Feb. 19 (Bloomberg) -- Potash Corp. of Saskatchewan Inc., the world's largest maker of crop nutrients, expects food demand from an expanding middle class in China and India to boost grain prices for years.

Rising consumption in Asia of higher-protein foods, including meat from animals raised on corn, soybean and wheat feeds, is eroding global grain inventories, helping lift crop prices to records and stimulating demand for nutrients to increase yields.

``When you see India tripling their middle class, China going from 200 million people in the middle class to 600 million people in the middle class, there is a tremendous competition for food,'' Potash Chief Executive Officer William Doyle, 57, said today in a Bloomberg Television interview in New York.

Soybean futures rose to a record $14.2875 a bushel today on the Chicago Board of Trade, capping an 85 percent gain in the past 12 months. Wheat prices, which have more than doubled in the past year, reached a record Feb. 11, and corn reached a record on Feb. 6.

Global grain inventories as a portion of demand have dwindled to the lowest since record-keeping began in 1960, according to the U.S. Department of Agriculture. The so-called stocks-to-use ratio is at 14.7 percent, or about 53 days of supply, down from 60 days a year ago.

`Tremendous Pressure'

``There's tremendous pressure on grains,'' Doyle said. ``We don't see this backing off.''

Potash rose C$7.90, or 5.3 percent, to C$157.25 as of 4:10 p.m. in Toronto Stock Exchange trading. The Saskatoon, Saskatchewan-based company's shares have more than doubled in the past year.

Potash's prospects are so good that executives considered taking the company private after the stock price fell more than 21 percent in three days in mid-January, Doyle said.

``Certain people thought it was the end of the agriculture story when it is really just the beginning,'' Doyle said. ``We know that our earnings will be much stronger this year.''

The buyout plan was abandoned because tight credit markets made financing too difficult to find, Doyle said. The company would consider such a move again if the shares were at the right price and financing was available, Doyle said.

Record Profit

Potash's fourth-quarter profit more than doubled to a record $376.8 million, or $1.16 a share, because of higher prices and increased shipments, the company said Jan. 24. Excluding one-time items, per-share profit of $1.11 topped the 97-cent average estimate of 13 analysts surveyed by Bloomberg.

Potash expects first-quarter profit, excluding one-time items, of $1.30 to $1.60 a share and full-year profit of $6.25 to $7.25 a share.

The company also plans to buy back as many as 15.82 million shares, or about 5 percent of its common stock outstanding, during the next year.

Potash is investing $1.8 billion to increase output at its potash mine and mill in Rocanville, Saskatchewan, by 2 million tons a year. The company has committed $2.5 billion for other expansions, including a new mine in Canada's New Brunswick province.

Adding capacity in Saskatchewan and New Brunswick will boost annual output to 15.7 million tons by 2012 and as much as 17.2 million tons by 2015, the company said. Potash now produces about 10 million tons a year.

To contact the reporters on this story: Christopher Donville in New York at cjdonville@bloomberg.net; Jack Kaskey in New York at jkaskey@bloomberg.net.

Last Updated: February 19, 2008 16:17 EST