The Daily Churn
Meeting rising consumer demand for organic dairy products
Darigold has joined the list of U.S. dairy cooperatives increasing their product variety to meet skyrocketing demand for organic dairy products.
In their U.S. Beverage Market Outlook 2019 report, the consumer market research group Packaged Facts found that between 2010 and 2018, the percentage of U.S. residents buying organic milk rose from 4 to 13 percent.
And by 2022, according to Statista data, that number is expected to surge an additional 14.3%.
Still, organic dairy comprises about 5 percent of the overall dairy market — which may in part be explained by the barriers associated with this kind of farming.
Defining organic dairy production
For a dairy to carry the “Certified Organic” label by the United States Department of Agriculture (USDA), it must meet a detailed list of criteria covering land requirements, healthcare practices and livestock living conditions.
Producers making the transition work directly with accredited certifying agencies that conduct regular inspections, audits and oversight of management practices to ensure their farm meets these stringent regulations.
Gwen Ayers, the Program Manager for the Idaho State Department of Agriculture’s Organic Program, acknowledges that this can be difficult for producers.
“Transitioning to organic takes a lot of time, potential increases in costs and also may require a large shift in the dairy’s management,” she says.
The land used to raise and feed cattle is a cornerstone of organic dairying, according to USDA’s National Organic Program.
All the land used to pasture, house and feed livestock must be organic certified, which means no chemical fertilizers, herbicides or pesticides can be applied for three years before or after certification.
Cattle must also be left on pasture for the entire grazing season—obtaining 30 percent of their feed from grass no less than 120 days of the year. Also, their diet may not contain any genetically modified feed ingredients.
“For new transitioning dairies, all conventional cows must be transitioned for one year until their milk can be considered organic,” says Ayers. “During this year they must be completely treated as if they are organic. Otherwise, operations transitioning can buy cattle that are already certified.”
Different farms, different business model
Many dairies were established before the organic label existed and grew their management and finances in a way that makes this transition impractical. This is the case for Chris Doelman, a second-generation dairy farmer in Olympia, Wash.
“We have been on the conventional path from beginning to now,” he says. “We didn’t feel for the size of our farm and the way we utilize our acreage and our farming practices that it was something that would be a good fit for our dairy.”
Organic dairying also has strict prohibitions regarding antibiotics, de-wormers and therapeutic hormone treatments, according to USDA guidelines. If an animal is in a life or death situation, she is required to receive appropriate conventional antibiotic treatment but must be sold.
Given these restraints, Ayers points to several considerations a dairy operation must make before deciding to enter the organic market, namely access to feed, herd management capabilities and financial cost.
While this market is not for every dairy producer, those who are interested and willing to transition have a viable consumer base for their milk.
Linking like-minded producers and consumers
Many consumers are increasingly interested in the story surrounding organic food production, according to Dr. Jessica Shade, director of science programs at The Organic Center—an educational research and communications group.
“There’s a long production line that goes up to making that (organic) milk,” she says. “It’s not just how the animal is treated, it’s what food that animal’s eating and the farming going into their food.”
The organic market also offers an opportunity to link like-minded consumers and farmers.
“As consumers become more interested in how their food is made, organic is a way to bridge that information disparity,” Shade says. “It’s a way for the farmers to talk directly with the consumers and connect with them about shared values.”
While there are as many different kinds of farmers as there are consumers, one dairy family in Washington says their farm’s location and climate made it easier to transition than it might be for others.
Different production perspectives
Lonny Schilter’s dairy farm in Chehalis, Wash. has been certified organic since 2005, he told The Daily Churn.
“What we were doing before fit into the organic lifestyle,” he says. “Grass production suits this climate and area really well, allowing us to easily grow forages and pasture animals.”
Transitioning to organic milk production also allowed them to stay in the dairy businesses with a relatively small herd of about 220 milking cows, since they are paid organic premiums. But those dairy farmers who aren’t able to produce or outsource all of their own certified organic feed, like Doelman, have other ways to stay in business while remaining sustainable.
On Beaver Creek Dairy (a Northwest Dairy Association member that ships its milk to Darigold), Doelman says they have farm practices that make it impossible to gain organic certification— including using corn and soybean byproducts for feed.
“We save that from going into landfills to be utilized to make an essential food,” says Doelman. “By doing that, we wouldn’t be able to be certified organic.”
Doelman, who is also on the Darigold board, says organic milk is another way for the dairy business to meet varying consumer interests and values.
“One is not better than the other, they’re just different,” he says. “Both provide consumers with choices, which we think is valuable.”