Organic dairy production is a system of farm design and management practices for producing milk, yoghurt, cheese, cream and other dairy products without the use of pesticides, synthetic fertilisers or antibiotics.
Worldwide demand for organic dairy products is growing and environmental bodies are encouraging the transition from conventional dairy farming to organic dairy farming. And yet, sales of organic dairy products have stagnated or, in some cases, declined. This may be partly due to rising retail prices affecting all food and drink, considering that organic products are a premium consumer product. However, there are also challenges at the farmer and processor level to consider.
Challenges facing the industry
Organic milk production costs are increasing as organic feed becomes more expensive and difficult to source due global supply chain challenges. So farmers’ operational costs are being squeezed in an already low margin business. While in some countries Government subsidies have been introduced to ease the burden, in the US for example, many say this is not enough.
Milk cooperatives and processors who collect organic milk from farmers and transport it to production plants for processing into organic dairy products are also under cost pressures from increased energy, transport and labour prices. The complexities of organic milk processing compared to conventional milk processing magnify these pressures further.
Organic milk must be separated from conventional milk during transport and during manufacturing. The profile of organic milk supply pools typically involves the collection of smaller volumes of milk from larger numbers of supplier farms – i.e. more pickups, more time, more cost. Dairy processors are eager to continue to support organic farmers but decreasing margins resulting from these increased responsibilities make it more difficult.
How the right technology can help Organic Dairy Processing
Planning and scheduling farm pickups for conventional milk is already complex. When you add in a second (or third!) type of milk in the form of organic milk, which cannot be mixed with other milk types, things start to get tricky. A milk tanker may drive by five farms but is only permitted to pick up milk from three of those. Ensuring that these routes are planned in the most efficient manner is a highly complex process and one that requires the assistance of purpose built software algorithms to find the best solutions.
Milk assembly complexity also increases when dealing with larger numbers of suppliers with smaller volumes of milk, as opposed to fewer farms where some farm volumes are large enough to fill a full tanker. Smaller volumes mean that more suppliers are needed to fill each load. The assignment of suppliers to each load, and the order of collection becomes more important – and, if done incorrectly, very expensive!
OptaHaul’s next generation route optimisation software manages multiple milk types automatically, including Organic Milk, and supports clients with milk supplier pools ranging from 100 to 2,500+ on our ‘built-for-dairy’ transport optimisation platform.
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