The demand for organic milk has increased substantially over the past few years. Organic milk industry offers new and profitable markets for dairymen and so its demand is expected to flourish over the years.

Organic milk is expected to flood the US market after being short in supply for several years. This is due to a regulation change and higher margins that push more dairy farmers to produce it. As per the news published on Reuters, a growth of at least 40% is expected in the supply of organic milk this year in the dairy industry from a previous annual growth rate of 20%. According to some estimates, this will lead to an excess of 25 Million Gallon of organic milk.

The dairy processors and distributors of US, like Dean Foods, Stonyfield Farm, and Organic valley (a dairy farms co-operative) are welcoming this news as it provides them new horizons to increase their market share and offer more organic milk-based products. 

In US, the demand for organic milk is increasing rapidly with the rising income and changing consumer tastes. As the number of retailers entering in the organic sector is increasing in the organic sector, the land farmed organically is also increasing. Retailers like Walmart offers organic dairy products at reasonably low prices. This means that organic products will be available at cheap prices and therefore, will be accessible at affordable prices to a larger segment of population of the country.

Retails outlets have recognized sales potential in the organic sector with the growth in demand for organic products. Besides supermarkets, increasing number of independent retailers have started selling organic products that includes fresh food and a wide range of dairy products, bakery goods, and processed food and drinks.

The demand for organic milk will continue to rise at 25% annually. This has forced some industry experts to predict that retail promotional war, in future, will be unavoidable. Growing production of organic food may provide incentive for input technologies but at the same time, it can lower the producers’ cost of organic production. Extended markets can encourage more farmers and handlers to step into the market place.

As per the research analysts at RNCOS,  “The market for organic milk is increasing at a speedy rate and will continue to rise in the coming years. Organic market offers supreme opportunities for dairymen to convert to organic food sector and benefit by capturing the perks offered by the boost in the demand for organic milk”. 

Related Market Research Reports:
Indian Food and Beverages Forecast (2007-2011)
European Organic Food Market
World Organic Foods And Beverages Report (2006)