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The price of a 500g block of butter has risen 60% in New Zealand in just one year, with the average price now $7.32.
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European butter prices have risen 19% on average from October 2023 to October 2024, according to The Associated Press.
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Fonterra, New Zealand’s dairy giant, announced a $729 million profit and an interim dividend of 22 cents per share.
The price of a block of butter is continuing to sky-rocket – but how does the price we pay compare to other countries?
The cheapest price of a 500g block of butter at Woolworths on Thursday was $7.19, $6.99 at Pak ‘n Save and in New World’s North Island stores it was $7.19, while in its South Island stores it was 60 cents more. The most expensive price for a block was $9.89.
According to Stats NZ data the average price of a 500g block was now $7.32, which was up 60% in just one year.
Across the ditch Aussies were forking out about the same with a 500g block of Pure Valley Unsalted butter $ 7.69 from Aldi, Woolworths Essential salted butter $7.70 and Coles Salted Butter $8.25.
European butter lovers were also suffering with butter prices rising 19% on average from October 2023 to October 2024, The Associated Press reported.
Dr Murat Ungor of Otago University said the cost of butter remains high due to a combination of international market forces and domestic structural issues, such as local consumers competing with export markets and limited competition in the supermarket sector.
“New Zealand is one of the world’s largest dairy exporters and accounts for significant share of the world’s internationally traded dairy products; and Fonterra sells most of its products overseas.”
Dairy giant Fonterra announced its half-year profits last week which revealed a $729 million profit, up 8% year-on-year. It also an interim dividend of 22 cents per share.
“The price of butter is primarily influenced by the broader dairy market and the wholesale costs set by the suppliers,” Ugnor said.
According to the Food and Agriculture Organisation of the United Nations (FAO), the FAO Dairy Price Index reached 148.7 points in February 2025, marking a 4.0% increase from January 2025 and a 23.2% surge compared to February 2024.
“This upward trend reflects broad-based price increases across all major dairy commodities, including butter, cheese, and milk powders.”
The FAO Butter Price Index, which tracks global butter prices, hit 204 points in February 2025, up 2.6% from the previous month and 23.8% higher than a year earlier.
“Domestic consumers compete with international buyers, meaning local prices are influenced by global market rates rather than just local production costs. NZ dairy processors sell at international market rates, leaving little incentive to discount locally. Fonterra’s dominance and supermarket duopoly reduce pressure to lower retail prices.”
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