Scotland business

Scottish ministers move to help firms over butter shortage

Five unwrapped blocks of butter on a wooden board

The Scottish government has announced "urgent" action to help bakers and shortbread makers in the wake of a butter shortage.

A feasibility study will be carried out to see if collective buying and storing of butter is an option that could help combat shortages and rising costs.

The Scottish Agricultural Organisation Society (SAOS) has been tasked with the work.

It will also look at ways to combat volatility in the butter industry.

A supply shortage combined with rising demand has seen wholesale butter prices rise to record highs this year.

In July, the boss of dairy giant Arla warned that the UK could be facing a butter and cream shortage this Christmas.

Peder Tuborgh said there was insufficient milk being supplied by farmers to make the products, but the National Farmers' Union described his comments as "scaremongering".

'Economic pressure'

Rural Economy Secretary Fergus Ewing told an audience at the RBS Food and Drink conference that the food and drink sector was a "significant and growing part of our economy" and ministers wanted to support manufacturers "particularly during times of economic pressure".

He said: "The price of wholesale butter has doubled since the start of the year, with wholesale prices at a record high.

"This is a concern for many of our smaller food and drink manufacturers who use butter as a primary ingredient, such as our shortbread and confectionery producers and bakeries, and who are finding trading tough."

Image copyright tiverylucky

He added: "We have listened to the concerns of our manufacturers and this urgent feasibility study will explore opportunities to exploit buying and efficiency savings made available through collaboration, boosting productivity and competitiveness within domestic and global markets.

"We expect to see the outcome of the study within the next month or so and we look forward to supporting the industry in whatever way we can."

The feasibility study is being funded from the £1m Market Driven Supply Chain (MDSC) project, which the Scottish government established in March.

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