The fourth quarter of 2010 was rough on the banana market, but leaders of Chiquita and Del Monte remain optimistic for a turnaround in 2011.

Both banana giants released fourth-quarter financial reports in early March that showed losses primarily blamed on weak markets and weather problems.

Cincinnati-based Chiquita Brands International Inc. reported a worse-than-expected $20 million fourth-quarter loss, as European banana markets remained weak and unusually cold weather hurt crops in Arizona and Latin American, leading to shortages.

Fernando Aguirre, Chiquita’s chief executive officer, said 2010 was “one of the most difficult operating environments in Europe in decades,” in a March 2 statement announcing the company’s quarterly results.

Chiquita, Del Monte post fourth-quarter losses


Chiquita, Del Monte post fourth-quarter losses


Additionally, the magnitude of sudden banana industry supply shortages and related cost increases caused by adverse weather conditions “was much greater than anticipated,” Aguirre said. But he said global banana pricing began to improve early this year, which should lead to stronger results for 2011.

Coral Gables, Fla.-based Fresh Del Monte Produce Inc. posted a $9.6 million fourth-quarter loss, citing weak banana prices, floods that hurt crops in Guatemala and the company exited operations in Brazil, South Africa and the Philippines.

While Fresh Del Monte’s banana sales volume rose 4% during the quarter, lower prices in Asia and the Middle East led to a loss in the business, the company said in a March 1 statement. Global banana prices fell 2%, to $12.77 per 40-pound box, the company said.

During a March 1 conference call with analysts, Mohammad Abu-Ghazaleh, Fresh Del Monte’s CEO, said he expects market conditions to improve this year.

Banana pricing “was tremendously weak in Europe and Asia throughout the year,” Abu-Ghazaleh said during the call, which followed the release of quarterly results.

“I’m very confident in our future. I’m very optimistic for 2011,” he said.

Net sales for Fresh Del Monte’s banana business rose 2.5% to $395.3 million during the three months ending Dec. 31. But the business posted a loss of $10.7 million, compared with a gross profit of $3.7 million a year earlier.

Bananas accounted for 44% of Fresh Del Monte’s total sales last year.

Chiquita’s banana sales fell 15% during the fourth quarter, to $438 million, compared with the same period in 2009, as European and Mediterranean volumes decreased. Additionally, cool weather in Latin America led to a delayed harvest, the company said.

As Chiquita’s growing operations suffered, supply costs escalated “dramatically” as the company was forced to buy more fruit on the spot market, Aguirre said.

Chiquita’s net fourth-quarterly loss of $20 million compares to a loss of $27 million for the same quarter a year earlier, the company said. Net sales fell 12% to $773 million. For all of 2010, Chiquita’s net earnings fell 37% to $57 million as sales declined 6.9% to $3.23 billion.