UK wholesale butter prices have reached seasonal record highs every month since March 2017, peaking at over £6,000/tonne. The start of 2018 is continuing that trend, surpassing the records set at the start of 2017.

Although butter prices are yet to reach the extreme highs of August and September last year, April 2018 saw prices at £4,660/tonne, up £935 on April 2017, another April record.

The charts below show the UK butter and SMP prices in terms of their contribution to AMPE.

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Skimmed milk powder is telling almost the opposite tale. Although prices have improved marginally over recent months, SMP prices are still running at record low levels for this time of year.

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Back in January, AHDB talked about the key dynamics that would shape the industry in 2018. This included a reference to the relationship between butter and SMP prices and the expectation that butter prices would need to rise again to compensate for the low SMP prices. It appears that, as we move through the spring, this dynamic is already starting to have an impact.