Whole, organic milk sales trends continue

August fluid milk sales were down slightly from the year before, according to USDA's Ag Marketing Service. However, whole milk continues to post monthly and year-to-date (Y-T-D) gains in both conventional and organic categories.

August 2015 packaged fluid milk sales totaled 4.04 billion lbs., down 1.4% from August 2014. Monthly sales of conventional products, at 3.85 billion lbs., were down 1.2%; organic products, at 192 million lbs., were down 5.9%. Organic represented about 4.7% of total sales for the month.

According to the U.S. Department of Labor's monthly estimates, the August 2015 Consumer Price Index for whole milk was down 8.4% compared to a year ago, with other milk down 6.0%.

Through the first nine months of 2015, packaged fluid milk sales totaled 32.54 billion lbs., down 1.5% from the same period in 2014. Y-T-D sales of conventional products, at 30.92 billion lbs., were also down 1.5%; organic products, at 1.61 billion lbs., were down 1.2% Organic represented about 5.0% of total sales for the month.

Monthly and Y-T-D sales of conventional whole (+4.3%, +3.7%), flavored whole milk (+6.5%, +5.5%) and organic whole milk (+3.4%, 10.0%) were up.

The estimates represent fluid milk product sales in federal and California milk marketing orders, which account for approximately 92% of total U.S. fluid milk sales.


Organic overview

USDA's Ag Marketing Service reported the decline in overall organic sales continues to be hampered by limited availability, rather than lower consumer demand.

Current organic whole milk availability is spotty in some Midwest stores, where coolers have some empty slots for various brands while stocked with other types of organic milk. Efforts to encourage more transitioning into certified production are intensifying. A significant organic processor, for example, is working with numbers of transitioning organic dairy producers representing 25% of current contracted organic producers. Full transitioning is a three-year process, so that will be a significant increase in producer numbers for this large processor in this specific time horizon. Other organic processors have varied numbers of transitioning prospective producers.

A large number of the organic dairy producers in the Midwest have contracted to receive pay prices that work out to a 12-month average mailbox price of $33.13/cwt. This is based on 12.2% component levels of 3.5% butterfat, 3.05% protein and 5.65% other solids.

Source: Dairy Market News