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Food: Butter prices are slipping

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No special offers, but the new normal price: Aldi and Norma reduce the price of butter by 0.40 cents. Others want to follow.

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Butter prices are slipping across the board in Germany. The discounters Aldi and Norma, but also the grocery store Kaufland, lowered the prices for the 250-gram pack of branded butter in the entry-level price range significantly on Wednesday: from 1.99 to 1.59 euros.

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Germany’s largest food retailer, Edeka, has already announced that it will reduce the price of its “Good & Cheap” butter by the same amount. Rewe also wants to follow the step, as do the discounters Netto and Penny.

Important for consumers: These are not special offers, but the new normal price. At the peak of the price wave in May, the butter package cost 2.29 euros. Butter from brand manufacturers has also become cheaper in many cases.

It should only be a matter of time before the rest of the trade follows the price reduction of the pioneers by around 20 percent. This is because butter is considered a basic price item that customers use to orientate themselves when perceiving a retailer’s price.

The fact that prices are slipping right now has to do with the rhythm of price negotiations in the dairy industry. The old contracts expired at the end of January, and in the new contracts the dealers were able to agree on significantly lower prices, which make the current price reductions possible.

One reason for this is that after the record milk prices achieved last year, raw milk production in Germany has increased noticeably again, said the general manager of the dairy industry association, Eckhard Heuser, of the German press agency. As a result, there was again a slight oversupply and prices came under pressure. The new contracts have a term of four weeks. However, the industry expert does not expect new price increases after the end of the term.

The “Lebensmittel-Zeitung” and the “Bild” also reported on the price increases.

Source: Stern

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