American butter prices hit a more than three-year low, demand remains strong but "supply exceeds demand"

In the past few years, with the continuous increase in demand for butter among Americans, the dairy industry has on one hand turned to raising cows that produce milk with higher fat content, and on the other hand expanded production facilities to meet market demand. However, it now appears that they may have been a bit too aggressive. Despite the continued strong demand, seasonal production levels approaching historical peaks have sparked concerns in the market about an excess of butter, causing American butter prices to fall to the lowest point in over three years. On Monday, the butter futures prices on the Chicago Mercantile Exchange reached their lowest level since November 2021, and milk futures prices used to make butter also saw similar declines. Corey Geiger, chief dairy economist at the agricultural lending institution American Ag Credit, said that this is not a demand-side issue, but rather a result of us supplying too much.