High prices -- and controversies over what exactly qualifies as ''organic'' food -- are hallmarks of a market that has grown almost fourfold since 2002, to $29.2 billion in sales in 2011. As consumers embrace organic items, food researchers and organic activists say that a niche sector once dedicated to food purity has been taken over by large corporate interests who are steamrolling a lax regulatory system into approving synthetic additives that dilute the brand.
''There were and are powerful political pressures to weaken the standards, so as many people as possible could qualify as organic,'' says Marion Nestle, a nutritionist at New York University who has studied the growth of the organic industry.
The DHA in Horizon milk is a non-organic oil derived from algae manufactured for the company. On cartons, the milk is described as an ''excellent source of hard-to-get plant-based DHA,'' along with the boast that it has a ''great taste'' with ''no fish oils.''
Brain Claims
The disputed brain health claims about DHA give Dean a marketing edge for an organic product that already sells at a premium in retail outlets such as Whole Foods Market Inc. and Trader Joe's Co. A half-gallon carton of organic milk had an average advertised price of $3.93, compared with $1.97 for non- organic milk, according to U.S. Department of Agriculture data for the first two weeks of July.
DHA usually adds between 30 cents to 80 cents to the half- gallon price, according to a survey by the USDA's National Organic Program, which is charged with ensuring the integrity of organic products.
The Horizon brand accounts for about 40 percent of the organic milk market, according to Amit Sharma, an analyst who covers Dean for BMO Capital Markets in New York.
Organic milk and cream sales in the U.S. totaled $2.41 billion in 2011, up 12.9 percent from the previous year, according to the Brattleboro, Vermont-based Organic Trade Association, the main organic producers' trade group.
Dean shares fell 17 cents to close at $12.04 on July 25.
Consumers are willing to pay a premium for organic milk, based largely on health claims.