This is a common way to disagree with someone:
A: You said that I could use it when you were finished with it.
B: Yeah, but I'm not finished with it yet.
A: What's wrong with him? He's smart, funny, handsome.
B: Yeah, but he's too short for me.
"Yeah but..." is useful when you agree with the specific sentence that a person said, but you disagree with their overall ideas.