Butter
Regional differences dictate our three main markets
Europe
There is simply too much butter
The EU butter market is struggling with a mismatch between supply and demand. When the butter price levels dropped fast in Q3 and Q4 of 2025 the buyside widely took the opportunity to secure volumes for most of 2026 already. This means that buyers are now generally looking at 2027 purchasing periods. The sell side, however, has a lot of butter for prompt delivery that still has to find a home. This pushes the spot price level down to around EUR 4000 ex works, and with the local buyside being absent one can even wonder if this price is a real reflection of the market. It is the demand for 2027 that keeps the market afloat at the moment but the main question mark is how sustainable this situation is.
Americas
Confusing market fundamentals make it difficult to read the US butter market
Despite strong butter production, reported stock levels were very low in February. Stock levels are driven down by both a robust export performance and healthy local consumption. Cream is in high demand by manufacturers of ice cream, cream cheese and sour cream at the moment. As a result cream availability is tight and prices are stable despite solid US milk production. Butter prices did come down though since last month and have landed at USD 1.75/lb (3860/t) ex works in early April. Butter prices in the EU are dropping and it remains to be seen if the US can continue to keep up its export volumes in H2. It feels like it is just as easy to find arguments why the market should move downward as it is to find reasons why prices should move upward.
Asia-Pacific
Tight supply and weak demand create a certain balance
The milk fat market in Asia Pacific is quite thin. Supply is tight, but demand is also not very good and there is little activity outside of GDT. At GDT China remained the largest buyer of butter, but AMF was mainly purchased by SE Asian buyers. Outside GDT the market price for butter is significantly higher even though it has dropped compared to our early March quote to the current level of USD 6700 FOB, and AMF came down to around USD 7200 FOB.
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