The Milk Industry

Paper Summary:

This paper focuses on the milk industry and how its prices have fluctuated. The paper studies the last ten years and reports that the prices have erratically soared and plummeted showing just a slight upward trend. The paper looks at the increasing demand for organic milk and discusses how the market is unpredictable and might have something in store for careless producers. The paper concludes that although a time of great opportunity is arising, milk companies should act with prudence in order to avoid any negative aftermath.

From the Paper:

"At present, the milk industry has to face three major issues: lack of variety, out-of-stock problems, and limited promotion of milk. These factors have a negative effect on demand, as convenience stores do not refill their shelves quickly enough, while 40% of the customers leave empty-handed if they do not find their choice of milk available. Moreover, convenience stores are lacking in variety, whereas merchandising and marketing milk are badly exploited. However, studies have shown that drug stores are increasingly preferred to convenient stores by milk purchasers as mothers with families. Drug sales represent 1.6% of total milk sales and even though they are not the main distribution channel, they still add up to 100 million gallon of milk per year."

Sample of Sources Used:

• Ramnarace, Cynthia. Organic Milk: Demand Skyrockets. Natural Food Network. On the Internet at www.naturalfoodnet.com/nfnportal/article.aspx?aid=361
• Demand for Organic Milk Exceeds the Supply. Bangor Daily News (Maine). July 23, 2005. On the Internet at www.organicconsumers.org/organic/milk072605.cfm
• OHIO DEPARTMENT OF AGRICULTURE, LICENSING REQUIREMENTS: DAIRY DIVISION. On the Internet at www.ohioagriculture.gov/pubs/divs/dary/dary-licensing.stm
• Demand for Organic Dairy Products in USA Exceeds Supply--New Farmers Needed. Cheese Market News May 20, 2005. On the Internet at www.organicconsumers.org/organic/cheese052705.cfm

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