Shoppers could face a shortage of butter

Milk output falling just as demand rises, warns dairy giant

ONE of Britain’s biggest dairies has warned that the UK is facing a butter and cream shortage.

Not enough milk is being produced, said Peder Tuborgh, chief executive of Arla, which makes Anchor butter and Cravendale milk.

He warned that a boost in demand for butter had coincided with many dairy manufacturers putting more milk into making cheese because it yields better returns at a time of low milk prices.

However, Mr Tuborgh insisted ‘there will still be butter available’.

The National Farmer’s Union confirmed that the wholesale price of butter was at record levels, but said warnings of an outright shortage were ‘scaremongering’.

For consumers, a 250g block of butter now costs £1.49, while a year ago it was £1.35, according to the Office for National Statistics.

Arla Foods is a co- operative owned by dairy farmers across Europe, including many here. It is the largest UK milk buyer and has annual revenues of £8.4billion.

Mr Tuborgh claimed that the slowdown in milk production began in 2016 when producers ‘put the brakes on’ – and the knock-on effect could be less butter and cream being produced.

Global butter prices have hit an all-time high, with prices rising 14 per cent last month, according to figures released on Thursday by the UN Food and Agriculture Organisation.

Simon Clapp, from Brue Valley Farms near Glastonbury which makes butter and cheese for the likes of M&S, Waitrose and Aldi, told BBC Radio 5 live: ‘It’s getting pretty tough, there’s a shortage of fats across Europe and we’re part of that. Since Brexit, the pound has weakened, so it’s made prod- ucts here more attractive, so cream is going abroad.

‘We’re seeing historic prices even above historic prices we’ve seen in the past – we’ve never been in this territory. This time last year, we’d spend 80p for cream to go into but- ter – now it’s up to £2.50, £2.60.’ Industry body Dairy UK said there had been significant rises in wholesale prices for butter and cream, adding: ‘This illustrates the fact that dairy markets are inherently subject to fluctuations and a sudden surge in milk production, or unseasonable weather which depresses production, can have a significant effect.’

The NFU said that although wholesale prices of cream and butter had hit record levels, this was not being reflected in the amount paid to farmers.

But it added: ‘Scaremongering about lack of milk supply only serves to concern consumers.’

A spokesman for Arla Foods said: ‘ We do expect the high demand for butter to continue… potentially creating a shortage of products in parts of the European food and dairy industry.’

‘Subject to fluctuations’