The bakery industry faced divergent cost pressures in 2024, clearly illustrated by our croissant cost
model showing a 7.11% year-over-year increase. While dairy costs surged, significant relief came from
sugar markets and relatively stable egg prices, creating a complex landscape for manufacturers to
navigate.

Butter prices dominated the cost narrative, reaching record highs with cream exceeding €10,000/MT
and butter surpassing €8,000/MT in the year’s second half. This extreme volatility in dairy fats pushed
many manufacturers to explore hybrid or full vegetable oil alternatives. However, the substantial
decline in sugar prices (-30.43% in Europe) provided important relief for bakery producers,
particularly benefiting high-sugar products like pastries, cookies, and sweet breads. This drop from
2023’s record levels, driven by strong European production and exports, helped partially offset rising
costs in other areas.

Egg markets, crucial for many bakery applications, showed more stability than in recent years,
particularly in Europe where prices moderated after 2023’s extreme volatility. However, the ongoing
transition to cage-free production systems and potential HPAI impacts remain key considerations for
manufacturers’ sourcing strategies.

Wheat flour prices remained relatively stable throughout the year, showing modest declines (-4.13%),
while allowing manufacturers to maintain consistent base costs for their primary ingredient. The
combination of stable flour prices and declining sugar costs provided some flexibility for managing the
impact of volatile dairy prices.

In 2025 the industry faces mixed signals ahead. While butter prices are expected to remain elevated
despite some seasonal relief during the spring flush, sugar markets may see supply adjustments as
current low prices influence European beet planting decisions. Egg markets face continued
uncertainty with the acceleration of cage-free transitions, particularly in Europe. Manufacturers will
likely continue portfolio diversification strategies, balancing premium butter-based offerings with
alternative formulations, while closely monitoring their full ingredient cost spectrum as they adapt to
evolving market conditions.

What’s inside this report

For a deeper dive into the trends that defined 2024 and the forces shaping 2025, our full report provides detailed insights into:

  • Key ingredients
    • Flour/Wheat
    • Starches
    • Eggs
  • Dairy
    • Butter & cream
    • Skimmed Milk Powder (SMP)
    • Whole Milk Powder (WMP)
    • Whey Powders
  • Oils & Fats
    • Palm Oil
    • Olive Oil
    • Soybean Oil
    • Rapeseed Oil
    • Sunflower Oil
  • Sweeteners
    • White and Raw Sugar
    • Glucose & Syrup
    • Alternative Sweeteners
  • Other Ingredients
    • Almonds
    • Walnuts
    • Cocoa
    • Energy

Each section offers comprehensive data and analysis, helping you navigate the complexities of the dairy market and make informed decisions for the year ahead.

Download the full report now to stay ahead of the curve and uncover actionable insights for 2025: https://vespertool.com/downloads/downloads-eoy-report-bakery-2024/