Organic fruits and vegetables are becoming more popular due to the perceived benefits to consumers’ health and its potential environmental benefits, such as soil health and quality. Market expansion, however, does not necessarily imply higher profits. Organic premiums, the additional amount over conventionally grown produce, have varied across products, attributes, and over time. This study analyses retail premium of organic over conventional production using USDA’s Agricultural Marketing Service (AMS) data on specialty crops. Four important crops with large markets are studied here, namely apples, cucumber, strawberries, and tomatoes. Price premiums statistically differ by variety, seasons, regions, and unit of sale (or package). Cucumbers, on average, fetch high premiums in the mainland, for example. The heteroskedastic-consistent regression estimates reveal conditional average differences by various aspects. Regional differences play a large role. For example, apples and tomatoes fetch the highest premium in the Southwest region. Seasonal influences were not the same across products. Apples had lower premiums off-season, whereas strawberries generally had higher premiums during off-season. There is some evidence of second degree price discrimination in apples and strawberries. The upshot is that, in any region, organic producers could earn larger premium by choosing the right variety in the right season sold in the right package.
| Published in | International Journal of Agricultural Economics (Volume 7, Issue 4) |
| DOI | 10.11648/j.ijae.20220704.14 |
| Page(s) | 175-185 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
| Copyright |
Copyright © The Author(s), 2022. Published by Science Publishing Group |
Organic Premiums, Organic Retail, Regional Economics, Sustainability, Fruits and Vegetables Prices, Organic Market
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APA Style
Jebaraj Asirvatham, Katie Bell. (2022). Organic Produce Retail Premiums Vary Across Regions and by Attributes. International Journal of Agricultural Economics, 7(4), 175-185. https://doi.org/10.11648/j.ijae.20220704.14
ACS Style
Jebaraj Asirvatham; Katie Bell. Organic Produce Retail Premiums Vary Across Regions and by Attributes. Int. J. Agric. Econ. 2022, 7(4), 175-185. doi: 10.11648/j.ijae.20220704.14
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Download@article{10.11648/j.ijae.20220704.14,
author = {Jebaraj Asirvatham and Katie Bell},
title = {Organic Produce Retail Premiums Vary Across Regions and by Attributes},
journal = {International Journal of Agricultural Economics},
volume = {7},
number = {4},
pages = {175-185},
doi = {10.11648/j.ijae.20220704.14},
url = {https://doi.org/10.11648/j.ijae.20220704.14},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijae.20220704.14},
abstract = {Organic fruits and vegetables are becoming more popular due to the perceived benefits to consumers’ health and its potential environmental benefits, such as soil health and quality. Market expansion, however, does not necessarily imply higher profits. Organic premiums, the additional amount over conventionally grown produce, have varied across products, attributes, and over time. This study analyses retail premium of organic over conventional production using USDA’s Agricultural Marketing Service (AMS) data on specialty crops. Four important crops with large markets are studied here, namely apples, cucumber, strawberries, and tomatoes. Price premiums statistically differ by variety, seasons, regions, and unit of sale (or package). Cucumbers, on average, fetch high premiums in the mainland, for example. The heteroskedastic-consistent regression estimates reveal conditional average differences by various aspects. Regional differences play a large role. For example, apples and tomatoes fetch the highest premium in the Southwest region. Seasonal influences were not the same across products. Apples had lower premiums off-season, whereas strawberries generally had higher premiums during off-season. There is some evidence of second degree price discrimination in apples and strawberries. The upshot is that, in any region, organic producers could earn larger premium by choosing the right variety in the right season sold in the right package.},
year = {2022}
}
TY - JOUR T1 - Organic Produce Retail Premiums Vary Across Regions and by Attributes AU - Jebaraj Asirvatham AU - Katie Bell Y1 - 2022/07/29 PY - 2022 N1 - https://doi.org/10.11648/j.ijae.20220704.14 DO - 10.11648/j.ijae.20220704.14 T2 - International Journal of Agricultural Economics JF - International Journal of Agricultural Economics JO - International Journal of Agricultural Economics SP - 175 EP - 185 PB - Science Publishing Group SN - 2575-3843 UR - https://doi.org/10.11648/j.ijae.20220704.14 AB - Organic fruits and vegetables are becoming more popular due to the perceived benefits to consumers’ health and its potential environmental benefits, such as soil health and quality. Market expansion, however, does not necessarily imply higher profits. Organic premiums, the additional amount over conventionally grown produce, have varied across products, attributes, and over time. This study analyses retail premium of organic over conventional production using USDA’s Agricultural Marketing Service (AMS) data on specialty crops. Four important crops with large markets are studied here, namely apples, cucumber, strawberries, and tomatoes. Price premiums statistically differ by variety, seasons, regions, and unit of sale (or package). Cucumbers, on average, fetch high premiums in the mainland, for example. The heteroskedastic-consistent regression estimates reveal conditional average differences by various aspects. Regional differences play a large role. For example, apples and tomatoes fetch the highest premium in the Southwest region. Seasonal influences were not the same across products. Apples had lower premiums off-season, whereas strawberries generally had higher premiums during off-season. There is some evidence of second degree price discrimination in apples and strawberries. The upshot is that, in any region, organic producers could earn larger premium by choosing the right variety in the right season sold in the right package. VL - 7 IS - 4 ER -
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