Dairy Australia - Dairy information for Australian Dairy Farmers and the industry

Primary content

Information on the production, sales, and trends for Australian manufactured butter.

Butter

In 2016/17, Australia produced 100,000 tonnes of butter and anhydrous milkfat (AMF) or butteroil in commercial butter equivalent terms (CBE).

Butter and AMF production (tonnes)

 

2011/12

2012/13

2013/14

2014/15

2015/16

2016/17

Butter/Butter blends (CBE)

100,551

99,035

101,705

101,641

99,015

85,869

AMF (CBE)

19,164

19,193

14,417

16,943

19,610

14,072

 

AMF is butter with the water removed, similar to ghee. It is produced mainly for export and domestic food manufacturing applications, such as bakery and confectionery. While these sectors also use butter, the majority of domestic butter sales are through retail and foodservice outlets. The manufacture of butter also results in the creation of skim milk powder as a co-product, utilising the solids non-fat component of the milk.

It is estimated that around 50% of the domestic sales of Australian dairyspreads were through supermarkets. Supermarket sales volumes increased 2.3% in 2016/17, together with a 5.2% increase in average retail prices during the year which delivered an increase in retail sales value of 7.6% over the previous year to more than $471 million. Changing consumer attitudes towards butter and saturated fats has seen butter and butter blends increase their share of the tablespreads market, at the expense of margarine.

Imports accounted for approximately a quarter of the Australian butter market by volume. In 2016/17 approximately 90% of the 34,000 tonnes of butter and butteroil imported into Australia was sourced from New Zealand.

Australian exports of butter and AMF can vary significantly from year to year, depending on milk availability during the season and local dairy company responses to international prices for competing products. Export volumes were down almost 40% last year to 21,000 tonnes, as Australian processors devoted milk into other production streams.

Australia’s most important overseas markets for butter/ AMF were Singapore, Greater China, the United Arab Emirates, Malaysia and Thailand; out of approximately 50 countries.

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