Willingness-to-pay for Local Milk-based Dairy Product in Senegal

Abstract

This paper aims to evaluate Senegalese consumers' willingness-to-pay (WTP) for local fresh milk-based products, in opposition to the ones produced with imported powder. Using data from a choice-based-conjoint analysis conducted on 400 households in the re- gion of Dakar, we evaluate the premium that consumers are willing to pay for fresh raw material (rather than powder) in the composition of sour milk. Based on an Ordered Probit Model, the results show evidence for a positive WTP for fresh raw material, which may be seen as a strong indication of preference for local products. This WTP greatly depends on the characteristics of the households. Wealthier house- holds are willing to pay more than the medium households, while big households are ready to pay much less than the base category ones. Obviously, some niche markets exist, that producers may target to sell the local milk-based dairy products. However, more infor- mation has to be provided about the composition of dairy products, as consumers are not currently able to distinguish both types of raw material, even if they are willing to pay more for one of them.