Organic milk has gone from a very niche product to having a much wider demand, and since the recession, the market has been back in growth, according to Richard Hampton, managing director of OMSco, which holds a 60 per cent market share of the UK organic liquid milk market.
Also speaking during the session was Graham Wilkinson, senior director of member relations at Arla, who added: “51.7 per cent of the population bought an organic dairy product last year. In the UK, 6 per cent of milk sold is organic, whereas in Denmark it is 30 per cent.”
Mr Wilkinson explained Arla wanted to double its organic business by 2020 and aimed to focus on marketing to ‘foodies’ to achieve this.
He said: “We want to make it less niche and more accessible, but currently organic is viewed as too expensive and people do not necessarily believe the messages which are put out about organic.
“As an industry, we want to improve the messages to these consumers.”
Mr Hampton said dairy is the number one organic category and primary ingredients such as meat, fruit and vegetables see the biggest demand for organic demand.
With an OMSCo premium sat at 12-13ppl for liquid, Mr Hampton said: “It is not all about the premium. There is long-term market growth. Organic has become more sustainable in terms of pricing overtime as markets have diversified.”
He added as the dairy base became more intensive, the premium would have to grow for organic to be sustainable.
Mr Hampton said: “The market is nicely balanced with extra milk if needed. There is no additional need for organic milk in the UK at this point. We have 12 per cent more milk than two years ago.”
The area of organic certified arable ground has been a real problem in the UK, with organic cereal availability being a limiting factor of organic milk production.
Mr Hampton said: “Conversion to organic is more attractive on the continent, with grants for conversion available, but I believe the market should pay for the conversion.
“Organic is a global trend set to continue in the current context.”