potash price predictions, page-8

ADY currently has a FOB price of $81.85 for the iron ore.

PT has not released its production costs for the iron ore. However, it is possible to approx. estimate them:

Current production levels 30,000 tonnes per month

18/02/08: Stockpile 190,000 tonnes

Therefore estimated stockpile 31/12/08:

145,000 tonnes ( 190,000 - 1.5 x 30,000 )

Inventory valuation 31/12/08:

A$5,872,812

approx US$5,400,000 (est. US rate as 31/12/08)

Est cost per tonne US$37.25

ADY would still have to incur some costs re loading ship and transport to port (some of stockpile was at port some at mine)

Therefore, with an FOB price of $81.85, ADY currently makes about $40 per tonne shipped while only operating at 30,000 tonnes per month. At current prices, all ADY has to do is limit its exposure to losses from fixed price contracts and production quantities and the iron ore business should remain profitable.

I think ADY has learnt from these past mistakes and hopefully will not expose itself to losses of such a nature in the future.

Regards

SP