« Iz I Dum?
» A Taste of 2008

Economics, Food

Adventures in Economics: Where’s My Friggin’ Butter?

06.04.08 | Comments

If you want to make some brownies or cookies or some other butter-intensive food, you’d go to the supermarket and just friggin’ buy some.

But, right now in Japan, you’ll be finding empty shelves, totally devoid of butterfats.

Why? Apparently, a bunch of dairy farmers jumped ship a few years back when milk consumption collapsed. According to various articles, this was due to some bad press on milk. I imagine the various food handling violations and scandals by dairy companies, namely Snow Brand, that occurred in the near past may have had an effect on consumers. Further, regardless of demand, Japan also deployed market protections to try to keep domestic dairy prices up when dairies suddenly overproduced in 2006.

As a result, in a show of long term economic market effects and price stickiness, the prices of dairy products has become volatile and butter has been affected most heavily. Demand for milk fell, suppliers reduced supply to return to equilibrium, suppliers cut a little too much or demand bounces or prices get stuck, prices for food, feed and other factors muck it all up, and I end up without my butter.

Recent news has been that butter is expected to rise 10% in price. But when I can’t find it, they might as well raise the price 500%, since I’m not getting it anyways. Makes cooking tough for sure.

Well… Enough of restarting the ol’ economics portion of the brain.


« Iz I Dum?
» A Taste of 2008