The Polish government has launched an unprecedented auction of 1,000 tonnes of butter from its strategic reserves, responding to mounting pressure over spiralling prices that have become a contentious political issue ahead of the May presidential elections.
The nation’s strategic reserves agency initiated the sale on Tuesday, offering frozen 25-kilogramme blocks of unsalted butter at a minimum price of 28.38 zlotys (€6.65) per kilo plus VAT. The decision comes as butter prices in supermarket chain Biedronka have reached between 39.95 and 49.95 zlotys per kilo.
The price surge stems from declining cattle numbers and disease outbreaks across Europe, coupled with increasing global demand. European Union butter prices have witnessed a staggering 40 per cent increase throughout 2024, with the UN’s food agency reporting record-high global prices in November.
The dairy crisis has spilled into Poland’s political arena, despite butter representing merely 0.6 per cent of average consumer spending. Rafał Trzaskowski, the presidential candidate from Prime Minister Donald Tusk’s ruling party, has used the issue to criticise central bank governor Adam Glapiński’s economic management.
The strategic reserves agency maintains stores of various foodstuffs, including dairy products, meat, cereals, sugar, and animal fats, to ensure supply chain stability. While large-scale butter auctions are uncommon, the agency routinely rotates food products to maintain quality standards.
The auction’s timing coincides with broader global food price increases, as evidenced by the UN Food and Agriculture Organization’s price index reaching its highest level since April 2023. The situation reflects a wider trend of food inflation affecting economies worldwide, with particular pressure on dairy products and vegetable oils.
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