Skip to content
Search
AI Powered
Latest Stories

Bakers brace for costly Christmas as butter prices surge

Bakers brace for costly Christmas as butter prices surge
Photo: iStock

Butter prices have rocketed in recent months, trading at record highs across Europe in bad news for bakers and pastry makers as they prepare for Christmas celebrations and already face high chocolate and sugar costs.

Strong demand for butter, tight stocks and dairy processors' preference to use more milk for the most profitable products such as cheese have driven the price surge, analysts say.


European butter was trading on world markets at a record $8,706 (£6660) per metric ton by 29 September, up 83 per cent on year, latest official European Commission data showed.

Prices were also higher year-on-year in Australia and New Zealand but came off summer highs.

While large food companies have covered much of their butter supplies before starting to produce Christmas cakes and ice creams, the impact for small producers will be significant with a rise in prices unavoidable, said Paul Boivin, director of the French bakers and pastry federation FEB.

Milk output declined last year in most parts of the globe including Europe, the US and New Zealand - the world's largest milk and butter exporter - as low prices and high feed costs discouraged many dairy farmers.

Global milk output rebounded slightly in 2024 but remained tight compared to growing demand, prompting producers to favour allocating milk to the most competitive products like cheese instead of butter, Rabobank dairy analyst Michael Harvey said.

EU milk production grew 0.7 per cent between January 2023 and July 2024, the latest EU data showed. Over the same period butter output fell 1.6 per cent with stocks at historically low levels, while cheese production gained 3.2 per cent.

The US Department of Agriculture this month raised its forecast for 2024 U.S. butter prices to $3 per pound, up 15 per cent from last year, due partly to fewer cows and less milk produced by each animal.

"Tighter milk supplies and firm demand are expected to carry the higher price outlook into 2025," USDA said.

Revenues in the global butter market are set to reach $42 billion in 2024, up more than 8 per cent from 2022, and the market is expected to grow annually by 7 per cent by 2029, according to data platform Statista.

European butter prices were also somewhat supported by fears of a further decline in milk supply due to a spread of diseases in dairy cows in Western Europe, including bluetongue and Epizootic Hemorrhagic Disease (EHD), analysts said.

However, the number of outbreaks of bird flu in US dairy cows was not large enough to impact the national level of milk production, USDA economist Michael McConnell said.

Butter prices should ease from record highs as dairy producers boost output to benefit from high prices but it could take several months to see a significant fall, said Susan Kilsby, analyst at ANZ bank in New Zealand.

(Reuters)

More for you

Michael Fletcher

Michael Fletcher

Former Nisa chief Michael Fletcher appointed SPAR UK managing director

SPAR UK has announced the appointment of Michael Fletcher as its new managing director.

Fletcher spent 22 years at Tesco plc, where he held numerous senior commercial roles in the UK, Ireland and Asia. He joined Co-op Retail in 2013 where he held the position of chief commercial officer before moving on to become CEO of Nisa Wholesale, a role he held until 2022.

Keep ReadingShow less
National President Mo Razzaq 2024 serious 1 1
Fed National President Mo Razzaq

Indies: It’s criminal police and government turn blind eye to shoplifting

Independent retailers are demanding tougher police action, more bobbies on the beat and harsher punishments as shoplifting levels reach an all-time high, a new survey reveals.

A whopping ninety-one per cent of respondents to a survey conducted by the Federation of Independent Retailers (the Fed) called for more police patrols on streets, while a similar number - 90 per cent - said that shoplifters should be handed harsher sentences.

Seven out of 10 respondents (72 per cent) said their stores had experienced shoplifting, break ins and damage to property, while they and their staff had been physically or verbally threatened.

Just under half of respondents (47 per cent) said they and their employees had been threatened or had suffered abuse and violence when asking for proof of age ahead of selling an age-restricted product.

Forty-four per cent reported that they and their staff had faced abuse or violence because they had refused to make a proxy sale – selling an age restricted product to a customer buying for a minor.

The results of the Fed’s survey came as new figures from the Office of National Statistics revealed that shoplifting was at a record high, with almost half a million offences recorded last year.

According to the ONS, 469,788 offences were logged by forces in the year to June 2024 – a 29 per cent increase on the previous 12 months.

The ONS added that this figure was the highest since records began – in March 2003.

“Inadequate responses from the police and a slap on the wrist for offenders means that shoplifting is soaring, and offenders are becoming more aggressive and brazen,” said Fed National President Mo Razzaq.

“From the responses we received, it is clear that real action is needed by police, by courts and by the government to stem the overwhelming tide of crime against retailers and their staff. Everyone deserves to feel safe at work and for their businesses to be protected against criminals.

“Fed members are also sending a clear message that one of the catalysts for verbal and physical abuse in stores is asking for proof of age before selling an age restricted product. If the government presses ahead with its plans to phase out smoking and vaping through a progressive ban to gradually end the sale of tobacco products across the country, independent retailers will be subject to even greater levels of violence, abuse and theft.”

Calling for action from the government and not just words, Mr Razzaq continued: “Without effective deterrent, criminals and opportunistic members of the public will continue to commit crimes.”

According to Ministry of Justice statistics, during the year to March 2024, 431 fines were handed out for retail theft under £100, while Home Office statistics for the same period show that 2,252 cautions were accepted for shoplifting.

PayPoint

PayPoint unveils new partnership with Leeds Credit Union

PayPoint has announced a new partnership with Leeds Credit Union (‘LCU’), a financial cooperative with 37,000 members, enabling them access to its CashOut service, effective immediately.

The partnership will mean that LCU customers can access their cash and savings across any of PayPoint’s UK network of 29,000 retailer partners. This represents an unprecedented growth in accessibility and the first partnership of its kind for LCU. Historically customers have needed to visit one of LCU’s four branches to withdraw money.

Keep ReadingShow less
Philip Morris to close German factories as cigarette demand declines
A Philip Morris logo is pictured on a factory in Serrieres near Neuchatel, Switzerland December 8, 2017. REUTERS/Denis Balibouse/File Photo

Philip Morris Shutting Down German Factories Due to Declining Cigarette Demand

Marlboro-maker Philip Morris said Tuesday it planned to close down its two production sites in Germany, citing falling demand for cigarettes among Europeans.

"In recent years, demand for cigarettes in Europe has fallen significantly," the company said in a statement, adding that it saw the same trend for roll-your-own tobacco.

Keep ReadingShow less
Nisa retailer Prem Uthayakumaran donates thousands to support local communities

Nisa retailer Prem Uthayakumaran donates thousands to support local communities

Nisa retailer Prem Uthayakumaran has made significant donations totalling £3,500 to two local community organisations through Nisa’s Making a Difference Locally (MADL) charity.

The funds will provide essential support to groups within the communities that his stores serve, helping them continue their invaluable work.

Keep ReadingShow less