Butter accounted for 26pc of Irish dairy exports last year due to an increase in the value of butter, which helped the value of Irish dairy exports remain steady at €6bn.
The figures, part of Bord Bia’s Export Performance and Prospects Report released last week, show that declines in the value of skim milk powder (SMP), whole milk powder (WMP), milk protein concentrate, and milk and cream were offset by an increase in the value of butter and, to a lesser extent, cheese exports.
Butter prices in the US reached an all-time high last year, while they jumped by almost 20pc in the EU.
Prices, according to Bord Bia, were impacted significantly globally due to tighter supplies, with EU butter prices up 47pc on 2023, where 38pc of Irish butter exports are sold into.
Ireland saw milk collections back around 2.5pc year on year, the second year in a row of decline, while growth in global milk supply in 2024 slowed by nearly 1pc. Although New Zealand, the US and Australia all increased output at higher rates, Europe struggled to deliver significant growth.
Of the top four European producers, only France increased supply; Germany, the United Kingdom and the Netherlands all remained flat or declined.
China’s rapid milk pool growth of recent years slowed in 2024 as smaller farmers struggled to turn a profit margin and while its imports of dairy fell by 11pc, it still remains the world’s largest dairy importer.
David Kennedy of Bord Bia says that “in short, butter demand was the powerhouse behind dairy price increases in 2024, underpinned by lower EU production that fell more than 2pc below 2023 levels. Europe and North America are driving growth, accounting for over 80pc of butter volumes exported.”
Irish butter exports to North America grew by 4pc to a value of €840m, accounting for 13pc of exports.
High butter value was the key driver of this growth, with butter rising by more than a quarter in value and volume terms.
The outlook for per capita consumption of butter in the US is trending positively, with an anticipated increase of 6pc, however trading uncertainties with the US under a new administration may constrain growth, Bord Bia warns.
The impact of reduced supplies in Europe has seen the product mix in Europe diversify and adapt.
The share of butter sold through retail in the EU has declined by an estimated 10pc between 2019 and 2023 to 34pc.
It is believed a new category emerged in France in response to this shift: mixed fat butter (a blended product containing 60pc butter and 40pc vegetable fat), which costs nearly 30pc less than full fat butter and is estimated to have a market share of 10-15pc in France.
You can now read the most important #news on #eDairyNews #Whatsapp channels!!!
🇺🇸 eDairy News INGLÊS: https://whatsapp.com/channel/0029VaKsjzGDTkJyIN6hcP1K
