time will be the decider

(Figures in U.S. dollars unless noted)

WINNIPEG, Manitoba, April 14 (Reuters) - China may slap an export tariff of 135 percent on phosphate fertilizers and 100 percent on urea nitrogen, creating concern about prices in an already tight market, UBS said on Monday in a research report.

Citing news reports, analyst Joe Dewhurst said the tariffs would stop Chinese phosphate exports, removing 19 percent of traded volumes for granular phosphates, which are important for India, Pakistan, Australia and Latin America.

"Traders from these countries are already voicing concerns on price impacts," Dewhurst wrote in the report. "The vacuum that will be created is substantial."

Dewhurst raised his estimate for phosphate prices by 16 percent to $1,105 per tonne for 2008 and by 47 percent to $1,100 per tonne for 2009.

China's tariff may cause spot urea prices to jump, although Dewhurst said he expects them to remain in balance for 2008.

But he raised his urea price estimate for 2009 by 14 percent to $400 a tonne, since China accounts for about 16 percent of traded urea volumes.

The export tariffs also reveal China, the world's largest potash consumer, has a weak negotiating position for potash import prices, Dewhurst said.

"It is likely that China will settle as a minimum at the Indian contract price, but could realistically be at prevailing spot," he wrote.

Earlier this month, India agreed to buy potash at the going spot market price of $625 per tonne for 2008 from major suppliers, which then pushed spot prices to $750 per tonne.

China has been out of the potash market in 2008 as it negotiates its annual price with suppliers.

Dewhurst raised his overall potash price estimates by 29 percent for 2008 to $611 per tonne and by 62 percent in 2009 to $850 per tonne.

UBS raised price targets for Potash Corp (POT.TO: Quote, Profile, Research), the world's largest fertilizer producer, to $235 from $211 and Agrium Inc (AGU.TO: Quote, Profile, Research) to $95 from $87.

Potash shares were up 2 percent or C$4.14 at C$186.86 on the Toronto Stock Exchange on Monday after earlier hitting a record C$188.02.

Agrium was up almost 5 percent or C$3.60 at C$76.79 after touching a record C$77.50.

UBS also said Israel Chemicals Ltd (ICL.TA: Quote, Profile, Research), Uralkali (URKA.MM: Quote, Profile, Research), Yara (YAR.OL: Quote, Profile, Research), Incitec Pivot (IPL.AX: Quote, Profile, Research) and others would benefit from the higher prices.

($1=$1.02 Canadian) (Reporting by Roberta Rampton; editing by Rob Wilson)