A renewed interest in home cooking leads to a revival of the butter category.

Deluged with news stories about the dangers of trans fats, American consumers have wandered the grocery aisles, dazed and confused about which products are safe to buy.

Arriving at the butter and spreads aisle, they might very well be puzzled by the vast array of choices before them. Seeing that a number of spreads boldly tout their trans-fat-free status right on the package, they could very easily assume that butter contains trans fats and, thus, should not be eaten. They would be wrong, of course, as butter is naturally free of trans fat.

Ignorant of that fact, however, they could make the wrong choice, taking home a butter alternative when they could be enjoying the real thing without suffering the negative health consequences of trans fats.

“It’s been problematic because the average consumer has a hard time distinguishing between artificial versus animal trans fats,” says Jerry Kozak, executive director of the American Butter Institute (ABI), Arlington, Va. “However, there are changes in that occurring, resulting in an improved perception of butter and larger volume sales of butter.”

According to Chicago-based Information Resources Inc. (IRI), butter sales across supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, rose 0.7 percent in units during the 52-week period ending June 17, 2007, while falling 5.6 percent in dollars, a reflection of the leveling off of butterfat prices, which were sky-high just two years ago. At the same time, sales of margarines, spreads and butter blends have fallen both in dollars and units — down 2.3 percent and 7.3 percent, respectively.

Inspired by such high-profile celebrity cooks as Rachael Ray and Giada De Laurentiis, consumers are embracing butter again, Kozak says. Seeking to take advantage of that trend, ABI has been working in conjunction with Rosemont, Ill.-based Dairy Management Inc. (DMI) to promote butter as the product of choice for chefs and bakers. Over the past several years, Kozak says, DMI has anteed up around $2 million for the butter promotion campaign, which is administered by the Wisconsin Milk Marketing Board (WMMB). Using the tagline “Butter. Pure and Simple,” the campaign demonstrates the power of butter as a cooking tool, something that’s certainly no secret to butter makers.

“Butter performs such a wonderful role in our lives,” says Jed Davis, director of marketing, Cabot Creamery Cooperative, Cabot, Vt. “From the standpoint of cooking, it’s a wonderful flavor enhancer. It’s unparalleled.”

Davis says the resurgence in home cooking and baking has led to a growing interest in European-style butters boasting a higher fat content. This is particularly true among so-called “foodies,” who tend to shop at stores like Whole Foods and don’t mind paying a little extra for something out of the norm.

“When you go to the butter case in your typical local supermarket, mostly what you are seeing are your traditionally packaged quarters and solids,” Davis says. “It flips the other way when you go into something like Whole Foods, where you may have five or six imported butters or domestic butters mimicking the European-style because that’s a clientele that’s interested in that.”

Theresa Marquez, chief marketing executive for La Farge, Wis.-based Organic Valley Family of Farms, calls this trend the “Europitization of America.” Interest in Organic Valley’s European Style Cultured Butter has been so strong that the company has two new “companion” butters in the works: a European style cultured butter containing 1 percent salt and a high conjugated linoleic acid (CLA) butter dubbed Spring Gold. CLA is a naturally occurring fatty acid found primarily in meat and dairy products, which proponents claim helps with weight loss.

According to Organic Valley COO Louise Hemstead, organic butter sales have grown in response to the increased availability of organic butterfat, as well as high conventional butter prices of recent years, which made the organic option available at a comparable price. “At times when we’ve seen conventional butter prices come up and kiss organic butterfat, we can hardly keep organic on the shelf,” Hemstead says. “The consumer really feels they are getting an extra value with the organic butter.”

Across the conventional butter category, innovation has been modest at best, according to Kozak, who points to spreadable butter with canola oil as the development that’s contributed the most to an overall category increase. Seeking to replicate the success of spreadable products sold by Land O’Lakes and other national brands, Crystal Farms, a subsidiary of Minnetonka, Minn.-based Michael Foods Inc., recently introduced Salted Sweet Cream Spreadable Butter, designed to be “soft and spreadable” right from the refrigerator. Made with canola oil and salted sweet cream, the product is also said to be suitable for baking and cooking. Meanwhile, Dublin, Calif.-based Challenge Dairy Products Inc. rolled out its own Spreadable Butter. According to company literature, it “goes on smooth and easy right out of the fridge and provides a tasty alternative to flavorless spreads.”

Within the spread category, butter faces continued competition from the phenomenally successfully Smart Balance brand of trans-fat-free spreads, which not only boast butter-like taste, but are said to perform like butter in cooking and baking applications. Manufactured by Cresskill, N.J.-based GFA Brands Inc., both Smart Balance and Smart Balance Light hold firmly to the fourth and ninth spots in the Margarine, Spreads and Butter Blends category, with the original Smart Balance product boasting an impressive 25.5 percent increase in dollar sales and 17.4 percent increase in unit sales, according to IRI.

The company recently bolstered its offerings with the addition of Smart Balance Organic Whipped Buttery Spread, a gluten-free, trans-fat-free, non-hydrogenated vegan product that is said to taste, spread, and cook just like real butter. Noting that “anything that takes shelf space away from butter is legitimate competition,” Hemstead doesn’t seem overly concerned about the success of alternative spreads such as Smart Balance. That said, she does concede that they are meeting a certain consumer demand and therefore, should be taken seriously.

For his part, Kozak isn’t spending too much time dwelling on butter’s competitors. With fewer butter imports making their way to U.S. ports and vastly more butter being exported to Singapore, Belgium, Holland, Russia, Israel, Turkey, Germany, and countless other nations, Kozak is feeling pretty bullish on butter these days.

“From July of 2005 to December of 2006, we exported over 14 million pounds of butter and just from January to May of this year, we exported over 11 million pounds of butter,” Kozak says. “That’s helping to expose those countries to the quality of U.S. butter.”

TOP 10 INDIVIDUAL BUTTER BRANDS*
	$ Sales (In Millions)	% Change vs. Year Ago	Dollar Share	Unit Sales (In Millions)	% Change vs. Year Ago
Total Category	$1,220.9	-5.6%	100.0%	473.0	0.7%
Private Label	564.7	-5.7	46.3	244.8	0.5
Land O’Lakes	349.6	-5.1	28.6	117.2	1.9
Challenge	61.8	-4.1	5.1	19.0	2.1
Breakstone	29.6	-13.2	2.4	12.8	-9.6
Tillamook	25.8	0.3	2.1	8.2	1.2
Crystal Farms	23.3	6.5	1.9	9.8	13.9
Keller’s	18.9	-17.6	1.6	7.9	-4.6
Cabot	18.8	0.5	1.5	7.0	5.9
Hotel Bar	17.4	-10.4	1.4	7.8	18.0
Horizon Organic	12.0	-5.8	1.0	2.2	-6.5
* Total sales in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, for the 52-week period ending June 17, 2007. SOURCE: Information Resources Inc.

TOP 10 INDIVIDUAL MARGARINE/SPREADS/ BUTTER BLEND BRANDS*
	$ Sales (In Millions)	% Change vs. Year Ago	Dollar Share	Unit Sales (In Millions)	% Change vs. Year Ago
Total Category	$1,205.5	-2.3%	100.0%	766.6	-7.3%
I Can’t Believe It’s Not Butter	237.1	-2.6	19.7	122.8	-4.8
Shedd’s Country Crock	198.6	3.9	16.5	99.3	-0.4
Private Label	81.4	-10.2	6.8	78.9	-15.0
Smart Balance	81.2	25.5	6.7	35.3	17.4
Blue Bonnet	73.1	-6.1	6.1	82.3	-10.3
Parkay	71.0	-8.5	5.9	49.7	-10.3
Land O’Lakes	65.4	-3.9	5.4	39.2	-7.5
Imperial	50.6	-10.2	4.2	66.4	-11.5
Smart Balance Light	45.3	9.3	3.8	22.6	6.8
Fleischmann’s	40.8	-10.9	3.4	25.8	-13.4
* Total sales in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart, for the 52-week period ending June 17, 2007. SOURCE: Information Resources Inc.