Concerns about the impact of modern agriculture on the environment have led to public support for the development of organic farming during the last 10-15 years. Besides generating environmental benefits and supplying food, organic farming is supposed to be “multifunctional”, such as providing rural amenities and promoting rural development. In Denmark, conversion into organic production has increased rapidly through the 1990s. Nevertheless, despite increased consumption of organic products in Denmark (in fact, Denmark has the highest organic share in consumption), drastic increases in organic production has led to surplus supply of organic products, especially milk. In this paper we use a dynamic general equilibrium model specifically developed for forecasting the Danish economy towards 2022 to explore the future development of the organic production in Denmark. Several policy scenarios aiming at benefiting organic production are analysed and the strength and weakness of these policy scenarios are discussed.