Poland’s butter reserve intervention backfires as large quantities end up in Czech stores. Despite government efforts, prices remain high, raising questions about the strategy’s effectiveness.
In an attempt to curb rising butter prices before Christmas, Polish Prime Minister Donald Tusk announced the release of 1,000 tons of butter from strategic reserves. The government auctioned off the stock at 28.38 PLN per kilogram, aiming to flood the market and counter speculation. However, the move had little effect, as butter prices remained unchanged. A significant portion of the stock ended up in the hands of a Czech company with operations in Poland, which supplies major retail chains in the Czech Republic and Slovakia.
One of the two selected buyers, Milkpol Polska, turned out to be a subsidiary of a Czech firm that dominates butter distribution in the region. This means that Polish reserves intended for domestic price stabilization were instead sold abroad. Former Agriculture Minister Marek Sawicki criticized the government’s strategy, arguing that the intervention was insufficient to influence market prices. With butter prices high across the EU, experts question whether the Polish government properly assessed the situation before proceeding with the sale.