Economic Forces Pushing Organic Dairies to be More Like Conventional Dairies, New USDA Study Finds
Economic forces are pushing organic dairies to become more like conventional dairies, reports a new study from USDA's Economic Research Service (ERS).
In "Characteristics, Costs and Issues for Organic Dairy Farming,” (http://www.ers.usda.gov/Publications/err82/) released today, authors William D. McBride and Catherine Greene say the number of organic dairies that use more conventional milk production technologies has increased in number.
Spurred by increased demand, organic milk production has been one of the fastest growing segments of organic agriculture in the U.S. Between 2000 and 2005, the number of certified organic milk cows on U.S. farms increased by an annual average of 25%, from 38,000 to more than 86,000.
But organic milk producers face challenges, the study notes. Organic milk producers usually begin as conventional dairy operators who go through what can be a challenging and costly transition. To qualify for organic certification under USDA's National Organic Program (NOP), producers must make changes in animal husbandry, land and crop management, input sourcing, and certification paperwork, among others.
In addition to these challenges, organic milk producers must now contend with the impact of a weaker U.S. economy on the demand for organic food products.
Most organic milk operations are small, with 45% milking fewer than 50 cows, and 87% fewer than 100, the study says. But the largest organic dairies, those with more than 200 cows, account for more than a third of organic milk production and are far more likely to generate returns above their capital and labor costs. That suggests that organic milk production will migrate toward larger operations, the authors say.
NOP, which develops, implements, and administers national production, handling and labeling organic standards, has proposed changes to clarify and stiffen pasture requirements for organic certification. These may determine how the organic production sector continues to evolve.
Catherine Merlo is Western editor for Dairy Today. You can reach her at cmerlo@farmjournal.com.
