During the global recession of 2007-2009, the global butter industry experienced a significant downturn. However, since that time, butter has seen a global resurgence, driven largely by increased demand in developing regions such as Asia Pacific and Latin America, as well as record consumption in the United States. SPX Food and Beverage President Marc Michael and Butter Process Category Manager Erik Dons Sorensen explain.
The global butter market certainly seems to be on an upswing. What’s driving this?
Marc Michael: Yes, after a downswing during the global recession, the world market for butter appears to have stabilized and is now on a growth trajectory. According to Global Industry Analysts, demand for butter worldwide is expected to rise, with global butter production projected to exceed 10 million metric tons by the year 2015. Developing areas such as the Asia Pacific and Latin America regions are expected to see the most significant growth.
A number of factors are helping to spur this growth. For example, demand for dairy-based products has been increasing due to an expanding middle class in countries such as India and China. A growing preference for butter among consumers is also due in part to nutritional studies espousing the benefits of natural ingredients.
In what parts of the world is butter consumption showing strength?
Marc Michael: Butter consumption in the world’s top-consuming nations is anticipated to climb to more than 8.8 million metric tons in 2014, up 2% from 2013. In Europe last year, for example, high demand for butter coupled with limited supplies resulted in nearly a 40% year-over-year increase in butter prices.
While some of the largest export markets for butter have traditionally been Iran, Egypt, and Russia, China has recently become a leading importer. In fact, emerging markets have driven a significant share of the growth in the global consumption of butter and other dairy products. These are markets where the middle class population is expanding, more people have disposable income and they are broadening their diets to include more dairy.
In the U.S., butter consumption recently hit its highest level in 40 years. According to the Milk Producers Federation, U.S. butter consumption is now 5.6 pounds a year per capita, up from its low point of 4.1 pounds in 1997. In fact, during the past decade, Americans have increased their butter intake by 24%, according to the Wisconsin Milk Marketing Board.
What are some of the other trends driving increased butter consumption globally?
Marc Michael: In developed markets, there is growing consumer demand for foods containing natural ingredients as well as heightened interest in gourmet cooking. Butter demand has also benefitted from being endorsed as a cooking ingredient of choice among celebrity chefs and cooking shows around the world.
Is SPX particularly active in the area of butter processing and production?
Erik Dons Sorenson: Yes, SPX Flow Food and Beverage can deliver complete processing lines for butter and butter products. These lines can be based on the traditional continuous butter making process or on recombined butter technology involving scraped surface heat exchanger technology. Today, SPX has butter processing system installations in more than 110 countries around the world. Our APV and Gerstenberg Schröder brands are well-known globally for manufacturing highly innovative processing equipment and systems for the production of butters, margarines and spreads.
Over the years, we also have developed a deep expertise in the design and installation of fully automated, continuous margarine and butter processing systems. For example, we developed a system for Tine BA, Norway's largest producer, distributor and exporter of dairy products. Our fully automated system has enabled Tine to continuously process both butter and margarine spreads in the same production facility, while also being configured to deliver environmental benefits through low water and energy consumption.
Are there any new innovations in butter processing from SPX?
Erik Dons Sorenson: Yes, working in close partnership with our dairy customers, we have developed the Gerstenberg Schröder Butter Reworker, which provides more production flexibility for reworking 25kg bulk butter, while also enhancing overall process efficiency.
With our Butter Reworker, we’ve enhanced the technology in order to lower the temperature of the butter blocks that can be reworked on the unit. As a result, today the machine is able to handle butter blocks at temperatures as low as -1°F or -18°C. This benefits customers who, for logistical reasons, prefer to rework bulk butter direct from a cold store (freezer) without prior tempering.
The Reworker also operates without any cutting at its inlet so as to minimize mechanical shear in the process and lower energy consumption. Such a device typically results in a larger incorporation of air when all the small butter pieces are worked together in the auger section. Working without any cutting or breaking device has also shown to result in a minimum loss of water from the reworking process. With the addition of a vacuum treatment system in the installation, the amount of air in the reworked butter is minimized, again improving operating profit.
Learn more about the SPX Butter Reworker
Additionally, we also recently introduced the SPX Butter Unwrapper machine.
Butter typically arrives into a processing facility boxed and wrapped in around 25 kg units. Before any reworking, melting or other downstream processes can be carried out it needs to be de-boxed and unwrapped. Once de-boxed, which tends to take place outside of the processing area to avoid dust from the cardboard, the new SPX Butter Unwrapper machine takes away the manual lifting associated with removing the plastic covering around the large blocks of butter. Removing the need for manual lifting protects operators from injury, ensures compliance with local health and safety regulations, and simplifies operational procedures as operators do not need to changeover to avoid exceeding daily maximum load lifts.
The SPX Butter Unwrapper machine removes logistical issues surrounding this process, simplifying operating procedures and decreasing the risk of injury for personnel. The machine is unique in how it handles the unwrapping process and offers real benefit and peace of mind to food processors. Designed and ideal for use with the butter bulks entering a processing line, the system can also be utilized for a multitude of other heavy packaged products.
Learn more about the SPX Butter Unwrapper