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Holiday deals ahead? Butter prices fall sharply before seasonal demand hits

A market advisor says butter prices are the lowest they’ve been since 2021.

Katie Burgess with Ever.ag tells Brownfield large butter supplies have pushed prices down by more than a dollar during the third quarter to the low $1.60s.

“Not only is milk production higher in the U.S., but the fat tests coming off the farms are somewhat unbelievable, and so more milk and more fat in each hundredweight of milk we produce means a whole lot of cream and plenty of supply of butter,” she explains.

She says while prices have increased somewhat in recent weeks, there’s still an opportunity to move product through the holidays.

“Historically, the butter market usually declines after the holiday demand wears out, whereas this year it happened before we even got close to holiday demand,” she says. “It does feel like with Thanksgiving and Christmas coming up, maybe the retailers can run some more aggressive promotions.”

Burgess says the lower prices have incentivized more exports, especially as competitors in Europe and New Zealand have had reduced milk production.

The U.S. Dairy Export Council estimates butterfat exports are up more than 150% year to date.

Brownfield’s Larry Lee interviews Katie Burgess with Ever.ag during the recent World Dairy Expo.