The holiday butter price rally is right on schedule, if not early, but the magnitude of the rise has been surprising. The CME spot butter price hit a new all-time high last week, then closed even higher at $3.34/lb. on October 2 and $3.42/lb. on October 3. Since September 1, the CME spot butter price has climbed 74¢.
“The rapidly increasing butter price—particularly to heights well above $3—has surprised some in the industry, especially since the year started with strong butter production. Smaller supplies and strong domestic demand teamed up this summer to push prices substantially higher.”
According to USDA data, August butter inventories of just over 289 million pounds were well below the five-year average of more than 329 million pounds, and month-to-month, stocks fell 40.3 million pounds, the largest drawdown between July and August since 2015, Berning noted. Between May and August, warehoused butter stocks declined by nearly 78.8 million pounds, the biggest drop over that timeframe since 1993, she added.
By FRAN HOWARD
October 4, 2023
dairyherd.com
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