Even though organic milk costs more than “regular” milk, its sales are growing briskly as health-conscious Americans aim to avoid the hormones and antibiotics that find their way into this dairy staple. The trouble is that the organic grain and hay used to feed most cows is rising in price. (Grass-feeding is cheaper and produces healthier milk, but that segment of production is still tiny.)
That means farmers must either pass on those costs to consumers or feed their cows less grain — and get lower milk output as a result. Either way, there are pressures driving up the price of organic milk right now. A half-gallon of organic milk typically sells for $3.99, but that could jump to $4.39 or higher in 2012 — a 10% increase.