United States-Bad year for Bunge.

UNITED STATES-BAN YEAR FOR BUNGE.

Bunge Ltd., the world’s biggest oilseed processor, posted its second consecutive quarterly loss as demand for fertilizer and soybean meal declined.

The net loss of $195 million, or $1.76 a share, compares with a profit of $289 million, or $2.10, a year earlier, White Plains, New York-based Bunge said today in a statement. Excluding certain items, profit was about $1.32 a share. The average estimate of seven analysts surveyed by Bloomberg was for profit of 59 cents. Sales dropped 26 percent to $9.2 billion.

Chief Executive Officer Alberto Weisser has said he’ll seek to reduce costs as the longest U.S. recession in a quarter century saps demand for agricultural commodities used in food, livestock feed and biofuels. Bunge, the largest fertilizer producer in South America , said its crop-nutrient unit posted a $262 million loss after a $133 million profit a year earlier.

"The start to 2009 was more challenging than expected," Weisser said in the statement. "Retail fertilizer margins in Brazil suffered from aggressive price reductions by competitors, which drove sales prices below international levels."

Bunge said 2009 earnings will be $4.90 to $5.40 a share, less than its January forecast of $6.90 to $7.60. The average profit estimate of eight analysts surveyed by Bloomberg was $6.37 a share.

Bunge fell $6.44, or 12 percent, to $48.06 at 10:04 a.m. in New York Stock Exchange composite trading. The stock slumped 54 percent in the year through yesterday.

Fertilizer Sales

The fertilizer unit had lower selling prices and sales volumes. The cost of raw materials and finished products were higher because of purchases made last year before prices fell, leading to an inventory valuation writedown of $64 million.

"We are working through our higher-cost fertilizer inventory, and the supply of fertilizer products in the Brazilian retail channel has been reduced by approximately 30 percent since the end of 2008," Weisser said. "Both of these facts should improve margins as the year progresses."

Profit before interest and taxes in Bunge’s agribusiness segment, which processes grains and oilseeds into food and animal feed at about 196 grain-storage facilities and 55 plants worldwide, plunged 93 percent to $18 million as lower demand "pressured volumes and margins."

The soybean-crush margin, which reflects the profit from processing soybeans into animal feed and vegetable oil based on futures traded in Chicago , averaged 7.6 percent lower at $61.875 a bushel during the quarter.

Feed consumption has slowed as U.S. livestock producers cut output amid falling demand for meat and poultry. The number of cattle on feedlots at the start of April dropped 4.6 percent from a year earlier, U.S. Department of Agriculture data show. Global soybean-meal consumption fell 6 percent in the first quarter, Bunge said.

’Signs of Stabilization’

"We are, however, seeing signs of stabilization in the poultry and pork industries, and we estimate soybean-meal demand for the calendar year to be up about 1 percent versus 2008," Weisser said.

Bunge in February estimated soybean-meal demand would increase 1.5 percent.

Profit from edible-oil products, which include bottled oil, mayonnaise and margarine, fell 57 percent to $22 million because of high-cost crude vegetable oil that was purchased before price declines and "aggressive product pricing" by rivals.

Earnings from milling corn and wheat for bakeries, cereal producers and brewers, more than doubled to $19 million because of higher sales volumes.