SASKATOON — Canada's largest potash producer is cutting its dividend by 34 per cent in response to weaker sales volumes and lower global fertilizer prices.

The announcement was included with the latest financial report from Potash Corporation of Saskatchewan (TSX:POT), which saw its fourth-quarter profit cut in half as a result of weak market conditions.

The Saskatoon-based company's net income, reported in U.S. dollars, dropped to $201 million or 24 cents per share from $407 million or 49 cents per share in the fourth quarter of 2014.

The value of its sales dropped to US$1.35 billion in the fourth quarter of 2015 from US$1.9 billion a year earlier.

During the quarter, PotashCorp declared dividends worth 38 cents per share but the payout to shareholders will fall to 25 cents per share with the May payment.

The company recently announced the closure of its new potash mine in New Brunswick, resulting in the loss of up to 430 jobs.

Besides potash, the company produces nitrogen-based and phosphates-based materials used in fertilizers to stimulate crop growth.

"Weaker fertilizer prices late in the year reduced our earnings for the quarter, giving rise to a more cautious outlook for all three nutrients as we begin 2016," PotashCorp president and CEO Jochen Tilk said in a statement.

The company is forecasting its 2016 earnings will amount to between 90 cents and $1.20 per share, including between 10 and 20 cents per share in the first quarter.

That's down from $1.52 per share in 2015 and $1.82 per share in 2014.

Tilk said the dividend cut and suspension of potash production in New Brunswick will "strategically position the company and balance the interests of our shareholders, debtholders, employees and communities who depend on our enduring success."

He added PotashCorp's long-standing position that rising global crop production and better economics "will support improved market conditions."