The head of Potash Corporation of Saskatchewan Inc. (TSX:POT) said he expects demand to pick up next year after reporting a drop in quarterly profit due to slow negotiations with buyers in China and India.

"We expect demand to rebound significantly in 2013 and our sales volumes to rise," chief executive Bill Doyle told a conference call with analysts.

The problems with China and India as well as concerns about the global economy have weighed on the company, but the need for potash hasn't gone away, he said.

"I think the China and India delays are just going to put more pressure into first quarter and first half of 2013," Doyle said.

"We think it is going to be a robust recovery year."

Saskatoon-based PotashCorp, one of the world's largest fertilizer producers, reported Thursday its third-quarter profit fell 22 per cent from a year ago.

The company said it earned US$645 million or 74 cents per share, down from $826 million or 94 cents per share a year ago. Revenue for the three months ended Sept. 30 was $2.14 billion, down from $2.32 billion in the third quarter of 2011.

The average analyst estimate compiled by Thomson Reuters had been for a profit of 77 cents per share.

The company warned last week that delays in reaching contracts with customers in China and India would result in the company missing its earlier 2012 targets.

On Thursday, it was more precise -- saying 2012 earnings would be between $2.40 and $2.60 a share, or about 14 per cent below the earlier guidance.

PotashCorp said the revised 2012 earnings forecast issued Thursday includes a 39-cent per share charge related to the Sinofert business in China that was recognized in the second-quarter.

The revised estimate reflects a reduction in shipments for 2012 to a range of 7.6 million to 8.3 million tonnes.

Desjardins analyst John Hughes maintained a "buy" rating on the company with "average" risk and a $58 price target.

"Although China and India require improved soil conditions to increase food production, demand was softer following the completion of existing supply contracts during the quarter," Hughes wrote in an note to clients.

"However, demand from North America and Brazil was aggressive due to robust demand from farmers."

PotashCorp said last week it will shut its Lanigan and Rocanville mines in Saskatchewan for eight-weeks starting Nov. 18 and Dec. 7 respectively.

Doyle explained it was part of the company's strategy to manage supply when demand is weak and ramp up production when buyers come back.

In addition to the contract delays in Asia, PotashCorp has faced challenging conditions in North America where a prolonged drought hit much of the United States raising concerns about future demand.

Potash and other fertilizers remain in the ground if plants don't use them, so farmers may buy less next year when they go to plant their crops.

However Doyle was unfazed by the short-term turmoil in the market.

"We know that capturing the greatest value for our assets requires thinking beyond this quarter or this year. That means sometimes accepting greater short-term variability. This can be frustrating for investors and we understand that. We are shareholders too. But as many of our long-term investors know, building a potash business can't be timed to swings in demand," he said.

Shares in PotashCorp closed down 12 cents at $40.17 on the Toronto Stock Exchange on Thursday.