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In June, the EU butter price continued its upward trend since the beginning of the year. The 2% y-o-y
decline in EU butter production supported EU butter prices during the Jan-Apr 2021 period. Although,
the prices were pressured by low export demand, resulting in a 25.3% y-o-y price reduction during
the Jan-April 2021 period. The June average price of EU butter stood at EUR 4,330/MT, up 62.3% y-o-y
and 5% m-o-m.
New Zealand is a net exporting market. This means that more than 90% of its dairy products is sold to
overseas markets, mainly China. In New Zealand, the butter market has fluctuated between steady
and declining since butter sales to China have weakened by more than expected. The June average
price of New Zealand butter dropped to NZD 6,543.4/MT, by 2.7% m-o-m, although up 15.8% y-o-y.
US butter production declined by 6.9% m-o-m in April '21, to 354,000 tonnes, bringing the butter
production for the Jan-Apr '21 period down by 5.7% y-o-y. Despite the production decline, US butter
inventories built up significantly in the first five months of 2021 to reach an 18-year high due to a
weak retail demand after Easter and slow demand from the foodservice sector in the run-up to
Summer. Although, the surge in exports limited the US butter price drop. The June average price of
US butter reached USD 3.918.2/MT in June, down 3.2% y-o-y and 2.2% m-o-m.
The June average of the Mintec Benchmark Prices for unsalted butter EXW UK increased slightly to
GBP 3,335/MT, up 0.6% m-o-m and 11.9% y-o-y. The marginal increase in butter prices in June
signals the end of the strong retail demand for butter in the UK, which occurred during COVID-19
induced lockdowns due to the surge in home cooking. Also, the foodservice sector is yet to operate at
total capacity, capping the demand for butter in the UK.