Raw Materials and Processing Effects on Chinese Organic Fertilizer Prices

This study investigates the impact of raw material sources and processing methods on the pricing of organic fertilizers in China’s market. Using sales data from Cnhnb.com, a leading agricultural input sales platform for ordinary farmers, and JD.com, a major retail platform for gardening enthusiasts, we employ text analysis methods and a probability-weighted hedonic pricing model to estimate price premiums and discounts, which can be interpreted as marginal value of characteristics or consumer preferences in a highly competitive multi-brand organic fertilizer market. Our results indicate significant price discounts for organic fertilizers derived from high-risk raw materials like manure and kitchen waste compared to products with unspecified sources, while fertilizers made from plant, animal (e.g., processed animal products, bone meal, etc.), and humic acid sources command price premiums. We also find that convenience-enhancing processing methods, such as pelletization and water-soluble concentration, and nutrient adjustments tailored for specific crops are effective in improving consumer preferences and increasing price premiums for organic fertilizers. These findings offer valuable insights for policymakers and industry stakeholders to expand market demand for organic fertilizers, promote their substitution for synthetic fertilizers, and foster the sustainable development of China’s organic fertilizer industry in the context of green agricultural transition.