Low inventories boost butter prices

In a period of just six weeks, DCA's butter quotation rose by more than €600 to €6.680 per tonne. This is the highest level since the fall of 2022, when the entire commodity market was in turmoil with many commodities at record highs. The raw materials market is currently much calmer, but that does not prevent butter prices from picking up quickly.

Low inventories
The cause of the revival must be sought in the tight supplies. Many customers are covered briefly. The combination of these factors makes the market extremely volatile. Buyers tumble over each other when prices move upward. Dairy trading houses are taking advantage of the opportunity by taking positions in the rising market. Butter producers are fine with it as long as market prices pick up. Cream prices have risen even faster than the butter market. With cream prices at €7.740 per tonne, it is no longer profitable to produce butter from this.

Since this week, butter prices seem to be leveling off somewhat and the market also feels calmer. End users experience a lot of resistance. Given the relatively high prices, this is not unrealistic. This also stimulates sales interest among manufacturers and trading houses. However, stocks are still low. In general terms, stocks are often built up in the first half of the year and delivered in quarters three and four, but this has not happened sufficiently this year. This creates a solid foundation for the butter market.

Aldi increases prices
The higher trading prices for butter also have an effect on the store shelf. At the beginning of June, Aldi increased the butter prices of its own brand Milsani in German supermarkets. Other supermarkets will probably follow.