Soaring UK butter prices have sparked calls for the European Commission to release the massive butter reserves it has built up through intervention buying.
UK wholesale butter prices rocketed 30% or £610 a tonne between August and September, according to new DairyCo data.
Many buyers had not forward bought their butter ahead of the summer break, which led to panic buying and pushed up prices, claimed sources. They called on the EC to ease the situation by allowing more butter into the market before cost rises were passed on to consumers.
"Now is the time to start getting it out," said Tony Evans, a partner at agricultural consultancy Andersons, adding that a dip in milk production had resulted in a window of opportunity.
"I don't see why they don't release it," he said. "I suspect they will but they won't tell many people about it. This is the traditional time when we start getting tight on milk supply anyway."
NFU Scotland said higher wholesale prices had not yet been fed through to milk producers, who needed a better return.
An EC spokesman explained a release would take place only when European and world markets could absorb the butter without any disturbance. "We will start to release when we feel the time is right so as to avoid any negative effect on the market," he said.
Doubts have been raised over whether the EC would risk releasing the butter mountain in light of the pressure it is currently facing from dairy farmers across Europe to relieve low milk prices.
"I suspect they'll be prepared to sit on it for two or three years," said PTF dairy analyst Mike Bessey. "It certainly won't be released this side of the new year."
Some 4,615 tonnes of UK butter were sold into intervention between March and May. The UK produced 14% more butter, or 9,000 more tonnes, in the first seven months of 2009 compared with the equivalent period last year.
UK wholesale butter prices rocketed 30% or £610 a tonne between August and September, according to new DairyCo data.
Many buyers had not forward bought their butter ahead of the summer break, which led to panic buying and pushed up prices, claimed sources. They called on the EC to ease the situation by allowing more butter into the market before cost rises were passed on to consumers.
"Now is the time to start getting it out," said Tony Evans, a partner at agricultural consultancy Andersons, adding that a dip in milk production had resulted in a window of opportunity.
"I don't see why they don't release it," he said. "I suspect they will but they won't tell many people about it. This is the traditional time when we start getting tight on milk supply anyway."
NFU Scotland said higher wholesale prices had not yet been fed through to milk producers, who needed a better return.
An EC spokesman explained a release would take place only when European and world markets could absorb the butter without any disturbance. "We will start to release when we feel the time is right so as to avoid any negative effect on the market," he said.
Doubts have been raised over whether the EC would risk releasing the butter mountain in light of the pressure it is currently facing from dairy farmers across Europe to relieve low milk prices.
"I suspect they'll be prepared to sit on it for two or three years," said PTF dairy analyst Mike Bessey. "It certainly won't be released this side of the new year."
Some 4,615 tonnes of UK butter were sold into intervention between March and May. The UK produced 14% more butter, or 9,000 more tonnes, in the first seven months of 2009 compared with the equivalent period last year.
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