Dairy - Butter: Market Size & Forecast 2026

The global butter and dairy spreads market sits at approximately USD 48.5 billion in 2025 (base year), held in a structurally tight balance between mature North American and European replacement demand, accelerating butterfat export capacity from the Southern Hemisphere, and a raw-milk cost structure that keeps producers marginal at sub-USD 1.60/lb farm-gate. The market is a feedstock-cost story, plain and simple. > **Analyst Take.** The Arla-DMK merger closed on 1 June 2026; the combined entity controls roughly 18% of EU butter processing capacity and will use that scale to pressure suppliers on farm-gate pricing. Buyers who locked H2 2026 butter supply in Q1 2026 at pre-merger pricing are positioned 3-5% better than those who deferred to post-merger negotiations. The right sequence is to confirm volume allocations with EU co-ops now, then revisit pricing once the Section 122 duty revie

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