He added that the problem persists for all butter packs — 100 grams (gm), 200 gm, and 500 gm. Similar instances have been reported from other parts of the city, with shopkeepers saying they can only get billing done once a day now. Refusing to divulge capacity utilization details, R S Sochi, managing director of Gujarat Co-operative Milk Marketing Federation that markets the brand of products, says butter production was gradually being ramped up after a better-than-expected Diwali led to a surge in demand.
“Diwali this year exceeded expectations. While there were no hiccups in production and distribution, certain distribution centers did not anticipate the sudden demand spike, leading to temporary crunch, followed by further panic buying,” says Sochi. According to Statista, revenue in the Indian butter segment has been pegged at $6.86 billion this year. The market is expected to grow annually by 5.24 per cent (compound annual growth rate 2022-2027).
According to industry sources, AMU’s daily milk procurement stands at roughly 27 million liters, while butter is at 150,000 tonnes per annum. While the milk fat content in liquid milk ranges between zero per cent and almost 10 per cent, that of butter and ghee (clarified butter) is at 82 per cent and 100 per cent of the products, respectively. In fact, 2021-22 had seen Gujarat Co-operative Milk Marketing Federations flagship brand AMU butter clock a 17 percent growth, while the ghee business grew more than 19 percent-both in value terms. Commenting further on the shortage, Sochi says the demand for all dairy products, led by liquid milk, was high during and after Diwali.
“Of all the milk fat generated from milk procurement, 60 percent goes for liquid milk, the rest for other products, including butter. We have always prioritized liquid milk production. When demand for it rose, We reallocated milk fat for more milk production. As a result, we couldn’t quickly ramp up butter production at the same time. However, the shortage was short-lived, and the situation is back to normal now,” adds Sochi.
Vendors and sellers on various e-commerce platforms are also experiencing a shortage of AMU products. An industry source says the shortage may be due to an outbreak of the lumpy skin disease that caused cattle deaths in many states. At Olive Bar & Kitchen in New Delhi, the shortage has prompted a shift to a plant-based menu. White butter has replaced table butter at the al fresco Mediterranean restaurant.
“In an effort to shift to healthier, gluten-free fats, we are using coconut fat in desserts. In sauces, we are using buttermilk,” says head chef Drum Oberon.
Kabir Sufi, president of the National Restaurant Association of India (NRA), says the shortage is a countrywide phenomenon, adding that the NRA has not taken any steps as yet to address the matter and is waiting to see how the situation evolves.
At Impresario, which owns and operates brands like Social, Smoke House Deli, and Mocha, the shortage has been pronounced. “We have proactively switched to other approved brands like Nadine for ghee and salted butter (500 gm), D Leta for unsalted butter, fresh cream, whipped topping, and processed cheese,” says Vishal Meta, head of procurement and supply chain, Impresario Entertainment & Hospitality.
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