Good news for consumers: According to a media report, butter is now significantly cheaper at the discounters Aldi and Kaufland. Other retailers could follow suit.

Butter was one of the foods that rose the most in price. While many products remain expensive, there is good news for butter. As reported by “Bild”, the two discounters Aldi (North and South) and Kaufland are now reducing the price of their own brand butter by 20 percent. According to this, the “Milsani” butter at Aldi will only cost 1.59 euros instead of 1.99 euros in the future. Kaufland also lowers the price for its own brand, also to 1.59 euros.

Is the discounter push now triggering a discount battle? Quite possible. Kaufland belongs to the Schwarz Group, which also includes the discounter Lidl. Rewe and Edeka should now also have pricked their ears.

But why is the butter price falling now? This is sometimes due to the price of milk. The dairy industry association assumes that the producer prices that farmers receive for their deliveries to the dairies will not remain at the record level of 60 cents per kilo reached at the end of 2022. On the one hand, the farmers delivered more milk, on the other hand, demand has fallen due to the high prices. That said Peter Stahl, Chairman of the Dairy Industry Association (MIV).

“That will have consequences for raw milk prices, no question about it,” added Stahl, whose main job is CEO of the Allgäuer Hochland Group. “It’s going to go down over the course of 23 as well.”

What consumers pay for milk, butter, cheese and other dairy products at retail depends not only on producer prices, but also on supermarket chain pricing and other factors. However, the ups and downs in producer prices are usually also reflected in the selling prices in the supermarket.

According to the association, the average producer price for milk in the course of 2022 also reached a new record level of 53 cents. Unlike in retail, producer prices for milk are given in kilos and not in litres. According to the MIV, one liter corresponds to 1.03 kilograms, because milk is a little heavier than water due to its fat content and other ingredients.

According to Stahl, milk consumption in Germany has fallen because of the high prices. Above all, sales of the more expensive organic milk have suffered. “We hope that the organic market will come back when the crisis situation subsides,” said Managing Director Eckhard Heuser.

Milk consumption in Germany has already fallen in recent years; in 2021, according to figures from the Federal Office for Agriculture and Food, it was almost 48 kilos per capita. The industry assumes that the trend will continue. “I would also see a gentle decline (…) in the next few years, so there is a lot to be done,” said MIV Vice Chairman Hans Holtorf, Managing Director of Frischli Milchwerke.

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