Potash Corp shares tumble on weaker outlook

* Potash Corp shares fall 3.6 percent in early trade

* Shares of Mosaic, Agrium, Uralkali, K+S also hit

(In U.S. dollars unless noted)

TORONTO, June 26 (Reuters) - Shares of the world's largest fertilizer company, Potash Corp of Saskatchewan (POT.TO), fell 3.6 percent in early trade on the Toronto Stock Exchange on Friday, after the company cut its second-quarter earnings forecast.

Potash Corp said it now expects earnings of 70 cents a share in the quarter, down from the $1.10 to $1.50 per share it had forecast earlier. [nN25293238]

"The change (in outlook) reflects substantially lower than forecasted potash sales volumes due to deferral of purchases by customers around the world and lower realized prices for phosphate fertilizers," the company said in a brief statement issued after the close of markets on Thursday.

The announcement from Potash Corp also hit shares of potash producers in Europe.

Shares of Germany's K+S (SDFG.DE) were down 3.4 percent on Friday, while those of Russia's Uralkali (URKA.MM) fell 1.6 percent.

Roughly 40 percent of global potash production capacity has been idled since the second half of 2008, but despite tight supply-side management, global potash inventory levels have risen drastically.

Last week, Potash Corp said it would cut 2009 potash production by an additional 800,000 tonnes, bringing cuts this calendar year to 4.7 million tonnes and total curtailments to 5.5 million tonnes since August 2008.

Potash Corp's warning also hurt shares of fellow North American potash producers Agrium Inc (AGU.TO) (AGU.N) and Mosaic Co (MOS.N), whose shares fell 2.2 percent and 1 percent, respectively on the New York Stock Exchange on Friday morning.

Potash Corp said any necessary revisions to its financial forecasts for the year will be addressed in its second-quarter news release, which is expected on July 23.

Shares of the company fell C$3.88, or 3.6 percent, to C$104.17 in early trade on the Toronto Stock Exchange.

($1=$1.15 Canadian)

(Reporting by Euan Rocha; editing by Peter Galloway)

((euan.rocha@thomsonreuters.com; +1 416 941 8185; Reuters Messaging: euan.rocha.reuters.com@reuters.net)) Keywords: POTASHCORP/SHARES

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