Darigold makes a splash in organic milk market

Published 10:00 am Wednesday, November 4, 2020

SEATTLE — Darigold, the marketing and processing arm of Seattle-based Northwest Dairy Association, just debuted two organic milk products this fall: Darigold FIT Organic Milk and Darigold Northwest Organic Milk.

The co-op’s move is significant to its farm members, many of whom were already producing some organic milk and can now sell it through Darigold rather than only through outside co-pack partners. The brand’s leap into the organic market also fits a larger trend as consumer interest in organic food and beverages reaches a record high this year.

“It’s part of our overall strategy to serve our customers and farmer-members well,” Duane Naluai, president of consumer products at Darigold, told the Capital Press.

Naluai said the organic venture will initially focus on serving the needs of the co-op’s already-existing organic farm base, but if consumer interest in the product line grows big enough, he said, the company may welcome more organic dairy farms into the cooperative.

“Certainly if we continue to grow our presence and these subcategories, we’ll continue to grow our co-op’s membership if required. But our commitment first is to the farm members we already have,” he said.

The co-op has nearly 400 farm owner-members in Washington, Oregon, Idaho and Montana. For its new organic product lineup, Darigold is adding organic segregation and processing capabilities to its plants.

Erin Byrne, company spokeswoman, declined to comment yet on the amount of money Darigold is investing in organic processing infrastructure and marketing but said she will reveal more details in coming months.

Earlier this year, as reported by the Capital Press, the company invested $67 million to expand its Boise plant in a separate but related effort to expand Darigold’s product offerings.

Darigold is starting to sell its two new fluid milk products, Darigold Northwest Organic Milk and Darigold FIT Organic Milk, at Costco stores in the Northwest this fall. The company started selling the former, available in whole, 2%, 1% and skim milk varieties, Sept. 1 and the latter Oct. 24.

Retail data show Costco has a higher percentage of shoppers who purchase organic products than the average grocery store, so Naluai said it was a logical place to launch Darigold’s organic milks.

Although Darigold’s leadership team declined to reveal how the products are performing because of a confidentiality agreement with Costco, Naluai did say consumer interest in organics is growing and the products are “consistently exceeding by double digits all their volume forecasts.”

Each year, Darigold handles about 10 billion pounds of milk from its member farms: enough to give every person in the U.S. about 3.5 gallons of milk. But the brand is focused on serving regional customers. Naluai said the target consumer audience for the new products are consumers looking for food that is both organic and regionally sourced — a point of intersection that Naluai calls the “sweet spot.”

Naluai told the Capital Press that starting in January the brand plans to expand to other retailers.

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