Caitríona Redmond: Why have butter prices soared and is it cheaper in other countries?

Head melted from increased prices? Word is spreading that butter is cheaper abroad but is that a rumour or a fact?

Recently going grocery shopping reminds me of the joke: “Why did the butter get depressed? It was spreading itself too thin.”

Every week I ask you, the reader, whether you have a consumer issue worth investigating. Without fail, I receive messages about the price of groceries, and most of the time, people get exercised about the price of butter.

Why butter you may ask? Well, it’s one of the few non-negotiable products in our shopping basket. It’s an Irish grocery staple at the top of the shopping list, right beside teabags and milk.

Bakers of Ireland have also been sobbing into their buttercream as they see the cost of making a cake increase significantly.

As consumers, we feel that the price of butter is putting us under pressure because we are experiencing a cost-of-living crisis, and the price of butter has been rising for several months now.

Recently, going grocery shopping reminds me of the joke: “Why did the butter get depressed? It was spreading itself too thin.”

I stand with most consumers who are browned off and feel the cost of living is unsustainable at the moment.

Feeding my family on less is a battle when the shopping trolley exceeds the weekly budget on a regular basis. It feels like the goalposts move every single week, doesn’t it?

This past week there has been a spreading rumour that a certain big brand name of Irish butter, is cheaper to buy across the other side of the pond. Faster than I could slather a slice of toast I had multiple tabs open featuring shopping sites east and west of the Atlantic, and a currency converter to prove or debunk this notion.

Butter is an Irish grocery staple at the top of the shopping list, right beside teabags and milk.

I now know way more than I ever expected to learn about the price of butter, and about how far one of our best Irish exports has reached globally.

Did you know that American bakers use ‘sticks of butter’ and that each stick of butter weighs 4oz, 113g? The next time you see an American recipe requiring sticks of butter, you will know that a half pound of butter in Ireland, weighing 227g, is the equivalent to two sticks of butter.

As I write today, two sticks of gloriously golden Irish butter will set an American shopper back €4.25 approximately, but an Irish shopper will pay €3.29 for the same weight by the same big brand name.

In Ireland, we have a considerable butter privilege because every large retailer has a private label or own brand Irish butter that is just as good as the more expensive brand name. Those retailers prize their competitive edge and because butter is a non-negotiable item, you will find that the lowest price is matched across most of the big five. A 227g pack of retailer branded butter costs €2.39.

For balance, I also checked those same prices worldwide and can tell you that Australians are paying approximately €3.70, and those in the UAE are paying €3.60 per 227g for an identical brand name.

This proves that the US tariffs have certainly increased the cost of Irish butter compared to other international markets.

Irish consumers are paying €2.39 for 227g of supermarket branded butter and American consumers are paying €4.25 for the same weight — so you can consider that rumour debunked!

As this is a topic that we are all getting exercised about, I reached out to the top five retailers for comment about the cost of dairy generally, and butter specifically, rising.

This is a sensitive topic, but Tesco did respond with insight: “Dairy commodity (which impacts butter pricing) continues to be high, and this is reflected in farmgate pricing. 

Tesco has been working hard to absorb price increases internally, however due to the sustained nature of the increase, some of this now has to be reflected in the retail price to consumers.

Aldi also said: “We provide affordability without compromising on quality for our customers. We work closely with our network of over 330 Irish suppliers to deliver the best products, supporting local businesses and ensuring excellent value for our customers. Our commitment to our customers is that we will never be beaten on price, and customers know they can get the same quality for less at Aldi by switching to our private label range.”

Unfortunately, the other three retailers declined to comment.

For all supermarkets, customers have a comfort level at which they are happy to pay the set price for a product.

Once that level is exceeded, customers feel uncomfortable about the increase in price and may start to complain, or even buy less.

There’s a tipping point where consumers will start buying less butter and this will have a knock-on effect on the retailer and the producer. Demand goes down the cost remains high and everybody loses out. Supermarket operators are eager for this not to happen, and will be watching butter purchasing and consumption rates, wary of consumer spending patterns impacting on profit margins.

If the prices continue to rise, we may be spreading our butter a little thinner. Either way, it’s fair to say that the cost of dairy will continue to irritate Irish consumers for some time to come.

Redmond Recommends: 

Dunnes Stores groceries online no longer automatically applies €5-off-€25 or €10-off-€50 discounts to orders for delivery. If you haven’t shopped in Dunnes Stores for a while and you need to do an online order, ask your friends and family if they have a voucher to spare, or check in your local community groups. Otherwise, your first online shop may cost you a pretty penny more than usual.

Every summer I stock up my freezer with choc ices and ice lollies from my local supermarket, rather than falling for the ice cream vans that plague my poor children (and my ears). I save a packet on trips to the van. After all, the money saved is put to good use buying more butter instead.