August 7th, 2007, filed by Sarah Coffey
Got organic milk?
An oversupply of fancy organic milk means it’s being priced less than the regular stuff in some parts of the country.
Companies such as Dean Foods, the largest U.S. dairy processor and distributor, are being forced to lower prices on organic milk brands.
A regulatory change and favorable prices led more farmers to produce the organic milk and caused an industry-wide oversupply.
“There are some parts of the country right now where there is deep discounting of organic milk, where the price of organic milk may indeed by lower than the price of branded conventional milk,” Chief Financial Officer Jack Callahan said during a conference call.
Organic milk is typically more expensive for consumers, but the glut in the market has forced retailers to not only lower prices but expand marketing and distribution, thus increasing costs, to unload the oversupply.
At the same time, rising regular milk prices are putting a pinch on Dean’s earnings.
“It’s sort of a unique confluence of two different issues happening at the same time with commodity prices rising to all-time highs and this glut of organic milk,” Callahan said.
Copyright Reuters. This entry was posted
on Tuesday, August 7th, 2007 at 5:26 pm and is filed under Reuters Shop Talk.
You can follow any responses to this entry through the RSS 2.0 feed.
You can leave a response, or trackback from your own site.
We are having some issues with spam. If your comment does not get moderated it might be that it was stopped by our spam filters. Try to avoid using words like "ringtone", "viagra", "blackjack" and others that fit this pattern - i.e. common spam. Sorry for this crude censorship, but there is little we can do.
When you submit a comment to us we request your name, e-mail address and optionally a link to a website. Please note where you submit a website address, we may link to it via your name. By sending us a comment, you accept that we have the right to show the comment and your name to users. Although we require your email address, this will not be published on the site, and is only required to enable us to check facts with you, e.g. if you are making a claim we can not confirm easily. Additionally, if you would like your comment removed at anytime, you'll have to use this e-mail address when you contact us. To remove a comment at any time please e-mail us at blogs-(at)-reuters-(dot)-com (address obscured to avoid spam) specifying who you are and what you would like removed. We moderate all comments and will publish everything that advances the post directly or with relevant tangential information. We reserve the right to edit comments in order to maintain the quality of the comments, and may not include links to irrelevant material. We try not to publish comments that we think are offensive or appear to pass you off as another person, and we will be conservative if comments may be considered libelous. Reuters will use your data in accordance with
Reuters privacy policy. Reuters Limited is primarily responsible for managing your data. As Reuters is a global company your data will be transferred and available internationally, including in countries which do not have privacy laws but Reuters seeks to comply with its privacy policy.
