Growth in the butter and margarine between 1999 and 2004 was similar to inflation, resulting in a flat market--a 1% decline. As a near universal household food staple, this market is challenged to grow sales due to its mature state. Rather than gaining sales for the market as a whole, sales are more often exchanged between the two segments--butter and margarine. Factors such as changes in price, frequency of promotion, and health concerns have the most influence over this volatile market. Margarine and butter are nearly equally split in terms of dollar sales, with margarine holding a slightly higher share of the FDM market in 2004. Over the review period, margarine sales declined 15% at constant prices, whereas butter sales remained flat. In terms of volume, margarine accounts for two and a half times more volume sold than butter. Yet, butter is sold on feature, promotion or display at high percentages, especially when volume is low due to high prices.

Butter sales have been slowly inching forward and this trend is expected to continue, as consumers become less concerned with saturated fat content and more appreciative of flavor. As such, health concerns and diet trends have influenced market sales and will continue to do so. While margarine manufacturers have been at the forefront of product innovation in terms of eliminating trans fatty acids in its products, product promotion and education must certainly be effective to thwart sales from the butter segment.

Mintel’s report is a detailed analysis of the whole butter and margarine market, including market size, drivers, segmentation, trends, and distribution. Original consumer research delves into the attitudes behind purchasing behavior, and a five-year market forecast helps you prepare for the future in the butter and margarine market.

This report covers stick butter, soft butter, premium grade butter, and flavored butter. Also included are butter blends, margarines, spreads with yogurt, spreads with olive oil, and “functional” margarine such as Take Control. Squeezable butter blends, margarines, and spreads are included.

Other dairy items are excluded from the scope of this report, including cheese, cream, milk-based products, olive oils, vegetable shortening, lard, rennet, and vegetable oils.