Keijiro Otsuka and Kaliappa Kalirajan (Eds). Agriculture in developing countries: technology issues. New Delhi: Sage publications, 2008, 166 pp., ISBN: 9780761936626, $39.95.

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An Analysis of Organic Fresh Produce Choice: A Consumer Preference Study in the Mid-Atlantic USA

Global sales of organic food and drink reached $80 billion in 2014, a more than four-fold market expansion since 2000 ($18 billion in organic sales). Demand for organic products is concentrated in North America and Europe, which create 96% of global revenues. Organic production expanded during the 1980s, with different certifiers developing their own standards and certification processes. Since that time, the industry has grown from experimental garden plots to large farms with surplus products sold under a special organic label. In the United States, sales of organic products topped $35 billion (USD) in 2013 (an increase of 11.5% from 2012) and grew by more than 11% in 2015. Market development in this area could enhance both the net profits and the sustainability of small farms by serving the organic niche market. This study profiles a typical organic consumer in the mid-Atlantic United States. An online survey was conducted to capture organic consumers’ interests in and expectations of organic fruits and vegetables. Data were collected through an online survey of 1,100 participants who were pre-screened and whose identities were checked from a selection of 5,191 candidates provided by a private online survey company. We developed a multinomial logit model to predict organic consumers’ choice of fresh fruits and vegetables. The seven most important fruits and vegetables were identified for this study, the rest were included in the “other” category. The choice of “other” fruits and vegetables has been left out of the regression as the base case. Results show that consumers who think that organic food tastes better and consumers who are college graduates are more likely to choose bananas compared to other fruits and vegetables. Respondents who are concerned about freshness, provide support to local farmers, have a two-year college degree, and are Caucasian are more likely to choose carrots. Those who provide support to local farmers and who have an education above high school are more likely to choose lettuce. Respondents with a two-year college degree are more likely to choose strawberries, while those who prefer organic wine are more likely to choose apples. Caucasians are more likely to choose tomatoes but less likely to choose spinach. Those living in urban areas are less likely to choose spinach. Producers of organic fruits and vegetables can target customers for sales based on their demographics and their preferences

Willingness to Pay a High-Premium for Organic Produce: An Econometric Analysis

U.S. consumer demand for organically produced goods has grown continuously since the USDA established national standards for organic production and processing in 2002 (www.USDA.gov). Organic food sales have increased from approximately $11 billion in 2004 to an estimated$35.9 billion in 2015. As previous literature suggests, a large portion of consumers view organics favorably, but very few routinely choose to buy organic food over conventional food. It is assumed that this is due to—among other things— socioeconomic disparities. The objective of this paper is to predict the characteristics of consumers who are willing to pay high premiums for organic produce in the mid-Atlantic United States. In the context of this paper, a high premium is defined as at least 16% more for organic fruits and vegetables compared to conventional produce. Data were collected from 1,100 consumers using a private online survey company. A logit model was developed to predict which consumers are more likely to pay a high premium for organic produce. Results indicate that the overall model is highly significant, with a correct prediction rate of 71%. Those who have a graduate degree and an annual income above $100,000 are more likely to pay high premiums. Moreover, those who use food advertisements, certified organic labels, and natural labels to purchase produce are more likely to pay high premiums. Caucasians are more likely to pay high premiums, as are those who frequently buy at farm direct markets. As expected, consumers who think that organic food tastes better than conventional food and those who switch supermarkets to buy organic produce are more likely to pay high premiums. Those who want to buy organic jam, jelly, marmalade, juices, sauces, and dried chips are more likely to pay a high premium for organic produce. Those who regularly shop at more than one food store are less likely to pay a high premium. The model indicates that those who are influenced by the naturally grown label and prefer conventionally grown but local produce are less likely to pay high premiums. Those who consider buying organic food to be a waste of money are less likely to pay a high premium for organic fresh fruits and vegetables. Producers of organic vegetables and fruits can target customers with these specific traits to enhance their profitability

Characteristics of Consumers Who Are Willing to Buy Certified Organic Produce: An Econometric Analysis

The profitability of farms in the northeastern U.S. is hampered by the high cost of production in the region. Production of high-value crops such as organic produce is one of the solutions to keep these farms viable in the region. However, production challenges and limited information related to marketing are likely to hamper the potential growth of organic agriculture in the northeastern U. S. A logit model was developed to predict who is more likely to buy certified organic produce using 1,100 respondents in the Mid-Atlantic region. About 87% of the consumers were willing to buy certified organic produce, and the remaining 13% were not. While 6% of respondents stated that they would not pay slightly more for organic produce, nearly 43 % of the respondents stated that they would pay more than 10 cents premium for a dollar’s worth of organic produce. The results indicate that those who have a graduate degree, those who are influenced by an eco-friendly label, country of origin label, or pesticide-free label are more likely to purchase certified organic produce. Producers and marketers of certified organic vegetables and fruits can target customers with these specific traits to enhance their sales and profitabilit