Terra Board of Directors Declares $7.50 per Share Special Cash Dividend

SIOUX CITY, Iowa--(Business Wire)--
Terra Industries Inc. (NYSE: TRA) today announced that its Board of Directors
has declared the previously announced special cash dividend of $7.50 per share.
The record date and the payment date for the special cash dividend will be the
same as those for Terra`s previously announced regular quarterly dividend,
November 23, 2009 and December 11, 2009, respectively.

"Terra`s Board is committed to enhancing value for all shareholders and over the
past three years 35% of Terra`s net income has been delivered to shareholders in
the form of share repurchases and dividends," said Terra President and CEO
Michael Bennett. "Through the special cash dividend, Terra will return an
aggregate of approximately $750 million to shareholders. In addition to this
special cash dividend, we recently announced an agreement to purchase a 50%
interest in Agrium Inc.`s Carseland, Alberta, Canada nitrogen production assets
and certain U.S. assets. These actions are further examples of the Board`s
commitment to providing shareholders with significant additional value for their
investment in Terra."

Terra`s common stock will begin trading without the special cash dividend and
the regular dividend, on an ex-dividend basis, on December 14, 2009 (i.e., the
first business day following the payment date). Shareholders of record on the
record date who sell their shares on or before the payment date will lose their
right to the special cash dividend and the regular dividend.

Based on its current estimates, the Company expects that approximately $1.00 to
$1.50 of the special cash dividend will, for tax purposes, be classified as a
return of capital. The tax character of the special cash dividend will be
determined by the amount of earnings and profits for 2009, which will not be
known until after the Company's books are closed effective December 31, 2009.

About Terra

Terra Industries Inc., with 2008 revenues of $2.9 billion, is a leading North
American producer and marketer of nitrogen products.

Important Information and Where to Find It

On October 13, 2009, Terra filed with the Securities and Exchange Commission
(the "SEC") a definitive proxy statement in connection with its 2009 Annual
Meeting, and is mailing the definitive proxy statement to its shareholders.
Investors and security holders are urged to read the definitive proxy statement
relating to the 2009 Annual Meeting and any other relevant documents filed with
the SEC (when available), because they contain important information. Investors
and security holders may obtain a free copy of the definitive proxy statement
and other documents that Terra files with the SEC (when available) at the SEC`s
Web site at www.sec.gov and Terra`s Web site at www.terraindustries.com. In
addition, the definitive proxy statement and other documents filed by Terra with
the SEC (when available) may be obtained from Terra free of charge by directing
a request to Terra Industries Inc., Attn: Investor Relations, Terra Industries
Inc., 600 Fourth Street, P.O. Box 6000, Sioux City, IA 51102-6000.

Certain Information Concerning Participants

Terra, its directors, executive officers and certain employees specified in
Annex A to Terra`s definitive proxy statement for the 2009 Annual Meeting, which
was filed with the SEC on October 13, 2009, are participants in the solicitation
of Terra`s security holders in connection with its 2009 Annual Meeting. Security
holders may obtain information regarding the names, affiliations and interests
of such individuals in Terra`s Annual Report on Form 10-K for the year ended
December 31, 2008, which was filed with the SEC on February 27, 2009 and amended
on April 28, 2009, and its definitive proxy statement for the 2009 Annual
Meeting. To the extent holdings of Terra securities have changed since the
amounts printed in the definitive proxy statement for the 2009 Annual Meeting,
such changes have been or will be reflected on Statements of Change in Ownership
on Form 4 filed with the SEC. These documents (when available) may be obtained
free of charge from the SEC`s Web site at www.sec.gov and Terra`s Web site at
www.terraindustries.com.

Forward-Looking Statements

Certain statements in this communication may constitute "forward-looking"
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements are based upon assumptions as to future events
that may not prove to be accurate. Actual outcomes and results may differ
materially from what is expressed or forecasted in these forward-looking
statements. As a result, these statements speak only as of the date they were
made and Terra undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, except as otherwise required by law. Words such as
"expects," "intends," "plans," "projects," "believes," "estimates," and similar
expressions are used to identify these forward-looking statements. In
particular, statements about Terra`s plans or intentions regarding the
completion of the Carseland acquisition and the benefits to Terra from such
acquisition are forward-looking statements and may not necessarily occur.
Forward-looking statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that are difficult to predict. These risks,
uncertainties and assumptions include, among others:

* the risk that the closing of the Carseland acquisition, which is conditioned
on the completion of Agrium Inc.`s unsolicited bid for CF Industries Holdings,
Inc., may not occur,
* risks related to potential acquisition transactions,
* changes in financial and capital markets,
* general economic conditions within the agricultural industry,
* competitive factors and price changes (principally, sales prices of nitrogen
and methanol products and natural gas costs),
* changes in product mix,
* changes in the seasonality of demand patterns,
* changes in weather conditions,
* changes in environmental and other government regulation,
* changes in agricultural regulations and
* changes in the securities trading markets.

Additional information as to these factors can be found in Terra`s 2008 Annual
Report/10-K and in Terra`s subsequent Quarterly Reports on Form 10-Q, in each
case in the sections entitled "Business," "Risk Factors," "Legal Proceedings,"
and "Management`s Discussion and Analysis of Financial Condition and Results of
Operations," and in the Notes to the consolidated financial statements.

Note:Terra Industries` news announcements are also available on its Web site,
www.terraindustries.com.

Terra Industries Inc.
Joe A. Ewing, 712-277-7305
Vice President, Investor Relations
jewing@terraindustries.com
or
Joele Frank, Wilkinson Brimmer Katcher
Matthew Sherman/Jamie Moser
212-355-4449
msherman@joelefrank.com/jmoser@joelefrank.com
or
MacKenzie Partners, Inc.
Larry Dennedy/Laurie Connell
800-322-2885
terraproxy@mackenziepartners.com

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