UK to face butter shortage in lead-up to Christmas

Arla boss Peder Tuborgh said milk supplies from farmers was on the decline, with dairy prices becoming increasingly volatile as they increase their herds.

“Butter will be very short at Christmas time,” Tuborgh told the BBC. “I know that we just have a desperate need for butter.”

Arla is a large European milk co-operative, and incorporates brands such as Anchor and Cravendale, with annual revenue of £8.4bn.

In response to a previous over-production of milk, Tuborgh said producers ‘put the brakes on’ in 2016 in an attempt to drive prices higher.

The fall in sterling following last year’s Brexit referendum has also contributed to the rising price of milk

The fall in sterling following last year’s Brexit referendum has also contributed to the rising price of milk.

The National Farmers Union referred to comments regarding milk supply as ‘scaremongering’, but also recognised such market volatility was not helpful.

"Scaremongering about lack of milk supply going forward only serves to concern consumers," it said.

"It's no surprise that milk buyers are worried about milk volumes falling. Confidence within dairy farming is at an all-time low - mistrust in the market dynamics and suspicion about how milk buyers are treating their supply base coupled with the lack of direction on the impact of Brexit on the dairy sector."