Farm Ireland

Monday 19 March 2018

Butter bandits on rise in Norway

Darragh McCullough

Darragh McCullough

While images of butter smuggling might seem like a quaint throwback to a bygone era in 21st-Century Ireland, it appears the trade is alive and well in butter-starved Norway.

A combination of lower-than-normal production levels, a spike in international demand for dairy fats and high tariffs on imports has led to a butter shortage in Norway. In the peak demand period just before Christmas, butter was reported to be making up to €54/kg in the shops.

This bizarre imbalance encouraged some of the country's more slippery customers to get a slice of the action.

But fat profits have been thin on the ground as reports of butter seizures by the Norwegian police mount up.

Two Swedes were arrested last month with 250kg of butter in their small van, but not before they had offloaded some of the consignment for €54/kg.

Norwegian authorities have attempted to address the situation by reducing import tariffs by up to 80pc.

According to Bord Bia reports, the shortage persists, however, in both Norway and neighbouring Finland. Analysts have been baffled over the shortage, given that indigenous manufacturers such as Valio, Arla and TINE have a surplus milk production. One theory suggests that the rise of low-carb diets caused a surge in demand for dairy fats in a country that already has one of the highest levels of dairy consumption in the world.

Nicolas Ranninger, Bord Bia's Nordic market analyst believes that the shortage has opened up opportunities for Irish dairy companies. While Mr Ranninger said that brand loyalty among Nordic consumers would continue to represent a significant barrier for generic products, there was growing demand for private-label goods. He added that this could open doors for branded products for niche segments of the market.

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