A drop in dairy production is helping butter prices surge as American families prepare for the holiday baking season.
The price of butter — a key ingredient in baked goods — has risen 24.6 percent since last year to an average price of $4.77 per unit in August, according to Bureau of Labor statistics. Butter prices beat inflation at most other grocery stores, with the exception of eggs, which are up 39.8 percent from a year earlier.
While consumers have been paying a total of 13.5 percent more for groceries since last year, they are paying 16.2 percent more for dairy products. Grocery prices edged up slightly in July-August after posting record-high increases in June-July, Breitbart News documented.
According to that Wall Street JournalThe reason for the rise in butter prices is that milk production has fallen, partly due to cow and labor shortages, although farmers have reportedly increased their herds.
As a result, butter production fell 2 percent in July, while butter in cold stores is also down 21 percent since last month, the UDSA said.
A Minnesota dairy farmer found that he had to reduce butter production at his facility from 5 percent to 10 percent because of staff shortages.
“It’s the second shift, which usually comes down to family time, that’s always harder to fill,” Marshall told Reece, senior vice president at Associated Milk Producers Inc diary.
Reese noted that before the pandemic, this wasn’t an issue.
Another reason butter production has declined is that hot summer temperatures are negatively affecting cows’ ability to produce milk, particularly in California, where prolonged droughts have resulted in less animal feed, a dairy expert said Bloomberg.
High retailer demand is also contributing to rising butter prices ahead of the autumn and winter baking season.
Reese warned retailers not to “go crazy” discounting butter during the holiday season as dairy farmers may not be able to keep up with production to supply the market.
Follow Ethan Letkeman on Twitter at @EthanLetkeman.
https://www.breitbart.com/economy/2022/09/22/butter-prices-soar-dairy-production-declines-ahead-holiday-baking-season/ Butter Prices Soar as Dairy Production Declines Ahead of Holiday Baking Season