The European butter oil market experienced mixed trends during the first quarter of 2025. Early in the quarter, prices declined as buyer sentiment weakened, and the market corrected after a period of record highs. This downward movement was supported by increased availability, stable milk fat output, and softened demand. However, as the quarter progressed, supply-side tightening began to shift market sentiment.
Contributing factors included reduced herd sizes, higher milk fat content, and trade uncertainties between Europe and the U.S., all of which introduced renewed upward pressure. The market reacted quickly buyer interest rebounded, contract activity increased, and prices began recovering noticeably toward the quarter’s end.
In parallel, butter oil prices in the Indian market remained relatively stable throughout the quarter. Consistent domestic demand and favorable pricing helped India maintain a competitive position globally. While Indian whole milk powder and skimmed milk powder encountered price pressure, butter oil sustained a steady export trajectory, drawing continued international interest.
Production levels remained stable, with diverse milk variants enabling effective market coverage without triggering surplus-related concerns. In contrast to milk powders, which faced persistent demand challenges, butter oil demand showed resilience in both domestic and export markets.
Related Report
Get real-time price assessments, periodic trends, forecasts and price driver insights across key global markets.
Unlock Price Insights NowOur Clients
Turn price intelligence into action with the Procurement Resource Database. Log in or subscribe to unlock live price trends, historical charts, supplier databases, cost curves, and analyst-backed insights across chemicals, agriculture, energy, packaging, and more. Use these tools to benchmark your contracts, plan budgets with confidence, and stay ahead of market moves on every product you buy.
0
+Products
0
+Regions
0
+Subscriptions
In 2024, there was heightened volatility in Europe's butter oil market spurred by high demand, limited milk availability, and changing priorities in the dairy industry's production. In the first half of the year, prices trended higher due to tight consumer and industrial demand.
Despite adverse weather conditions across several European regions, milk supply remained stable. But processors increasingly diverted milk to more profitable products such as cheese, reducing the supply of butter oil. This tightening of supply, together with strong domestic and export demand, continued to push butter oil prices upwards.
The latter part of the year also saw continued price increases, leading to regulatory action in some markets. Strategic reserves were released in certain countries to relieve pressures domestically, and small scale producers struggled to manage high levels of input costs.
Market sentiment was also driven by tight global milk production that held below historical levels. This was worsened by disease outbreaks in dairy herds across much of Western Europe, causing additional uncertainty around production continuity. Butter oil production continued to be depressed as producers held back the good quality milk for cheese and other value-added dairy products, putting further pressure on supply of the feedstock.
Butter oil refers to the fat-concentrate that is derived primarily from butter or cream, practically by the elimination of all the water and nonfat solids. Butteroil is a rich source of vitamin K and is generally extracted from the milk of cattles fed with growing green grass and green leaves. It should contain at least 99.3% milk fat and has long shelf life than ghee or butter.
Recombination with skimmed milk powder, Instant milk powder production, Baking, Chocolate manufacturing industry
Fonterra Co-operative Group, Dairy Farmers of America Inc, Hilmar Cheese Company, Inc, Lactalis Group, FrieslandCampina, Westland Milk Products
CurrencyUS$ (Data can also be provided in local currency)
Supplier Database AvailabilityYes
Customization ScopeThe report can be customized as per the requirements of the customer
Post-Sale Analyst Support360-degree analyst support after report delivery
Note: Our supplier search experts can assist your procurement teams in compiling and validating a list of suppliers indicating they have products, services, and capabilities that meet your company's needs.
Butter Oil is oil derived from butter. In order to produce Butter Oil, melted butter is passed through a centrifuge and the milk solids are separated by centrifuging it and separating the oil directly from butter.
Manager - Market Research
Delivering market research and procurement intelligence at Procurement Resource with a focus on economic forecasting, commodity analysis, and client advisory to help sourcing teams make data-backed purchasing decisions.
Our Price Analysis Methodology
Experience how Procurement Resource transforms raw material price data into clear, decision ready intelligence. Optimise your performance with reliable, expert market data and analysis. Schedule your demo today to experience a live walk-through where our experts will showcase interactive price charts, forecasted prices, and insights driving the prices for your key commodities, tailored to your workflows. Contact us now!
Our Team will be happy to assist you
We are just a text away
Still Need Help?
This report provides an extensive cost evaluation of Milk Chocolate production via conching and tempering processes.
Unlock full access to Procurement Resource's price databases, interactive charts, and short-term forecasts for thousands of commodities. Elevate your sourcing decisions by comparing prices across regions, downloading historical data, and layering in analyst-backed insights, all with our flexible plans that scale as your portfolio grows.
Still have any Questions
Contact Us
Price Trend Dashboard - What's Included
Price trends across a diverse portfolio of categories and products, spanning board to niche chemicals
Coverage extendable to grade-specific chemicals based on procurement requirements
Regular price tracking supported by robust historical datasets
News, policy updates, and key market drivers impacting price movements
Short-term and long-term price outlooks and forecasts
Supply-demand dynamics and capacity-driven market analysis
Track prices, market movements, supply-demand dynamics, and industry developments across hundreds of commodities through a centralized intelligence platform built for informed procurement decisions.
Understand market fluctuations using analyst-backed forecasts, historical pricing patterns, and evolving industry trends to strengthen sourcing strategies and budget planning.
Leverage cost models, pricing benchmarks, and procurement insights to evaluate purchasing opportunities, improve negotiations, and enhance operational efficiency.
Access region-specific price trends, trade activities, capacity changes, and supply chain developments influencing commodity markets worldwide.
