NEW YORK (AP) — A near-record corn crop is going to cut demand for fertilizers, said a UBS analyst Friday as he downgraded two fertilizer companies, just as the government sees U.S. farmers' incomes dropping.

The Agriculture Department said Thursday that farmers' net income will drop 38 percent to $54 billion this year from 2008. That's $9 billion below the average net farm income over the past 10 years.

Dropping incomes mean farmers will have less money to spend on fertilizers.

Moreover, the U.S. government expects a record soybean crop this year and the second-biggest corn crop ever — despite a 30-35 percent decline in shipments of potash, a key fertilizer, according to UBS analyst Don Carson.

"This makes us less confident of a complete recovery in potash consumption," he said in a research note. Potash prices have also stabilized at lower levels after India made a major purchase at $460/tonne in early July and Brazil spot sales were $525/tonne. At the time of the India buy, spot prices were between $700 and $750 per tonne. Carson doesn't expect prices to head back up soon.

He downgraded Mosaic Co. and Potash Corp. of Saskatchewan Inc. to "Neutral" from "Buy."

Mosaic shares fell $1.84, or 3.6 percent, to $49.54, while Potash dropped $2.02, or 2.1 percent, to $90.60. Other fertilizer companies were also lower. Agrium Inc. slipped 31 cents to $47.45; CF Industries Holdings fell $1.11 to $81.07; Intrepid Potash Inc. declined 40 cents to $24.47; and Terra Industries Inc. fell 41 cents to $32.66.

Other agribusiness companies were mixed. Crop producer and biofuel maker Archer Daniels Midland Co. rose 54 cents to $28.75, while Monsanto Co., the world's biggest seed company, dropped $1.82 to $82.80. Bunge Ltd., which has fertilizer, seed and consumer foods units, dipped 6 cents to $68.53.