‘There is no economic reason for dairies to transition to organic’

Global organic dairy sales were valued at around US $ 24bn in 2021 and according to forecasts from Precedence Research worldwide demand is expected to grow at a strong clip in the coming years. The global organic dairy market size is projected to hit around US $ 53.6bn by 2030 thanks to an expected compound annual growth rate just north of 10%. Demand is being driven by factors ranging from health and wellness (organic milk is high in omega 3 fatty acids and antioxidants, for instance) to perceived sustainability benefits.

But the US dairy industry is not necessarily in the best position to take a leadership role and capitalize on growing global demand, according to Ed Maltby, Northeast Organic Dairy Producers Alliance (NODPA) Executive. “The critical wording here is globally, which will come down to how competitive the US is compared to other major countries that supply the world market: for example New Zealand and Australia. My assumption is that the US has higher production costs than New Zealand especially with the requirement for pasture, ”He told this publication.

Indeed, the most recent data from the American Organic Trade Association (OTA) reveals US organic dairy export volumes have consistently fallen since 2017. Since that year, organic fluid milk exports have fallen 76%, down to less than 2,000 MT in 2020. While volumes have plummeted, the value decline is somewhat less pronounced – if still significant. OTA revealed the value of US organic dairy exports has been supported by increased organic whey and organic dry milk product exports. Over 2020, the value of US organic dairy exports reached $ 4.9m in 2020, down ‘only’ 27% from 2017.

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