paid shares             |  |            | 142,819,552 |  |            |  | 120,376,972 |            | 
|Par value of shares in US$                             |  |            | 0.9435      |  |            |  | 2.8464      |            | 
|Number of current shares                               |  |            | 142,819,552 |  |            |  | 120,376,972 |            | 
|Capital amount in shares ThUS$                         |  |            | 134,750     |  |            |  | 342,636     |            | 
|Total number of subscribed shares, total               |  |            | 142,819,552 |  |            |  | 120,376,972 |            | 



As of December 31, 2013, 2012 and 2011, the Company has not
placed any new issuances of shares on the market.



F-142







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.3 | Disclosures on reserves in equity
| | ---- | ---------------------------------



As of December 31, 2013 and 2012, this caption comprises the
following:



|                                                               |  | 12/31/2013 ThUS$ |         |   | 12/31/2012 ThUS$ |  |         | 12/31/2011 ThUS$ | 
|-------------------------------------------------------------- |  | ---------------- | ------- | - | ---------------- |  | ------- | ---------------- | 
|Reserve for currency exchange conversion                       |  |                  | (3,817  | ) |                  |  | (330    | )                | 
|Reserve for cash flow hedges                                   |  |                  | (3,766  | ) |                  |  | (16,522 | )                | 
|Reserve for actuarial gains or losses in defined benefit plans |  |                  | (1,231  | ) |                  |  | (2,243  | )                | 
|Other reserves                                                 |  |                  | (1,677  | ) |                  |  | (1,677  | )                | 
|                                                               |  |                  |         |   |                  |  |         |                  | 
|Total other reserves                                           |  |                  | (10,491 | ) |                  |  | (20,772 | )                | 



Reserves for currency exchange conversion



This balance reflects retained earnings
for changes in the exchange rate, when converting financial statements of subsidiaries whose functional currency is from each company’s
origin country and the presentation currency is the US dollar.



Reserve for cash flow hedges



The Company maintains as hedge instruments,
financial derivatives related to obligations with the public issued in Unidades de Fomento and Chilean pesos. Changes from the
fair value of derivatives designated and classified as hedges are recognized under this classification.



Reserve for actuarial gains or losses
in defined benefit plans



Our subsidiary SQM North America has established
pension plans for its retired employees that are calculated by measuring the projected obligation of IAS using a net salary progressive
rate net of adjustments to inflation, mortality and turnover assumptions, deducting the resulting amounts at present value using
a 6.5% interest rate for 2013 and 2012.



Other reserves



Corresponds to the acquisition of the subsidiary
SQM Iberian S.A., which was already under ownership of the Company at the acquisition date (IAS 27 R).



F-143







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.4 | Dividend policies
| | ---- | -----------------



As required by Article 79 of the Chilean
Companies Act, unless otherwise decided by unanimous vote of the holders of issued and subscribed shares, we must distribute a
cash dividend in an amount equal to at least 30% of our consolidated Profit for the period for year ended as of December 31, unless
and except to the extent that it has a deficit in retained earnings (losses not absorbed in prior years).



The Company’s dividend policy for
2013 is as follows:



| | - | Distribution and payment in favor of each shareholder of a final dividend which will be equivalent
to 50% of Profit for the period obtained in 2013.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------



| | - | Distribution and payment, if possible during 2013, of a interim dividend which will be recorded
against the aforementioned final dividend. This provisional dividend will be paid probably during the last quarter of 2013 and
its amount could not exceed 50% of the retained earnings for distribution obtained during 2013, which are reflected in the Company’s
financial statements as of September 31, 2013.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | The distribution and payment by the Company of the remaining balance of the final dividend related
to Profit for the period for the 2013 commercial year in up to two installments, which will have to be effectively paid and distributed
prior to June 30, 2014.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | An amount equivalent to the remaining 50% of the Company’s Profit for the period for 2013
will be retained and destined to the financing of operations of one or more of the Company’s investment projects with no
prejudice of the possible future capitalization of the entirety or a portion of this.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | The Board of Directors does not consider the payment of any additional and interim dividends.
| | - | ---------------------------------------------------------------------------------------------



| | - | The Board of Directors considers as necessary to indicate that the aforementioned Dividends Policy
correspond to the intention or expectation of the Board regarding this matter. Consequently, the enforcement of such Policy Dividends
is necessarily conditioned to net incomes finally obtained, to the results indicating the Company’s regular forecasts or
the existence of certain conditions that could affect them. Notwithstanding the above and to the extent that such policy dividend
does not suffer a significant change, SQM S.A. will timely communicate its shareholders on this matter.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-144







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.5 | Provisional dividends
| | ---- | ---------------------



On November 19, 2013, the Board of Directors
of Sociedad Química y Minera de Chile S.A, agreed to pay and distribute to the Company’s shareholders, stating from
December 12, 2013, a provisional dividend of US$0.75609 per share, equivalent, approximately, to ThUS$199,000 or 49.9% of the net
distributable profit for the commercial year 2013, accumulated at September 30 of such year. The above, also, is charged against
income of said commercial year, in favor of the Shareholders who appeared registered in SQM’s Shareholders Registry by the
5th working day prior to December 12, and in its equivalent in Chilean pesos according to the value of the “Observed dollar”
or “USA dollar” that appears published in the Official Gazette on December 6, 2013.



On April 25th, 2013, at the 38th ordinary
shareholders’ meeting, a definitive dividend payment of US$1.23323 per share was approved, based on the net profit earned
during the commercial year 2012. US$0.94986 per share that was already paid as provisional dividend should be discounted from the
abovementioned dividend, and the balance, amounting to US$0.28337 per share will paid and distributed in favor of the Shareholders
who appeared registered in SQM’s Shareholders Registry by the 5th working day prior the day in which the dividend will be
paid. The last amount, if corresponds, will be paid in its equivalent in Chilean pesos according to the value of the “Observed
dollar” or “USA dollar” that appears published in the Official Gazette on April 25, 2013.



F-145











Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 17 - Disclosures
on equity (continued)



| | 17.5 | Provisional dividends, continued
| | ---- | --------------------------------



Dividends presented deducted from equity
are:



|                                               |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ |  |         | 12/31/2011 ThUS$ | 
|---------------------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- | 
|Dividends attributable to owners of the parent |  |                  | 203,401 |  |                  |  | 253,438 |                  | 
|Dividends payable                              |  |                  | 36,583  |  |                  |  | 76,267  |                  | 
|Total                                          |  |                  | 239,984 |  |                  |  | 329,705 |                  | 



F-146







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities



| | 18.1 | Types of provisions
| | ---- | -------------------



|                                                               |  | 12/31/2013 |        |  | 12/31/2012   | 
|-------------------------------------------------------------- |  | ---------- | ------ |  | ------------ | 
|                                                               |  | Current    |        |  | Non- current | 
|                                                               |  | ThUS$      |        |  | ThUS$        | 
|                                                               |  |            |        |  |              | 
|Provision for legal complaints (*)                             |  |            | 8,567  |  |              | 
|Provision for dismantling, restoration and rehabilitation cost |  |            | -      |  |              | 
|Other provisions                                               |  |            | 9,386  |  |              | 
|Total                                                          |  |            | 17,953 |  |              | 



(*) Provisions for legal complaints relate
to legal expenses for lawsuits whose resolution are pending, and correspond to funds estimated necessary to make the disbursement
of expenses incurred for this purpose. This provision relates mainly to the litigation of its subsidiary located in Brazil and
United States (see note 19.1) and other litigations.



F-147







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities (continued)



| | 18.2 | Description of other provisions
| | ---- | -------------------------------



|Description of other provisions                                           |  | 12/31/2013 ThUS$ |       |  | 12/31/2012 ThUS$ | 
|------------------------------------------------------------------------- |  | ---------------- | ----- |  | ---------------- | 
|Current provisions, other short-term provisions                           |  |                  |       |  |                  | 
|Provision for tax loss in fiscal litigation                               |  |                  | 1,401 |  |                  | 
|Royalties, agreement with CORFO (the Chilean Economic Development Agency) |  |                  | 4,782 |  |                  | 
|Fine to Brazil                                                            |  |                  | 2,500 |  |                  | 
|Miscellaneous provisions                                                  |  |                  | 703   |  |                  | 
|Total                                                                     |  |                  | 9,386 |  |                  | 
|Other long-term provisions                                                |  |                  |       |  |                  | 
|Mine closure                                                              |  |                  | 5,633 |  |                  | 
|Total                                                                     |  |                  | 5,633 |  |                  | 



| | 18.3 | Other non-financial liabilities, current
| | ---- | ----------------------------------------



|Description of other liabilities                 |  | 12/31/2013 ThUS$ |        |  | 12/31/2012 ThUS$ | 
|------------------------------------------------ |  | ---------------- | ------ |  | ---------------- | 
|                                                 |  |                  |        |  |                  | 
|Tax withholdings                                 |  |                  | 12,334 |  |                  | 
|VAT payable                                      |  |                  | 2,531  |  |                  | 
|Guarantees received                              |  |                  | 1,000  |  |                  | 
|Accrual for dividend                             |  |                  | 36,583 |  |                  | 
|Monthly tax provisional payments                 |  |                  | 6,601  |  |                  | 
|Deferred income                                  |  |                  | 13,475 |  |                  | 
|Withholdings from employees and salaries payable |  |                  | 4,087  |  |                  | 
|Accrued vacations                                |  |                  | 18,652 |  |                  | 
|Other current liabilities                        |  |                  | 90     |  |                  | 
|Total                                            |  |                  | 95,353 |  |                  | 



F-148







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities (continued)



| | 18.4 | Changes in provisions as of 12/31/2013
| | ---- | --------------------------------------



|Description of items that gave rise to variations |  | Legal complaints |        |  | Provision for dismantling,
    restoration and rehabilitation cost |  |       | Other provisions |  |  | Total   |  
|------------------------------------------------- |  | ---------------- | ------ |  | ------------------------------------------------------------------ |  | ----- | ---------------- |  |  | ------- | -
|                                                  |  | ThUS$            |        |  | ThUS$                                                              |  |       | ThUS$            |  |  | ThUS$   |  
|                                                  |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|Total provisions, initial balance                 |  |                  | 8,567  |  |                                                                    |  | 4,357 |                  |  |  | 12,922  |  
|                                                  |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|Changes in provisions:                            |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|                                                  |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|Additional provisions                             |  |                  | 3,000  |  |                                                                    |  | 1,276 |                  |  |  | 12,608  |  
|                                                  |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|Provision used                                    |  |                  | -      |  |                                                                    |  | -     |                  |  |  | (15,943 | )
|Increase(decrease) in foreign currency exchange   |  |                  | -      |  |                                                                    |  | -     |                  |  |  | (201    | )
|                                                  |  |                  |        |  |                                                                    |  |       |                  |  |  |         |  
|Total provisions, final
    balance               |  |                  | 11,567 |  |                                                                    |  | 5,633 |                  |  |  | 9,386   |  



F-149







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities (continued)



| | 18.4 | Changes in provisions as of 12/31/2012
| | ---- | --------------------------------------



|Description of items that gave rise to variations |  | Legal complaints |       |   | Provision for dismantling,
    restoration and rehabilitation cost |  |       | Other provisions |  |  | Total   |  
|------------------------------------------------- |  | ---------------- | ----- | - | ------------------------------------------------------------------ |  | ----- | ---------------- |  |  | ------- | -
|                                                  |  | ThUS$            |       |   | ThUS$                                                              |  |       | ThUS$            |  |  | ThUS$   |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Total provisions, initial balance                 |  |                  | 7,571 |   |                                                                    |  | 3,724 |                  |  |  | 14,237  |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Changes in provisions:                            |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Additional provisions                             |  |                  | 1,000 |   |                                                                    |  | 633   |                  |  |  | 8,863   |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Provision used                                    |  |                  | (4    | ) |                                                                    |  | -     |                  |  |  | (10,061 | )
|Increase (decrease) in foreign currency exchange  |  |                  | -     |   |                                                                    |  | -     |                  |  |  | (117    | )
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Total provisions, final
    balance               |  |                  | 8,567 |   |                                                                    |  | 4,357 |                  |  |  | 12,922  |  



F-150







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities (continued)



| | 18.5 | Changes in provisions as of 12/31/2011
| | ---- | --------------------------------------



|Description of items that gave rise to variations |  | Legal complaints |       |   | Provision for dismantling,
    restoration and rehabilitation cost |  |       | Other provisions |  |  | Total   |  
|------------------------------------------------- |  | ---------------- | ----- | - | ------------------------------------------------------------------ |  | ----- | ---------------- |  |  | ------- | -
|                                                  |  | ThUS$            |       |   | ThUS$                                                              |  |       | ThUS$            |  |  | ThUS$   |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Total provisions, initial balance                 |  |                  | 4,590 |   |                                                                    |  | 3,500 |                  |  |  | 12,424  |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Changes in provisions:                            |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Additional provisions                             |  |                  | 3,000 |   |                                                                    |  | 224   |                  |  |  | 13,076  |  
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Provision used                                    |  |                  | (19   | ) |                                                                    |  | -     |                  |  |  | (11,080 | )
|Increase (decrease) in foreign currency exchange  |  |                  | -     |   |                                                                    |  | -     |                  |  |  | (183    | )
|                                                  |  |                  |       |   |                                                                    |  |       |                  |  |  |         |  
|Total provisions, final
    balance               |  |                  | 7,571 |   |                                                                    |  | 3,724 |                  |  |  | 14,237  |  



F-151







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 18 - Provisions and
other non-financial liabilities (continued)



| | 18.6 | Detail of main types of provisions
| | ---- | ----------------------------------



Legal expenses: This
provision depends on the pending resolution of a legal lawsuit, to pay the expenses associated to and incurred during such lawsuit
(incurred mainly in Brazil and U.S.A.).



Tax accrual in tax litigation:
This accrual relates to lawsuits pending resolution related to taxes in Brazil for two of our subsidiaries, SQM Brazil and NNC.



CORFO (Economic Development
Agency) Royalties agreement: Relates to the commercialization of mining properties that SQM Salar S.A. pays the Economic Development
Agency for on a quarterly basis. The amount of the lease payable is calculated based on sales of products extracted from the Atacama
Saltpeter deposit.



The settlement of the aforementioned
amounts is performed on a quarterly basis.



To date, the Company and its subsidiaries have no
significant uncertainties about the timing and amount of one class of provision.



F-152







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions



According to note 18.1 the Company has
only registered a provision for those lawsuits in which the probability to lose is “more likely than not”. The Company
is party to lawsuits and other relevant legal actions, including the claimed or nominal value amount, that are detailed as follows:



| | 19.1 | Lawsuits and other relevant events
| | ---- | ----------------------------------



|1. | Plaintiff     | : | JB Comércio de Fertilizantes and Defensivos Agrícolas Ltda. (JB)                                                                              
|-- | ------------- | - | ----------------------------------------------------------------------------------------------------------------------------------------------
|   | Defendant     | : | Nitratos Naturais do Chile Ltda. (NNC)                                                                                                        
|   | Date          | : | December 1995                                                                                                                                 
|   | Court         | : | MM 1a, Vara Civel de Comarca de Barueri, Brazil.                                                                                              
|   | Reason        | : | Compensation claim filed by JB against NNC for having appointed a distributor in a territory of Brazil for which JB had an exclusive contract.
|   | Status        | : | Lower court ruling against Nitratos Naturais do Chile Ltda. and recourse of appeal pending resolution.                                        
|   | Nominal value | : | ThUS$ 1,800                                                                                                                                   
|   |               |   |                                                                                                                                               
|2. | Plaintiff     | : | Nancy Erika Urra Muñoz                                                                                                                        
|   | Defendants    | : | Fresia Flores Zamorano, Duratec-Vinilit S.A. and SQM S.A. and their insurers                                                                  
|   | Date          | : | December 2008                                                                                                                                 
|   | Court         | : | 1st Civil Court of Santiago                                                                                                                   
|   | Reason        | : | Labor Accident                                                                                                                                
|   | Status        | : | Evidence                                                                                                                                      
|   | Nominal value | : | ThUS$550                                                                                                                                      



F-153







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.1 | Lawsuits and other relevant events, continued
| | ---- | ---------------------------------------------



|3. | Plaintiff     | : | City of Pomona, California USA                                                                                                                                                                                  
|-- | ------------- | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | Defendant     | : | SQM North America Corporation                                                                                                                                                                                   
|   | Date          | : | December 2010                                                                                                                                                                                                   
|   | Court         | : | United States District Court Central District of California                                                                                                                                                     
|   | Reason        | : | Payment of expenses and other amount related to the treatment of groundwater to allow for consumption by removing the existing perchlorate in such groundwater and that supposedly come from Chilean fertilizer.
|   | Status        | : | Conditional waiver as a result of pending appeal. Appeal will be reviewed in a hearing in October of 2013. Sentence pending.                                                                                    
|   | Nominal value | : | Not possible to determine                                                                                                                                                                                       
|   |               |   |                                                                                                                                                                                                                 
|4. | Plaintiff     | : | City of Lindsay, California USA                                                                                                                                                                                 
|   | Defendant     | : | SQM North America Corporation                                                                                                                                                                                   
|   |               |   | The lawsuit also was filed against Sociedad Química y                                                                                                                                                           
|   |               |   | Minera de Chile S.A. this lawsuit has not yet been notified to the Company                                                                                                                                      
|   | Date          | : | December 2010                                                                                                                                                                                                   
|   | Court         | : | United States District Court Eastern District of California                                                                                                                                                     
|   | Reason        | : | Payment of expenses and other amount related to the treatment of groundwater to allow for consumption by removing the existing perchlorate in such groundwater and that supposedly come from Chilean fertilizer.
|   | Status        | : | Claim. Suspended procedure                                                                                                                                                                                      
|   | Nominal value | : | Not possible to determine                                                                                                                                                                                       
|   |               |   |                                                                                                                                                                                                                 
|5. | Plaintiff     | : | Metalúrgica FAT Limitada                                                                                                                                                                                        
|   | Defendant     | : | SQM Salar S.A.                                                                                                                                                                                                  
|   | Date          | : | August 2011                                                                                                                                                                                                     
|   | Court         | : | 9th Civil Court in Santiago                                                                                                                                                                                     
|   | Reason        | : | Compensation for early termination of supply contract and installation of metal structures                                                                                                                      
|   | Status        | : | .Verdict of $40m in damages. Appeal pending.                                                                                                                                                                    
|   | Nominal value | : | ThUS$175                                                                                                                                                                                                        



F-154







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies and
restrictions (continued)



| | 19.1 | Lawsuits and other relevant events, continued
| | ---- | ---------------------------------------------



|6. | Plaintiff     | : | Angelina Castillo Figueroa and others                                                     
|-- | ------------- | - | ------------------------------------------------------------------------------------------
|   | Defendant     | : | SQM Nitratos S.A. and its insurers                                                        
|   | Date          | : | June 2012                                                                                 
|   | Court         | : | 2nd Civil Court in Santiago                                                               
|   | Reason        | : | Compensation claim for alleged civil liability under tort                                 
|   |               |   | derived from explosion occurred on September 6, 2010                                      
|   |               |   | near Baquedano causing the death of 6 workers                                             
|   | Status        | : | Evidence.                                                                                 
|   | Nominal value | : | ThUS$9,400                                                                                
|   |               |   |                                                                                           
|7. | Plaintiff     | : | María Angélica Alday Fuentes                                                              
|   | Defendant     | : | Vladimir Roco Alvarez, Compass Catering S.A. and SQM S.A.                                 
|   | Date          | : | August 2012                                                                               
|   | Court         | : | 1st Civil Court in Antofagasta                                                            
|   | Reason        | : | Compensation for moral damages for attempted sexual assault.                              
|   | Status        | : | Replay to claim.                                                                          
|   | Nominal value | : | ThUS$200                                                                                  
|   |               |   |                                                                                           
|8. | Plaintiff     | : | Workers Union of the Sociedad Industrial Minera Nueva Victoria                            
|   | Defendant     | : | SQM S.A. and SQM Industrial S.A.                                                          
|   | Date          | : | May 2013                                                                                  
|   | Court         | : | Iquique Labor Court of First Instance                                                     
|   | Reason        | : | Charging of benefits allegedly owed due to possible application of bonus for meeting goals
|   | Status        | : | Trial Preparation Hearings (2)                                                            
|   | Nominal value | : | ThUS$400                                                                                  
|   |               |   |                                                                                           
|9. | Plaintiff     | : | Cristián Plaza Portilla, Sergio Herrera Contreras and other                               
|   | Defendant     | : | SQM Salar S.A.                                                                            
|   | Date          | : | August 2013                                                                               
|   | Court         | : | Antofagasta Labor Court of First Instance                                                 
|   | Reason        | : | Charging of benefits allegedly owed due to possible application of bonus for meeting goals
|   | Status        | : | Trial Preparation Hearings (8)                                                            
|   | Nominal value | : | ThUS$1,120                                                                                



F-155







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.1 | Lawsuits and other relevant events, continued
| | ---- | ---------------------------------------------



|10. | Plaintiff     | : | E-CL S.A                                                                                                                                                                                                                                
|--- | ------------- | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | Defendant     | : | Sociedad Química y Minera de Chile S.A.                                                                                                                                                                                                 
|    | Date          | : | September 2013                                                                                                                                                                                                                          
|    | Court         | : | Arbitration                                                                                                                                                                                                                             
|    | Reason        | : | Early termination of the Power Supply Contract entered into on February 12, 1999 (which matures in March 2016), on the basis of the alleged incompliance of a prior sentence between both parties that was resolved in favor of SQM S.A.
|    | Status        | : | Evidentiary stage                                                                                                                                                                                                                       
|    | Nominal value | : | ThUS$5,100                                                                                                                                                                                                                              
|    |               |   |                                                                                                                                                                                                                                         
|11. | Plaintiff     | : | Workers Union of the Sociedad Industrial
Minera Nueva Victoria                                                                                                                                                                          
|    | Defendant     | : | SQM S.A. and SQM Industrial S.A.                                                                                                                                                                                                        
|    | Date          | : | October 2013                                                                                                                                                                                                                            
|    | Court         | : | Iquique Labor Court of First Instance                                                                                                                                                                                                   
|    | Reason        | : | Charging of benefits allegedly owed due to possible application of bonus for meeting goals                                                                                                                                              
|    | Status        | : | Response to law suit (2)                                                                                                                                                                                                                
|    | Nominal value | : | ThUS$400                                                                                                                                                                                                                                



F-156







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.1 | Lawsuits and other relevant events, continued
| | ---- | ---------------------------------------------



The Company and its subsidiaries have been
involved and will probably continue to be involved in,either as plaintiffs or defendants, certain judicial proceedings that have
been and will be heard by the Arbitral or Ordinary Courts of Justice that will make the final decision. Those proceedings that
are regulated by the appropriate legal regulations are intended to exercise or oppose certain actions or exceptions related to
certain mining claims either granted or to be granted and that do not or will not affect in an essential manner the development
of the Company and its subsidiaries.



Soquimich Comercial S.A. has been involved
in and will probably continue being involved in either as plaintiff or defendant certain judicial proceedings through which it
intends to collect and receive the amounts owed, the total nominal value of which is approximately ThUS$700.



The Company has made efforts and continues
to make efforts to obtain payment of certain amounts that are still owed to it on occasion of their activities. Such amounts will
continue to be required using judicial or non-judicial means by the plaintiffs, and the actions and exercise related to these are
currently in full force and effect.



The Company and its subsidiaries have not
received legal notice of any claims other than those mentioned in paragraph I above. The claims detailed above seek to annul certain
mining claims that were purchased by SQM S.A. and Subsidiaries, the proportional purchase value of which, with respect to the portion
affected by the superimposition, exceeds the nominal and approximate amount of ThUS$150. The claims seek payment of certain amounts
allegedly owed by the Company due to its own activities, which exceed the approximate, nominal and individual amount of ThUS$150.



F-157







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.2 | Restrictions to management or financial limits
| | ---- | ----------------------------------------------



Credit contracts subscribed by the SQM
Group with domestic and foreign banks and for issuance of bonuses in the local and international market, requires the Company complies
with the following level of consolidated financial indicators, calculated for a moving period which considers the last twelve months:



| | - | To maintain a minimum equity of ThUS$900,000.
| | - | ---------------------------------------------



| | - | To maintain a Net Financial Debt and EBITDA ratio not higher than 3 times.
| | - | --------------------------------------------------------------------------



| | - | To maintain a Total Indebtedness Ratio not higher than 1.4 times Total Indebtedness level defined
as the Total Liabilities ratio divided by Total Equity.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | To maintain a ratio between the operating subsidiaries SQM Industrial S.A. and SQM Salar S.A.,
or their respective legal successor’ financial debt and the total Issuer’s consolidated current assets not higher than
0.3 times.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of December 31, 2013, the aforementioned
financial indicators are as follows:

|Indicator                                          |  | 12/31/2013 |           |  | 12/31/2012 | 
|-------------------------------------------------- |  | ---------- | --------- |  | ---------- | 
|Equity ThUS$                                       |  |            | 2,432,241 |  |            | 
|Net Financial Debt/ EBITDA                         |  |            | 1.06      |  |            | 
|Indebtedness                                       |  |            | 0.96      |  |            | 
|SQM Industrial and SQM Salar debt / Current assets |  |            | 0.02      |  |            | 



Issuance contracts for bonuses issued abroad
require the Company does not merge or dispose at any title the asset as a whole or as a substantial part of it, unless the following
copulative conditions are met: (i) the legal successor company is an entity subject to Chilean or United States’ laws, and
assumes under a complimentary contract the Company’s obligations, (ii) the Issuer does not fail to comply immediately after
the merge or disposal, and (iii) The Issuer delivers a legal opinion stating the merge or disposal and the complimentary contract
meet the requirements described in the original contract.

In addition, SQM S.A. is committed to disclose
financial information on quarterly basis.

The Company and its subsidiaries have complied
and are fully complying with all aforementioned limitations, restrictions and obligations.



F-158







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.3 | Commitments
| | ---- | -----------



The subsidiary SQM Salar S.A. has signed
a rental contract with the Economic Development Agency (CORFO), which establishes that this subsidiary will pay rent to CORFO for
the concept of commercialization of certain mining properties owned by CORFO and for the products resulting from this commercialization.
The annual rent stated in the aforementioned contract is calculated on the basis of sales of each type of product. The contract
is in force until 2030, and rent began being paid in 1996 reflecting an expense amount of ThUS$22,885 as of December 31, 2013 (ThUS$
27,193 as of December 31, 2012).



On 15 November 2013, Corporación
de Fomento de la Producción (CORFO) sent a letter to SQM Salar S.A. (SQMS) stating its intention to a) collect the amount
of Ch$2,530,298,919 (ThUS$4,823) that in CORFO’s opinion, SQMS would owe to it for the calculation and payment of rental
payments according to the “Lease Agreement of OMA Mining Claims located in the Atacama Salt Flat” entered into between
CORFO and SQMS on November 12, 1993 (the AGREEMENT) and b) require the constitution of an instance of arbitrage stated in the AGREEMENT
with the purpose that the arbitrator appointed by the “Arbitration Center of the Santiago Chamber of Commerce” determines
if other alleged lese payment obligations may exist that SQMS could owe to CORFO under the AGREEMENT. SQMS differs completely form
CORFO’s claims. In fact, the AGREEMENT has been in force for more than 20 years and during all this time, SQMS has paid to
CORFO more than 80 quarterly payments in their entirety and on a timely basis that CORFO has received satisfactorily. Each of the
parties, CORFO and SQMS, have requested the formation of an appropriate arbitration and such processes have not yet began.



| | 19.4 | Restricted or pledged cash
| | ---- | --------------------------



The subsidiary Isapre Norte Grande Ltda.
in compliance with that established by the Chilean Superintendence of Healthcare, which regulates the running of pension-related
health institutions, maintains a guarantee in financial instruments, delivered in deposits, custody and administration to Banco
de Chile.



This guarantee, according to the regulations
issued by the Chilean Superintendence of Healthcare is equivalent to the total sum owed to its members and medical providers, Banco
de Chile reports the present value of the guarantee to the Chilean Superintendence of Healthcare and Isapre Norte Grande Ltda.
on a daily basis. As of December 31, 2013, the guarantee amounts to ThUS$708.



F-159







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies
and restrictions (continued)



| | 19.5 | Securities obtained from third parties
| | ---- | --------------------------------------



The main
security received from third parties (distributors) to guarantee Soquimich Comercial S.A.’s compliance with obligations in
contracts of commercial mandates for the distribution and sale of fertilizers amounted to ThUS$14,178 as of December 31, 2013;
which is detailed as follows:



|                                |  | 31/12/2013 |       
|------------------------------- |  | ---------- | ------
|Company                         |  | ThUS$      |       
|                                |  |            |       
|Agrícola Lobert Ltda.           |  |            | 1,271 
|Agroc Patricio Bornand L. Eirl  |  |            | 392   
|Agrocomercial Bornand Ltda.     |  |            | 344   
|Agroindustrial Orzonaga Ltda.   |  |            | 133   
|Aldo Epple Davazno              |  |            | 935   
|Bernardo Guzman Schmidt         |  |            | 139   
|Coop. Ag. Lechera Bio Bio Ltda. |  |            | 3,431 
|Comercial Agrosal Ltda.         |  |            | 116   
|Contador Frutos S.A.            |  |            | 1,447 
|Dante Hauri Gomez               |  |            | 126   
|Gilberto Rivas Y Cia. Ltda.     |  |            | 136   
|Hortofruticola La Serena        |  |            | 323   
|Jose Antonio Gonzalez           |  |            | 118   
|Juan Luis Gaete Chesta          |  |            | 425   
|Lemp Martin Julian              |  |            | 124   
|Neyib Farran Y Cia. Ltda.       |  |            | 133   
|Patricio Meneses Saglieto       |  |            | 953   
|Sebastian Urrutia Araya         |  |            | 116   
|Soc.Agr. Huifquenco Cia Ltda.   |  |            | 117   
|Soc. Agrocom. Julio Polanco     |  |            | 132   
|Tattersall S.A.                 |  |            | 1,789 
|Vicente Oyarce Castro           |  |            | 525   
|Vito Leopolo Llanos             |  |            | 953   
|Total                           |  |            | 14,178



F-160







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies and restrictions (continued)



| | 19.6 | Indirect guarantees
| | ---- | -------------------



Guarantees in which there is no pending
balance indirectly reflect that the respective guarantees are in force and approved by the Company's Board of Directors and have
not been used by the respective subsidiary.



|                                      |  | Debtor                           |  |              |  | Pending balances as of
    the closing date of the financial statements | 
|------------------------------------- |  | -------------------------------- |  | ------------ |  | ----------------------------------------------------------------------- | 
|Creditor of the guarantee             |  | Name                             |  | Relationship |  | Type of  guarantee                                                      | 
|Australian and New Zealand Bank       |  | SQM North America Corp           |  | Subsidiary   |  | Bond                                                                    | 
|Australian and New Zealand Bank       |  | SQM Europe N.V.                  |  | Subsidiary   |  | Bond                                                                    | 
|Generale Bank                         |  | SQM North America Corp           |  | Subsidiary   |  | Bond                                                                    | 
|Generale Bank                         |  | SQM Europe N.V.                  |  | Subsidiary   |  | Bond                                                                    | 
|Kredietbank                           |  | SQM North America Corp           |  | Subsidiary   |  | Bond                                                                    | 
|Kredietbank                           |  | SQM Europe N.V.                  |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | SQM Investment Corp. N.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | SQM Europe N.V.                  |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | SQM North America Corp           |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | Nitratos Naturais do Chile Ltda. |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | SQM México S.A. de C.V.          |  | Subsidiary   |  | Bond                                                                    | 
|Banks and financial institutions      |  | SQM Brasil Ltda.                 |  | Subsidiary   |  | Bond                                                                    | 
|“BNP”                                 |  | SQM Investment Corp. N.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Sociedad Nacional de Mineria A.G.     |  | SQM Potasio S.A.                 |  | Subsidiary   |  | Bond                                                                    | 
|Scotiabank & Trust (Cayman) Ltd.      |  | Royal Seed Trading A.V.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Scotiabank & Trust (Cayman) Ltd.      |  | Royal Seed Trading A.V.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Bank of America                       |  | Royal Seed Trading A.V.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Export Development Canada             |  | Royal Seed Trading A.V.V.        |  | Subsidiary   |  | Bond                                                                    | 
|The Bank of Tokyo-Mitsubishi UFJ Ltd. |  | Royal Seed Trading A.V.V.        |  | Subsidiary   |  | Bond                                                                    | 
|JP Morgan Chase Bank                  |  | SQM Industrial S.A.              |  | Subsidiary   |  | Bond                                                                    | 
|The Bank of Nova Scotia               |  | SQM Investment Corp. N.V.        |  | Subsidiary   |  | Bond                                                                    | 
|Morgan Stanley Capital Services       |  | SQM Investment Corp. N.V.        |  | Subsidiary   |  | Bond                                                                    | 
|The Bank of Tokyo-Mitsubishi UFJ Ltd. |  | SQM Investment Corp. N.V.        |  | Subsidiary   |  | Bond                                                                    | 



F-161







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 19 - Contingencies and restrictions (continued)



| | 19.6 | Indirect guarantees, continued
| | ---- | ------------------------------



|                            |  | Debtor                    |  |              |  | Pending balances as of
    the closing date of the financial statements | 
|--------------------------- |  | ------------------------- |  | ------------ |  | ----------------------------------------------------------------------- | 
|Creditor of the guarantee   |  | Name                      |  | Relationship |  | Type of
guarantee                                                       | 
|HSBC                        |  | SQM Investment Corp. N.V. |  | Subsidiary   |  | Bond                                                                    | 
|Deutsche Bank AG            |  | SQM Investment Corp. N.V. |  | Subsidiary   |  | Bond                                                                    | 
|Credit Suisse International |  | SQM Investment Corp. N.V. |  | Subsidiary   |  | Bond                                                                    | 



F-162







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 20 - Revenue



As of December 31, 2013 as 2012 and 2011, revenue is detailed
as follows:



|                    |  | January to December |          
|------------------- |  | ------------------- | ---------
|Types of revenue    |  | 2013                |          
|                    |  | ThUS$               |          
|                    |  |                     |          
|Sales of goods      |  |                     | 2,191,650
|Lending of services |  |                     | 11,490   
|Total               |  |                     | 2,203,140



Note 21 - Earnings per Share



Basic earnings per share are calculated
by dividing net income attributable to the Company’s shareholders by the weighted average of the number of shares in circulation
during that period.



As expressed, earnings per share are detailed
as follows:





|Basic earnings per share                               |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ |  |         | 12/31/2011 ThUS$ | 
|------------------------------------------------------ |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- | 
|                                                       |  |                  |         |  |                  |  |         |                  | 
|Earnings (losses) attributable to owners of the parent |  |                  | 467,113 |  |                  |  | 649,167 |                  | 





|                                       |  | 12/31/2013 Units |             |  | 12/31/2012 Units |  |             | 12/31/2011 Units | 
|-------------------------------------- |  | ---------------- | ----------- |  | ---------------- |  | ----------- | ---------------- | 
|Number of common shares in circulation |  |                  | 263,196,524 |  |                  |  | 263,196,524 |                  | 



|                                         |  | 12/31/2013 |        |  | 12/31/2012 |  |        | 12/31/2011 | 
|---------------------------------------- |  | ---------- | ------ |  | ---------- |  | ------ | ---------- | 
|                                         |  |            |        |  |            |  |        |            | 
|Basic earnings per share (US$ per share) |  |            | 1.7748 |  |            |  | 2.4665 |            | 



The Company has not made any operation
with a potential dilutive effect that assumes diluted earnings per share different from the basic earnings per share.



F-163







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
22 - Borrowing costs



The cost of interest is recognized as an
expense in the year in which it is incurred, except for interest that is directly related to the acquisition and construction of
tangible property, plant and equipment assets which comply with the requirements of IAS 23. As of December 31, 2013, total interest
expenses incurred amount to ThUS$58,608 (ThUS$54,095 as of December 31, 2012), and THUS$39,335 as of December 31, 2011.



The Company capitalizes all interest costs
directly related to the construction or to the acquisition of property, plant and equipment, which require a substantial time to
be suitable for use.



Costs of capitalized interest, property, plant and equipment



The
cost of capitalized interest is determined by applying the average or weighted average of all financing costs incurred by the Company
to the monthly end balances of works-in-progress meeting the requirements of IAS 23.



The rates and costs for capitalized interest
of property, plant and equipment are detailed as follows:



|                                                                                     |  | 12/31/2013 |        |   | 12/31/2012 | 
|------------------------------------------------------------------------------------ |  | ---------- | ------ | - | ---------- | 
|                                                                                     |  |            |        |   |            | 
|Capitalization rate of costs for capitalized interest, property, plant and equipment |  |            | 7      | % |            | 
|                                                                                     |  |            |        |   |            | 
|Amount of costs for interest capitalized in ThUS$                                    |  |            | 17,232 |   |            | 



F-164







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 23 - Effect of fluctuations
on foreign currency exchange rates



| | a) | Foreign currency exchange differences recognized in profit or loss except for financial instruments measured at fair value
through profit or loss:
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------



|                                                                                |  | 12/31/2013 ThUS$ |         |   | 12/31/2012 ThUS$ |  |         | 12/31/2011 ThUS$ | 
|------------------------------------------------------------------------------- |  | ---------------- | ------- | - | ---------------- |  | ------- | ---------------- | 
|                                                                                |  |                  |         |   |                  |  |         |                  | 
|Foreign exchange gains (losses) recognized in the result of the year.           |  |                  | (11,954 | ) |                  |  | (26,787 | )                | 
|Foreign exchange reserves attributable to the owners of the controlling entity  |  |                  | (3,487  | ) |                  |  | 921     |                  | 
|                                                                                |  |                  |         |   |                  |  |         |                  | 
|Foreign exchange conversion reserves attributable to the non-controlling entity |  |                  | (72     | ) |                  |  | 61      |                  | 



| | b) | Reserves for foreign currency exchange differences:
| | -- | ---------------------------------------------------



As of December 31, 2013 as December 31, 2012 and December 31,
2011, foreign currency exchange differences are detailed as follows:



|Detail                                                        |  | 12/31/2013 ThUS$ |        |   | 12/31/2012 ThUS$ |  |        | 12/31/2011 ThUS$ | 
|------------------------------------------------------------- |  | ---------------- | ------ | - | ---------------- |  | ------ | ---------------- | 
|                                                              |  |                  |        |   |                  |  |        |                  | 
|Changes in equity generated through the equity method:        |  |                  |        |   |                  |  |        |                  | 
|Comercial Hydro S.A.                                          |  |                  | 1,004  |   |                  |  | 1,004  |                  | 
|SQMC Internacional Ltda.                                      |  |                  | 22     |   |                  |  | 39     |                  | 
|Proinsa Ltda.                                                 |  |                  | 16     |   |                  |  | 29     |                  | 
|Comercial Agrorama Ltda.                                      |  |                  | 36     |   |                  |  | 87     |                  | 
|Isapre Norte Grande Ltda.                                     |  |                  | 15     |   |                  |  | 59     |                  | 
|Almacenes y Depósitos Ltda.                                   |  |                  | 69     |   |                  |  | 99     |                  | 
|Sales de Magnesio Ltda.                                       |  |                  | 103    |   |                  |  | 209    |                  | 
|Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A. |  |                  | 9      |   |                  |  | 20     |                  | 
|Agrorama S.A.                                                 |  |                  | (16    | ) |                  |  | (6     | )                | 
|Doktor Tarsa                                                  |  |                  | (3,647 | ) |                  |  | (1,074 | )                | 
|Nutrisi Holding B.V.                                          |  |                  | -      |   |                  |  | -      |                  | 
|SQM Vitas Fzco                                                |  |                  | (657   | ) |                  |  | (318   | )                | 
|Ajay Europe                                                   |  |                  | 146    |   |                  |  | (275   | )                | 
|SQM Eastmed Turkey                                            |  |                  | (42    | ) |                  |  | (42    | )                | 
|Charlee SQM (Thailand) Co. Lta.                               |  |                  | (129   | ) |                  |  | (32    | )                | 
|Coromandel SQM India                                          |  |                  | (231   | ) |                  |  | (118   | )                | 
|SQM Italia SRL                                                |  |                  | 89     |   |                  |  | 28     |                  | 
|SQM Oceania Pty Limited                                       |  |                  | (619   | ) |                  |  | (39    | )                | 
|SQM Indonesia S.A.                                            |  |                  | 15     |   |                  |  | -      |                  | 
|Total                                                         |  |                  | (3,817 | ) |                  |  | (330   | )                | 



| | c) | Functional and presentation currency
| | -- | ------------------------------------



The functional currency in these companies
corresponds to the currency of the country of origin of each entity, and its presentation currency is the US dollar.



F-165







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 23 - Effect of fluctuations
on foreign currency exchange rates (continued)



| | d) | Reasons to use one presentation currency and a different functional currency
| | -- | ----------------------------------------------------------------------------



| | - | The total revenues of these subsidiaries
are associated with the local currency.
| | - | --------------------------------------------------------------------------------

| | - | The commercialization cost structure of
these companies is affected by the local currency.
| | - | ------------------------------------------------------------------------------------------

| | - | The equities of these companies are expressed
in local currency (Chilean peso).
| | - | -------------------------------------------------------------------------------



Note
24 - Environment



| | 24.1 | Disclosures of disbursements related to the environment
| | ---- | -------------------------------------------------------



The Company is continuously concerned with
protecting the environment both in its production processes and with respect to products manufactured. This commitment is supported
by the principles indicated in the Company’s Sustainable Development Policy. The Company is currently operating under an
Environmental Management System (EMS) that has allowed it to strengthen its environmental performance through the effective application
of the Company’s Sustainable Development Policy.



Operations that use caliche as a raw material
are carried out in desert areas with climatic conditions that are favorable for drying solids and evaporating liquids using solar
energy. Operations involving the open-pit extraction of minerals, due to their low waste-to-mineral ratio, generate remaining deposits
that slightly alter the environment. A portion of the ore extracted is crushed, a process in which particle emissions occur. Currently
this operation is conducted only at the Pedro de Valdivia worksite and no ore crushing process is conducted in the Maria Elena
sector.



Many of the Company’s products are
shipped in bulk at the Port of Tocopilla. In 2007 the city of Tocopilla was declared a zone Saturated with MP10 Particles mainly
due to the emissions from the electric power plants that operate in that city. In October 2010 the Decontamination Plan for Tocopilla
was put in place. Accordingly, the Company has committed to taking several measures to mitigate the effects derived from bulk product
movements in the port. These measures have been successfully implemented since 2007.



The Company carries out environmental follow-up
and monitoring plans based on specialized scientific studies. Within this context, the Company entered into a contract with the
National Forestry Corporation (CONAF) aimed at researching the activities of flamingo groups that live in the Salar de Atacama
(Atacama Saltpeter Deposit) lagoons. Such research includes a population count of the birds, as well as breeding research. Environmental
monitoring activities carried out by the Company at the Salar de Atacama and other systems in which it operates are supported by
a number of studies that have integrated diverse scientific efforts from prestigious research centers, including Dictuc from the
Pontificia Universidad Católica in Santiago and the School of Agricultural Science of the Universidad de Chile.



F-166







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.1 | Disclosures of disbursements related to the environment, continued
| | ---- | ------------------------------------------------------------------



Furthermore, within the framework of the
environmental studies which the Company is conducting, the Company performs significant activities in relation to the recording
of Pre-Columbian and historical cultural heritage, as well as the protection of heritage sites, in accordance with current Chilean
laws. These activities have been especially performed in the areas surrounding Maria Elena and the Nueva Victoria plants. This
effort is being accompanied by cultural initiatives within the community and the organization of exhibits in local and regional
museums.



As emphasized in its Sustainable Development
Policy, the Company strives to maintain positive relationships with the communities surrounding the locations in which it carries
out its operations, as well as to participate in communities’ development by supporting joint projects and activities which
help to improve the quality of life for residents. For this purpose, the Company has focused its efforts on activities involving
the rescue of historical heritage, education and culture, as well as development, and in order to do so, it acts both individually
and in conjunction with private and public entities.



| | 24.2 | Detail of information on disbursements related to the environment
| | ---- | -----------------------------------------------------------------



The accumulated disbursements in which
the Company incurred as of December 31, 2013 for the concept of investments in production processes, verification and control of
compliance with ordinances and laws relative to industrial processes and facilities, including prior year disbursements related
to these projects amounted to ThUS$20,043 and are detailed as follows:



F-167







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2013



|Identification of the
    Parent or subsidiary |  | Name of the project with
    which the disbursement is associated                       |  | Concept for which the disbursement
    was made or  will be made |  | Asset /  Expense |  | Description of the asset
    or  expense Item |  | Amount of 
    disbursement  for the Period |       |  | Actual or  estimated
    date on which  disbursements 
    were or will be  made
|---------------------------------------------- |  | --------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------- |  | ---------------- |  | --------------------------------------------- |  | ------------------------------------------- | ----- |  | --------------------------------------------------------------------------------
|Others                                         |  | Environmental-operational area                                                          |  | Not classified                                                   |  | Expense          |  | Not-classified                                |  |                                             | 1,753 |  |                                                                                 
|SQM Industrial S.A.                            |  | CQLX-S Carmen and Lagarto hazardous waste yard                                          |  | Sustainability                                                   |  | Asset/expense    |  | Not classified                                |  |                                             | 98    |  |                                                                                 
|SQM Industrial S.A.                            |  | FP55 - FPXA-EIA Pampa Blanca Expansion                                                  |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 1,493 |  |                                                                                 
|SQM Industrial S.A.                            |  | IQWZ - Normalization TK NV liquid fuels                                                 |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not classified                                |  |                                             | 24    |  |                                                                                 
|SQM Industrial S.A.                            |  | JQ8K – DIA Line 4 Floor Drying, Coya Sur                                                |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 32    |  |                                                                                 
|SQM Industrial S.A.                            |  | JQB6 - DIA Plant NPT4, Coya Sur                                                         |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 84    |  |                                                                                 
|SQM Industrial S.A.                            |  | JQH9 – Purchase of Bertrams Boiler                                                      |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Development                                   |  |                                             | 612   |  |                                                                                 
|SQM Industrial S.A.                            |  | MNYS - Measures of Technological Change Cultural Heritage Dissemination
    Maria Elena |  | Environmental processing                                         |  | Expense          |  | Not classified                                |  |                                             | 37    |  |                                                                                 
|SQM Industrial S.A.                            |  | MP5W - Normalization TK ́s Combustibles                                                  |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not classified                                |  |                                             | 2,114 |  |                                                                                 
|SQM Industrial S.A.                            |  | MPQU - Construction of Hazardous Chemical Supplies warehouse                            |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Development                                   |  |                                             | 449   |  |                                                                                 
|SQM Industrial S.A.                            |  | MQA8- Normalization gas system, external cafeterias (Stage 1: projects)                 |  | Sustainability: Environment and Risk prevention                  |  | Asset/Expense    |  | Not classified                                |  |                                             | 139   |  |                                                                                 
|SQM Industrial S.A.                            |  | MQBM-Archaeological Digging Deployment Maria Elena - Toco                               |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not classified                                |  |                                             | 14    |  |                                                                                 
|SQM Industrial S.A.                            |  | MQHF -Sustaining of batteries ME                                                        |  | Sustainability: Environment and Risk prevention                  |  | Asset/Expense    |  | Not classified                                |  |                                             | 310   |  |                                                                                 
|SQM Industrial S.A.                            |  | MQK2-Elimination of PCBs I                                                              |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not classified                                |  |                                             | 17    |  |                                                                                 
|SQM Industrial S.A.                            |  | PPC1-Remove switches park PCB sub 3 and 1/12 Pedro de Valdivia                          |  | Sustainability: Environment and Risk prevention                  |  | Asset/ Expense   |  | Not classified                                |  |                                             | 147   |  |                                                                                 
|SQM Industrial S.A.                            |  | PPZU - Standardize and certify Plant Fuel Tanks                                         |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 2,644 |  |                                                                                 
|SQM Industrial S.A.                            |  | PQLV-DIA Pedro de Valdivia Mine                                                         |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 271   |  |                                                                                 
|SQM Industrial S.A.                            |  | SQ7X-Reach 2011-2013                                                                    |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not classified                                |  |                                             | 341   |  |                                                                                 
|SQM Industrial S.A.                            |  | TQA2 - Drainage Improvement Villa Prat                                                  |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not classified                                |  |                                             | 17    |  |                                                                                 
|SQM Industrial S.A.                            |  | PQXM – Elaboration DIA Operation with batteries in PV                                   |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 89    |  |                                                                                 



F-168







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2013, continued



|Identification of the
    Parent or subsidiary |  | Name of the project with
    which the disbursement is associated                   |  | Concept for which the disbursement
    was made or  will be made |  | Asset /  Expense |  | Description of the asset
    or  expense Item |  | Amount of 
    disbursement  for the Period |       |  | Actual or  estimated
    date on which  disbursements 
    were or will be  made
|---------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | ---------------------------------------------------------------- |  | ---------------- |  | --------------------------------------------- |  | ------------------------------------------- | ----- |  | --------------------------------------------------------------------------------
|SQM S.A.                                       |  | IP83-DIA Expansion TLN-15                                                           |  | Environmental Processing                                         |  | Asset            |  | Not Classified                                |  |                                             | 23    |  |                                                                                 
|SQM S.A.                                       |  | IPFT-Cultural Heritage Region I                                                     |  | Sustainability                                                   |  | Expense          |  | Not classified                                |  |                                             | 174   |  |                                                                                 
|SQM S.A.                                       |  | IPXE-Environmental monitoring plan Llamara Salt Flat                                |  | Cost Reduction                                                   |  | Expense          |  | Not classified                                |  |                                             | 1,013 |  |                                                                                 
|SQM S.A.                                       |  | IPXF-Environmental monitoring plan Pampa del Tamarugal                              |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not Classified                                |  |                                             | 951   |  |                                                                                 
|SQM S.A.                                       |  | IQ1M-PSA Re-injection of water to Puquíos Llamara                                   |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not Classified                                |  |                                             | 2,320 |  |                                                                                 
|SQM S.A.                                       |  | IQ3S-Hazardous Materials Management Standardization                                 |  | Sustainability                                                   |  | Asset-Expense    |  | Not Classified                                |  |                                             | 378   |  |                                                                                 
|SQM S.A.                                       |  | IQ54-Cultural heritage Pampa Hermosa                                                |  | Minor projects (between ThUS$50 and ThUS$299)                    |  | Asset            |  | Not Classified                                |  |                                             | 506   |  |                                                                                 
|SQM S.A.                                       |  | IQOW-Deposit authorization for Humberstone heritage                                 |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not Classified                                |  |                                             | 1     |  |                                                                                 
|SQM S.A.                                       |  | IQPJ-Mine Area equity measures Stage I                                              |  | Sustainability                                                   |  | Expense          |  | Not Classified                                |  |                                             | 110   |  |                                                                                 
|SQM S.A.                                       |  | IQWS - Mine Area equity measures Stage II                                           |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not Classified                                |  |                                             | 79    |  |                                                                                 
|SQM S.A.                                       |  | IQX6 – Environmental management plan of Tamarugos Pampa del
    Tamarugal 2013-2014 |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not Classified                                |  |                                             | 193   |  |                                                                                 
|SQM S.A.                                       |  | IQXB - Environmental management plan of Tamarugos Llamara Salt Flat
    2013-2014   |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not Classified                                |  |                                             | 141   |  |                                                                                 
|SQM S.A.                                       |  | MQLQ- Gas scrubbing system                                                          |  | Not Classified                                                   |  | Asset            |  | Development                                   |  |                                             | 468   |  |                                                                                 
|SQM Salar S.A                                  |  | LQG8 – Waste room  Toconao Campsite                                                 |  | Sustainability: Natural Resources                                |  | Expense          |  | Not Classified                                |  |                                             | 15    |  |                                                                                 
|SQM Salar S.A.                                 |  | LQDM – Certification of tanks                                                       |  | Sustainability: Replacement of equipment                         |  | Asset            |  | Not classified                                |  |                                             | 256   |  |                                                                                 
|SQM Salar S.A.                                 |  | LQI6-EIA Operating maintenance at Salar de Atacama                                  |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 466   |  |                                                                                 
|SQM Salar S.A.                                 |  | LQNI-DIA KCI Floor Drying and compacting expansion                                  |  | Environmental processing                                         |  | Asset            |  | Not classified                                |  |                                             | 59    |  |                                                                                 
|SIT S.A.                                       |  | TPYX - Enabling the dust collector of the crib and court seal 3
    Tocopilla       |  | Sustainability: Environment and Risk prevention                  |  | Asset / Expense  |  | Development                                   |  |                                             | 1,708 |  |                                                                                 



F-169







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2013, continued



|Identification of the
    Parent or subsidiary |  | Name of the project with
    which the disbursement is associated |  | Concept for which the disbursement
    was made or  will be made |  | Asset /  Expense |  | Description of the asset
    or  expense Item |  | Amount of 
    disbursement  for the Period |        |  | Actual or  estimated
    date on which  disbursements 
    were or will be  made
|---------------------------------------------- |  | ----------------------------------------------------------------- |  | ---------------------------------------------------------------- |  | ---------------- |  | --------------------------------------------- |  | ------------------------------------------- | ------ |  | --------------------------------------------------------------------------------
|SIT S.A.                                       |  | TQAV - Paving paths IV                                            |  | Sustainability:                                                  |  | Asset            |  | Development                                   |  |                                             | 3      |  |                                                                                 
|SIT S.A.                                       |  | TQQ5- Environmental curtains Field No. 8                          |  | Sustainability: Environment and Risk prevention                  |  | Expense          |  | Not classified                                |  |                                             | 221    |  |                                                                                 
|SQM Nitratos S.A.                              |  | IQMH - Normalization Mine NV area operation                       |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not classified                                |  |                                             | 222    |  |                                                                                 
|SQM Nitratos S.A.                              |  | PQI9 – Mine waste water treatment plant                           |  | Sustainability: Environment and Risk prevention                  |  | Asset            |  | Not classified                                |  |                                             | 51     |  |                                                                                 
|Total                                          |  |                                                                   |  |                                                                  |  |                  |  |                                               |  |                                             | 20,043 |  |                                                                                 



F-170







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Future expenses as of 12/31/2013



|Identification
    of the Parent or subsidiary |  | Name
    of the project with which the disbursement is associated                   |  | Concept
    for which the disbursement was
    made or will be made |  | Asset
    /  Expense |  | Description
    of the asset or  expense Item |  | Amount
    of  disbursement  for the Period |       |  | Actual
    or  estimated date on
    which  disbursements  were or will be  made
|---------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | ------------------------------------------------------------------- |  | -------------------- |  | --------------------------------------------- |  | ------------------------------------------- | ----- |  | --------------------------------------------------------------------------------
|SQM Industrial S.A.                            |  | FP55 - FPXA-EIA Pampa Blanca Expansion                                              |  | Environmental processing                                            |  | Asset                |  | Not classified                                |  |                                             | 1     |  |                                                                                 
|SQM Industrial S.A.                            |  | IQWZ - Normalization TK NV liquid fuels                                             |  | Sustainability: Environment and Risk prevention                     |  | Asset                |  | Not classified                                |  |                                             | 800   |  |                                                                                 
|SQM Industrial S.A.                            |  | MP5W - Normalization TK ́s Combustibles                                              |  | Sustainability: Environment and Risk prevention                     |  | Asset                |  | Not classified                                |  |                                             | 795   |  |                                                                                 
|SQM Industrial S.A.                            |  | MQBM-Archaeological Digging Deployment Maria Elena - Toco                           |  | Sustainability: Environment and Risk prevention                     |  | Expense              |  | Not classified                                |  |                                             | 63    |  |                                                                                 
|SQM Industrial S.A.                            |  | MQK2-Elimination of PCBs I                                                          |  | Sustainability: Environment and Risk prevention                     |  | Expense              |  | Not classified                                |  |                                             | 33    |  |                                                                                 
|SQM Industrial S.A.                            |  | PPZU - Standardize and certify Plant Fuel Tanks                                     |  | Environmental processing                                            |  | Asset                |  | Not classified                                |  |                                             | 533   |  |                                                                                 
|SQM Industrial S.A.                            |  | PQLV-DIA Pedro de Valdivia Mine                                                     |  | Environmental processing                                            |  | Asset                |  | Not classified                                |  |                                             | 103   |  |                                                                                 
|SQM S.A.                                       |  | IP83-DIA Expansion TLN-15                                                           |  | Environmental Processing                                            |  | Asset                |  | Not Classified                                |  |                                             | 0     |  |                                                                                 
|SQM S.A.                                       |  | IPFT-Cultural Heritage Region I                                                     |  | Sustainability                                                      |  | Expense              |  | Not classified                                |  |                                             | 1     |  |                                                                                 
|SQM S.A.                                       |  | IQ1M-PSA Re-injection of water to Puquíos Llamara                                   |  | Sustainability: Environment and Risk prevention                     |  | Asset                |  | Not Classified                                |  |                                             | 300   |  |                                                                                 
|SQM S.A.                                       |  | IQ3S-Hazardous Materials Management Standardization                                 |  | Sustainability                                                      |  | Asset-Expense        |  | Not Classified                                |  |                                             | 12    |  |                                                                                 
|SQM S.A.                                       |  | IQOW-Deposit authorization for Humberstone heritage                                 |  | Sustainability: Environment and Risk prevention                     |  | Expense              |  | Not Classified                                |  |                                             | 10    |  |                                                                                 
|SQM S.A.                                       |  | IQWS - Mine Area equity measures Stage II                                           |  | Sustainability: Environment and Risk prevention                     |  | Expense              |  | Not Classified                                |  |                                             | 29    |  |                                                                                 
|SQM S.A.                                       |  | IQX6 – Environmental management plan of Tamarugos Pampa del
    Tamarugal 2013-2014 |  | Sustainability: Environment and Risk prevention                     |  | Asset                |  | Not Classified                                |  |                                             | 595   |  |                                                                                 
|SQM S.A.                                       |  | IQXB - Environmental management plan of Tamarugos Llamara Salt Flat
    2013-2014   |  | Sustainability: Environment and Risk prevention                     |  | Asset                |  | Not Classified                                |  |                                             | 266   |  |                                                                                 
|SQM Salar S.A.                                 |  | LQDM – Certification of tanks                                                       |  | Sustainability: Replacement of equipment                            |  | Asset                |  | Not Classified                                |  |                                             | 94    |  |                                                                                 
|SQM Salar S.A.                                 |  | LQI6-EIA Operating Maintenance at Salar de Atacama                                  |  | Environmental Processing                                            |  | Asset                |  | Not Classified                                |  |                                             | 59    |  |                                                                                 
|SIT S.A.                                       |  | TQQ5- Environmental curtains Field No. 8                                            |  | Sustainability: Environment and Risk prevention                     |  | Expense              |  | Not Classified                                |  |                                             | 90    |  |                                                                                 
|SQM Industrial S.A.                            |  | PQXM – Elaboration DIA Operation with
    batteries in PV                           |  | Environmental processing                                            |  | Asset                |  | Not classified                                |  |                                             | 212   |  |                                                                                 
|Total                                          |  |                                                                                     |  |                                                                     |  |                      |  |                                               |  |                                             | 3,996 |  |                                                                                 



F-171







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2012, continued



|Identification
    of the Parent
    or subsidiary |  | Name
    of the project with which the disbursement is associated                       |  | Concept
    for which the
    disbursement was made
    or will be made |  | Asset
    /  Expense |  | Description
    of the asset or  expense Item |  | Amount
    of 
    disbursement  for the Period
    ThUS$ |       |  | Actual
    or estimated
    date on which  disbursements were or
    will be made
|-------------------------------------------------- |  | --------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------- |  | -------------------- |  | --------------------------------------------- |  | --------------------------------------------------------- | ----- |  | ---------------------------------------------------------------------------------
|SQM Industrial S.A.                                |  | Environmental and community management (2012 Expense
    Accumulated as of 4Q)          |  | Not classified                                                          |  | Expense              |  | Not classified                                |  |                                                           | 1,808 |  |                                                                                  
|SQM Industrial S.A.                                |  | IQ8G- Improvement of Bureau of Exchange, offices and facilities                         |  | Medium projects (between ThUS$300 and ThUS$999)                         |  | Asset                |  | Sustainability                                |  |                                                           | 72    |  |                                                                                  
|SQM Industrial S.A.                                |  | JQEZ – Change of Bertrams Prilling Boiler CS                                            |  | Sustainability: Replacement of equipment                                |  | Asset                |  | Development                                   |  |                                                           | 235   |  |                                                                                  
|SQM Industrial S.A.                                |  | JQH9 – Purchase of Bertrams Boiler                                                      |  | Sustainability: Environment and Risk prevention                         |  | Asset                |  | Development                                   |  |                                                           | 600   |  |                                                                                  
|SQM Industrial S.A.                                |  | MNYS - Measures of Technological Change Cultural Heritage Dissemination
    Maria Elena |  | Environmental processing                                                |  | Expense              |  | Not classified                                |  |                                                           | 37    |  |                                                                                  
|SQM Industrial S.A.                                |  | MP5W - Normalization TK ́s Combustibles                                                  |  | Sustainability: Environment and Risk prevention                         |  | Asset                |  | Not classified                                |  |                                                           | 841   |  |                                                                                  
|SQM Industrial S.A.                                |  | MPQU - Construction of Hazardous Chemical Supplies warehouse                            |  | Sustainability: Environment and Risk prevention                         |  | Asset                |  | Development                                   |  |                                                           | 211   |  |                                                                                  
|SQM Industrial S.A.                                |  | MQ8M - Reconditioning monitoring station ME                                             |  | Sustainability: Natural Resources                                       |  | Expense              |  | Not classified                                |  |                                                           | 8     |  |                                                                                  
|SQM Industrial S.A.                                |  | MQA8- Normalization gas system, external cafeterias (Stage 1: projects)                 |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 106   |  |                                                                                  
|SQM Industrial S.A.                                |  | MQAJ - Improvements to Camp Water and Sewage (P Contesse commitment
    to DDSS)        |  | Sustainability: Natural Resources                                       |  | Expense              |  | Not classified                                |  |                                                           | 8     |  |                                                                                  
|SQM Industrial S.A.                                |  | MQHF -Sustaining of batteries ME                                                        |  | Sustainability: Environment and Risk prevention                         |  | Asset / Expense      |  | Not classified                                |  |                                                           | 161   |  |                                                                                  
|SQM Industrial S.A.                                |  | PPC1-Remove switches park PCB sub 3 and 1/12 Pedro de Valdivia                          |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 147   |  |                                                                                  
|SQM Industrial S.A.                                |  | PPNK-Management of Ammonia PV stoppage plant                                            |  | Sustainability: Environment and Risk prevention                         |  | Asset / Expense      |  | Not classified                                |  |                                                           | 193   |  |                                                                                  



F-172







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2012, continued



|Identification
    of the Parent
    or subsidiary |  | Name of the
    project with which the disbursement is associated                 |  | Concept for
    which the
    disbursement was made
    or will be made |  | Asset / 
    Expense |  | Description
    of the asset or  expense Item |  | Amount
    of 
    disbursement  for the Period
    ThUS$ |       |  | Actual or estimated
    date on which  disbursements were or
    will be made
|-------------------------------------------------- |  | --------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------- |  | -------------------- |  | --------------------------------------------- |  | --------------------------------------------------------- | ----- |  | -----------------------------------------------------------------------------
|SQM Industrial S.A.                                |  | PPZU - Standardize and certify Plant Fuel Tanks                                   |  | Environmental processing                                                |  | Asset                |  | Not classified                                |  |                                                           | 1,763 |  |                                                                              
|SQM Industrial S.A.                                |  | SQ7X-Reach 2011-2013                                                              |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 199   |  |                                                                              
|SQM Industrial S.A.                                |  | TQA2 - Drainage Improvement Villa Prat                                            |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 16    |  |                                                                              
|SQM Industrial S.A.                                |  | CQLX-SCarmen and Lagarto hazardous waste yard                                     |  | Sustainability                                                          |  | Expense              |  | Not classified                                |  |                                                           | 47    |  |                                                                              
|Sqm Industrial S.A.                                |  | MQBM-Archaeological Digging Deployment Maria Elena - Toco                         |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 7     |  |                                                                              
|Sqm Industrial S.A.                                |  | MQK2-Elimination of PCBs I                                                        |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not classified                                |  |                                                           | 16    |  |                                                                              
|SQM Industrial S.A.                                |  | JQ8K – DIA Line 4 Floor Drying, Coya Sur                                          |  | Environmental processing                                                |  | Asset                |  | Not classified                                |  |                                                           | 32    |  |                                                                              
|SQM Industrial S.A.                                |  | FP55 - FPXA-EIA Pampa Blanca Expansion                                            |  | Environmental processing                                                |  | Asset                |  | Not classified                                |  |                                                           | 1,425 |  |                                                                              
|SQM Industrial S.A.                                |  | JQB6 - DIA Plant NPT4, Coya Sur                                                   |  | Environmental processing                                                |  | Asset                |  | Not classified                                |  |                                                           | 65    |  |                                                                              
|SQM Industrial S.A.                                |  | PQLV-DIA Pedro de Valdivia Mine                                                   |  | Environmental processing                                                |  | Asset                |  | Not classified                                |  |                                                           | 131   |  |                                                                              
|SQM S.A.                                           |  | AQ0A-Drilling of 4 Wells for Change in Catchment Point at Pampa
    del Tamarugal |  | Increase of capacity                                                    |  | Asset                |  | Development                                   |  |                                                           | 534   |  |                                                                              
|SQM S.A.                                           |  | IPFT-Cultural Heritage Region I                                                   |  | Sustainability                                                          |  | Expense              |  | Not Classified                                |  |                                                           | 166   |  |                                                                              



F-173







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2012, continued



|Identification
    of
    the Parent or
    subsidiary |  | Name of
    the project with which the disbursement is associated |  | Concept
    for which the
    disbursement was made
    or will be made |  | Asset
    /  Expense |  | Description
    of the asset or  expense Item |  | Amount
    of  disbursement  for the Period |       |  | Actual
    or estimated
    date on which  disbursements were or
    will be made
|------------------------------------------------------ |  | ----------------------------------------------------------------- |  | ----------------------------------------------------------------------- |  | -------------------- |  | --------------------------------------------- |  | ------------------------------------------- | ----- |  | ---------------------------------------------------------------------------------
|SQM S.A.                                               |  | IPXE-Environmental monitoring plan Llamara Salt Flat              |  | Cost reduction                                                          |  | Expense              |  | Not Classified                                |  |                                             | 872   |  |                                                                                  
|SQM S.A.                                               |  | IPXF-Environmental monitoring plan Pampa del Tamarugal            |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not Classified                                |  |                                             | 881   |  |                                                                                  
|SQM S.A.                                               |  | IQ08-PSA Llamara & Pampa del Tamarugal                            |  | Sustainability: Environment and Risk prevention                         |  | Asset                |  | Development                                   |  |                                             | 1,759 |  |                                                                                  
|SQM S.A.                                               |  | IQ0C-Mine Area Enhancement NV                                     |  | Sustainability: Environment and Risk prevention                         |  | Expense              |  | Not Classified                                |  |                                             | 66    |  |                                                                                  
|SQM S.A.                                               |  | IQ1K-Construcion of 3 observation wells in Sur Viejo              |  | Capacity expansion                                                      |  | Asset                |  | Development                                   |  |                                             | 195   |  |                                                                                  
|SQM S.A.                                               |  | IQ1M-PSA Re-injection of water to Puquíos Llamara                 |  | Sustainability: Environment and Risk prevention                         |  | Asset                |  | Not Classified                                |  |                                             | 1,653 |  |                                                                                  
|SQM S.A.                                               |  | IQ3S-Hazardous Materials Management Standardization               |  | Sustainability                                                          |  | Asset-Expense        |  | Not Classified                                |  |                                             | 251   |  |                                                                                  
|SQM S.A.                                               |  | IQ52- Nueva Victoria Environmental Office                         |  | Minor projects (between ThUS$50 and ThUS$299)                           |  | Expense              |  | Not Classified                                |  |                                             | 29    |  |                                                                                  
|SQM S.A.                                               |  | IQ53-Cultural heritage route Soronal adduction (Pampa Hermosa)    |  | General Projects (ThUS$ < 50)                                           |  | Expense              |  | Not Classified                                |  |                                             | 24    |  |                                                                                  
|SQM S.A.                                               |  | IQ54-Cultural heritage Pampa Hermosa                              |  | Minor projects (between ThUS$50 and ThUS$299)                           |  | Asset                |  | Not Classified                                |  |                                             | 500   |  |                                                                                  
|SQM S.A.                                               |  | IQ9V – Quillagua Project                                          |  | Minor projects (between ThUS$50 and ThUS$299)                           |  | Expense              |  | Not classified                                |  |                                             | 788   |  |                                                                                  
|SQM S.A.                                               |  | PQB9-PQB9 - Change of exhaust extractor SO2 gas                   |  | Not classified                                                          |  | Asset                |  | Not classified                                |  |                                             | 178   |  |                                                                                  



F-174







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2012, continued



|Identification of  the
    Parent or
    subsidiary |  | Name of the project with
    which the disbursement is associated                                |  | Concept for which the
    disbursement was made
    or will be made |  | Asset /  Expense |  | Description of the asset
    or  expense Item |  | Amount of 
    disbursement  for the Period |       |  | Actual or estimated
    date on which  disbursements were
    or will be made
|--------------------------------------------------- |  | ------------------------------------------------------------------------------------------------ |  | ------------------------------------------------------------------- |  | ---------------- |  | --------------------------------------------- |  | ------------------------------------------- | ----- |  | -----------------------------------------------------------------------------
|SQM S.A.                                            |  | MQLQ- Gas scrubbing system                                                                       |  | Not classified                                                      |  | Asset            |  | Development                                   |  |                                             | 324   |  |                                                                              
|SQM S.A.                                            |  | IQOW- Deposit authorization for Humberstone heritage                                             |  | Sustainability: Environment and Risk prevention                     |  | Expense          |  | Not classified                                |  |                                             | 1     |  |                                                                              
|SQM S.A.                                            |  | IQPJ- Mine Area equity measures Stage I                                                          |  | Sustainability:                                                     |  | Expense          |  | Not classified                                |  |                                             | 61    |  |                                                                              
|SQM S.A.                                            |  | IQ6M -IQ6N-DIA  Nueva Victoria Sur Mine Expansion                                                |  | Environmental processing                                            |  | Asset            |  | Not classified                                |  |                                             | 115   |  |                                                                              
|SQM S.A.                                            |  | IP83 - DIA Expansion TLN-15                                                                      |  | Environmental processing                                            |  | Asset            |  | Not classified                                |  |                                             | 23    |  |                                                                              
|SQM Salar S.A.                                      |  | CQ4M – Regularization of Contractor facilities                                                   |  | Sustainability: Environment and Risk prevention                     |  | Asset            |  | Not classified                                |  |                                             | 17    |  |                                                                              
|SQM Salar S.A.                                      |  | CQ8U - New Changing Room CL - HL                                                                 |  | Sustainability: Environment and Risk prevention                     |  | Asset            |  | Not classified                                |  |                                             | 242   |  |                                                                              
|SQM Salar S.A.                                      |  | LP82 - Project for the Promotion of Agricultural Activity in Communities
    of the Salt deposit |  | Sustainability: Environment and Risk prevention                     |  | Expense          |  | Development                                   |  |                                             | 1,126 |  |                                                                              
|SQM Salar S.A.                                      |  | LPTF – Environmental study and exploration 2010                                                  |  | Environmental processing                                            |  | Expense          |  | Not classified                                |  |                                             | 398   |  |                                                                              
|SQM Salar S.A.                                      |  | LPTJ - Improvements Sanitary Works                                                               |  | Sustainability:                                                     |  | Asset            |  | Not classified                                |  |                                             | 206   |  |                                                                              
|SQM Salar S.A.                                      |  | LQDM – Certification of tanks                                                                    |  | Sustainability: Replacement of equipment                            |  | Asset            |  | Not classified                                |  |                                             | 146   |  |                                                                              
|SQM Salar S.A.                                      |  | LQI6-EIA Operating maintenance at Salar de Atacama                                               |  | Environmental processing                                            |  | Asset            |  | Not classified                                |  |                                             | 358   |  |                                                                              
|SQM Salar S.A.                                      |  | LQNI-DIA KCI Floor Drying and compacting expansion                                               |  | Environmental processing                                            |  | Asset            |  | Not classified                                |  |                                             | 19    |  |                                                                              
|SIT S.A.                                            |  | MQ6Y-MQ6Y - Maintenance and repair of ME and Tocopilla bureau of
    exchange                    |  | Sustainability: Environment and Risk prevention                     |  | Expense          |  | Not classified                                |  |                                             | 20    |  |                                                                              



F-175







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Accumulated expenses as of 12/31/2012, continued



|Identification of  the
    Parent or
    subsidiary |  | Name of the project with
    which the disbursement is associated             |  | Concept for which the 
    disbursement was made 
    or will be made |  | Asset /  Expense |  | Description of the asset
    or  expense Item |  | Amount of 
    disbursement  for the Period |        |  | Actual or estimated 
    date on which  disbursements were 
    or will be made
|--------------------------------------------------- |  | ----------------------------------------------------------------------------- |  | --------------------------------------------------------------------- |  | ---------------- |  | --------------------------------------------- |  | ------------------------------------------- | ------ |  | -------------------------------------------------------------------------------
|SIT S.A.                                            |  | TPR8 - Disposal of liquid waste generation by aspiration                      |  | Sustainability:                                                       |  | Expense          |  | Not classified                                |  |                                             | 64     |  |                                                                                
|SIT S.A.                                            |  | TPYX - Enabling the dust collector of the crib and court seal 3
    Tocopilla |  | Sustainability: Environment and Risk prevention                       |  | Asset / Expense  |  | Development                                   |  |                                             | 1,658  |  |                                                                                
|SIT S.A.                                            |  | TQAP - Paving Field No. 3 and No. 4                                           |  | Capacity Expansion                                                    |  | Expense          |  | Not classified                                |  |                                             | 13     |  |                                                                                
|SIT S.A.                                            |  | TQAV - Paving paths IV                                                        |  | Sustainability:                                                       |  | Asset            |  | Development                                   |  |                                             | 3      |  |                                                                                
|SIT S.A.                                            |  | TQM2- Unloading/loading encapsulation project/Field 1 and 8                   |  | Sustainability:                                                       |  | Asset            |  | Not classified                                |  |                                             | 8      |  |                                                                                
|SIT S.A.                                            |  | TQLY- Dust extractor packing machine No. 1                                    |  | Environmental processing                                              |  | Asset            |  | Not classified                                |  |                                             | 25     |  |                                                                                
|SIT S.A.                                            |  | TQNA- Tocopilla weather station (Tocopilla Decontamination Plan
    Network)  |  | Sustainability: Environment and Risk prevention                       |  | Asset            |  | Not classified                                |  |                                             | 15     |  |                                                                                
|SIT S.A.                                            |  | TQQ5- Environmental curtains Field No. 8                                      |  | Sustainability: Environment and Risk prevention                       |  | Expense          |  | Not classified                                |  |                                             | 22     |  |                                                                                
|SQM Nitratos S.A                                    |  | IQDN - Storage Rises – Maintenance of Mine NV                                 |  | Not classified                                                        |  | Asset            |  | Not classified                                |  |                                             | 26     |  |                                                                                
|Minera Nueva Victoria S.A.                          |  | IQ4C - Development Camp (Osmosis and Others)                                  |  | Minor projects (between ThUS$50 and ThUS$299)                         |  | Asset            |  | Not classified                                |  |                                             | 1,987  |  |                                                                                
|SQM Nitratos S.A.                                   |  | PQI9 – Mine waste water treatment plant                                       |  | Sustainability: Environment and Risk prevention                       |  | Asset            |  | Not classified                                |  |                                             | 47     |  |                                                                                
|SQM Nitratos S.A.                                   |  | IQMH - Normalization Mine NV area operation                                   |  | Sustainability: Environment and Risk prevention                       |  | Asset            |  | Not classified                                |  |                                             | 99     |  |                                                                                
|SQM Salar S.A                                       |  | LQFD – Bureaus of exchange                                                    |  | Not classified                                                        |  | Asset            |  | Not classified                                |  |                                             | 160    |  |                                                                                
|                                                    |  |                                                                               |  |                                                                       |  |                  |  | TOTAL                                         |  |                                             | 23,207 |  |                                                                                



F-176







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)





| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Future expenses as of 12/31/2012



|Identification
    of  the Parent or 
    subsidiary |  | Name
    of the project with which the disbursement is associated                            |  | Concept
    for which the 
    disbursement was made
    or will be made |  | Asset
    /  Expense |  | Description
     of the asset 
    or expense 
    Item |  | Amount
    of  disbursement  for the Period |       |  | Actual
    or  estimated date on which  disbursements 
    were or will be  made
|---------------------------------------------------- |  | -------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------ |  | -------------------- |  | ------------------------------------------------------- |  | ------------------------------------------- | ----- |  | --------------------------------------------------------------------------------
|SQM Industrial S.A.                                  |  | Environmental and Community Management (Budget available
    for the second quarter of 2012) |  | Not classified                                                           |  | Expense              |  | Not classified                                          |  |                                             | 2,027 |  |                                                                                 
|SQM Industrial S.A.                                  |  | MNYS - Measures of Technological Change Cultural Heritage Dissemination
    Maria Elena      |  | Environmental processing                                                 |  | Expense              |  | Not classified                                          |  |                                             | 68    |  |                                                                                 
|SQM Industrial S.A.                                  |  | MP5W - Normalization TK ́s Combustibles                                                       |  | Sustainability: Environment and Risk prevention                          |  | Asset                |  | Not classified                                          |  |                                             | 1,600 |  |                                                                                 
|SQM Industrial S.A.                                  |  | MPQU - Construction of Hazardous Chemical Supplies warehouse                                 |  | Sustainability: Environment and Risk prevention                          |  | Asset                |  | Development                                             |  |                                             | 152   |  |                                                                                 
|SQM Industrial S.A.                                  |  | MQHF -Sustaining of batteries ME                                                             |  | Sustainability: Environment and Risk prevention                          |  | Asset - Expense      |  | Not classified                                          |  |                                             | 16    |  |                                                                                 
|SQM Industrial S.A.                                  |  | PPC1-Remove switches park OCB sub 3 and 1/12 Pedro de Valdivia                               |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 44    |  |                                                                                 
|SQM Industrial S.A.                                  |  | PPZU - Standardize and certify Plant Fuel Tanks                                              |  | Environmental processing                                                 |  | Asset                |  | Not classified                                          |  |                                             | 1,315 |  |                                                                                 
|SQM Industrial S.A.                                  |  | SQ7X-Reach 2011-2013                                                                         |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 20    |  |                                                                                 
|SQM Industrial S.A.                                  |  | TQA2 - Drainage Improvement Villa Prat                                                       |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 104   |  |                                                                                 
|SQM Industrial S.A.                                  |  | CQLX- S Carmen and Lagarto hazardous waste yard                                              |  | Sustainability                                                           |  | Asset                |  | Not classified                                          |  |                                             | 53    |  |                                                                                 
|SQM Industrial S.A.                                  |  | JQL7- KNO3 prilled dust collection and drying engineering and project                        |  | Sustainability                                                           |  | Asset                |  | Research                                                |  |                                             | 200   |  |                                                                                 
|SQM Industrial S.A.                                  |  | MQBM - Archaeological Digging Deployment Maria Elena - Toco                                  |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 49    |  |                                                                                 
|SQM Industrial S.A.                                  |  | MQK2 – Elimination of PCBs I                                                                 |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 554   |  |                                                                                 
|SQM Industrial S.A.                                  |  | FP55 - FPXA-EIA Pampa Blanca Expansion                                                       |  | Environmental processing                                                 |  | Asset                |  | Not classified                                          |  |                                             | 135   |  |                                                                                 



F-177







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Future expenses as of 12/31/2012



|Identification
    of the Parent or 
    subsidiary |  | Name
    of the project with which the disbursement is associated             |  | Concept
    for which the 
    disbursement was made 
    or will be made |  | Asset
    /  Expense |  | Description
     of the asset 
    or expense 
    Item |  | Amount
    of  disbursement  for the Period |     |  | Actual
    or  estimated date on which  disbursements 
    were or will be  made
|--------------------------------------------------- |  | ----------------------------------------------------------------------------- |  | ------------------------------------------------------------------------- |  | -------------------- |  | ------------------------------------------------------- |  | ------------------------------------------- | --- |  | --------------------------------------------------------------------------------
|SQM Industrial S.A.                                 |  | JQB6 - DIA Plant NPT4, Coya Sur                                               |  | Environmental processing                                                  |  | Asset                |  | Not classified                                          |  |                                             | 5   |  |                                                                                 
|SQM Industrial S.A.                                 |  | PQLV-DIA Pedro de Valdivia Mine                                               |  | Environmental processing                                                  |  | Asset                |  | Not classified                                          |  |                                             | 243 |  |                                                                                 
|SQM S.A.                                            |  | IPFT - Cultural Heritage Region I                                             |  | Sustainability                                                            |  | Expense              |  | Not classified                                          |  |                                             | 17  |  |                                                                                 
|SQM S.A.                                            |  | IPXE - Environmental Monitoring Plan Llamara Salt flat                        |  | Cost reduction                                                            |  | Expense              |  | Not classified                                          |  |                                             | 87  |  |                                                                                 
|SQM S.A.                                            |  | IPXF - Environmental Monitoring Plan Pampa del Tamarugal                      |  | Sustainability: Environment and Risk prevention                           |  | Expense              |  | Not classified                                          |  |                                             | 168 |  |                                                                                 
|SQM S.A.                                            |  | IQ1M - PSA Re-injection of water to Puquios Llamara                           |  | Sustainability: Environment and Risk prevention                           |  | Asset                |  | Not classified                                          |  |                                             | 441 |  |                                                                                 
|SQM S.A.                                            |  | IQ3S- Hazardous Materials Management Standardization                          |  | Sustainability                                                            |  | Asset - Expense      |  | Not classified                                          |  |                                             | 148 |  |                                                                                 
|SQM S.A.                                            |  | IQ54 - Cultural heritage Pampa Hermosa                                        |  | Minor projects (between ThUS$50 and ThUS$299)                             |  | Asset                |  | Not classified                                          |  |                                             | 219 |  |                                                                                 
|SQM S.A.                                            |  | MQLQ- Gas scrubbing system                                                    |  | Not classified                                                            |  | Asset                |  | Development                                             |  |                                             | 288 |  |                                                                                 
|SQM S.A.                                            |  | IQOW- Deposit authorization for Humberstone heritage                          |  | Sustainability: Environment and Risk prevention                           |  | Expense              |  | Not classified                                          |  |                                             | 38  |  |                                                                                 
|SQM S.A.                                            |  | IQ6M -IQ6N-DIA Nueva Victoria Sur Mine Expansion                              |  | Environmental processing                                                  |  | Asset                |  | Not classified                                          |  |                                             | 2   |  |                                                                                 
|SQM Salar S.A.                                      |  | LQDM – Certification of tanks                                                 |  | Sustainability: Replacement of equipment                                  |  | Asset                |  | Not classified                                          |  |                                             | 600 |  |                                                                                 
|SQM Salar S.A.                                      |  | LQI6-EIA Operating maintenance at Salar de Atacama                            |  | Environmental processing                                                  |  | Asset                |  | Not classified                                          |  |                                             | 265 |  |                                                                                 
|SQM Salar S.A.                                      |  | LQNI-DIA KCI Floor Drying and compacting expansion                            |  | Environmental processing                                                  |  | Asset                |  | Not classified                                          |  |                                             | 16  |  |                                                                                 
|SIT S.A.                                            |  | TPYX - Enabling the dust collector of the crib and court seal 3
    Tocopilla |  | Sustainability: Environment and Risk prevention                           |  | Asset / Expense      |  | Development                                             |  |                                             | 40  |  |                                                                                 



F-178







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note
24- Environment (continued)



| | 24.2 | Detail of information on disbursements related to the environment, continued
| | ---- | ----------------------------------------------------------------------------



Future expenses as of 12/31/2012



|Identification
    of  the Parent or 
    subsidiary |  | Name
    of the project with which the disbursement is associated |  | Concept
    for which the 
    disbursement was made
    or will be made |  | Asset
    /  Expense |  | Description
     of the asset 
    or expense 
    Item |  | Amount
    of  disbursement  for the Period |       |  | Actual
    or  estimated date on which  disbursements 
    were or will be  made
|---------------------------------------------------- |  | ----------------------------------------------------------------- |  | ------------------------------------------------------------------------ |  | -------------------- |  | ------------------------------------------------------- |  | ------------------------------------------- | ----- |  | --------------------------------------------------------------------------------
|SIT S.A.                                             |  | TQAV - Paving paths IV                                            |  | Sustainability                                                           |  | Asset                |  | Development                                             |  |                                             | 162   |  |                                                                                 
|SIT S.A.                                             |  | TQQ5- Environmental curtains Field No. 8                          |  | Sustainability: Environment and Risk prevention                          |  | Expense              |  | Not classified                                          |  |                                             | 30    |  |                                                                                 
|SQM Nitratos S.A.                                    |  | IQMH - Normalization Mine NV area operation                       |  | Sustainability: Environment and Risk prevention                          |  | Asset                |  | Not classified                                          |  |                                             | 157   |  |                                                                                 
|SQM Salar S.A.                                       |  | LQG8 – Waste room  Toconao
    Campsite                           |  | Sustainability: Natural Resources                                        |  | Expense              |  | Not classified                                          |  |                                             | 16    |  |                                                                                 
|                                                     |  |                                                                   |  |                                                                          |  |                      |  | Total                                                   |  |                                             | 9,279 |  |                                                                                 



F-179









Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 24 – Environment (continued)



| | 24.3 | Description of each project, indicating whether these are in process or have been finished
| | ---- | ------------------------------------------------------------------------------------------



SQM Industrial S.A.



CQLX:The project includes the construction
at each location a courtyard of 145 m2 approx. The project is finished.



FP55 – FPXA:These 2 projects
have a final objective consisting in the installation of a sea water sucking system of 87 km from the Mejillones area to the SQM
facilities located in Pampa Blanca. The projected expenses correspond only to the filing of the EIA of the PB mine zone and the
EIA of the PB expansion. Both projects are in process.



IQW2:Gathering, information and
recording into the Company’s system of the water level, volume, instantaneous and average flow data of the exploitation wells
that are currently in the Operations Center No.1, LLamara area wells, two wells Iris area and the information of the Sonoral wells
that will be provided during the current year. The purpose of this project is to monitor in real time the exploitation variables
of water resources and be able to perform a more precise control of extractions. The project is in process.



IQWZ:Perform an analysis of the
Tank facilities (civil works, mechanical work, piping, electrical work and instrumentation) by a company specialized in liquid
fuels and that is a Certifying Entity. After that, performing the detail engineering and then implementing the modifications required
to normalize the TKs facilities and leave them in conditions to be declared and filed with the SEC. The budget of ThUS$123 only
covers expenses related to the analysis and detail engineering. The project is in process.



JQ8K:This project has the purpose
of building a new drying plant in Coya Sur. The projected expenses correspond only to the environmental filing. The project is
in finishing stage.



JQB6:Preparation and filing of
the EID of projectNPT4 of Coya Sur, which increases the salt production capacity. The project is in process.



JQH9:The purpose of this project
is to purchase Bertram’s boilers in order to improve the combustion levels, decrease and control the emission of fumes to
the environment. The project is closed.



JQL7:Perform a study that allows
optimizing the dust collection and lost product in KNO3 drying and CS prilling plants in the future. Assess accurately the product
lost in dust. The project is in process.



F-180







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 24 - Environment (continued)



| | 24.3 | Description of each project, indicating whether these are in process or have been finished, continued
| | ---- | -----------------------------------------------------------------------------------------------------



MNYS:Preparation and execution
of a project of geoglyphs conservation; editing and publishing a book and implementing a diffusion center. Construction of a collection
deposit. All these are compensation measures of the project Technological Change Maria Elena. The project is in process.



MP5W: Normalization of the fuel
storage and distribution system in SQM installations. The project is in process.



MPQU:Construction of warehouses
for dangerous chemicals supplies in order to decrease the chance of accidents and pollution. The project is in process.



MQA8:Normalization of gas networks
of peripheral casinos (stage 1: projects): CS, Lagarto, Iodum, PV, Toco and Rancho 6. The Project is in process.



MQBM:Implementing archeological
measures in Maria Elena – Toco site, such as the archeological registry, analysis of lithic materials, and generation of
reports. The project is in process.



MQHF:Enable a wastewater plant
in Toco according to SD 594, a change room for operators and contractors, among other things. The project is finished.



MQK2:The project involves the decontamination
of equipment and items contaminated with PCBs and / or final disposal in accordance with applicable regulations. The project is
in process.



PPC1:Purchase and replacement of
equipment contaminated with PCB and obsolete equipment without spare parts. The project is in process.



PPZU:The necessary actions to normalize
and certify certified fuel tanks in the plants in María Elena, Coya Sur and Pedro de Valdivia were performed. The project
is in process.



PQLV:Preparation and filing of
EID Pedro de Valdivia. The project is in process.



PQXM:Elaborate a projectto
enter into the Environmental Impact Assessment System (SEIA), with the intention of obtaining the environmental approval for the
operation of Batteries in Pedro de Valdivia. This project is in process.



F-181







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 24 - Environment (continued)



| | 24.3 | Description of each project, indicating whether these are in process or have been finished, continued
| | ---- | -----------------------------------------------------------------------------------------------------



SQ7X: The purpose of this project
is to obtain and record information of components and finished products of SQM in the ECHA database in order to comply with the
requirements set by the REACH regulation of the European Union. The project is in finishing stage.



TQA2:This project aims to improve
the sewerage system of Villa Prat. The project is in finishing stage.



SQM S.A.



IP83:Preparation and filing of
the EID of the Project “Extension TLN-15”. The projected expenses only include the environment document filing. The
project is in process.



IPFT: The project considers the
implementation of measures committed in projects in the area of the Nueva Victoria mine, update of operations in Nueva Victoria,
evaporation ducts and pits in Iris. The project is in finishing stage.



IPXE:To implement the plan of environment
follow-up of Project Pampa Hermosa in Salar de Llamara. The project is in finishing stage.



IPXF:To implement the environment
plan follow-up of the project Pampa Hermosa in Pampa del Tamarugal. The project is in finishing stage.



IQ1M:To implement environmental
commitments included in the EIS of project “Pampa Hermosa” to safeguard the puquíos zone that is in the Salar
de Llamara water reservoir. The project is in finishing stage.



IQ3S:Improvements in the storage
installations of dangerous raw materials in Nueva Victoria. The project is in process.



IQ54:This corresponds to the implementation
of environmental commitments acquired through the environment assessment of the project Pampa Hermosa (RCA N°890/2010). The
project is in process.



F-182







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 24 - Environment (continued)



| | 24.3 | Description of each project, indicating whether these are in process or have been finished, continued
| | ---- | -----------------------------------------------------------------------------------------------------



IQOW:Enable a deposit in Humberstone
Saltpeter to store material of heritage interest recovered in land campaigns of Project ZMNV (performed and to be performed). The
project is in finishing stage.



IQPJ:The project consists of the
implementation of heritage measures involved in the Environmental Assessment for the mine areas. The measures will be implemented
according to the requirements of the mining operation VPONV.



IQWS:Implementation of heritage-related
environmental commitments, to make Mining areas in 2013, required to develop the mining exploitation of the VPONV, in compliance
with the commitments agreed through the Environmental Assessment System (SEA), The project is in process.



IQX6: Implementation of environmental
commitments of the Pampa Hermosa Project at Pampa del Tamarugal contemplated for the years 2013-2014. The project is in process.



IQXB:Implementation of environmental
commitments of the Pampa Hermosa Project at Salar de Llamara contemplated for the years 2013-2014. The project is in process.



MQLQ:Design and implement a system
to scrub gases allowing mitigating of SO2 emissions, this system should be aligned to SQM ́s Sustainable Development Policy.
The project is in process.



SQM Salar S.A.



LQG8: Increase the capacity of the
waste room of Toconao Camp, in order to avoid accumulation problems and waste handling. The project is in process.



LQDM:Certification of the liquid
fuel storage tanks.The project is in process.



LQI6:Preparation and processing
of the EIA Update Operations in the Salar de Atacama. The project is in process.



F-183







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 24 - Environment (continued)



| | 24.3 | Description of each project, indicating whether these are in process or have been finished, continued
| | ---- | -----------------------------------------------------------------------------------------------------



LQNI: Preparation and processing
of EID of project "Expansion of Drying and KCI Compacting Plant". The expenses considered include environmental processing
only. The project is in process.



LQSZ:To perform certifications
to comply with the SEC regulations.



SIT S.A.



TPYX:To comply with the commitment
of decreasing the emission of particulate material towards the city of Tocopilla. The project is in process.



TQAV:Paving and maintenance of
internal roads of the port ofTocopilla, to decrease pollution and to comply with the Supreme Decree related to the saturated
zone. The project is in process.



TQLY:This project aims at eliminating
environmental contamination that may exist in the areas of work of operators. The project is in process.



TQQ5: This project aims to contain
emissions of particulate matter to prevent contamination to adjacent communities. The project is in process



SQM Nitratos S.A.



IQMH:Creation of an area allowing
to store hazardous substances. The project is in process.



PQI9:Construction of a new pit
replacing the current with a new waste water treatment technology. The project is in process.



F-184







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 25 - Other current and non-current
non-financial assets



As of December 31, 2013, and December 31,
2012, the detail of other current and non-current assets is as follows:



|Other non-financial  assets, current |  | 12/31/2013 ThUS$ |        |  | 12/31/2012 ThUS$ | 
|------------------------------------ |  | ---------------- | ------ |  | ---------------- | 
|Domestic Value Added Tax             |  |                  | 21,263 |  |                  | 
|Foreign Value Added Tax              |  |                  | 5,842  |  |                  | 
|Prepaid mining licenses              |  |                  | 1,522  |  |                  | 
|Prepaid insurance                    |  |                  | 9,767  |  |                  | 
|Other prepayments                    |  |                  | 623    |  |                  | 
|Other assets                         |  |                  | 5,213  |  |                  | 
|Total                                |  |                  | 44,230 |  |                  | 





|Other non-financial  assets, non-current                |  | 12/31/2013 ThUS$ |        |  | 12/31/2012 ThUS$ | 
|------------------------------------------------------- |  | ---------------- | ------ |  | ---------------- | 
|Stain development expenses and prospecting expenses (1) |  |                  | 33,388 |  |                  | 
|Guarantee deposits                                      |  |                  | 708    |  |                  | 
|Pension plan                                            |  |                  | 987    |  |                  | 
|Other assets                                            |  |                  | 1,422  |  |                  | 
|Total                                                   |  |                  | 36,505 |  |                  | 





| | 1) | Reconciliation of changes in assets for exploration and mineral resource evaluation, by type
| | -- | --------------------------------------------------------------------------------------------



Movements in assets for the exploration
and evaluation of mineral resources as of December 31, 2013, and December 31, 2012:



|                                                                                     |  | 12/31/2013 |        |   | 12/31/2012 | 
|------------------------------------------------------------------------------------ |  | ---------- | ------ | - | ---------- | 
|Reconciliation                                                                       |  | ThUS$      |        |   | ThUS$      | 
|                                                                                     |  |            |        |   |            | 
|Assets for the exploration and evaluation of mineral resources, net, opening balance |  |            | 22,496 |   |            | 
|Changes in assets for exploration and assessment of mineral resources:               |  |            |        |   |            | 
|Additions, other than business combinations                                          |  |            | 13,064 |   |            | 
|Depreciation and amortization                                                        |  |            | (2,059 | ) |            | 
|Increase (Decrease) due to transfers and other charges                               |  |            | (113   | ) |            | 
|Assets for exploration and assessment of mineral resources, net, closing balance     |  |            | 33,388 |   |            | 



| | - | As of the presentation date, no reevaluations of assets for exploration and assessment of mineral
resources have been conducted.
| | - | --------------------------------------------------------------------------------------------------------------------------------



F-185







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments



| | 26.1 | Operating segments
| | ---- | ------------------



General information:



The amount of each item presented in each
operating segment is equal to that reported to the highest authority that makes decisions regarding the operation, in order to
decide on the allocation of resources to the defined segments and to assess its performance.

Factors used to identify segments on
which a report should be presented:

Segments reported are strategic business
units that offer different products and services. These are managed separately because each business requires different technology
and marketing strategies.



Description of the types of products
and services on which each reportable segment obtain its income from ordinary activities



The operating segments, through which incomes
of ordinary activities are obtained, that generate expenses and whose operating results are reviewed on a regular basis by the
maximum authority who makes decisions regarding operations, relate to the following groups of products:



1.- Specialty plant nutrients

2.- Iodine and its derivatives

3.- Lithium and its derivatives

4.- Industrial chemicals

5.- Potassium

6.- Other products and services



Description of income sources for all the other segments



Information relative to assets, liabilities
and profit and expenses that cannot be assigned to the segments indicated above, due to the nature of production processes, is
included under "Unassigned amounts” category of the disclosed information.

Basis of accounting for transactions between reportable segments



Sales between segments are made in the
same conditions as those made to third parties, and are consistently measures as presented in the income statement.



F-186







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.1 | Operating segments, continued
| | ---- | -----------------------------



Description of the nature of the differences
between measurements of results of reportable segments and the result of the entity before the expense or income tax expense of
incomes and discontinued operations.



The information reported in the segments
is extracted from the Company ́s consolidated financial statements and therefore is not required to prepare reconciliations
between the data mentioned above and those reported in the respective segments, according to what is stated in paragraph 28 of
IFRS 8, "Operating Segments".



Description of the nature of the differences
between measurements of assets of reportable segments and the Company ́s assets



Assets are not shown classified by segments,
as this information is not readily available, some of these assets are not separable by the type of activity to which they affect
and as this information is not used by management in decisions making with respect to resources to be allocated to each defined
segment. All assets are disclosed in the "unallocated amounts" category.



Description of the nature of the differences
between measurements of liabilities of reportable segments and the Company ́s liabilities



Liabilities are not shown classified by
segments, as this information is not readily available, some of these liabilities are not separable by the type of activity that
affects them and as this information is not used by management in decisions making regarding resources to be allocated to each
defined segment. All liabilities are disclosed in the "unallocated amounts" category.



F-187







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.2 | Operating segment disclosures as of December 31, 2013
as of December 31, 2012 and December 31, 2011:
| | ---- | ----------------------------------------------------------------------------------------------------



|12/31/2013                                                                                                         
|-------------------------------------------------------------------------------------------------------------------
|                                                                                                                   
|Operating segment items                                                                                            
|                                                                                                                   
|Revenue                                                                                                            
|Revenues from transactions with other operating
    segments of the same entity                                    
|                                                                                                                   
|Revenues from external customers
    and transactions with other operating segments of the same entity             
|                                                                                                                   
|Interest revenue                                                                                                   
|Interest expense                                                                                                   
|depreciation and amortization expense                                                                              
|The entity’s interest in the profit or
    loss of associates and joint ventures accounted for by the equity method
|income tax expense, continuing operations                                                                          
|Other items other tan significant cash                                                                             
|Income (loss) before taxes                                                                                         
|                                                                                                                   
|Net income (loss) from continuing operations                                                                       
|Net income (loss) from discontinued operations                                                                     
|Net income (loss)                                                                                                  
|                                                                                                                   
|Assets                                                                                                             
|Equity-accounted investees                                                                                         
|Increase of non-current assets                                                                                     
|Liabilities                                                                                                        
|Equity                                                                                                             
|Equity and liability                                                                                               
|Impairment loss recognized in profit or loss                                                                       
|Cash flows from (used in) operating activities                                                                     
|Cash flows from (used in) investing activities                                                                     
|Cash flows from (used in) financing activities                                                                     





F-188







Notes
to the Consolidated Financial Statements as of December 31, 2013





Note 26 - Operating segments (continued)



| | 26.2 | Operating segment disclosures as of December 31, 2013
as of December 31, 2012 and December 31, 2011:
| | ---- | ----------------------------------------------------------------------------------------------------



|12/31/2012                                                                                                         
|-------------------------------------------------------------------------------------------------------------------
|                                                                                                                   
|Operating segment items                                                                                            
|                                                                                                                   
|Revenue                                                                                                            
|Revenues from transactions with other operating
    segments of the same entity                                    
|                                                                                                                   
|Revenues from external customers
    and transactions with other operating segments of the same entity             
|                                                                                                                   
|Interest revenue                                                                                                   
|Interest expense                                                                                                   
|depreciation and amortization expense                                                                              
|The entity’s interest in the profit or
    loss of associates and joint ventures accounted for by the equity method
|income tax expense, continuing operations                                                                          
|Other items other tan significant cash                                                                             
|Income (loss) before taxes                                                                                         
|                                                                                                                   
|Net income (loss) from continuing operations                                                                       
|Net income (loss) from discontinued operations                                                                     
|Net income (loss)                                                                                                  
|                                                                                                                   
|Assets                                                                                                             
|Equity-accounted investees                                                                                         
|Increase of non-current assets                                                                                     
|Liabilities                                                                                                        
|Equity                                                                                                             
|Equity and liability                                                                                               
|Reversal of impairment losses recognized in
    profit and loss for the year                                       
|Impairment loss recognized in profit or loss                                                                       
|Cash flows from (used in) operating activities                                                                     
|Cash flows from (used in) investing activities                                                                     
|Cash flows from (used in) financing activities                                                                     





F-189







Notes
to the Consolidated Financial Statements as of December 31, 2013





Note 26 - Operating segments (continued)



| | 26.2 | Operating segment disclosures as of December 31, 2013
as of December 31, 2012 and December 31, 2011:
| | ---- | ----------------------------------------------------------------------------------------------------





|12/31/2011                                                                                                         
|-------------------------------------------------------------------------------------------------------------------
|                                                                                                                   
|Operating segment items                                                                                            
|                                                                                                                   
|Revenue                                                                                                            
|Revenues from transactions with other operating segments of the
    same entity                                    
|                                                                                                                   
|Revenues from external customers and transactions
    with other operating segments of the same entity             
|                                                                                                                   
|Interest revenue                                                                                                   
|Interest expense                                                                                                   
|depreciation and amortization expense                                                                              
|The entity’s interest in the profit or loss of associates
    and joint ventures accounted for by the equity method
|income tax expense, continuing operations                                                                          
|Other items other tan significant cash                                                                             
|Income (loss) before taxes                                                                                         
|                                                                                                                   
|Net income (loss) from continuing operations                                                                       
|Net income (loss) from discontinued operations                                                                     
|Net income (loss)                                                                                                  
|                                                                                                                   
|Assets                                                                                                             
|Equity-accounted investees                                                                                         
|Increase of non-current assets                                                                                     
|Liabilities                                                                                                        
|Equity                                                                                                             
|Equity and liability                                                                                               
|Reversal of impairment losses recognized in profit and loss for
    the year                                       
|Impairment loss recognized in profit or loss                                                                       
|Cash flows from (used in) operating activities                                                                     
|Cash flows from (used in) investing activities                                                                     
|Cash flows from (used in) financing activities                                                                     



F-190







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.3 | Statement of comprehensive income classified by operating
segments based on groups of products as of December 31, 2013:
| | ---- | -----------------------------------------------------------------------------------------------------------------------



|Items in the statement of comprehensive income                                                         |  | Specialty plant nutrients
    ThUS$ |          |   | Iodine and its
    derivatives ThUS$ |  |          | Lithium and its
 derivatives
    ThUS$ |  |  | Industrial chemicals
    ThUS$ |   |  | Potassium  ThUS$ |          |   | Other products and
    services ThUS$ |  |          | Corporate Unit ThUS$ |  |  | Total segments and
    Corporate unit ThUS$ |  
|------------------------------------------------------------------------------------------------------ |  | ----------------------------------- | -------- | - | ------------------------------------ |  | -------- | -------------------------------------- |  |  | ------------------------------ | - |  | ---------------- | -------- | - | ------------------------------------- |  | -------- | -------------------- |  |  | ------------------------------------------- | -
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                  |          |   |                                       |  |          |                      |  |  |                                             |  
|Revenue                                                                                                |  |                                     | 687,455  |   |                                      |  | 461,015  |                                        |  |  | 196,492                        |   |  |                  | 153,963  |   |                                       |  | 606,315  |                      |  |  | 97,900                                      |  
|Cost of sales                                                                                          |  |                                     | (536,067 | ) |                                      |  | (202,650 | )                                      |  |  | (99,244                        | ) |  |                  | (110,921 | ) |                                       |  | (443,988 | )                    |  |  | (88,820                                     | )
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                  |          |   |                                       |  |          |                      |  |  |                                             |  
|Gross profit                                                                                           |  |                                     | 151,388  |   |                                      |  | 258,365  |                                        |  |  | 97,248                         |   |  |                  | 43,042   |   |                                       |  | 162,327  |                      |  |  | 9,080                                       |  
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                  |          |   |                                       |  |          |                      |  |  |                                             |  
|Other incomes by function                                                                              |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | 84,000                                      |  
|Administrative expenses                                                                                |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Other expenses by function                                                                             |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Other gains (losses)                                                                                   |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Financial income                                                                                       |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Financial costs                                                                                        |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|interest in the profit or loss of associates and joint ventures
    accounted for by the equity method |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Exchange differences                                                                                   |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Profit (loss )before taxes                                                                             |  |                                     | 151,388  |   |                                      |  | 258,365  |                                        |  |  | 97,248                         |   |  |                  | 43,042   |   |                                       |  | 162,327  |                      |  |  | 93,080                                      |  
|Income tax expense                                                                                     |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Profit (loss )from continuing operations                                                               |  |                                     | 151,388  |   |                                      |  | 258,365  |                                        |  |  | 97,248                         |   |  |                  | 43,042   |   |                                       |  | 162,327  |                      |  |  | 93,080                                      |  
|Profit (loss ) from discontinued operations                                                            |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | 151,388  |   |                                      |  | 258,365  |                                        |  |  | 97,248                         |   |  |                  | 43,042   |   |                                       |  | 162,327  |                      |  |  | 93,080                                      |  
|Profit (loss, attributable to                                                                          |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                  |          |   |                                       |  |          |                      |  |  |                                             |  
|Profit (loss ) attributable to the controller ́s owners                                                 |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Profit (loss ) attributable to the non-controllers                                                     |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                  | -        |   |                                       |  | -        |                      |  |  | -                                           |  





F-191







Notes
to the Consolidated Financial Statements as of December 31, 2013





Note 26 - Operating segments (continued)



| | 26.3 | Statement of comprehensive income classified by operating
segments based on groups of products as of December 31, 2012:
| | ---- | -----------------------------------------------------------------------------------------------------------------------



|Items in the statement of comprehensive income                                                         |  | Specialty
    plant nutrients ThUS$ |          |   | Iodine and
     its derivatives ThUS$ |  |          | Lithium and
    its
 derivatives ThUS$ |  |  | Industrial
    chemicals ThUS$ |   |  | Potassium 
    ThUS$ |          |   | Other
    products and services ThUS$ |  |          | Corporate
    Unit ThUS$ |  |  | Total
    segments and Corporate unit ThUS$ |  
|------------------------------------------------------------------------------------------------------ |  | ----------------------------------- | -------- | - | ------------------------------------- |  | -------- | -------------------------------------- |  |  | ------------------------------ | - |  | -------------------- | -------- | - | ------------------------------------- |  | -------- | ------------------------ |  |  | ------------------------------------------- | -
|                                                                                                       |  |                                     |          |   |                                       |  |          |                                        |  |  |                                |   |  |                      |          |   |                                       |  |          |                          |  |  |                                             |  
|Revenue                                                                                                |  |                                     | 675,350  |   |                                       |  | 578,091  |                                        |  |  | 222,238                        |   |  |                      | 245,208  |   |                                       |  | 605,059  |                          |  |  | 103,214                                     |  
|Cost of sales                                                                                          |  |                                     | (457,470 | ) |                                       |  | (215,573 | )                                      |  |  | (111,543                       | ) |  |                      | (162,153 | ) |                                       |  | (359,032 | )                        |  |  | (94,796                                     | )
|                                                                                                       |  |                                     |          |   |                                       |  |          |                                        |  |  |                                |   |  |                      |          |   |                                       |  |          |                          |  |  |                                             |  
|Gross profit                                                                                           |  |                                     | 217,880  |   |                                       |  | 362,518  |                                        |  |  | 110,695                        |   |  |                      | 83,055   |   |                                       |  | 246,027  |                          |  |  | 8,418                                       |  
|                                                                                                       |  |                                     |          |   |                                       |  |          |                                        |  |  |                                |   |  |                      |          |   |                                       |  |          |                          |  |  |                                             |  
|Other incomes by function                                                                              |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Administrative expenses                                                                                |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Other expenses by function                                                                             |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Other gains (losses)                                                                                   |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Financial income                                                                                       |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Financial costs                                                                                        |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|interest in the profit or loss of associates and joint ventures
    accounted for by the equity method |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Exchange differences                                                                                   |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss )before taxes                                                                             |  |                                     | 217,880  |   |                                       |  | 362,518  |                                        |  |  | 110,695                        |   |  |                      | 83,055   |   |                                       |  | 246,027  |                          |  |  | 8,418                                       |  
|Income tax expense                                                                                     |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss )from continuing operations                                                               |  |                                     | 217,880  |   |                                       |  | 362,518  |                                        |  |  | 110,695                        |   |  |                      | 83,055   |   |                                       |  | 246,027  |                          |  |  | 8,418                                       |  
|Profit (loss ) from discontinued operations                                                            |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | 217,880  |   |                                       |  | 362,518  |                                        |  |  | 110,695                        |   |  |                      | 83,055   |   |                                       |  | 246,027  |                          |  |  | 8,418                                       |  
|Profit (loss, attributable to                                                                          |  |                                     |          |   |                                       |  |          |                                        |  |  |                                |   |  |                      |          |   |                                       |  |          |                          |  |  |                                             |  
|Profit (loss ) attributable to the controller ́s owners                                                 |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss ) attributable to the non-controllers                                                     |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | -        |   |                                       |  | -        |                                        |  |  | -                              |   |  |                      | -        |   |                                       |  | -        |                          |  |  | -                                           |  





F-192







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.3 | Statement of comprehensive income classified by operating
segments based on groups of products as of December 31, 2011:
| | ---- | -----------------------------------------------------------------------------------------------------------------------



|Items in the statement of comprehensive income                                                         |  | Specialty
    plant nutrients ThUS$ |          |   | Iodine and
    its derivatives ThUS$ |  |          | Lithium and
    its
 derivatives ThUS$ |  |  | Industrial
    chemicals ThUS$ |   |  | Potassium 
    ThUS$ |         |   | Other
    products and services ThUS$ |  |          | Corporate
    Unit ThUS$ |  |  | Total
    segments and Corporate unit ThUS$ |  
|------------------------------------------------------------------------------------------------------ |  | ----------------------------------- | -------- | - | ------------------------------------ |  | -------- | -------------------------------------- |  |  | ------------------------------ | - |  | -------------------- | ------- | - | ------------------------------------- |  | -------- | ------------------------ |  |  | ------------------------------------------- | -
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                      |         |   |                                       |  |          |                          |  |  |                                             |  
|Revenue                                                                                                |  |                                     | 721,696  |   |                                      |  | 454,468  |                                        |  |  | 183,403                        |   |  |                      | 139,508 |   |                                       |  | 555,742  |                          |  |  | 90,469                                      |  
|Cost of sales                                                                                          |  |                                     | (494,220 | ) |                                      |  | (192,107 | )                                      |  |  | (98,173                        | ) |  |                      | (83,503 | ) |                                       |  | (337,478 | )                        |  |  | (85,013                                     | )
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                      |         |   |                                       |  |          |                          |  |  |                                             |  
|Gross profit                                                                                           |  |                                     | 227,476  |   |                                      |  | 262,361  |                                        |  |  | 85,230                         |   |  |                      | 56,005  |   |                                       |  | 218,264  |                          |  |  | 5,456                                       |  
|                                                                                                       |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                      |         |   |                                       |  |          |                          |  |  |                                             |  
|Other incomes by function                                                                              |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Administrative expenses                                                                                |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Other expenses by function                                                                             |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Other gains (losses)                                                                                   |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Financial income                                                                                       |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Financial costs                                                                                        |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|interest in the profit or loss of associates
    and joint ventures accounted for by the equity method |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Exchange differences                                                                                   |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss )before taxes                                                                             |  |                                     | 227,476  |   |                                      |  | 262,361  |                                        |  |  | 85,230                         |   |  |                      | 56,005  |   |                                       |  | 218,264  |                          |  |  | 5,456                                       |  
|Income tax expense                                                                                     |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss )from continuing
    operations                                                           |  |                                     | 227,476  |   |                                      |  | 262,361  |                                        |  |  | 85,230                         |   |  |                      | 56,005  |   |                                       |  | 218,264  |                          |  |  | 5,456                                       |  
|Profit (loss ) from discontinued operations                                                            |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | 227,476  |   |                                      |  | 262,361  |                                        |  |  | 85,230                         |   |  |                      | 56,005  |   |                                       |  | 218,264  |                          |  |  | 5,456                                       |  
|Profit (loss, attributable
    to                                                                      |  |                                     |          |   |                                      |  |          |                                        |  |  |                                |   |  |                      |         |   |                                       |  |          |                          |  |  |                                             |  
|Profit (loss ) attributable to the controller ́s
    owners                                             |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss ) attributable to the non-controllers                                                     |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  
|Profit (loss)                                                                                          |  |                                     | -        |   |                                      |  | -        |                                        |  |  | -                              |   |  |                      | -       |   |                                       |  | -        |                          |  |  | -                                           |  



F-193







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.4 | Revenue from transactions with other Company operating segments as of December 31, 2013
| | ---- | ---------------------------------------------------------------------------------------



|Items in the statement of
    comprehensive
    income |  | Specialty
    plant
    nutrients ThUS$ |         |  | Iodine
    and
    its
    derivatives ThUS$ |  |         | Lithium
    and
    its
    derivatives ThUS$ |  |  | Industrial
    chemicals ThUS$ |  |  | Potassium
    ThUS$ |         |  | Other
    products
    and services ThUS$ |  |         | Total
    segments and
    Corporate unit ThUS$ | 
|------------------------------------------------------ |  | --------------------------------------- | ------- |  | -------------------------------------------- |  | ------- | --------------------------------------------- |  |  | ------------------------------ |  |  | ------------------- | ------- |  | ----------------------------------------- |  | ------- | ----------------------------------------------- | 
|                                                       |  |                                         |         |  |                                              |  |         |                                               |  |  |                                |  |  |                     |         |  |                                           |  |         |                                                 | 
|Revenue                                                |  |                                         | 687,455 |  |                                              |  | 461,015 |                                               |  |  | 196,492                        |  |  |                     | 153,963 |  |                                           |  | 606,315 |                                                 | 



| | 26.4 | Revenue from transactions with other Company operating segments as of December 31, 2012
| | ---- | ---------------------------------------------------------------------------------------



|Items in the statement of comprehensive
    income |  | Specialty
    plant
    nutrients ThUS$ |         |  | Iodine
    and
    its 
derivatives ThUS$ |  |         | Lithium
    and
    its
    derivatives ThUS$ |  |  | Industrial
    chemicals ThUS$ |  |  | Potassium
    ThUS$ |         |  | Other
    products
    and services ThUS$ |  |         | Total
    segments and
    Corporate unit ThUS$ | 
|-------------------------------------------------- |  | --------------------------------------- | ------- |  | ----------------------------------------- |  | ------- | --------------------------------------------- |  |  | ------------------------------ |  |  | ------------------- | ------- |  | ----------------------------------------- |  | ------- | ----------------------------------------------- | 
|                                                   |  |                                         |         |  |                                           |  |         |                                               |  |  |                                |  |  |                     |         |  |                                           |  |         |                                                 | 
|Revenue                                            |  |                                         | 675,350 |  |                                           |  | 578,091 |                                               |  |  | 222,238                        |  |  |                     | 245,208 |  |                                           |  | 605,059 |                                                 | 



| | 26.4 | Revenue from transactions with other Company operating segments as of December 31, 2011
| | ---- | ---------------------------------------------------------------------------------------



|Items in the statement of comprehensive income |  | Specialty plant nutrients
    ThUS$ |         |  | Iodine and
    its
    derivatives ThUS$ |  |         | Lithium and
    its
    derivatives ThUS$ |  |  | Industrial
    chemicals ThUS$ |  |  | Potassium ThUS$ |         |  | Other products and
    services ThUS$ |  |         | Total
    segments and Corporate unit ThUS$ | 
|---------------------------------------------- |  | ----------------------------------- | ------- |  | ---------------------------------------- |  | ------- | ----------------------------------------- |  |  | ------------------------------ |  |  | --------------- | ------- |  | ------------------------------------- |  | ------- | ------------------------------------------- | 
|                                               |  |                                     |         |  |                                          |  |         |                                           |  |  |                                |  |  |                 |         |  |                                       |  |         |                                             | 
|Revenue                                        |  |                                     | 721,696 |  |                                          |  | 454,468 |                                           |  |  | 183,403                        |  |  |                 | 139,508 |  |                                       |  | 555,742 |                                             | 



F-194







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.5 | Disclosures on geographical areas
| | ---- | ---------------------------------



As indicated in paragraph 33 of IFRS 8,
the entity discloses geographical information on its revenue from operating activities with external customers and from non-current
assets that are not financial instruments, deferred income tax assets, assets related to post-employment benefits or rights derived
from insurance contracts.



| | 26.6 | Disclosures on main customers
| | ---- | -----------------------------



With respect to the degree of dependency
of the Company on its customers, in accordance with paragraph N° 34 of IFRS N° 8, the Company has no external customers
who individually represent 10% or more of its revenue. Credit risk concentrations with respect to trade and other accounts receivable
are limited due to the significant number of entities in the Company’s portfolio and its worldwide distribution. The Company’s
policy requires guarantees (such as letters of credit, guarantee clauses and others) and/or to maintain insurance policies for
certain accounts as deemed necessary by the Company's Management.



F-195







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.7 | Segments by geographical areas as of December 31,
2013 as of December 31, 2012 and December 31, 2011:
| | ---- | -----------------------------------------------------------------------------------------------------



|                                                 |  | Chile |           |  | Latin America
    and the
    Caribbean |  |         | Europe |  |  | North
    America |  |  | Asia and
    others |         |  | 12/31/2013 | 
|------------------------------------------------ |  | ----- | --------- |  | --------------------------------------- |  | ------- | ------ |  |  | ----------------- |  |  | ------------------- | ------- |  | ---------- | 
|Items                                            |  | ThUS$ |           |  | ThUS$                                   |  |         | ThUS$  |  |  | ThUS$             |  |  | ThUS$               |         |  | ThUS$      | 
|                                                 |  |       |           |  |                                         |  |         |        |  |  |                   |  |  |                     |         |  |            | 
|Revenue                                          |  |       | 242,373   |  |                                         |  | 379,063 |        |  |  | 504,043           |  |  |                     | 546,075 |  |            | 
|                                                 |  |       |           |  |                                         |  |         |        |  |  |                   |  |  |                     |         |  |            | 
|Non-current assets:                              |  |       | 2,218,631 |  |                                         |  | 434     |        |  |  | 36,680            |  |  |                     | 16,636  |  |            | 
|Investment accounted for under the equity method |  |       | 1,649     |  |                                         |  | -       |        |  |  | 24,847            |  |  |                     | 13,126  |  |            | 
|Intangible assets other than goodwill            |  |       | 104,043   |  |                                         |  | -       |        |  |  | -                 |  |  |                     | 317     |  |            | 
|Goodwill                                         |  |       | 26,929    |  |                                         |  | 86      |        |  |  | 11,373            |  |  |                     | -       |  |            | 
|Property, plant and equipment, net               |  |       | 2,050,684 |  |                                         |  | 157     |        |  |  | 460               |  |  |                     | 2,205   |  |            | 
|Investment property                              |  |       | -         |  |                                         |  | -       |        |  |  | -                 |  |  |                     | -       |  |            | 
|Other non-current assets                         |  |       | 35,326    |  |                                         |  | 191     |        |  |  | -                 |  |  |                     | 988     |  |            | 



|                                                 |  | Chile |           |  | Latin America and the
    Caribbean |  |         | Europe |  |  | North America |  |  | Asia and others |         |  | 12/31/2012 | 
|------------------------------------------------ |  | ----- | --------- |  | ----------------------------------- |  | ------- | ------ |  |  | ------------- |  |  | --------------- | ------- |  | ---------- | 
|Items                                            |  | ThUS$ |           |  | ThUS$                               |  |         | ThUS$  |  |  | ThUS$         |  |  | ThUS$           |         |  | ThUS$      | 
|                                                 |  |       |           |  |                                     |  |         |        |  |  |               |  |  |                 |         |  |            | 
|Revenue                                          |  |       | 269,421   |  |                                     |  | 416,089 |        |  |  | 558,245       |  |  |                 | 619,667 |  |            | 
|                                                 |  |       |           |  |                                     |  |         |        |  |  |               |  |  |                 |         |  |            | 
|Non-current assets:                              |  |       | 2,054,806 |  |                                     |  | 488     |        |  |  | 35,709        |  |  |                 | 18,066  |  |            | 
|Investment accounted for under the equity method |  |       | 1,656     |  |                                     |  | -       |        |  |  | 24,051        |  |  |                 | 15,357  |  |            | 
|Intangible assets other than goodwill            |  |       | 23,630    |  |                                     |  | -       |        |  |  | -             |  |  |                 | 378     |  |            | 
|Goodwill                                         |  |       | 26,929    |  |                                     |  | 86      |        |  |  | 11,373        |  |  |                 | -       |  |            | 
|Property, plant and equipment, net               |  |       | 1,985,128 |  |                                     |  | 183     |        |  |  | 285           |  |  |                 | 2,331   |  |            | 
|Investment property                              |  |       | -         |  |                                     |  | -       |        |  |  | -             |  |  |                 | -       |  |            | 
|Other non-current assets                         |  |       | 17,463    |  |                                     |  | 219     |        |  |  | -             |  |  |                 | -       |  |            | 



F-196







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.7 | Segments by geographical areas as of December 31,
2013 as of December 31, 2012 and December 31, 2011:
| | ---- | -----------------------------------------------------------------------------------------------------



|                                                 |  | Chile |           |  | Latin America
 and the
 Caribbean |  |         | Europe |  |  | North
 America |  |  | Asia and
 others |         |  | 12/31/2011 | 
|------------------------------------------------ |  | ----- | --------- |  | --------------------------------- |  | ------- | ------ |  |  | -------------- |  |  | ---------------- | ------- |  | ---------- | 
|Items                                            |  | ThUS$ |           |  | ThUS$                             |  |         | ThUS$  |  |  | ThUS$          |  |  | ThUS$            |         |  | ThUS$      | 
|                                                 |  |       |           |  |                                   |  |         |        |  |  |                |  |  |                  |         |  |            | 
|Revenue                                          |  |       | 247,510   |  |                                   |  | 284,605 |        |  |  | 837,126        |  |  |                  | 445,048 |  |            | 
|                                                 |  |       |           |  |                                   |  |         |        |  |  |                |  |  |                  |         |  |            | 
|Non-current assets:                              |  |       | 1,809,871 |  |                                   |  | 1,757   |        |  |  | 28,681         |  |  |                  | 15,335  |  |            | 
|Investment accounted for under the equity method |  |       | 1,444     |  |                                   |  | -       |        |  |  | 16,919         |  |  |                  | 14,867  |  |            | 
|Intangible assets other than goodwill            |  |       | 3,877     |  |                                   |  | -       |        |  |  | -              |  |  |                  | 439     |  |            | 
|Goodwill                                         |  |       | 27,146    |  |                                   |  | 86      |        |  |  | 11,373         |  |  |                  | -       |  |            | 
|Property, plant and equipment, net               |  |       | 1,752,991 |  |                                   |  | 1,433   |        |  |  | 389            |  |  |                  | 29      |  |            | 
|Investment property                              |  |       | -         |  |                                   |  | -       |        |  |  | -              |  |  |                  | -       |  |            | 
|Other non-current assets                         |  |       | 24,413    |  |                                   |  | 238     |        |  |  | -              |  |  |                  | -       |  |            | 



F-197







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 26 - Operating segments (continued)



| | 26.8 | Property, plant and equipment classified by geographical
areas
| | ---- | --------------------------------------------------------------



The company's main productive facilities are located near their
mines and extraction facilities in northern Chile. The following table presents the main production facilities as of December 31,
2013 and December 31, 2012:



|Location          |  | Products:                                                         
|----------------- |  | ------------------------------------------------------------------
|Pedro de Valdivia |  | Production of iodine and nitrate salts                            
|María Elena       |  | Production of iodine and nitrate salts                            
|Coya Sur          |  | Production of nitrate salts                                       
|Nueva Victoria    |  | Production of iodine and nitrate salts                            
|Salar de Atacama  |  | Potassium chloride, Lithium chloride, boric acid potassium sulfate
|Salar del Carmen  |  | Production of Lithium carbonate and lithium hydroxide             
|Tocopilla         |  | Port facilities                                                   



F-198







Notes
to the Consolidated Financial Statements as of December 31, 2013



Nota 27 - Gains (losses)
from operating activities in the statement of income by function of expenses, included according to their nature



|     |  |          |  | 12/31/2013 |           |  | 12/31/2012 |  |           | 12/31/2011 | 
|---- |  | -------- |  | ---------- | --------- |  | ---------- |  | --------- | ---------- | 
|     |  |          |  | ThUS$      |           |  | ThUS$      |  |           | ThUS$      | 
|27.1 |  | Revenue  |  |            |           |  |            |  |           |            | 
|     |  |          |  |            |           |  |            |  |           |            | 
|     |  | Products |  |            | 2,191,650 |  |            |  | 2,420,357 |            | 
|     |  | Services |  |            | 11,490    |  |            |  | 8,803     |            | 
|     |  |          |  |            |           |  |            |  |           |            | 
|     |  | Total    |  |            | 2,203,140 |  |            |  | 2,429,160 |            | 



|     |  |                                                           |  | 12/31/2013 |            |   | 12/31/2012 |  |            | 12/31/2011 | 
|---- |  | --------------------------------------------------------- |  | ---------- | ---------- | - | ---------- |  | ---------- | ---------- | 
|     |  |                                                           |  | ThUS$      |            |   | ThUS$      |  |            | ThUS$      | 
|27.2 |  | Cost of sales                                             |  |            |            |   |            |  |            |            | 
|     |  |                                                           |  |            |            |   |            | 
|     |  | Raw material and supplies                                 |  |            | (811,518   | ) |            |  | (1,066,803 | )          | 
|     |  |                                                           |  |            |            |   |            |  |            |            | 
|     |  | Types of employee benefits expenses                       |  |            |            |   |            |  |            |            | 
|     |  | Salaries and wages                                        |  |            | (138,937   | ) |            |  | (134,400   | )          | 
|     |  | Other short-term employee benefits                        |  |            | (44,601    | ) |            |  | (66,370    | )          | 
|     |  | Termination benefit expenses                              |  |            | (10,811    | ) |            |  | (4,325     | )          | 
|     |  | Total employee benefits expenses                          |  |            | (194,349   | ) |            |  | (205,095   | )          | 
|     |  |                                                           |  |            |            |   |            |  |            |            | 
|     |  | Depreciation expense                                      |  |            | (216,388   | ) |            |  | (190,509   | )          | 
|     |  | Amortization expense                                      |  |            | -          |   |            |  | -          |            | 
|     |  | Impairment loss recognized in profit or loss for the year |  |            | (25,195    | ) |            |  | (1,762     | )          | 
|     |  | Other expenses, by nature (*)                             |  |            | (234,240   | ) |            |  | 63,602     |            | 
|     |  |                                                           |  |            |            |   |            |  |            |            | 
|     |  | Total                                                     |  |            | (1,481,690 | ) |            |  | (1,400,567 | )          | 



| | (*) | Include the variation of finished and products in-process
| | --- | ---------------------------------------------------------



F-199







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 27 - Gains (losses)
from operating activities in the statement of income by function of expenses, included according to their nature (continued)



|     |  |                                                         |  | 12/31/2013 |        |  | 12/31/2012 |  |        | 12/31/2011 | 
|---- |  | ------------------------------------------------------- |  | ---------- | ------ |  | ---------- |  | ------ | ---------- | 
|     |  |                                                         |  | ThUS$      |        |  | ThUS$      |  |        | ThUS$      | 
|27.3 |  | Other income                                            |  |            |        |  |            |  |        |            | 
|     |  |                                                         |  |            |        |  |            |  |        |            | 
|     |  | Discounts obtained from suppliers                       |  |            | 1,349  |  |            |  | 648    |            | 
|     |  | Compensation received and insurance claim recovery      |  |            | 5,306  |  |            |  | 5,240  |            | 
|     |  | Penalties charged to suppliers                          |  |            | 374    |  |            |  | 312    |            | 
|     |  | Taxes recovered                                         |  |            | 9      |  |            |  | 15     |            | 
|     |  | Excess in the provision of liabilities with 3rd parties |  |            | 712    |  |            |  | 669    |            | 
|     |  | Excess in allowance for doubtful accounts               |  |            | -      |  |            |  | 154    |            | 
|     |  | Sale of Property, plant and equipment                   |  |            | 107    |  |            |  | 281    |            | 
|     |  | Sale of materials, spare parts and supplies             |  |            | 1,392  |  |            |  | 1,388  |            | 
|     |  | Sale of mining concessions (1)                          |  |            | 86,157 |  |            |  | 1,578  |            | 
|     |  | Sale of scrap                                           |  |            | 27     |  |            |  | 176    |            | 
|     |  | Indemnity Minera Esperanza                              |  |            | -      |  |            |  | 28     |            | 
|     |  | Excess indemnity provision Yara South Africa            |  |            | 272    |  |            |  | 335    |            | 
|     |  | Lowest Price paid in portfolio purchase                 |  |            | 337    |  |            |  | -      |            | 
|     |  | Lowest Price in goodwill purchases                      |  |            | 248    |  |            |  | -      |            | 
|     |  | Change inventory provision                              |  |            |        |  |            |  |        |            | 
|     |  | Sale of concession of Minera Sierra Gorda               |  |            |        |  |            |  |        |            | 
|     |  | Other operating results                                 |  |            | 426    |  |            |  | 1,878  |            | 
|     |  |                                                         |  |            |        |  |            |  |        |            | 
|     |  | Total                                                   |  |            | 96,716 |  |            |  | 12,702 |            | 



| | (1) | During 2013, the Company, Antofagasta Minerals S.A. and Minera Antucoya entered into an amendment
to their Mining Claim Sale Contract in relation to the “Antucoya Project”, whereby the Company sold certain mining
concessions for ThUS$84,000. The amendment provided a one time cash payment in lieu of annual royalty payments.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|     |  |                                        |  | 12/31/2013 |          |   | 12/31/2012 |  |          | 12/31/2011 | 
|---- |  | -------------------------------------- |  | ---------- | -------- | - | ---------- |  | -------- | ---------- | 
|     |  |                                        |  | ThUS$      |          |   | ThUS$      |  |          | ThUS$      | 
|27.4 |  | Administrative expenses                |  |            |          |   |            |  |          |            | 
|     |  |                                        |  |            |          |   |            |  |          |            | 
|     |  | Employee benefit expenses by nature    |  |            |          |   |            |  |          |            | 
|     |  | Salaries and wages                     |  |            | (48,033  | ) |            |  | (44,429  | )          | 
|     |  | Other short-term benefits to employees |  |            | (3,176   | ) |            |  | (2,868   | )          | 
|     |  |                                        |  |            |          |   |            |  |          |            | 
|     |  | Total employee benefit expenses        |  |            | (51,209  | ) |            |  | (47,297  | )          | 
|     |  |                                        |  |            |          |   |            |  |          |            | 
|     |  | Other expenses, by nature              |  |            | (53,980  | ) |            |  | (59,145  | )          | 
|     |  |                                        |  |            |          |   |            |  |          |            | 
|     |  | Total                                  |  |            | (105,189 | ) |            |  | (106,442 | )          | 



F-200







Notes
to the Consolidated Financial Statements as of December 31, 2013



Nota 27 - Gains (losses)
from operating activities in the statement of income by function of expenses, included according to their nature (continued)



|     |  |                                                           |  | 12/31/2013 |         |   | 12/31/2012 |  |         | 12/31/2011 | 
|---- |  | --------------------------------------------------------- |  | ---------- | ------- | - | ---------- |  | ------- | ---------- | 
|     |  |                                                           |  | ThUS$      |         |   | ThUS$      |  |         | ThUS$      | 
|27.5 |  | Other expenses by function                                |  |            |         |   |            |  |         |            | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Employee benefit expenses by nature                       |  |            |         |   |            |  |         |            | 
|     |  | Other short-term benefits to employees                    |  |            | (6      | ) |            |  | (24     | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Depreciation and amortization expenses                    |  |            |         |   |            |  |         |            | 
|     |  | Depreciation of stopped assets                            |  |            | (433    | ) |            |  | (5,649  | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Impairment loss recognized in profit or loss for the year |  |            |         |   |            |  |         |            | 
|     |  | Impairment of allowance for doubtful accounts             |  |            | (732    | ) |            |  | (1,054  | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Subtotal to date                                          |  |            | (732    | ) |            |  | (1,054  | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Other expenses, by nature                                 |  |            |         |   |            |  |         |            | 
|     |  | Legal Expenses                                            |  |            | (3,791  | ) |            |  | (1,984  | )          | 
|     |  | Worksite stoppage expenses                                |  |            | (75     | ) |            |  | (75     | )          | 
|     |  | VAT and other unrecoverable tax                           |  |            | (1,196  | ) |            |  | (1,182  | )          | 
|     |  | Fines paid                                                |  |            | (444    | ) |            |  | (790    | )          | 
|     |  | Consultancy services                                      |  |            | (8      | ) |            |  | (19     | )          | 
|     |  | Provisions, investment and material plan expenses         |  |            | (19,397 | ) |            |  | (15,578 | )          | 
|     |  | Donations rejected as expense                             |  |            | (5,253  | ) |            |  | (5,517  | )          | 
|     |  | Provision for work closing                                |  |            | (1,276  | ) |            |  | (634    | )          | 
|     |  | Legal provision                                           |  |            | -       |   |            |  | -       |            | 
|     |  | Adjustment to net realizable value of items of PP&E       |  |            | (10,085 | ) |            |  | -       |            | 
|     |  | Indemnities paid                                          |  |            | (146    | ) |            |  | (281    | )          | 
|     |  | Other operating expenses                                  |  |            | (6,555  | ) |            |  | (1,841  | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Subtotal to date                                          |  |            | (48,226 | ) |            |  | (27,901 | )          | 
|     |  |                                                           |  |            |         |   |            |  |         |            | 
|     |  | Total                                                     |  |            | (49,397 | ) |            |  | (34,628 | )          | 



|     |  |                                  |  | 12/31/2013 |         |   | 12/31/2012 |  |       | 12/31/2011 | 
|---- |  | -------------------------------- |  | ---------- | ------- | - | ---------- |  | ----- | ---------- | 
|     |  |                                  |  | ThUS$      |         |   | ThUS$      |  |       | ThUS$      | 
|27.6 |  | Other income (expenses)          |  |            |         |   |            |  |       |            | 
|     |  |                                  |  |            |         |   |            |  |       |            | 
|     |  | Personnel restructuring expenses |  |            | (11,545 | ) |            |  | -     |            | 
|     |  | Sale of investment in associates |  |            | -       |   |            |  | (404  | )          | 
|     |  | Retirement plan provision        |  |            | -       |   |            |  | -     |            | 
|     |  | El Toco closing provision        |  |            | -       |   |            |  | -     |            | 
|     |  | Other                            |  |            | 154     |   |            |  | 1,087 |            | 
|     |  |                                  |  |            |         |   |            |  |       |            | 
|     |  | Total                            |  |            | (11,391 | ) |            |  | 683   |            | 



F-201







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 27 - Gains (losses)
from operating activities in the statement of income by function of expenses, included according to their nature (continued)





|27.7 |  | Summary of expenses by nature :                           |  | January to December |           
|---- |  | --------------------------------------------------------- |  | ------------------- | ----------
|     |  |                                                           |  | 2013                |           
|     |  |                                                           |  | ThUS$               |           
|     |  |                                                           |  |                     |           
|     |  | Raw material and supplies used                            |  |                     | (811,518  
|     |  |                                                           |  |                     |           
|     |  | Types of employee benefits expenses                       |  |                     |           
|     |  |                                                           |  |                     |           
|     |  | Salaries and wages                                        |  |                     | (186,970  
|     |  | Other short-term employee benefits                        |  |                     | (47,783   
|     |  | Termination benefit expenses                              |  |                     | (10,811   
|     |  | Total employee benefit expenses                           |  |                     | (245,564  
|     |  | Depreciation and amortization expenses                    |  |                     |           
|     |  | Depreciation expense                                      |  |                     | (216,821  
|     |  | Amortization expense                                      |  |                     | -         
|     |  | Impairment loss recognized in profit or loss for the year |  |                     | (25,927   
|     |  | Other expenses, by nature                                 |  |                     | (347,837  
|     |  |                                                           |  |                     |           
|     |  | Total expenses, by nature                                 |  |                     | (1,647,667





This table corresponds to the summary from
Note 27.2 to 27.6 required by the Chilean Superintendence of Securities and Insurance



|27.8 |  | Finance expenses                                     |  | January to December |         |   |       | 
|---- |  | ---------------------------------------------------- |  | ------------------- | ------- | - | ----- | 
|     |  |                                                      |  | 2013                |         |   | 2012  | 
|     |  |                                                      |  | ThUS$               |         |   | ThUS$ | 
|     |  |                                                      |  |                     |         |   |       | 
|     |  | Interest expense from bank borrowings and overdrafts |  |                     | (3,186  | ) |       | 
|     |  | Interest expense from bonds                          |  |                     | (62,966 | ) |       | 
|     |  | Interest expense from loans                          |  |                     | (8,691  | ) |       | 
|     |  | Capitalized interest expenses                        |  |                     | 17,232  |   |       | 
|     |  | Other finance costs                                  |  |                     | (997    | ) |       | 
|     |  |                                                      |  |                     |         |   |       | 
|     |  | Total                                                |  |                     | (58,608 | ) |       | 



F-202







Notes
to the Consolidated Financial Statements as of December 31, 2013



Nota 28 - Income tax and deferred taxes



Accounts receivable from taxes as of December 31, 2013 and December
31, 2012, are as follows:



|28.1 | Current tax assets:
|---- | -------------------



|                                                                        |  | 12/31/2013 |        |  | 12/31/2012 | 
|----------------------------------------------------------------------- |  | ---------- | ------ |  | ---------- | 
|                                                                        |  | ThUS$      |        |  | ThUS$      | 
|Monthly provisional income tax payments, Chilean companies current year |  |            | 44,018 |  |            | 
|Monthly provisional payment Royalty                                     |  |            | 10,417 |  |            | 
|Monthly provisional income tax payments, foreign companies              |  |            | 1,444  |  |            | 
|Corporate tax credits (1)                                               |  |            | 2,025  |  |            | 
|Corporate tax absorbed by tax losses (2)                                |  |            | 1,572  |  |            | 
|Total                                                                   |  |            | 59,476 |  |            | 



| | (1) | These credits are available to companies and relate to the corporate tax payment in April of the
following year. These credits include, amongst others, training expense credits (SENCE) and property, plant and equipment acquisition
credits that are equivalent to 4% of the property, plant and equipment purchases made during the year. In addition, some credits
relate to the donations the Group has made during 2013 and 2012.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | This concept corresponds to the absorption of non-operating losses (NOL’s) determined by
the company at year end, which must be imputed or recorded in the Retained Taxable Profits Registry (FUT).
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In accordance with the laws in
force and as provided by article 31, No. 3 of the Income Tax Law, when profits recorded in the FUT that have not been withdrawn
or distributed are totally or partially absorbed by NOL’s, the corporate tax paid on such profits (20%, 17%, 16.5%, 16%,
15%, 10% depending on the year in which profits were generated) will be considered to be a provisional payment with respect to
the portion representing the absorbed accumulated tax profits.



F-203







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.1 | Current tax assets, continued
| | ---- | -----------------------------



Taxpayers are entitled to apply
for a refund of this monthly provisional income tax payments on the absorbed profits recorded in the FUT registry via their tax
returns (Form 22).



Therefore, the provisional payment
for absorbed profits (PPAP) recorded in the FUT is in effect a recoverable tax, and as such the Company records it as an asset.



| | 28.2 | Current tax liabilities:
| | ---- | ------------------------



|Current tax liabilities        |  | 12/31/2013 |        |  | 12/31/2012 | 
|------------------------------ |  | ---------- | ------ |  | ---------- | 
|                               |  | ThUS$      |        |  | ThUS$      | 
|1st Category income tax        |  |            | 21,466 |  |            | 
|Royalty tax on mining activity |  |            | -      |  |            | 
|Foreign company income tax     |  |            | 10,113 |  |            | 
|Article 21 Single Tax          |  |            | 128    |  |            | 
|Total                          |  |            | 31,707 |  |            | 



Income tax is determined on the
basis of the determination of tax result to which the tax rate currently in force in Chile is applied. As established by Law 20.630,
beginning on 2012 and after this tax rate is 20%.



The provision for royalty is
determined by applying the tax rate determined for the Net operating income (NOI).



In conclusion, both concepts
represent the estimated amount the Company will have to pay for income tax and specific tax on mining.



| | 28.3 | Tax earnings
| | ---- | ------------



As of December 31, 2013 as December 31,
2012, and December 31, 2011 the Company and its subsidiaries have recorded the following consolidated balances for retained tax
earnings, income not constituting revenue subject to income tax, accumulated tax losses and credit for shareholders:



|                                     |  | 12/31/2013 ThUS$ |           |  | 12/31/2012 ThUS$ |  |           | 12/31/2011 ThUS$ | 
|------------------------------------ |  | ---------------- | --------- |  | ---------------- |  | --------- | ---------------- | 
|Taxable profits with credit rights   |  |                  | 1,321,643 |  |                  |  | 1,262,201 |                  | 
|Taxable profits without credit right |  |                  | 90,628    |  |                  |  | 138,535   |                  | 
|Taxable loss                         |  |                  | 7,425     |  |                  |  | 9,931     |                  | 
|Credit for shareholders              |  |                  | 321,006   |  |                  |  | 294,146   |                  | 



F-204







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.3 | Tax earnings, continued
| | ---- | -----------------------



The Retained Taxable Profits Registry (FUT)
is a chronological registry where the profits generated and distributed by the company are recorded. The object of the FUT is to
control the accumulated tax profits of the company that may be distributed, withdrawn or remitted to the owners, shareholders or
partners, and the final taxes that must be imposed, called in Chile Global Aggregate Tax (that levies persons resident or domiciled
in Chile), or Withholding Tax (that levies persons “Not” resident or domiciled in Chile).



The FUT Register contains profits with credit rights and profits
without credit rights, which arise out of the inclusion of the net taxable income determined by the company or the profits received
by the company that may be dividends received or withdrawals made during the period.



Profits without credit rights represent
the tax payable by the company within the year and filed the following year, therefore they will be deducted from the FUT Registry
the following year.



Profits with credit rights may be used
to reduce the final tax burden of owners, shareholders or partners, which upon withdrawal are entitled to use the credits associated
with the relevant profits.



In summary, companies use the FUT Registry
to maintain control over the profits they generate that have not been distributed to the owners and the relevant credits associated
with such profits.



| | 28.4 | Income tax and deferred taxes
| | ---- | -----------------------------



Assets and liabilities recognized in the
Statement of financial position are offset if and only if:



| | 1 | The Company has legally recognized before the right the tax authority to offset the amounts recognized
in these entries; and
| | - | ----------------------------------------------------------------------------------------------------------------------------





| | 2 | Deferred income tax assets and liabilities are derived from income tax related to the same tax
authority on:
| | - | ------------------------------------------------------------------------------------------------------------



| | (i) | the same entity or tax subject; or
| | --- | ----------------------------------



(ii)	different
entities or tax subjects who intend either to settle current fiscal assets and liabilities for their net amount, or to realize
assets and pay liabilities simultaneously in each of the future periods in which the Company expects to settle or recover significant
amounts of deferred tax assets or liabilities.



F-205







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



Deferred income tax assets
recognized are those income taxes to be recovered in future periods, related to:



(a) deductible temporary differences;

(b) the offset of losses obtained
in prior periods and not yet subject to tax deduction; and

(c) the offset of unused credits
from prior periods.



The Company recognizes a deferred
tax asset when there is certainty that these can be offset with tax income from subsequent periods, losses or fiscal credits not
yet used, but solely as long as it is more likely than not that there will be tax earnings in the future against which to charge
to these losses or unused fiscal credits.



Deferred tax liabilities recognized
refer to the amounts of income taxes payable in future periods related to taxable temporary differences



| | d.1 | Income tax assets and liabilities as of December 31, 2013 are
detailed as follows:
| | --- | ----------------------------------------------------------------------------------



|                                                 |  | Net position, assets |     |  | Net position, liabilities | 
|------------------------------------------------ |  | -------------------- | --- |  | ------------------------- | 
|Description of deferred income tax assets and    |  | Assets               |     |  | Liabilities               | 
|liabilities                                      |  | ThUS$                |     |  | ThUS$                     | 
|Depreciation                                     |  |                      | -   |  |                           | 
|Doubtful accounts impairment                     |  |                      | -   |  |                           | 
|Accrued vacations                                |  |                      | -   |  |                           | 
|Manufacturing expenses                           |  |                      | -   |  |                           | 
|Unrealized gains (losses) from sales of products |  |                      | -   |  |                           | 
|Fair value of bonds                              |  |                      | -   |  |                           | 
|Severance indemnity                              |  |                      | -   |  |                           | 
|Hedging                                          |  |                      | -   |  |                           | 
|Inventory of products, spare parts and supplies  |  |                      | 1   |  |                           | 
|Research and development expenses                |  |                      | -   |  |                           | 
|Tax losses                                       |  |                      | -   |  |                           | 
|Capitalized interest                             |  |                      | -   |  |                           | 
|Expenses in assumption of bank loans             |  |                      | -   |  |                           | 
|Unaccrued interest                               |  |                      | -   |  |                           | 
|Fair value of property, plant and equipment      |  |                      | -   |  |                           | 
|Employee benefits                                |  |                      | -   |  |                           | 
|Royalty deferred income taxes                    |  |                      | -   |  |                           | 
|Purchase of intangible assets                    |  |                      | -   |  |                           | 
|Provision for lawsuits and legal expenses        |  |                      | -   |  |                           | 
|Provision for investment plan                    |  |                      | -   |  |                           | 
|Provision of fines and crushing site closure     |  |                      | -   |  |                           | 
|Other                                            |  |                      | 530 |  |                           | 
|Balance to date                                  |  |                      | 531 |  |                           | 
|Net balance                                      |  |                      | 531 |  |                           | 



F-206







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.2 | Income tax assets and liabilities as of December 31, 2012 are detailed as follows
| | --- | ---------------------------------------------------------------------------------



|                                                 |  | Net position, assets |     |  | Net position, liabilities | 
|------------------------------------------------ |  | -------------------- | --- |  | ------------------------- | 
|Description of deferred income tax assets and    |  | Assets               |     |  | Liabilities               | 
|Liabilities                                      |  | ThUS$                |     |  | ThUS$                     | 
|Depreciation                                     |  |                      | -   |  |                           | 
|Doubtful accounts impairment                     |  |                      | -   |  |                           | 
|Accrued vacations                                |  |                      | -   |  |                           | 
|Manufacturing expenses                           |  |                      | -   |  |                           | 
|Unrealized gains (losses) from sales of products |  |                      | -   |  |                           | 
|Fair value of bonds                              |  |                      | -   |  |                           | 
|Severance indemnity                              |  |                      | -   |  |                           | 
|Hedging                                          |  |                      | -   |  |                           | 
|Inventory of products, spare parts and supplies  |  |                      | 37  |  |                           | 
|Research and development expenses                |  |                      | -   |  |                           | 
|Tax losses                                       |  |                      | -   |  |                           | 
|Capitalized interest                             |  |                      | -   |  |                           | 
|Expenses in assumption of bank loans             |  |                      | -   |  |                           | 
|Unaccrued interest                               |  |                      | -   |  |                           | 
|Fair value of property, plant and equipment      |  |                      | -   |  |                           | 
|Employee benefits                                |  |                      | -   |  |                           | 
|Royalty deferred income taxes                    |  |                      | -   |  |                           | 
|Purchase of intangible assets                    |  |                      | -   |  |                           | 
|Provision for lawsuits and legal expenses        |  |                      | -   |  |                           | 
|Provision for investment plan                    |  |                      | -   |  |                           | 
|Provision of fines and crushing site closure     |  |                      | -   |  |                           | 
|Other                                            |  |                      | 186 |  |                           | 
|Balance to date                                  |  |                      | 223 |  |                           | 
|Net balance                                      |  |                      | 223 |  |                           | 



F-207







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.3 | Reconciliation of changes in deferred tax liabilities (assets) as of December 31, 2013
| | --- | --------------------------------------------------------------------------------------



|                                                              |  | Deferred tax liabilities (assets) at the beginning of the period |          |   | Deferred tax expense (income) recognized in profit or loss |  |         | Deferred tax related to items credited (debited) directly to equity |  |  | Total increase (decrease) of deferred tax liabilities (assets) |  |  | Deferred tax liabilities (assets) at the end of the period |        
|------------------------------------------------------------- |  | ---------------------------------------------------------------- | -------- | - | ---------------------------------------------------------- |  | ------- | ------------------------------------------------------------------- |  |  | -------------------------------------------------------------- |  |  | ---------------------------------------------------------- | -------
|Depreciation                                                  |  |                                                                  | 145,251  |   |                                                            |  | 17,127  |                                                                     |  |  | -                                                              |  |  |                                                            | 17,127 
|Doubtful accounts impairment                                  |  |                                                                  | (5,807   | ) |                                                            |  | (1,223  | )                                                                   |  |  | -                                                              |  |  |                                                            | (1,223 
|Accrued vacations                                             |  |                                                                  | (3,971   | ) |                                                            |  | 405     |                                                                     |  |  | -                                                              |  |  |                                                            | 405    
|Manufacturing expenses                                        |  |                                                                  | 60,160   |   |                                                            |  | 6,599   |                                                                     |  |  | -                                                              |  |  |                                                            | 6,599  
|Unrealized gains (losses) from sales of products              |  |                                                                  | (105,879 | ) |                                                            |  | 21,168  |                                                                     |  |  | -                                                              |  |  |                                                            | 21,168 
|Fair value of bonds                                           |  |                                                                  | (3,684   | ) |                                                            |  | -       |                                                                     |  |  | 3,023                                                          |  |  |                                                            | 3,023  
|Severance indemnity                                           |  |                                                                  | 4,483    |   |                                                            |  | 146     |                                                                     |  |  | -                                                              |  |  |                                                            | 146    
|Hedging                                                       |  |                                                                  | 22,890   |   |                                                            |  | (17,629 | )                                                                   |  |  | -                                                              |  |  |                                                            | (17,629
|Inventory of products, spare parts and supplies               |  |                                                                  | (14,990  | ) |                                                            |  | (5,802  | )                                                                   |  |  | -                                                              |  |  |                                                            | (5,802 
|Research and development expenses                             |  |                                                                  | 4,917    |   |                                                            |  | 2,101   |                                                                     |  |  | -                                                              |  |  |                                                            | 2,101  
|Capitalized interest                                          |  |                                                                  | 20,449   |   |                                                            |  | 1,310   |                                                                     |  |  | -                                                              |  |  |                                                            | 1,310  
|Expenses in assumption of bank loans                          |  |                                                                  | 2,243    |   |                                                            |  | 674     |                                                                     |  |  | -                                                              |  |  |                                                            | 674    
|Unaccrued interest                                            |  |                                                                  | (215     | ) |                                                            |  | 176     |                                                                     |  |  | -                                                              |  |  |                                                            | 176    
|Fair value of property, plant and equipment                   |  |                                                                  | 2,743    |   |                                                            |  | (2,140  | )                                                                   |  |  | -                                                              |  |  |                                                            | (2,140 
|Employee benefits                                             |  |                                                                  | (2,027   | ) |                                                            |  | 1,646   |                                                                     |  |  | -                                                              |  |  |                                                            | 1,646  
|Royalty deferred income taxes                                 |  |                                                                  | 8,430    |   |                                                            |  | (507    | )                                                                   |  |  | -                                                              |  |  |                                                            | (507   
|Unused tax losses                                             |  |                                                                  | (1,509   | ) |                                                            |  | 1,041   |                                                                     |  |  | -                                                              |  |  |                                                            | 1,041  
|Purchase of intangible assets                                 |  |                                                                  | -        |   |                                                            |  | 235     |                                                                     |  |  | -                                                              |  |  |                                                            | 235    
|Provision for lawsuits and legal expenses                     |  |                                                                  | (1,823   | ) |                                                            |  | (55     | )                                                                   |  |  | -                                                              |  |  |                                                            | (55    
|Provision for investment plan                                 |  |                                                                  | (2,487   | ) |                                                            |  | (1,738  | )                                                                   |  |  | -                                                              |  |  |                                                            | (1,738 
|Provision of fines and crushing site closure                  |  |                                                                  | (745     | ) |                                                            |  | (855    | )                                                                   |  |  | -                                                              |  |  |                                                            | (855   
|Other                                                         |  |                                                                  | (3,984   | ) |                                                            |  | 2,841   |                                                                     |  |  | -                                                              |  |  |                                                            | 2,841  
|Total temporary differences, losses and unused fiscal credits |  |                                                                  | 125,445  |   |                                                            |  | 25,520  |                                                                     |  |  | 3,023                                                          |  |  |                                                            | 28,543 



F-208







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.3 | Reconciliation of changes in deferred tax liabilities (assets) as of December 31, 2012
| | --- | --------------------------------------------------------------------------------------



|                                                              |  | Deferred tax liabilities (assets) at the beginning of the period |         |   | Deferred tax expense (income) recognized in profit or loss |  |        | Deferred tax related to items credited (debited) directly to equity |  |  | Total increase (decrease) of deferred tax liabilities (assets) |   |  | Deferred tax liabilities (assets) at the end of the period |       
|------------------------------------------------------------- |  | ---------------------------------------------------------------- | ------- | - | ---------------------------------------------------------- |  | ------ | ------------------------------------------------------------------- |  |  | -------------------------------------------------------------- | - |  | ---------------------------------------------------------- | ------
|Depreciation                                                  |  |                                                                  | 114,151 |   |                                                            |  | 31,100 |                                                                     |  |  | -                                                              |   |  |                                                            | 31,100
|Doubtful accounts impairment                                  |  |                                                                  | (4,061  | ) |                                                            |  | (1,746 | )                                                                   |  |  | -                                                              |   |  |                                                            | (1,746
|Accrued vacations                                             |  |                                                                  | (2,642  | ) |                                                            |  | (1,329 | )                                                                   |  |  | -                                                              |   |  |                                                            | (1,329
|Manufacturing expenses                                        |  |                                                                  | 54,747  |   |                                                            |  | 5,413  |                                                                     |  |  | -                                                              |   |  |                                                            | 5,413 
|Unrealized gains (losses) from sales of products              |  |                                                                  | (97,441 | ) |                                                            |  | (8,438 | )                                                                   |  |  | -                                                              |   |  |                                                            | (8,438
|Fair value of bonds                                           |  |                                                                  | (2,104  | ) |                                                            |  | -      |                                                                     |  |  | (1,580                                                         | ) |  |                                                            | (1,580
|Severance indemnity                                           |  |                                                                  | 3,036   |   |                                                            |  | 1,447  |                                                                     |  |  | -                                                              |   |  |                                                            | 1,447 
|Hedging                                                       |  |                                                                  | 16,636  |   |                                                            |  | 6,254  |                                                                     |  |  | -                                                              |   |  |                                                            | 6,254 
|Inventory of products, spare parts and supplies               |  |                                                                  | (7,866  | ) |                                                            |  | (7,161 | )                                                                   |  |  | -                                                              |   |  |                                                            | (7,161
|Research and development expenses                             |  |                                                                  | 4,598   |   |                                                            |  | 319    |                                                                     |  |  | -                                                              |   |  |                                                            | 319   
|Capitalized interest                                          |  |                                                                  | 17,461  |   |                                                            |  | 2,988  |                                                                     |  |  | -                                                              |   |  |                                                            | 2,988 
|Expenses in assumption of bank loans                          |  |                                                                  | 1,855   |   |                                                            |  | 388    |                                                                     |  |  | -                                                              |   |  |                                                            | 388   
|Unaccrued interest                                            |  |                                                                  | (386    | ) |                                                            |  | 171    |                                                                     |  |  | -                                                              |   |  |                                                            | 171   
|Fair value of property, plant and equipment                   |  |                                                                  | (1,539  | ) |                                                            |  | 4,282  |                                                                     |  |  | -                                                              |   |  |                                                            | 4,282 
|Employee benefits                                             |  |                                                                  | (1,177  | ) |                                                            |  | (850   | )                                                                   |  |  | -                                                              |   |  |                                                            | (850  
|Royalty deferred income taxes                                 |  |                                                                  | 10,035  |   |                                                            |  | (1,605 | )                                                                   |  |  | -                                                              |   |  |                                                            | (1,605
|Unused tax losses                                             |  |                                                                  | (1,046  | ) |                                                            |  | (463   | )                                                                   |  |  | -                                                              |   |  |                                                            | (463  
|Purchase of intangible assets                                 |  |                                                                  | -       |   |                                                            |  | -      |                                                                     |  |  | —                                                              |   |  |                                                            | -     
|Provision for lawsuits and legal expenses                     |  |                                                                  | (1,848  | ) |                                                            |  | 25     |                                                                     |  |  | -                                                              |   |  |                                                            | 25    
|Provision for investment plan                                 |  |                                                                  | (2,861  | ) |                                                            |  | 374    |                                                                     |  |  | -                                                              |   |  |                                                            | 374   
|Provision of fines and crushing site closure                  |  |                                                                  | (640    | ) |                                                            |  | (105   | )                                                                   |  |  | -                                                              |   |  |                                                            | (105  
|Other                                                         |  |                                                                  | (618    | ) |                                                            |  | (2,552 | )                                                                   |  |  | -                                                              |   |  |                                                            | (2,552
|Total temporary differences, losses and unused fiscal credits |  |                                                                  | 98,290  |   |                                                            |  | 28,512 |                                                                     |  |  | (1,580                                                         | ) |  |                                                            | 26,932



F-209







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.4 | Deferred taxes related to benefits for tax losses
| | --- | -------------------------------------------------



The Company’s tax loss carryforwards
were mainly generated by losses in Chile, which in accordance with current Chilean tax regulations have no expiration date.



As of December 31, 2013 and December 31,
2012, tax loss carryforwards (NOL carryforwards) are detailed as follows:





|                |  | 12/31/2013 |     |  | 12/31/2012 | 
|--------------- |  | ---------- | --- |  | ---------- | 
|                |  | ThUS$      |     |  | ThUS$      | 
|                |  |            |     |  |            | 
|Chile           |  |            | 468 |  |            | 
|Other countries |  |            | -   |  |            | 
|                |  |            |     |  |            | 
|Total           |  |            | 468 |  |            | 



Tax losses as of December 31 correspond mainly to Servicios
Integrales de Tránsitos y Transferencias S.A., Exploraciones Mineras S.A. e Isapre Norte Grande Ltda.



| | d.5 | Unrecognized deferred income tax assets and liabilities
| | --- | -------------------------------------------------------



Unrecognized deferred tax assets and liabilities as of December
31, 2013 and December 31, 2012 are as follows:



|                             |  | 12/31/2013           |       |   | 12/31/2012           |  |       | 12/31/2011           | 
|---------------------------- |  | -------------------- | ----- | - | -------------------- |  | ----- | -------------------- | 
|                             |  | ThUS$                |       |   | ThUS$                |  |       | ThUS$                | 
|                             |  | Assets (liabilities) |       |   | Assets (liabilities) |  |       | Assets (liabilities) | 
|                             |  |                      |       |   |                      |  |       |                      | 
|Tax losses (Carry Forwards)  |  |                      | 139   |   |                      |  | 139   |                      | 
|Doubtful accounts impairment |  |                      | 81    |   |                      |  | 81    |                      | 
|Inventory impairment         |  |                      | 1,020 |   |                      |  | 1,020 |                      | 
|Pensions plan                |  |                      | (536  | ) |                      |  | (536  | )                    | 
|Accrued vacations            |  |                      | 29    |   |                      |  | 29    |                      | 
|Depreciation                 |  |                      | (57   | ) |                      |  | (57   | )                    | 
|Other                        |  |                      | (19   | ) |                      |  | (19   | )                    | 
|                             |  |                      |       |   |                      |  |       |                      | 
|Balances to date             |  |                      | 657   |   |                      |  | 657   |                      | 



Tax losses mainly relate to the United States, and they expire
in 20 years.



F-210







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.6 | Movements in deferred tax assets and liabilities
| | --- | ------------------------------------------------



Movements in deferred tax assets and liabilities as of December
31, 2013 and December 31, 2012 are detailed as follows:



|                                                             |  | 12/31/2013           |         |  | 12/31/2012           | 
|------------------------------------------------------------ |  | -------------------- | ------- |  | -------------------- | 
|                                                             |  | ThUS$                |         |  | ThUS$                | 
|                                                             |  | Liabilities (assets) |         |  | Liabilities (assets) | 
|                                                             |  |                      |         |  |                      | 
|Deferred tax assets and liabilities, net opening balance     |  |                      | 125,222 |  |                      | 
|Increase in deferred taxes in profit or loss                 |  |                      | 25,519  |  |                      | 
|Tax Recovery of first category credit absorbed by tax losses |  |                      | -       |  |                      | 
|Increase (decrease) in deferred taxes in equity              |  |                      | 3,023   |  |                      | 
|                                                             |  |                      |         |  |                      | 
|Balances to date                                             |  |                      | 153,764 |  |                      | 



| | d.7 | Disclosures on income tax expense (income)
| | --- | ------------------------------------------



The Company recognizes current tax and deferred taxes as income
or expenses, and they are included in profit or loss, unless they arise from:



| | (a) | a transaction or event recognized in the same period or in a different period, outside profit or loss either in other comprehensive
income or directly in equity; or
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



(b)	a business combination



F-211







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



Current
and deferred tax (expenses) income are detailed as follows:



|                                                                                             |  | 12/31/2013        |          |   | 12/31/2012        |  |          | 12/31/2011        | 
|-------------------------------------------------------------------------------------------- |  | ----------------- | -------- | - | ----------------- |  | -------- | ----------------- | 
|                                                                                             |  | ThUS$             |          |   | ThUS$             |  |          | ThUS$             | 
|                                                                                             |  | Income (expenses) |          |   | Income (expenses) |  |          | Income (expenses) | 
|                                                                                             |  |                   |          |   |                   |  |          |                   | 
|Current income tax (expense)                                                                 |  |                   |          |   |                   |  |          |                   | 
|Current income tax (expense)                                                                 |  |                   | (113,326 | ) |                   |  | (187,715 | )                 | 
|Adjustments to prior year current income tax                                                 |  |                   | 305      |   |                   |  | 145      |                   | 
|                                                                                             |  |                   |          |   |                   |  |          |                   | 
|Current income tax (expense), net, total                                                     |  |                   | (113,021 | ) |                   |  | (187,570 | )                 | 
|                                                                                             |  |                   |          |   |                   |  |          |                   | 
|Deferred tax (expense)                                                                       |  |                   |          |   |                   |  |          |                   | 
|Deferred tax (expense) income relating to the creation and reversal of temporary differences |  |                   | (25,518  | ) |                   |  | (28,512  | )                 | 
|Deferred tax (expense), net, total                                                           |  |                   | (25,518  | ) |                   |  | (28,512  | )                 | 
|                                                                                             |  |                   |          |   |                   |  |          |                   | 
|Tax (expense) income                                                                         |  |                   | (138,539 | ) |                   |  | (216,082 | )                 | 



Tax
(expense) income for foreign and domestic parties are detailed as follows:





|                                                                |  | 12/31/2013        |          |   | 12/31/2012        |  |          | 12/31/2011        | 
|--------------------------------------------------------------- |  | ----------------- | -------- | - | ----------------- |  | -------- | ----------------- | 
|                                                                |  | ThUS$             |          |   | ThUS$             |  |          | ThUS$             | 
|                                                                |  | Income (expenses) |          |   | Income (expenses) |  |          | Income (expenses) | 
|                                                                |  |                   |          |   |                   |  |          |                   | 
|Current income tax expense by foreign and domestic parties, net |  |                   |          |   |                   |  |          |                   | 
|Current income tax (expense), foreign parties, net              |  |                   | (8,267   | ) |                   |  | (14,790  | )                 | 
|Current income tax (expense), domestic, net                     |  |                   | (104,769 | ) |                   |  | (172,780 | )                 | 
|                                                                |  |                   |          |   |                   |  |          |                   | 
|Current income tax (expense), net, total                        |  |                   | (113,036 | ) |                   |  | (187,570 | )                 | 
|                                                                |  |                   |          |   |                   |  |          |                   | 
|Deferred tax expense by foreign and domestic parties, net       |  |                   |          |   |                   |  |          |                   | 
|Deferred tax (expense), foreign parties, net                    |  |                   | 492      |   |                   |  | 474      |                   | 
|Deferred tax (expense), domestic, net                           |  |                   | (25,995  | ) |                   |  | (28,986  | )                 | 
|                                                                |  |                   |          |   |                   |  |          |                   | 
|Deferred tax (expense), net, total                              |  |                   | (25,503  | ) |                   |  | (28,512  | )                 | 
|                                                                |  |                   |          |   |                   |  |          |                   | 
|Income tax (expense)                                            |  |                   | (138,539 | ) |                   |  | (216,082 | )                 | 



F-212







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.8 | Equity interest in taxation attributable to equity-accounted investees
| | --- | ----------------------------------------------------------------------



The Company does not recognize any deferred
tax liability in all cases of taxable temporary differences associated with investments in subsidiaries, branches and associated
companies or interest in joint ventures, because as indicated in the standard, the following two conditions are jointly met



| | (a) | the parent, investor or interest holder is able to control better opportunity for reversal of the temporary difference; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                            

| | (b) | It is more likely than not that the temporary difference is not reversed in the foreseeable future.
| | --- | ---------------------------------------------------------------------------------------------------



In addition, the Company does not recognize
deferred income tax assets for all deductible temporary differences from investments in subsidiaries, branches and associated companies
or interests in joint ventures because it is not possible to meet for the following requirements:



| | (a) | Temporary differences are reversed in a foreseeable future; and
| | --- | ---------------------------------------------------------------



| | (b) | The Company has tax earnings, against which temporary differences can be used.
| | --- | ------------------------------------------------------------------------------



| | d.9 | Disclosures on the tax effects of other comprehensive income
components:
| | --- | ------------------------------------------------------------------------



|                                                                                                   |  | 12/31/2013                         |       
|-------------------------------------------------------------------------------------------------- |  | ---------------------------------- | ------
|                                                                                                   |  | ThUS$                              |       
|Income tax related to components of other income and expense with a charge or credit to net equity |  | Amount before taxes (expense) gain |       
|Cash flow hedge                                                                                    |  |                                    | 15,113
|Total                                                                                              |  |                                    | 15,113



|                                                                                                   |  | 12/31/2012                         |       
|-------------------------------------------------------------------------------------------------- |  | ---------------------------------- | ------
|                                                                                                   |  | ThUS$                              |       
|Income tax related to components of other income and expense with a charge or credit to net equity |  | Amount before taxes (expense) gain |       
|                                                                                                   |  |                                    |       
|Cash flow hedge                                                                                    |  |                                    | (6,236
|                                                                                                   |  |                                    |       
|Total                                                                                              |  |                                    | (6,236



F-213







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



|                                                                                                   |  | 12/31/2011                         |       
|-------------------------------------------------------------------------------------------------- |  | ---------------------------------- | ------
|                                                                                                   |  | ThUS$                              |       
|Income tax related to components of other income and expense with a charge or credit to net equity |  | Amount before taxes (expense) gain |       
|                                                                                                   |  |                                    |       
|Cash flow hedge                                                                                    |  |                                    | (1,091
|                                                                                                   |  |                                    |       
|Total                                                                                              |  |                                    | (1,091



| | d.10 | Explanation of the relationship between expense (income) for
tax purposes and accounting income.
| | ---- | ------------------------------------------------------------------------------------------------



In accordance with paragraph
No. 81, letter c) of IAS 12, the Company has estimated that the method that discloses more significant information for the users
of its financial statements is the reconciliation of tax expense (income) to the result of multiplying financial gains for accounting
purposes by the tax rate in force in Chile. This option is based on the fact that the Parent and its subsidiaries incorporated
in Chile generate almost the total amount of tax expense (income) and the fact that amounts of subsidiaries incorporated in foreign
countries have no relevant significance within the context of the total amount of tax expense (income.)



Reconciliation of numbers
in income tax expenses (income) and the result of multiplying financial gain by the rate prevailing in Chile



|                                                                                                 |  | 12/31/2013       |          |   | 12/31/2012       |  |          | 12/31/2011       | 
|------------------------------------------------------------------------------------------------ |  | ---------------- | -------- | - | ---------------- |  | -------- | ---------------- | 
|                                                                                                 |  | ThUS$            |          |   | ThUS$            |  |          | ThUS$            | 
|                                                                                                 |  | Income (expense) |          |   | Income (expense) |  |          | Income (expense) | 
|                                                                                                 |  |                  |          |   |                  |  |          |                  | 
|Consolidated income before taxes                                                                 |  |                  | 613,110  |   |                  |  | 873,451  |                  | 
|Income tax rate in force in Chile                                                                |  |                  | 20       | % |                  |  | 20       | %                | 
|                                                                                                 |  |                  |          |   |                  |  |          |                  | 
|Tax expense using the legal rate                                                                 |  |                  | (122,622 | ) |                  |  | (174,690 | )                | 
|Effect of royalty tax expense                                                                    |  |                  | (10,277  | ) |                  |  | (25,486  | )                | 
|Tax effect of non-taxable revenue                                                                |  |                  | 5,669    |   |                  |  | 7,419    |                  | 
|Effect of taxable rate of non-deductible expenses for determination of taxable income (loss)     |  |                  | (1,955   | ) |                  |  | (3,091   | )                | 
|Tax effect of tax rates supported abroad                                                         |  |                  | (2,268   | ) |                  |  | (5,265   | )                | 
|Effect on the tax rate arising from changes in the tax rate                                      |  |                  | -        |   |                  |  | -        |                  | 
|Other tax effects from the reconciliation between the accounting income and tax expense (income) |  |                  | (7,086   | ) |                  |  | (14,969  | )                | 
|Tax expense using the effective rate                                                             |  |                  | (138,539 | ) |                  |  | (216,082 | )                | 



F-214







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 28 - Income tax and deferred taxes (continued)



| | 28.4 | Income tax and deferred taxes, continued
| | ---- | ----------------------------------------



| | d.11 | Tax periods potentially subject to verification:
| | ---- | ------------------------------------------------



The Group’s Companies are
potentially subject to income tax audits by tax authorities in each country. These audits are limited to a number of interim tax
periods, which, in general, when they elapse, give rise to the expiration of these inspections.



Tax audits, due to their nature,
are often complex and may require several years. Below, we provide a summary of tax periods that are potentially subject to verification,
in accordance with tax regulations in force in the country of origin:



| | a) | Chile:
| | -- | ------



According to article 200 of Decree
Law No. 830, the tax authority shall review for any deficiencies in its settlement of any taxes to be paid, by applying a requirement
of a 3 years term from the expiration of the legal deadline when payment should have been made. In addition, this requirement could
be extended to a 6 years term for the revision of taxes subject to declaration, when such declaration was not been filed or has
been presented purposely false.



| | b) | United States
| | -- | -------------



In the United States, the tax
authority may review tax returns for up to 3 years from the expiration date of the tax return. In the event that an omission or
error is detected in the tax return of sales or cost of sales, the review can be extended for a period of up to 6 years.



| | c) | Mexico:
| | -- | -------



In Mexico, the tax authority can review tax returns
up to 5 years from the expiration date of the tax return.



| | d) | Spain:
| | -- | ------



In Spain, the tax authority can
review tax returns up to 4 years from the expiration date of the tax return.



| | e) | Belgium:
| | -- | --------



In Belgium, the tax authority
may review tax returns for up to 3 years from the expiration date of the tax return if no tax losses exist. In the event of detecting
an omission or error in the tax return, the review can be extended for a period of up to 5 years.



| | f) | South Africa:
| | -- | -------------



In South Africa, the tax authority
may review tax returns for up to 3 years from the expiration date of the tax return. In the event an omission or error in the tax
return is detected, the review can be extended for a period of up to 5 years.



F-215







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 29 - Disclosures
on the effects of fluctuations in foreign currency exchange rates



Assets held in foreign currency subject to fluctuations in exchange
rates are detailed as follows:

|Class of asset                              |  | Currency |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|------------------------------------------- |  | -------- |  | ---------------- | ------- |  | ---------------- | 
|Current assets:                             |  |          |  |                  |         |  |                  | 
|Cash and cash equivalents                   |  | BRL      |  |                  | 73      |  |                  | 
|Cash and cash equivalents                   |  | CLP      |  |                  | 25,391  |  |                  | 
|Cash and cash equivalents                   |  | CNY      |  |                  | 384     |  |                  | 
|Cash and cash equivalents                   |  | EUR      |  |                  | 9,230   |  |                  | 
|Cash and cash equivalents                   |  | GBP      |  |                  | 14      |  |                  | 
|Cash and cash equivalents                   |  | IDR      |  |                  | 4       |  |                  | 
|Cash and cash equivalents                   |  | INR      |  |                  | 7       |  |                  | 
|Cash and cash equivalents                   |  | MXN      |  |                  | 428     |  |                  | 
|Cash and cash equivalents                   |  | PEN      |  |                  | 2       |  |                  | 
|Cash and cash equivalents                   |  | THB      |  |                  | 2,161   |  |                  | 
|Cash and cash equivalents                   |  | YEN      |  |                  | 1,435   |  |                  | 
|Cash and cash equivalents                   |  | ZAR      |  |                  | 7,229   |  |                  | 
|Subtotal cash and cash equivalents          |  |          |  |                  | 46,358  |  |                  | 
|Other current financial assets              |  | CLP      |  |                  | 108,892 |  |                  | 
|Subtotal other current financial assets     |  |          |  |                  | 108,892 |  |                  | 
|Other current non-financial assets          |  | ARS      |  |                  | 21      |  |                  | 
|Other current non-financial assets          |  | AUD      |  |                  | 95      |  |                  | 
|Other current non-financial assets          |  | BRL      |  |                  | 1       |  |                  | 
|Other current non-financial assets          |  | CLF      |  |                  | 75      |  |                  | 
|Other current non-financial assets          |  | CLP      |  |                  | 25,814  |  |                  | 
|Other current non-financial assets          |  | CNY      |  |                  | 33      |  |                  | 
|Other current non-financial assets          |  | EUR      |  |                  | 5,383   |  |                  | 
|Other current non-financial assets          |  | MXN      |  |                  | 793     |  |                  | 
|Other current non-financial assets          |  | PEN      |  |                  | 3       |  |                  | 
|Other current non-financial assets          |  | THB      |  |                  | 13      |  |                  | 
|Other current non-financial assets          |  | YEN      |  |                  | -       |  |                  | 
|Other current non-financial assets          |  | ZAR      |  |                  | 801     |  |                  | 
|Subtotal other current non-financial assets |  |          |  |                  | 33,032  |  |                  | 
|Trade and other receivables                 |  | AUD      |  |                  | -       |  |                  | 
|Trade and other receivables                 |  | BRL      |  |                  | 32      |  |                  | 
|Trade and other receivables                 |  | CLF      |  |                  | 507     |  |                  | 
|Trade and other receivables                 |  | CLP      |  |                  | 50,112  |  |                  | 
|Trade and other receivables                 |  | CNY      |  |                  | 9       |  |                  | 
|Trade and other receivables                 |  | EUR      |  |                  | 31,975  |  |                  | 
|Trade and other receivables                 |  | GBP      |  |                  | 261     |  |                  | 
|Trade and other receivables                 |  | MXN      |  |                  | 240     |  |                  | 
|Trade and other receivables                 |  | PEN      |  |                  | 92      |  |                  | 
|Trade and other receivables                 |  | THB      |  |                  | 1,823   |  |                  | 
|Trade and other receivables                 |  | YEN      |  |                  | -       |  |                  | 
|Trade and other receivables                 |  | ZAR      |  |                  | 14,742  |  |                  | 
|Subtotal trade and other receivables        |  |          |  |                  | 99,793  |  |                  | 
|Receivables from related parties            |  | AED      |  |                  | 379     |  |                  | 
|Receivables from related parties            |  | CLP      |  |                  | 517     |  |                  | 
|Receivables from related parties            |  | EUR      |  |                  | 845     |  |                  | 
|Receivables from related parties            |  | YEN      |  |                  | 197     |  |                  | 
|Receivables from related parties            |  | ZAR      |  |                  | 9,157   |  |                  | 
|Subtotal receivables from related parties   |  |          |  |                  | 11,095  |  |                  | 
|Current tax assets                          |  | AUD      |  |                  | -       |  |                  | 
|Current tax assets                          |  | CLP      |  |                  | 1,033   |  |                  | 
|Current tax assets                          |  | EUR      |  |                  | 75      |  |                  | 
|Current tax assets                          |  | INR      |  |                  | -       |  |                  | 
|Current tax assets                          |  | MXN      |  |                  | 230     |  |                  | 
|Current tax assets                          |  | PEN      |  |                  | 267     |  |                  | 
|Current tax assets                          |  | YEN      |  |                  | -       |  |                  | 
|Subtotal current tax assets                 |  |          |  |                  | 1,605   |  |                  | 
|Total current assets                        |  |          |  |                  | 300,775 |  |                  | 



F-216







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 29 - Disclosures
on the effects of fluctuations in foreign currency exchange rates (continued)



|Class of asset                                  |  | Currency |  | 12/31/2013 ThUS$ |         |  | 12/31/2012 ThUS$ | 
|----------------------------------------------- |  | -------- |  | ---------------- | ------- |  | ---------------- | 
|Non-current assets:                             |  |          |  |                  |         |  |                  | 
|Other non-current financial assets              |  | BRL      |  |                  | 27      |  |                  | 
|Other non-current financial assets              |  | CLP      |  |                  | 20      |  |                  | 
|Other non-current financial assets              |  | YEN      |  |                  | 45      |  |                  | 
|Subtotal other non-current financial assets     |  |          |  |                  | 92      |  |                  | 
|Other non-current non-financial assets          |  | BRL      |  |                  | 191     |  |                  | 
|Other non-current non-financial assets          |  | CLP      |  |                  | 758     |  |                  | 
|Subtotal other non-current non-financial assets |  |          |  |                  | 949     |  |                  | 
|Non-current rights receivable                   |  | CLF      |  |                  | 465     |  |                  | 
|Non-current rights receivable                   |  | CLP      |  |                  | 818     |  |                  | 
|Subtotal non-current rights receivable          |  |          |  |                  | 1,283   |  |                  | 
|Equity-accounted investees                      |  | AED      |  |                  | 24,215  |  |                  | 
|                                                |  |          |  |                  |         |  |                  | 
|Equity-accounted investees                      |  | CLP      |  |                  | 1,649   |  |                  | 
|Equity-accounted investees                      |  | IDR      |  |                  | 802     |  |                  | 
|Equity-accounted investees                      |  | EUR      |  |                  | 7,924   |  |                  | 
|Equity-accounted investees                      |  | INR      |  |                  | -       |  |                  | 
|Equity-accounted investees                      |  | THB      |  |                  | 1,876   |  |                  | 
|Equity-accounted investees                      |  | TRY      |  |                  | 15,336  |  |                  | 
|Subtotal equity-accounted investees             |  |          |  |                  | 51,802  |  |                  | 
|Intangible assets other than goodwill           |  | CLP      |  |                  | 507     |  |                  | 
|Intangible assets other than goodwill           |  | CNY      |  |                  | 3       |  |                  | 
|Subtotal intangible assets other than goodwill  |  |          |  |                  | 510     |  |                  | 
|Property, plant and equipment                   |  | CLP      |  |                  | 5,633   |  |                  | 
|Subtotal property, plant and equipment          |  |          |  |                  | 5,633   |  |                  | 
|Total non-current assets                        |  |          |  |                  | 60,269  |  |                  | 
|Total assets                                    |  |          |  |                  | 361,044 |  |                  | 



F-217







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 29 - Disclosures on the effects of fluctuations in foreign
currency exchange rates (continued)



Liabilities held in foreign currencies are detailed as follows:



|                                                  |  |          |  | 12/31/2013          |        |  | 12/31/2012                      | 
|------------------------------------------------- |  | -------- |  | ------------------- | ------ |  | ------------------------------- | 
|Class of liability                                |  | Currency |  | Up to 90 days ThUS$ |        |  | Over 90 days up to 1 year ThUS$ | 
|Current liabilities                               |  |          |  |                     |        |  |                                 | 
|Other current financial liabilities               |  | CLF      |  |                     | 1,455  |  |                                 | 
|Other current financial liabilities               |  | CLP      |  |                     | -      |  |                                 | 
|Subtotal other current financial liabilities      |  |          |  |                     | 1,455  |  |                                 | 
|Trade and other payables                          |  | ARS      |  |                     | 3      |  |                                 | 
|Trade and other payables                          |  | BRL      |  |                     | 64     |  |                                 | 
|Trade and other payables                          |  | CHF      |  |                     | 1      |  |                                 | 
|Trade and other payables                          |  | CLP      |  |                     | 55,785 |  |                                 | 
|Trade and other payables                          |  | CNY      |  |                     | 117    |  |                                 | 
|Trade and other payables                          |  | EUR      |  |                     | 18,654 |  |                                 | 
|Trade and other payables                          |  | GBP      |  |                     | 6      |  |                                 | 
|Trade and other payables                          |  | INR      |  |                     | 1      |  |                                 | 
|Trade and other payables                          |  | MXN      |  |                     | 485    |  |                                 | 
|Trade and other payables                          |  | PEN      |  |                     | 3      |  |                                 | 
|Trade and other payables                          |  | YEN      |  |                     | -      |  |                                 | 
|Trade and other payables                          |  | ZAR      |  |                     | 2,517  |  |                                 | 
|Subtotal trade and other payables                 |  |          |  |                     | 77,636 |  |                                 | 
|Other current provisions                          |  | ARS      |  |                     | 62     |  |                                 | 
|Other current provisions                          |  | BRL      |  |                     | 821    |  |                                 | 
|Other current provisions                          |  | CLP      |  |                     | 6      |  |                                 | 
|Other current provisions                          |  | EUR      |  |                     | 7      |  |                                 | 
|Other current provisions                          |  | INR      |  |                     | 1      |  |                                 | 
|Subtotal other current provisions                 |  |          |  |                     | 897    |  |                                 | 
|Current tax liabilities                           |  | INR      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | BRL      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | CLP      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | CNY      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | EUR      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | MXN      |  |                     | -      |  |                                 | 
|Current tax liabilities                           |  | ZAR      |  |                     | -      |  |                                 | 
|Subtotal current tax liabilities                  |  |          |  |                     | -      |  |                                 | 
|Current provisions for employee benefits          |  | CLP      |  |                     | 24,172 |  |                                 | 
|Current provisions for employee benefits          |  | MXN      |  |                     | 156    |  |                                 | 
|Subtotal current provisions for employee benefits |  |          |  |                     | 24,328 |  |                                 | 



F-218







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 29 - Disclosures on the effects of fluctuations in foreign
currency exchange rates (continued)



|                                                 |  |          |  | 12/31/2013          |         |  | 12/31/2012                      | 
|------------------------------------------------ |  | -------- |  | ------------------- | ------- |  | ------------------------------- | 
|Class of liabilities                             |  | Currency |  | Up to 90 days ThUS$ |         |  | Over 90 days up to 1 year ThUS$ | 
|Other current non-financial liabilities          |  | BRL      |  |                     | 55      |  |                                 | 
|Other current non-financial liabilities          |  | CLP      |  |                     | 7,055   |  |                                 | 
|Other current non-financial liabilities          |  | CNY      |  |                     | 18      |  |                                 | 
|Other current non-financial liabilities          |  | EUR      |  |                     | 2,442   |  |                                 | 
|Other current non-financial liabilities          |  | MXN      |  |                     | 720     |  |                                 | 
|Other current non-financial liabilities          |  | AUD      |  |                     | -       |  |                                 | 
|Other current non-financial liabilities          |  | PEN      |  |                     | 70      |  |                                 | 
|Other current non-financial liabilities          |  | THD      |  |                     | -       |  |                                 | 
|Other current non-financial liabilities          |  | ZAR      |  |                     | 8       |  |                                 | 
|Subtotal other current non-financial liabilities |  |          |  |                     | 10,368  |  |                                 | 
|Total current liabilities                        |  |          |  |                     | 114,684 |  |                                 | 



F-219







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 29 - Disclosures on the effects of fluctuations in foreign
currency exchange rates (continued)



|                                                      |  |          |  | 12/31/2013                      |        |  | 12/31/2012                       | 
|----------------------------------------------------- |  | -------- |  | ------------------------------- | ------ |  | -------------------------------- | 
|Class of liabilities                                  |  | Currency |  | Over 1 year up to 3 years ThUS$ |        |  | Over 3 years up to 5 years ThUS$ | 
|Non-current liabilities                               |  |          |  |                                 |        |  |                                  | 
|Other non-current financial liabilities               |  | CLF      |  |                                 | 12,957 |  |                                  | 
|Other non-current financial liabilities               |  | CLP      |  |                                 | -      |  |                                  | 
|Subtotal other non-current financial liabilities      |  |          |  |                                 | 12,957 |  |                                  | 
|                                                      |  |          |  |                                 |        |  |                                  | 
|Deferred tax liabilities                              |  | CLP      |  |                                 | -      |  |                                  | 
|Deferred tax liabilities                              |  | MXN      |  |                                 | -      |  |                                  | 
|Subtotal deferred tax liabilities                     |  |          |  |                                 | -      |  |                                  | 
|Non-current provisions for employee benefits          |  | CLP      |  |                                 | -      |  |                                  | 
|Non-current provisions for employee benefits          |  | MXN      |  |                                 | -      |  |                                  | 
|Non-current provisions for employee benefits          |  | YEN      |  |                                 | -      |  |                                  | 
|Subtotal non-current provisions for employee benefits |  |          |  |                                 | -      |  |                                  | 
|Total non-current liabilities                         |  |          |  |                                 | 12,957 |  |                                  | 



F-220







Notes
to the Consolidated Financial Statements as of December 31, 2013



Note 30 – Subsequent events



| | 30.1 | Authorization of the financial statements
| | ---- | -----------------------------------------



The consolidated financial statements of
Sociedad Química y Minera de Chile S.A. and subsidiaries prepared in accordance with International Financial Reporting Standards
for the period ended December 31, 2013 were approved and authorized for issuance by the Management on April 23, 2014.



| | 30.2 | Disclosures on events occurring after the reporting date
| | ---- | --------------------------------------------------------



Management is not aware of any significant
events that occurred between December 31, 2013 and the date of issuance of these consolidated financial statements that may significantly
affect them.



| | 30.3 | Detail of dividends declared after the reporting date
| | ---- | -----------------------------------------------------



At the date of these financial statements, there are no dividends
declared after the balance sheet date.



F-221