A Butter Shortage Could Wreak Havoc On Your Holiday Baking

With summer officially — and sadly — over, it's time for us to drown our sorrows over the loss of bottomless margaritas, late afternoon BBQs, and long, warm nights with the anticipation of — what else? — all the delicious holiday baked goods that will grace our tables over the colder months. Whether your favorite holiday treat is pumpkin pie, sticky toffee pudding, or gingerbread cookies, it will soon be the season. But, you might run into one pesky little issue as you assemble your baking arsenal, and that's a nationwide butter shortage.

According to the Wall Street Journal, the availability of this beloved baking necessity has been tanking, with the amount that was in U.S. cold storage at the end of July the lowest it's been since 2017. The factors most affecting butter production have been labor shortages at processing plants and lower milk production at the country's dairy farms — and these two issues have caused butter prices to soar even more than many of the foods that have been affected by record-high inflation. The U.S. Bureau of Labor Statistics reports that in August, grocery prices were a full 13.5% higher than they were in the prior-year period, with WSJ noting that two items that have been most impacted are eggs — another baking staple — and butter.

Short butter supplies mean sky-high prices

As reported by the Wall Street Journal, the butter situation in the U.S. is a serious one, with prices rising 24.6% since last year — outpaced only by eggs, whose price skyrocketed nearly 40% since last summer. The paper explains that the number of U.S. dairy cows shrunk last year as farmers faced unmanageable costs, leading to lower milk production, and, therefore, to lower butter production. Plus, ongoing labor shortages spurred by the COVID-19 pandemic have continued and in the butter industry, have caused some makers to reduce or slow production.

Through July of this year, butter production fell 2% — and a smaller supply means that what's available is pricier than it has been in a long time. Butter prices reached $4.77 per pound in the four-week period ending in late August, which Nielsen said was the highest level since at least 2017, via WSJ. And with the holiday baking season coming right up, grocers will want to offer their customers reasonable prices in order to be able to move the product, an idea dairy producers are already warning against. "Don't go crazy," Marshall Reece of the Minnesota-based Associated Milk Producers Inc. (AMPI) cautioned stores. "You can't have a fire sale on butter, we won't be able to supply you." AMPI's butter production this year is down between 5% and 10% this year as compared to pre-pandemic, WSJ reported.

If you're on a budget this holiday season, you might want to stir together a vegan dessert instead.