The study also showed that shoppers at farm markets are willing to pay almost twice as much extra as retail grocery shoppers for the same locally produced foods. Both kinds of shoppers also will pay more for guaranteed fresh produce and tend to favor buying food produced by small farms over what they perceive as corporate operations, according to the study.
“Our conclusion is that if a farmer wants to consider producing food for local distribution and marketing it locally, there are people who are willing to pay more for it,” said Marvin Batte, a co-author of the study and the Fred N. VanBuren professor of agricultural, environmental and development economics at Ohio State University. “We are not saying that we should be producing all of our foods locally, just that this may be a viable, profitable activity for farmers.”
And what’s good for farmers also benefits consumers in this case, said Batte, director of the research project.
“This is an indication that certain groups out there value locally produced food and if farmers deliver that, it makes these consumers happier, so it’s good for them, too,” he said.
Most of the survey was conducted in late 2005. Batte said the findings – and his contention that not all food should be produced locally – still apply today, even in the face of rising fuel and food prices. Many food crops that thrive in specific types of climates cannot be efficiently and affordably produced for local distribution elsewhere. And, he said, those who buy local food to support nearby growers likely would be even more motivated to lend that support in a flagging economy.
The study is published in the May issue of the American Journal of Agricultural Economics.
The researchers surveyed shoppers at 17 Midwestern locations, including seven retail grocery stores, six on-site farm markets and four farmers’ markets hosting sellers from multiple farms. The researchers used data from 477 surveys.
The survey presented shoppers with two product options. Both were baskets of strawberries, but they were presented under 80 combinations of price, farm location and farm type. Some scenarios also included a freshness guarantee. After presenting the options, the researchers asked shoppers which basket of strawberries they would buy.
“Statistically, we sorted out what explains each person choosing one basket over the other. We were able to determine how important price was, how important where the strawberries were produced was and whether the freshness guarantee was a factor,” Batte said. “Basically what made the biggest difference was local production.”
In the study, local production meant the berries were grown within Ohio.
The average retail shopper was willing to pay 48 cents more for strawberries produced locally, and shoppers at farm markets were willing to pay 92 cents extra. With the base price for a quart of berries set at $3, farm market shoppers were willing to pay almost a third more for the local produce.
The freshness guarantee also held meaning for shoppers. If shoppers were promised fresh produce that was recently harvested, farm market shoppers were willing to pay 73 cents extra and retail shoppers indicated they would pay 54 cents more.
The researchers also tried to test shopper interest in supporting small vs. large farms by naming one fictional berry producer “Fred’s” and the other “Berries Inc.” Shoppers in grocery stores were willing to pay 17 cents extra for a quart of berries from Fred’s, and farm market shoppers were willing to pay 42 cents more for the perceived small-farm produce.
“We suspected people who go to farmers’ markets go there for a reason, because they are willing to pay more, hunt it down and travel there. But we also found that the typical shopper in a retail grocery store is willing to pay more, as well. And in fact, we’re seeing that grocery stores are figuring this out by prominently labeling locally produced food,” Batte said. “So we were trying to see if that group of people who shop at retail groceries are willing to pay X amount, and determine what that amount is.”
Though the study was conducted in Ohio, Batte said the findings could easily extend to the rest of the country. However, the definition of local would be likely to differ in California, a large state with multiple growing regions, and New England, where several small states are clustered closely together.
“The shoppers are expected to be there in each kind of shopping venue nationally, but ‘local’ would need to be defined more precisely for various regions,” Batte said.
Though not all farmers would be able to set up a niche operation to grow and sell their produce to nearby consumers, Batte said some smaller farm owners could consider adding hand-harvested local production with the expectation that they can charge a premium for that produce.
“Farmers could actually be a little less efficient on the production side and still be more profitable on the revenue side if they can capture that premium price,” he said.
This work was supported by the National Research Initiative of the U.S. Department of Agriculture, the Fred N. VanBuren Program in Farm Management at Ohio State, and the Ohio Agricultural Research and Development Center.
Co-authors of the study were graduate student Kim Darby, outreach program leader Stan Ernst and Professor Brian Roe of Ohio State’s Department of Agricultural, Environmental and Development Economics.
Marvin Batte | newswise
Win-win strategies for climate and food security
02.10.2017 | International Institute for Applied Systems Analysis (IIASA)
The personality factor: How to foster the sharing of research data
06.09.2017 | ZBW – Leibniz-Informationszentrum Wirtschaft
University of Maryland researchers contribute to historic detection of gravitational waves and light created by event
On August 17, 2017, at 12:41:04 UTC, scientists made the first direct observation of a merger between two neutron stars--the dense, collapsed cores that remain...
Seven new papers describe the first-ever detection of light from a gravitational wave source. The event, caused by two neutron stars colliding and merging together, was dubbed GW170817 because it sent ripples through space-time that reached Earth on 2017 August 17. Around the world, hundreds of excited astronomers mobilized quickly and were able to observe the event using numerous telescopes, providing a wealth of new data.
Previous detections of gravitational waves have all involved the merger of two black holes, a feat that won the 2017 Nobel Prize in Physics earlier this month....
Material defects in end products can quickly result in failures in many areas of industry, and have a massive impact on the safe use of their products. This is why, in the field of quality assurance, intelligent, nondestructive sensor systems play a key role. They allow testing components and parts in a rapid and cost-efficient manner without destroying the actual product or changing its surface. Experts from the Fraunhofer IZFP in Saarbrücken will be presenting two exhibits at the Blechexpo in Stuttgart from 7–10 November 2017 that allow fast, reliable, and automated characterization of materials and detection of defects (Hall 5, Booth 5306).
When quality testing uses time-consuming destructive test methods, it can result in enormous costs due to damaging or destroying the products. And given that...
Using a new cooling technique MPQ scientists succeed at observing collisions in a dense beam of cold and slow dipolar molecules.
How do chemical reactions proceed at extremely low temperatures? The answer requires the investigation of molecular samples that are cold, dense, and slow at...
Scientists from the Max Planck Institute of Quantum Optics, using high precision laser spectroscopy of atomic hydrogen, confirm the surprisingly small value of the proton radius determined from muonic hydrogen.
It was one of the breakthroughs of the year 2010: Laser spectroscopy of muonic hydrogen resulted in a value for the proton charge radius that was significantly...
17.10.2017 | Event News
10.10.2017 | Event News
10.10.2017 | Event News
17.10.2017 | Life Sciences
17.10.2017 | Life Sciences
17.10.2017 | Earth Sciences