UPDATE 1-Chiquita's banana prices rise, volumes dip in Jan-Feb

(Recasts, adds details, share movement)

March 13 (Reuters) - Chiquita Brands International Inc (CQB.N) posted a rise in banana prices in all markets during January and February, but volumes were flat or lower, hit by reduced supply and higher expenses, sending its shares down as much as 4 percent.

The flat to lower banana volumes reflect industry-wide constraints on availability due to a series of adverse weather conditions throughout Central America and Ecuador, Chiquita Brands CEO Fernando Aguirre said in a statement.

In February, Chiquita had forecast significantly higher industry costs, especially for fuel and raw materials, and product supply expenses totaling $120 million to $135 million for 2008.

Chiquita, known for its namesake bananas and Fresh Express bagged salads, said North American banana pricing was up 10 percent year over year, but sales volumes remained flat in the January-February period.

In its core European markets, Chiquita saw banana prices rising 21 percent from a year ago, on a U.S. dollar basis, while sales volumes fell 11 percent.

Cincinnati-based Chiquita, which competes with Fresh Del Monte Produce Inc (FDP.N) and privately-held Dole Food, was forced to cancel a few of its lower-price contracts in Europe to fight rising costs. The move also contributed to the fall in volumes.

In Asia Pacific and the Middle East, banana pricing rose 10 percent year over year, on a U.S. dollar basis, mainly due to increased contract prices and favorable currency exchange rates, while volume fell by 1 percent, the company said.

In its Fresh Express salads business, Chiquita reported year-over-year increases in both net revenue per case and volume growth in the two-month period. Including the Verdelli Farms volume, the total volume gain for salads was 13 percent from a year ago.

Chiquita shares were trading down 16 cents at $21.37 in late morning trade on the New York Stock Exchange. They had touched a low of $20.52 earlier in the session. (Reporting by Dhanya Skariachan in Bangalore; Editing by Gopakumar Warrier)