Mintec EU butter prices rose by 34% in the four-week period to 15th July 2020 attributed to a rise in retail demand, as much of Europe eased lockdown restrictions due to an improvement in the number of COVID-19 cases.
While consumption from the foodservice sector has fallen due to the effects of coronavirus, a rise in home cooking and baking has supported retail purchases and is expected to compensate. Demand for packaged butter has increased in many Western European countries. Butter manufacturers in Germany report that retail packaged butter sales are strong for this time of year, reflecting that more people are staying home for summer holidays. In addition, block butter contracts are being filled, however new contracting for later this year is slow, as buyers are more inclined to close deals for lower price range bulk butter when available.
EU butter prices have remained competitive on the global market, which is expected to support export volumes throughout the year (+15% year-on-year), attributed to China’s economic recovery from COVID-19 - EU’s largest dairy importer.
However, as some major European countries have reimposed second localised lockdowns, uncertainty may arise resulting in a bearish trend for butter prices.