Butter price war spreads as Aldi announces cuts

On Monday, Aldi said it was cutting the price of its Kilkeely pure Irish creamery butter from €3.99 to €3.39 for 454g, and from €2.39 to €2.09 for 227g.

Aldi has become the latest retailer to announce a reduction in the price of butter, as supermarkets step up competition amidst surging grocery inflation.

On Monday, Aldi said it was cutting the price of its Kilkeely pure Irish creamery butter from €3.99 to €3.39 for 454g, and from €2.39 to €2.09 for 227g. It follows similar moves from Lidl and Musgraves — for Supervalu and Centra — on Sunday to drop the cost of their own-brand butter.

It comes as the latest figures from the Central Statistics Office show that the average price of a pound of butter increased by 55c in the last year, to €4.88.

Its consumer price index also suggests that butter has risen over 10% in the last 12 months, and is among the many staple items that are rising at significantly more than the general inflation rate.

In the year to November, the price of food and drink has risen by 4.2% in the Irish economy but there have been significant rises in the likes of beef (up 23.9%), fresh seafood (up 10.5%), chocolate (up 11.5%) and coffee (up 12.4%).

There has been some relief for consumers, however, in the shape of supermarkets dropping the price of some own-brand items in recent months.

This move on butter comes after similar drops for bread and milk from some of the main grocery retailers.

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In announcing the butter price fall, Aldi’s country managing director Niall O’Connor said: “We’re mindful that Christmas has been a time of increased spending for consumers and budgets have been stretched."

While the announcements from retailers suggest a price war may be in the offing, critics have said that the price drops suggest that supermarkets can reduce prices on a wider basis whilst still making significant profits.

However, Ireland’s consumer watchdog has said there are no indications there has been “excessive pricing due to abuse of dominance” in Ireland’s grocery retail sector.