Organic Milk

Organic Milk Market - Global Industry Insights, Trends, Outlook,
and Opportunity Analysis, 2018-2025
Organic milk is referred to the milk from livestock, which are raised through organic
farming methods. Livestock are fed with organic feed and need to follow organic
farming stipulation such as no artificial additives in the feed, no antibiotics, no growth
hormones, living condition allow movement of livestock, and the animal should have
access to outdoors.
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Market Dynamics
Changing dietary preference of the people towards organic food & beverage
products is propelling demand for organic milk products. According to reports
published by the Food and Drug Administration of United States, six in 10 U.S.
citizens believe that organic food products are better for their health. Also, according
to the U.S Department of Agriculture, 4% of the total food sales in the U.S. in 2016
were organic products. The organic retail sales in Europe stood at US$ 30.85 billion
in 2014, as estimated by The International Federation of Organic Agriculture
Movements.
Moreover, increasing awareness about harmful effects of chemical traces in milk
products are leading to increasing demand for organic milk products. Chemical
fertilizers contain harmful toxins such as nitrates, heavy metals, and metal salts,
which adversely affects human health and lead to various issues related to cellular
metabolic processes. However, organic farming method includes feeding of 100%
organic feed to livestock, which do not contain any harmful traces or growth
hormones or antibodies. Therefore, increasing popularity of organic food as a safe
food is projected to fuel growth of the global organic milk market over the forecast
period.
The cost of organic milk is higher than conventional milk, which is a major challenge
for growth of the market. Furthermore, governments across various regions have
imposed strict regulations on organic milk products. For instance, the United States
Department of Agriculture (USDA) established guidelines for organic certification.
Under USDA organic regulation (7 CFR 205), farms need to follow standards such
as Land Requirement (205.202), origin of livestock (205.236), Livestock Feed
(205.237), and Livestock Healthcare Practices (205.238) in order to be eligible for
organic certification. Such strict regulations forces manufacturers to maintain their
product quality and thus, is expected to be a major restraining factor for the market
growth.
Market Outlook
On the basis of distribution channel, supermarkets segment is projected to gain
major traction in the market over the forecast period. Supermarkets are focusing on
initiatives to tap potential opportunity in organic milk market. For instance, in
February 2017, Asda, one of the key retailor in the U.K., started to sell Dairy Farmers
‘free range dairy milk’, to meet consumer demand for organic milk in the U.K. Asda
identified potential 109 stores and started selling organic milk under Pasture Promos
logo. Such marketing strategies are projected to boost sales of organic milk products
through supermarkets.
North America accounted for highest revenue share in global organic milk market in
2017 and the region is projected to lead the market throughout the forecast period. In
North America, the U.S. is the most lucrative market for organic milk. According to
Agricultural Marketing Services USDA 2018 report on Organic Fluid Dairy, total
organic milk products sales for February 2018 were pegged at 205 million pounds,
up by 1.0% from February 2017. Total organic milk products sales for February 2018
were pegged at 85 million pounds, which is up by 10.9% compared to February last
year.
Europe accounted for second-largest market share and the trend is projected to
continue over the forecast period. European Union is actively promoting organic
farming through the EU Common Agricultural Policy (CAP). Under the current CAP
for the period 2014–2020, organic farming is supported by Pillar 1 (direct payments)
and Pillar 2 (Rural Development Programme). Such factors are expected to increase
availability of organic feed to livestock and in turn aiding in growth of the organic milk
market in Europe.
Key players in Global Organic Milk Market
Key players operating in the global organic milk market include Groupe Danone,
Organic Valley, Organic Milk Suppliers Cooperative (OMSCo), Fonterra Co-operative
Group Limited, Arla Foods Amba, Agropur Dairy Cooperative, Clover Stornetta
Farms, Inc., and Shamrock Foods Company, among others.
Leading market players are launching new organic milk products, in order to meet
rising demand from consumers. For instance, in September 2017, Arla Foods
launched its first branded organic milk product in Middle East. The product was
strategically launched by company to tap potential market outside Europe. The
product was launched in all leading retail chains in UAE such as Union Coop,
Choithrams, Lulu, Geant, and Spinneys hypermarkets. Moreover, Arla Food is
planning to expand its organic food business in Saudi Arabia and Kuwait in 2018.
Such activities are projected to have positive impact on growth of the market in
Middle East.
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The research report on organic milk market segments the global market by product type (100% Organic Milk, Low Fat Organic Milk, Fat Free Organic Milk, and Others), by distribution channel (Hypermarkets, Supermarkets, Convenience Stores, Online Stores, and Others)

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