As the holidays get closer and many Americans start thinking about Thanksgiving and Christmas desserts and menus, be aware that there is a butter shortage.
The Wall Street Journal reported that due to reduced milk production and labor shortages at food processing plants, butter is increasingly scarce and expensive.
The last time the U.S. saw such a short supply of butter in cold storage was 2017, the Department of Agriculture told the Journal.
This has led to a spike in the cost of butter, since availability is limited.
“A quick visit to the supermarket makes it clear that inflation has certainly affected grocery prices, but butter prices in particular have seen drastic increases due to availability,” Delish reported.
There are a number of factors that are at play in creating the butter shortage and the resulting price inflation.
To start, livestock feed is more expensive, which puts pressure on farmers, the U.S. Department of Agriculture reported.
The result of increased costs for farmers is that the overall U.S. dairy herd has shrunk, the Journal reported.
Add to that a labor shortage in the food processing and production industry, along with high consumer demand, and the result is price increase and product decrease, the Journal reported.
Overall, the price of food has significantly increased, but butter has stood out.
In the past 12 months, the cost of groceries has increased 13.5 percent — the largest 12-month increase since March of 1979, the Bureau of Labor Statistics reported in August.
The price of butter increased 24.6 percent in that same time frame, BLS data showed.
Even the Federal Reserve Bank of St. Louis has been tracking butter prices as they have steadily climbed since the end of last year.
In December 2021, the average price for a pound of butter was $3.47. By August of this year, the average price was $4.69, the Federal Reserve data showed.
Butter prices have had the most meteoric rise of any basic foods except for eggs, which have increased 39.8 percent in price over the last 12 months, BLS reported.
While the prices keep rising and there is concern about the availability for the upcoming holidays, the U.S.’s butter problem is not necessarily new. According to data, it has been getting worse over the last few years, not just the last few months.
Last year, 2021, was particularly hard on the butter industry, as production fell 2 percent, the USDA told the Journal.
In the bigger picture, since 2016 the U.S. has also been importing more butter than it has exported, the Journal reported.
The U.S. has particularly relied on places like Ireland, New Zealand, Mexico, the Netherlands and India, for butter, the Observatory of Economic Complexity reported.
But now, the panic over butter is increasing and becoming a reality for individual consumers, since the holidays are just weeks away.
Typically, retailers discount butter during the holidays, since there is such a high demand for it. But this year, producers are warning retailers to not discount it too much, since the supply is low.
“Don’t go crazy. You can’t have a fire sale on butter, we won’t be able to supply you,” Marshall Reece, senior vice president at Associated Milk Producers Inc., told the Journal.
Some producers are trying their best to produce more butter ahead of the holidays, the Journal reported.
The CEO of the big dairy processor Darigold Inc., Joe Coote, told the Journal that they are trying to find ways to ramp up the capacity at the company’s butter plants.
Coote said they are even looking for ways to run the butter churns and packaging faster in order to get higher output.
Last year, Americans were expected to buy about 161 million pounds of butter just between the second week of November and Christmas, the agricultural journal AG Web reported.
So the butter industry is scrambling to meet this kind of high demand again in just a few weeks.
But even as the butter industry presses to meet demand, consumers will have to prepare for higher prices and more expensive holiday food menus.
This article appeared originally on The Western Journal.
