Even the Hipster Organic Milk Craze Isn't Enough to End Glut

It wasn’t that long ago that U.S. dairy farmers couldn’t keep up with the booming demand for organic milk. While everyone from hipsters to housewives is drinking more of the stuff than ever -- and paying twice as much as conventional milk -- the days of shortages are long gone. Production has surged so fast in the past two years that some of the surplus is being sold at a lower price without an organic label. A few dairies are just dumping what they can’t sell. The wave of new supplies reflect an expansion of cow herds by farmers seeking the hefty premiums and growing market share for organic products at a time when most Americans are drinking less milk. The organic surplus may reach 50 million gallons this year, according to Richard Mathews, executive director of the Western Organic Dairy Producers Alliance. In January, the USDA reported a “backlog” of new organic producers trying to secure processing contracts. Some farmers also are now subject to quotas, receiving a conventional price for any excess over a specified volume, the agency said in a March 10 report.