Bananas suppliers accomodate to bad weather

The decline in banana production as a result of storms in the Caribbean and Latin America should benefit to large companies.

Tomas storm that hit the banana farms in St. Vincent and Martinique has resulted in the removal of 2 to 2.5% of the production of bananas for the European Union. The damage could cause disruptions to the 2nd quarter 2011.

The bad weather has decreased production in Ecuador. These production issues have caused an increase of nearly 25% of the price of bananas in the EU.

Dole and Del Monte Fresh Produce Inc. announced that they would produce less millions of boxes of bananas. These reductions should lead to higher prices.

Stock analysts believe that the major companies should now keep titles. Dole, Chiquita and Fresh Del Monte have seen their shares go up immediately.

Source: Bloomberg