UPDATE 2-North American potash inventories tighten further

* Stocks at producer level now 24 pct below 5-yr average (Adds analyst comment, details on share price move)

TORONTO Feb 16 (Reuters) - North American potash inventories at the producer level tightened further in January ahead of the spring planting season in the region, according to data issued by Potash Corp (POT.N) late on Tuesday.

The announcement lifted shares of Potash Corp and other North American fertilizer makers. Analysts said tighter inventories would help producers push through price increases in overseas markets.

Shares of Potash Corp rose 1.5 percent in New York, while shares Mosaic Co (MOS.N) and Agrium Inc (AGU.N) rose more than 1 percent.

Potash Corp, the world's largest producer of the crop nutrient, said the latest industry data in North America indicates inventories fell nearly 85,000 tonnes in January.

Inventories of the nutrient, which helps improve a plant's disease resistance and crop quality and increases yields, are now 24 percent below the prior five-year average.

The data from the Saskatoon, Saskatchewan-based company also indicated the average price of potash, while trending upward continues to hover just below the $400 a tonne mark.

Analysts noted that current market fundamentals indicate that India -- one of the world's largest potash importers -- is unlikely to be able to settle on a new potash contract this year at a price below $400 a tonne.

Chinese potash buyers recently agreed on a six month contract to import potash at $400 a tonne from Russian and Canadian exporters. The Chinese and Indian contracts are closely watched as spot market prices are typically pegged at a level slightly above these contract prices.

India is expected to import over 5 million tonnes of the nutrient this year and new import contracts are likely to be signed in March, or April. [ID:nSGE7180D3]

The data also indicates that di-ammonium phosphate stocks in the region rose by 107,000 tonnes in January, but inventories of the phosphate-based nutrient continue to lag the prior 5-year average by 25 percent. (Reporting by Euan Rocha; editing by Janet Guttsman)