In recent years, butter prices in European markets have skyrocketed. Demand is on the rise, while production has stagnated or even declined.

Throughout the 2000s and 2010s, bulk butter prices on the key Dutch market fluctuated between €2,000 and €4,000 per ton. Since then, prices have surged to between €4,000 and €8,000 per ton. In the autumn of 2024, the price peaked at €8,100 per ton and currently stands at €7,500 per ton.

This is reported by the Danish Dairy Board (Mejeriforeningen) in an article on their website, where they also interviewed Niels Ole Nielsen, Chief Consultant at the Danish Agriculture & Food Council’s dairy division, about the reasons behind the price surge.

• Butter prices are constantly fluctuating, and with the current state of the market, we should expect them to remain at a very high level, says Niels Ole Nielsen. He explains that this is a new trend in the global dairy markets:
• In the past, it was almost a given that milk production increased every year, which created a kind of balance between supply and demand. In recent years, however, many dairy farmers—both in Denmark and elsewhere—have been reluctant to invest in new barns and more cows, partly due to uncertainty about future production conditions. As a result, milk production has largely stagnated in Denmark, the EU, and globally since 2020, meaning supply can no longer keep up with demand.

In 2024, total EU butter production declined by one percent. While that may not sound like much, Nielsen says it was enough to affect prices.

• When butter demand remains high, even a relatively small drop in production can lead to significant price increases, he notes.

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