At one-time, organic milk was wildly popular with health-conscious consumers. Supermarkets could not keep organic milk on the shelves. Now, the organic milk industry is experiencing a significant decline in demand.
Organic milk is produced from cows that have not been treated with antibiotics.
Organic milk cows eat organically certified feed, and they graze in a natural environment. For farmers to produce organic milk, they must follow stringent organic regulations and guidelines by the United States Department of Agriculture (USDA).
Organic milk must come from cows that have been under ongoing organic management for at least one year prior to the production of milk. There are numerous certification agencies in the United States that are accredited by the USDA to certify organic milk farms according to the National Organic Program (NOP) standards. Organic milk farmers must operate their farms in a manner to ensure that they maintain their certification.
Today, it seems the organic milk craze is waning, and the individuals who made it popular are searching for other options. As a result, there is an oversupply of organic milk. This overabundance and declining sales are impacting supermarkets, packaged-food companies, consumers, and organic dairy farmers.
Impact on Supermarkets and Packaged Food Companies
With the slowing demand in organic milk, several packaged-food companies are looking at ways to revitalize the interest by turning organic milk into other products, such as cheese. Supermarkets are reducing the shelf space for organic milk and making room for non-dairy alternatives.
Impact on Consumers
Consumers are exploring new options to replace organic milk in their diets. Many health-conscious consumers are seeking plant-based alternatives, and almond milk is top on their list. Some customers believe cows’ milk is not as healthy as other options, such as almond or coconut milk.
Impact on Farmers and Organic Milk Producers
With the declining interest in organic milk, dairy farmers are now experiencing a surplus of organic milk. In its heyday, the increased demand from consumers made dairy farmers eager to produce organic milk. Organic dairy farmers are seeking ways to cut their losses because they have a much higher cost of production as compared with conventional milk farmers. Organic farmers must invest a large amount of money and energy into their operations to be certified as organic milk producers.
Organic milk farmers operate on six-month or annual contracts that lock in price points with processors. On the other hand, conventional milk farmers operate on monthly contracts. Many organic farmers are asking themselves, can they continue to be profitable with a decline in organic milk and the expenses required to earn organic certification?
Competing alternatives to organic milk and the growing lack of interest in the product are not good news for the organic milk industry. Declining sales are affecting the wallets of farmers who make their living producing organic milk. Unfortunately, experts in the food industry predict the problem will continue through 2018, which is not a good prognosis for organic milk farmers whose livelihoods depend on it.