France’s much-loved croissant au beurre has run up against the forces of global markets.
Finding butter for the breakfast staple has become a challenge across France. Soaring global demand and falling supplies have boosted butter prices, and with French supermarkets unwilling to pay more for the dairy product, producers are taking their wares across the border. That has left the French, the world’s biggest per-capita consumers of butter, short of a key ingredient for their sauces and tarts.
“The issue is purely French and is related to the fact that there’s a price war raging between French retailers,” Thierry Roquefeuil, chairman of the milk-producers’ federation FNPL, said in a phone interview from his farm near Figeac, in Southwestern France. “French retailers refuse to increase prices, even by few cents, even for butter. Dairy producers see that there’s an outside demand at higher prices so they sell abroad, and rightfully so.”
Global butter prices have almost tripled to 7,000 euros ($8,144) a ton from 2,500 euros in 2016, according to Agritel, an Paris-based farming consultancy. In Europe, prices peaked at about 6,500 euros a ton in September, the highest since the European Commission began collecting such data in 2000.
French Honor
While France’s Food Retailers’ Federation is underplaying the shortages as a temporary logistical problem linked in part to people hoarding butter, the issue made it last week to the floor of the French parliament. Questioned by lawmakers, Agriculture Minister Stephane Travert said he hoped a deal could soon be found between retailers and dairy producers.
“I want to reassure all the consumers that soon butter will find its way back to shop shelves and consumers won’t be deprived of this French commodity that does honor to French tables and is the pride of French dairy production,” Travert said in the National Assembly on Wednesday.
A report released Saturday by the consulting firm Nielsen showed that 30 percent of butter demand in French supermarkets wasn’t met between Oct. 16 and Oct. 22. The proportion was as high as 46 percent in some stores, mostly due to hoarding, it said.
The problem can be traced to the end of milk-production quotas in April 2015 that led to a glut early last year in Europe, and a drastic drop in prices. This prompted production cuts by spring this year.
The reduction coincided with other global milk products exporters curbing their own output: the U.S. stopped selling abroad to address higher domestic demand while New Zealand, the world’s biggest dairy exporter, experienced lower production due to droughts, Pierre Begoc, an Agritel analyst, said in a phone interview.