The French market for organic dairy products is to show accelerated growth in coming years as dairies raise production levels.

According to the latest strategic research by Organic Monitor, French organic dairy revenues expanded by 35.7% in 2001. High growth was reported last year due to consumer demand for organic foods being elevated by the BSE crisis.

Strong growth is set to continue as more organic milk becomes available to French dairies that are increasing production volumes for the major retailers. Revenues are forecast to approach €400m (US$356.8m) in 2004, making it the third largest market in the EU.

Market growth has been constrained for a number of years by organic milk shortages. Over a third of the organic milk used by French dairies was imported in 2000 and although the portion of imports is declining, domestic volumes are not projected to meet market requirements until 2003.

The organic cheese market is expected to show the highest growth in the coming years. The segment is the second largest in the French organic dairy sector, accounting for over 20% of revenues in 2001. Most organic cheese production is on a small-scale by regional producers and insufficient volumes have prevented wider availability in the retailers. As more organic milk becomes available, production levels are to rise considerably to cater for the growing demand from the retail sector and the export market. The organic cheese market is projected to expand almost four-fold over the forecast period.

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The study found that the organic milk market is the most developed in the organic dairy sector. Organic milk was first introduced in the hypermarkets &  supermarkets in 1996 and is now available in most of the large retailers. Organic milk sales accounted for 3% of French milk sales in 2001 with Lactalis dominating the branded segment.

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