Organic Dairy Market By Type of Product (Organic Milk, Yogurt Subtypes, Organic Cheese, Organic Butter, Organic Cream and Creamers, Additional Dairy Alternatives), Distribution Channel (Supermarkets and Hypermarkets, Specialty Stores, Online Retail, Farmers’ Market, Food Service and Institutional Buyers), Customer Demographics (Health-Conscious Consumers, Environmental Advocates, Ethical Consumers, Millennials and Generation Seniors) & Region for 2024-2031

Organic Dairy Market Valuation – 2024-2031

Rising consumer awareness of health and wellbeing, with a demand for natural and chemical-free products. Concerns about the environmental impact of conventional farming have also increased demand for organic dairy, which is considered as more sustainable is fuelling the USD 25.57 Billion in 2024 and reaching USD 40.56 Billion by 2031.

Furthermore, rising disposable incomes, particularly in emerging nations, allow customers to choose premium organic products. Government programs and certifications that promote organic farming techniques help to expand the market, making organic dairy more accessible and trusted around the world is grow at a CAGR of about 6.55% from 2024 to 2031.

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Organic Dairy Market: Definition/ Overview

Organic dairy refers to dairy products made from livestock raised in accordance with organic farming standards, which include the absence of synthetic chemicals, pesticides, antibiotics, and growth hormones, as well as the use of organic feed. Organic dairy farming also prioritizes animal welfare and sustainable environmental methods. Organic dairy is used to produce milk, yogurt, cheese, butter, and cream without harmful ingredients, which appeals to health-conscious consumers and those with dietary restrictions. The future of organic dairy seems positive, thanks to increased customer demand for healthier, more sustainably produced products. Increased awareness of organic products’ environmental and health benefits, as well as the expansion of distribution channels such as e-commerce, are expected to drive additional market growth.

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Will Growing Demand of Natural and Chemical-Free Products Propel the Organic Dairy Market?

The increasing demand for natural and chemical-free products is boosting the organic dairy industry as customers become more health-conscious. In April 2024, According to a survey done by Euromonitor International, around 72% of customers in North America and Europe choose products devoid of artificial additives and pesticides. This shift in consumer behavior is driving up demand for organic dairy products, which are viewed as healthier options. Furthermore, the organic dairy segment is projected to grow at a CAGR of 10% between 2024 and 2030, reflecting this rising preference.

In January 2024, Danone said that it would increase organic dairy production, with intentions to convert numerous conventional farms to organic standards by 2025. Furthermore, in March 2024, the US Department of Agriculture (USDA) initiated a program to promote organic farming practices, including financial incentives for farmers that switch to organic methods. This government support is in line with customer demand for chemical-free goods, which is boosting the organic dairy market’s growth.

Will High Cost of Organic Farming Practices Hinder the Growth of the Organic Dairy Market?

The high expense of organic farming procedures significantly limits the growth of the organic dairy business. Organic dairy farming necessitates careful adherence to standards such as pesticide-free feed, humane animal treatment, and sustainable land management practices. In comparison to traditional dairy farming, these technologies frequently result in lower milk outputs as well as higher labor and operational costs. As a result, organic dairy products are more expensive, potentially limiting their appeal to price-sensitive customers and slowing market expansion, particularly in places with lower consumer buying power.

Furthermore, organic producers incur greater initial investment costs for obtaining organic certification, which is a time-consuming and costly process. The greater cost burden is passed on to customers, resulting in a demand gap between organic and conventional dairy products. Despite increased interest in sustainability and health advantages, price disparities may deter some consumers from moving to organic products. Without scalable cost-reduction strategies or greater subsidies from governments, the organic dairy market may struggle to achieve widespread affordability and growth.

Category-Wise Acumens

Will Rising Demand of Canned Organic Milk Propel the Organic Dairy Market?

As consumers are demanding for convenient, long-lasting, and healthier alternatives, the sales of canned organic milk is projected to rise. Thus, an upsurge  in the demand for canned products is enabling the segment hold major sales in the market. Canned organic milk has a longer shelf life and does not require refrigeration, making it a convenient option for health-conscious consumers. In recent years, companies like Horizon Organic have expanded their canned milk product lines to meet this demand, leveraging its appeal in both urban and rural markets. For instance, in March 2023, Horizon Organic launched a new line of canned organic milk targeting eco-conscious consumers, further driving market growth.

Furthermore, government assistance for organic agriculture in key regions is driving the market. In June 2023, the USDA announced additional programs to encourage organic farming methods, particularly dairy. These policies aim to increase the availability of organic products while also reducing the dairy sector’s carbon footprint. This regulatory support, combined with consumer demand, is likely to continue propelling the market for canned organic milk in the coming years.

Organic yogurt is the fastest-growing area of the organic dairy business, particularly in subtypes such as Greek yogurt and plant-based alternatives. The growing interest in gut health and probiotics, together with increased demand for nutritious snacks, has resulted in considerable development in this sector. Additionally, the shift toward healthier eating habits has bolstered the popularity of organic yogurt, making it a key growth driver in the market.

Will Rising Sales through Supermarkets and Hypermarkets Fuel the Organic Dairy Market?

Rising sales through supermarkets and hypermarkets are likely to propel its leadership in the organic dairy industry, as these outlets provide consumers with broad product visibility and convenient shopping. Organic dairy products are frequently distributed through supermarkets, which sell a wide range of things such as organic milk, yogurt, and cheese. For instance, in April 2023, Whole Foods Market expanded its organic dairy section, catering to the increasing consumer demand for healthier and more sustainable food options. This expansion has increased sales of organic dairy products by making them more accessible to average consumers.

Furthermore, governments have been supportive of organic food availability through major retail stores. In July 2023, The European Union pledged financing to promote organic products in supermarkets as part of its Green Deal plan to improve sustainable agriculture and food consumption. The program attempts to increase the availability and affordability of organic dairy products by partnering with major stores. These initiatives, together with the convenience of purchasing through large-scale retail chains, are projected to stimulate further expansion in the organic dairy sector.

Online shopping is the fastest expanding distribution channel. Consumers are purchasing more organic dairy products through online platforms as e-commerce and home delivery services become more popular, particularly during the COVID-19 epidemic. This trend is being driven by the convenience of ordering from home, increased product availability, and the expansion of subscription-based services.

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Country/Region-wise

Will Growing Organic Dairy Consumption in Europe Drive the Organic Dairy Market?

The increasing consumption of organic dairy products in Europe is considerably boosting the organic dairy industry, owing to rising health awareness and customer preferences for sustainable food options. In March 2024, According to a European Commission report issued, organic milk consumption in Europe increased by 12% in 2023, indicating a growing trend toward organic diets. Furthermore, the European Union (EU) has enacted measures to promote organic farming, with the goal of increasing the proportion of organic agricultural land to 25% by 2030. This initiative is expected to bolster the supply of organic dairy products, further satisfying consumer demand.

In April 2024, Mincho, a German dairy producer, announced intentions to increase its organic milk production capacity by 20% in order to satisfy rising retail demand. Furthermore, in February 2024, the French government granted €50 million to support organic dairy farmers, with the goal of improving the quality and availability of organic dairy products on the market. Such steps not only improve production capacity, but also demonstrate strong government backing for the organic dairy sector, implying that rising organic dairy consumption in Europe will most likely continue to drive market expansion.

Will Rising Disposable Incomes in Asia Pacific Propel the Organic Dairy Market?

Rising disposable incomes in the Asia Pacific area are expected to drive the organic dairy industry as consumers seek more premium food goods, including organic dairy alternatives. In January 2024According to an Asian Development Bank (ADB) report released, the region’s average disposable income has increased by about 8% each year over the last five years. This financial boost enables customers to spend more on high-quality food, resulting in a significant increase in demand for organic dairy products. The trend mirrors a broader shift toward health and wellness, with consumers valuing nutritional and ecologically friendly solutions.

In March 2024 Nestlé announced plans to create a new line of organic dairy products geared to Asian preferences, with a focus on India and China. In February 2024, the Indian government also announced a program to assist organic farming, providing USD 100 Million to promote organic dairy production among local farmers. This government support, together with increased disposable incomes, is likely to boost the organic dairy market’s growth trajectory in Asia Pacific.

Competitive Landscape

The competitive landscape of the organic dairy market is characterized by a diverse mix of regional and international players striving to meet the growing demand for organic dairy products. Smaller, regional producers often compete by offering locally sourced, niche products that appeal to consumers focused on sustainability and farm-to-table movements. Additionally, the market sees rising competition from private-label brands in supermarkets, which provide organic dairy at competitive prices. Strategic partnerships, new product launches, and innovation in organic dairy alternatives, such as plant-based blends, are driving competition, with a focus on sustainability and transparency to attract eco-conscious consumers.

Some of the prominent players operating in the organic dairy market include:

• Danone S.A.
• Orgain, Inc.
• The Hain Celestial Group, Inc.
• Stonyfield Farm, Inc.
• Organic Valley
• Horizon Organic
• White Wave Foods Company
• Yili Group
• FrieslandCampina
• Amul

Latest Developments

• In November 2023, the USDA announced a new grant program aimed at supporting organic dairy farms in transitioning from conventional practices. The program provides financial assistance for farmers looking to meet organic certification standards. This initiative is expected to boost the supply of organic dairy products in the market.
• In October 2023, Lactalis Group announced plans to invest $30 million in growing its organic dairy product line. The money will go toward producing new organic yogurt and cheese products. The company hopes to capitalize on the growing customer preference for healthier and organic eating options.

Report Scope

Organic Dairy Market, By Category

Type of Product:

• Organic Milk
• Yogurt Subtypes
• Organic Cheese
• Organic Butter
• Organic Cream and Creamers
• Additional Dairy Alternatives

Distribution Channel:

• Supermarkets and Hypermarkets
• Specialty Stores
• Online Retail
• Farmers’ Market
• Food Service and Institutional Buyers

Customer Demographics:

• Health-Conscious Consumers
• Environmental Advocates
• Ethical Consumers
• Millennials and Generation Z
• Seniors

Region:

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East & Africa

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