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Tight butter supply impacting East Tennessee businesses and bakeries

Right now, lower-than-average butter supplies are causing higher prices. It's putting the squeeze on businesses that use a lot of butter.

KNOXVILLE, Tennessee — You may have noticed another staple in your kitchen costing more than normal. The price of butter is up, increasing more than 20% over the past 365 days.

Chandra Taylor has been the owner of Mer Mer's Bakery for 25 years. She spent most of Wednesday working on a cookie order for a customer. 

"It took about 10 pounds of butter. We made over 100 cookies."

Her most recent job with the cookie order cost her about $70 worth of butter.

Data from the Department of Labor Statistics show the cost of up butter is up by more than 20% compared to this time last year. The International Dairy Foods Association said it's because of tight stocks, more butter being exported, and food inflation. Butter storage was reported to be down 22% and milk production was down 1% the first half of the year.

"Where you could buy butter last year for maybe $2.99 a pound -- it's now $6.99 a pound. So that's a big extreme price hike, especially for us bakers here,” Taylor said. 

Taylor said butter is a crucial ingredient in most of her desserts. The higher prices are impacting her because there isn't a good substitute butter for many of her baked goods. She said she has to raise her prices by at least $3. 

“90% of everything that we make uses real butter. We can't change the recipe, but we have to change the price,” she said. 

The International Dairy Foods Association said it is not worried about there being a butter shortage yet, saying it has "seen bigger deficits before." The price of butter, however, is expected to remain high before demand peaks during the holidays.

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