Aaron Hickmott outside his Master of Gingerbread bakery in Palmerston North.
Aaron Hickmott outside his Master of Gingerbread bakery in Palmerston North.
Soaring butter prices and a scarcity of “yellow gold” could force a popular Palmerston North bakery to close.
A shortage has seen Master of Gingerbread bakery owner Aaron Hickmott driving around town hunting for enough butter to make his next batch of biscuits.
“I wasn’t able to bake for threedays. There just wasn’t any butter around,” he said.
“And to think this country is the home of dairy.”
It wasn’t just a lack of supply turning up the heat. Current butter prices - said to be selling for $13 a block in some New Zealand stores recently - is eating away profit.
Hickmott said he was loathe to raise his prices and was taking the hit - for now. He refused to consider using a butter substitute.
Butter stocks are running low in some stores.
Butter was a key ingredient and unless there was both a surety of supply and realistic pricing, he would be forced to turn the ovens off.
“It is a crisis. It’s at a tipping point. It’s the thing that will take us down, but I’m hoping we might be able to ride it out until Christmas,” he said.
The shop sold and delivered gingerbread and other biscuits and cakes, all made by hand. Authentic taste and smell was a point of difference - hence why he prefers to use only New Zealand butter.
As a key ingredient, the current price of butter is putting the squeeze on the Palmerston North bakery.
“There are fake butters, but they have a different texture and taste. People notice it. You have to have taste as your point of difference and you don’t want to compromise that,” he said.
“It reminds people of home, or of their Nana.”
Hickmott, 29, said when he first opened the bakery, he was paying $2.49 for 500g of butter. He was able to pay the bills and the wages of two fulltime employees when butter was priced around $6 a block.
“But this is crazy. It’s like yellow gold,” he said.
In recent weeks some supermarkets have put a limit on the amount of butter per customer, in some stores it was a maximum of four blocks each.
Amy Ward and Andrew Hickmott work full time at Master of Gingerbread in Palmerston North.
Hickmott said he needed between 60 and 80 blocks of butter each day. During the busy Christmas period, he might use 100 blocks.
Hickmott started baking as a youngster, selling batches of biscuits on the side of the road in Featherston St. He would share some of the profit to his mother so she could buy more ingredients.
He left school at 14 to work at local supermarket, but continued baking at home. Acting on the suggestion of his late grandfather, he opened the Master of Gingerbread bakery in 2019.
New Zealand’s dairy herd produced about 286,000 tonnes of butter in 2023 according to the Dairy Companies Association of New Zealand (DCANZ), with 266,000 tonnes of that then exported.
That left behind about 4kg of butter per person each year - around 8 blocks.
Prices increased 5.5% at a Global Dairy Trade auction across the board early last week - the largest percentage increase since March 2021. It was good news for farmers, as the price of whole milk powder increased by 7.2%.
Fonterra consumer sales director Guy Blaikie said it worked closely with its New Zealand customers to ensure demand was met.
“As milk supply is seasonal, with less milk produced in winter months, we work closely with out cusrtomers on their predicted levels of demand, and then meet their forecasted needs,” he said.
“In many cases, our customers build up stock levels over the winter months to have adequate supply for their consumers.
Supermarkets source their butter from different dairy processors. Global butter prices have increased over the past six months due to tight butter availability.”
Hickmott however is hoping for a price decrease for butter sooner, rather than later. In the meantime, he’s still baking, and still driving around the district hunting down that “yellow gold”.
