You may want to lay off the eggnog this December, because going to be an expensive Christmas this year... all because of a whole different kind of white stuff. CNBC reports that dairy prices will rise in Europe due to a shortage of milk, cream, and butter. Producers lessened their milk output after low prices a year ago; Peder Tuborgh, CEO of Danish-based dairy co-op Arla Foods, told Reuters that while prices have stabilized, the current world milk stocks are quite low. "There has been a scarcity of milk in the whole world after the very low prices last year," he explained to Reuters. "There is a big lack of fat, cream, and butter products everywhere in Europe. It will not at all be possible to meet the demand up to Christmas. It is those forces that are dragging up the prices significantly."
Arla, which is owned by 12,500 farmers in Europe, announced on Friday that it would be increasing prices for the third consecutive month, and may increase it again before the year is up. "After that we might increase it one more time this year, but that is a bit uncertain," Tuborgh told Reuters.
Luckily, it looks like this whole situation is temporary, and the market will balance itself out; Tuborgh predicted that milk supply will catch up with the prices next year and increase by 2-3 percent, lowering demand and thus, prices.
The milk shortage also led to even more heartbreaking repercussions earlier this summer; croissants, which are generally made of at least 25% butter, spiked in price due to increasing butter costs. "These levels of prices have never been seen," French baker federation spokesperson Armelle Favre said then.