IDEAS home Printed from https://ideas.repec.org/p/ags/uersrr/242448.html
   My bibliography  Save this paper

Changes in Retail Organic Price Premiums from 2004 to 2010

Author

Listed:
  • Carlson, Andrea
  • Jaenicke, Edward

Abstract

Organic foods are one of the most rapidly growing sectors of the retail food market. This study applies a hedonic model to 2004-10 Nielsen Homescan data to estimate the organic price premiums for 17 products. Eggs and dairy products generally have the highest premiums, while fresh produce has the widest spread of premiums (ranging from 7 percent of the nonorganic price for spinach to 60 percent for salad mix). Processed food premiums range from 22 percent for granola to 54 percent for canned beans. The strong organic premiums, combined with increased sales, suggest that there is continued room for growth in the organic supply.

Suggested Citation

  • Carlson, Andrea & Jaenicke, Edward, 2016. "Changes in Retail Organic Price Premiums from 2004 to 2010," Economic Research Report 242448, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersrr:242448
    DOI: 10.22004/ag.econ.242448
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/242448/files/ERR209.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.242448?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. King, Robert P. & Hand, Michael S. & DiGiacomo, Gigi & Clancy, Kate & Gomez, Miguel I. & Hardesty, Shermain D. & Lev, Larry & McLaughlin, Edward W., 2010. "Comparing the Structure, Size, and Performance of Local and Mainstream Food Supply Chains," Economic Research Report 246989, United States Department of Agriculture, Economic Research Service.
    2. Greene, Catherine & McBride, William D., 2015. "Consumer Demand for Organiz Milk Continues to Expand-Can the U.S. Dairy Sector Catch Up?," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 30(01), pages 1-6.
    3. He, Na & Bernard, John C., 2011. "Differences in WTP and Consumer Demand for Organic and Non-GM Fresh and Processed Foods," Agricultural and Resource Economics Review, Cambridge University Press, vol. 40(2), pages 218-232, September.
    4. Kiesel Kristin & Villas-Boas Sofia B, 2007. "Got Organic Milk? Consumer Valuations of Milk Labels after the Implementation of the USDA Organic Seal," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 5(1), pages 1-40, April.
    5. Greene, Catherine, 2014. "Support for the Organic Sector Expands in the 2014 Farm Act," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, issue 06, pages 1-1, July.
    6. Waseem Ahmad & Sven Anders, 2012. "The Value of Brand and Convenience Attributes in Highly Processed Food Products," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 60(1), pages 113-133, March.
    7. Smith, Travis A. & Lin, Biing-Hwan & Huang, Chung L., 2008. "Organic Premiums of U.S. Fresh Produce," 2008 Conference, April 21-22, 2008, St. Louis, Missouri 37626, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    8. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    9. Zhang, Feng & Epperson, James E. & Huang, Chung L. & Houston, Jack E., 2009. "Organic Price Premiums Paid for Fresh Tomatoes and Apples by U.S. Households: Evidence from Nielsen Homescan Data," Journal of Food Distribution Research, Food Distribution Research Society, vol. 40(3), pages 1-10, November.
    10. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    11. Greene, Catherine, 2013. "Growth Patterns in the U.S. Organic Industry," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, issue 09, pages 1-1, October.
    12. Judith A. Chevalier & Anil K. Kashyap & Peter E. Rossi, 2003. "Why Don't Prices Rise During Periods of Peak Demand? Evidence from Scanner Data," American Economic Review, American Economic Association, vol. 93(1), pages 15-37, March.
    13. Stevens-Garmon, John & Huang, Chung L. & Lin, Biing-Hwan, 2007. "Organic Demand: A Profile of Consumers in the Fresh Produce Market," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 22(2), pages 1-8.
    14. Schroeter, Christiane & Cai, Xiaowei, 2011. "It’s All About Produce: Flexing the Muscles of Western U.S. Organic Spinach Consumption," Western Economics Forum, Western Agricultural Economics Association, vol. 10(2), pages 1-13.
    15. George W. Ladd & Veraphol Suvannunt, 1976. "A Model of Consumer Goods Characteristics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(3), pages 504-510.
    16. Chang, Jae Bong & Lusk, Jayson L. & Norwood, F. Bailey, 2010. "The Price of Happy Hens: A Hedonic Analysis of Retail Egg Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 35(3), pages 1-18, December.
    17. A. Colin Cameron & Pravin K. Trivedi, 2010. "Microeconometrics Using Stata, Revised Edition," Stata Press books, StataCorp LLC, number musr, January.
    18. Dimitri, Carolyn & Oberholtzer, Lydia, 2009. "Marketing U.S. Organic Foods: Recent Trends From Farms to Consumers," Economic Information Bulletin 58615, United States Department of Agriculture, Economic Research Service.
    19. Kiesel Kristin & Villas-Boas Sofia B, 2007. "Got Organic Milk? Consumer Valuations of Milk Labels after the Implementation of the USDA Organic Seal," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 5(1), pages 1-40, April.
    20. Feng Zhang & Chung L. Huang & Biing-Hwan Lin & James E. Epperson, 2008. "Modeling fresh organic produce consumption with scanner data: a generalized double hurdle model approach," Agribusiness, John Wiley & Sons, Ltd., vol. 24(4), pages 510-522.
    21. Chen Zhen & Justin L. Taylor & Mary K. Muth & Ephraim Leibtag, 2009. "Understanding Differences in Self-Reported Expenditures between Household Scanner Data and Diary Survey Data: A Comparison of Homescan and Consumer Expenditure Survey," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(3), pages 470-492, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ufer, Danielle J., 2025. "Animal Welfare and Treatment Label Claims in U.S. Table Eggs: Trends in Retail Premiums and Policy Impacts, 2008–18," Economic Research Report 349285, United States Department of Agriculture, Economic Research Service.
    2. Sohae Eve Oh & Tomislav Vukina, 2018. "Substitutability between organic and conventional poultry products and organic price premiums," Economia agro-alimentare, FrancoAngeli Editore, vol. 20(1), pages 75-92.
    3. Ishwari Singh Bisht & Jai Chand Rana & Rashmi Yadav & Sudhir Pal Ahlawat, 2020. "Mainstreaming Agricultural Biodiversity in Traditional Production Landscapes for Sustainable Development: The Indian Scenario," Sustainability, MDPI, vol. 12(24), pages 1-24, December.
    4. Zahniser, Steven & Avendaño Ruíz, Belem & Astill, Gregory, 2023. "How Mexico’s Horticultural Export Sector Responded to the Food Safety Modernization Act," Economic Research Report 338954, United States Department of Agriculture, Economic Research Service.
    5. Lesly Cassin & Paolo Melindi-Ghidi & Fabien Prieur, 2021. "The impact of income inequality on public environmental expenditure with green consumerism," Working Papers 2021.08, FAERE - French Association of Environmental and Resource Economists.
    6. Seufert, Verena & Ramankutty, Navin & Mayerhofer, Tabea, 2017. "What is this thing called organic? – How organic farming is codified in regulations," Food Policy, Elsevier, vol. 68(C), pages 10-20.
    7. Pingan Xiang & Zhizhen Liu, 2024. "Is It Both Sufficient and Necessary to Disclose Environmental Information Regarding the Origin on Consumer Purchases?," Sustainability, MDPI, vol. 16(12), pages 1-15, June.
    8. Matthias Staudigel & Aleksej Trubnikov, 2022. "High price premiums as barriers to organic meat demand? A hedonic analysis considering species, cut and retail outlet," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(2), pages 309-334, April.
    9. Syed Badruddoza & Andrea C. Carlson & Jill J. McCluskey, 2022. "Long‐term dynamics of US organic milk, eggs, and yogurt premiums," Agribusiness, John Wiley & Sons, Ltd., vol. 38(1), pages 45-72, January.
    10. Staudigel, Matthias & Trubnikov, Aleksej, 2018. "How do organic price premiums vary across different supply and demand side factors? A hedonic analysis of the German market for fresh meat," 2018 Annual Meeting, August 5-7, Washington, D.C. 273989, Agricultural and Applied Economics Association.
    11. Carlson, Andrea C. & Waldrop, Megan, 2018. "Estimating Retail Organic Price Premiums for Snack Foods Using Scanner Data from 2013 to 2016," 2018 Annual Meeting, August 5-7, Washington, D.C. 274053, Agricultural and Applied Economics Association.
    12. Stewart, Hayden & Kuchler, Fred & Dong, Diansheng & Cessna, Jerry, 2021. "Examining the Decline in U.S. Per Capita Consumption of Fluid Cow’s Milk, 2003–18," Economic Research Report 327183, United States Department of Agriculture, Economic Research Service.
    13. Adam Pawlewicz, 2020. "Change of Price Premiums Trend for Organic Food Products: The Example of the Polish Egg Market," Agriculture, MDPI, vol. 10(2), pages 1-22, February.
    14. Wilson, Lacey & Lusk, Jayson L., 2020. "Consumer willingness to pay for redundant food labels," Food Policy, Elsevier, vol. 97(C).
    15. Page, Elina T & Short, Gianna & Sneeringer, Stacy & Bowman, Maria, 2021. "The Market for Chicken Raised Without Antibiotics, 2012–17," Economic Information Bulletin 327364, United States Department of Agriculture, Economic Research Service.
    16. Yuting Liu & Abdoul G. Sam, 2022. "The organic premium of baby food based on market segments," Agribusiness, John Wiley & Sons, Ltd., vol. 38(3), pages 533-556, July.
    17. Feliu López-i-Gelats & Jordi Bartolomé Filella, 2020. "Examining the role of organic production schemes in Mediterranean pastoralism," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(6), pages 5771-5792, August.
    18. Tatiana Drugova & Kynda R. Curtis & Sherzod B. Akhundjanov, 2020. "Are multiple labels on food products beneficial or simply ignored?," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(4), pages 411-427, December.
    19. Meilin Ma & Carson Reeling & Megan N Hughes & Shalamar Armstrong & Richard Roth, 2023. "Comparison of conservation instruments under long-run yield uncertainty and farmer risk aversion," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 50(5), pages 1685-1714.
    20. Wei, Hanlin & Goodhue, Rachael & Zhang, Minghua, 2024. "Pesticide Use and Cropland Consolidation in California Organic Agriculture," Ecological Economics, Elsevier, vol. 218(C).
    21. Lesly Cassin & Paolo Melindi-Ghidi & Fabien Prieur, 2021. "Voting for environmental policy with green consumers: the impact of income inequality," CEE-M Working Papers hal-03146526, CEE-M, Universtiy of Montpellier, CNRS, INRA, Montpellier SupAgro.
    22. Carlson, Andrea & Greene, Catherine & Raszap Skorbiansky, Sharon & Hitaj, Claudia & Ha, Kim & Cavigelli, Michel & Ferrier, Peyton & McBride, William, 2023. "U.S. Organic Production, Markets, Consumers, and Policy, 2000-21," USDA Miscellaneous 333551, United States Department of Agriculture.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Edward C. Jaenicke & Andrea C. Carlson, 2015. "Estimating and Investigating Organic Premiums for Retail‐Level Food Products," Agribusiness, John Wiley & Sons, Ltd., vol. 31(4), pages 453-471, October.
    2. Syed Badruddoza & Andrea C. Carlson & Jill J. McCluskey, 2022. "Long‐term dynamics of US organic milk, eggs, and yogurt premiums," Agribusiness, John Wiley & Sons, Ltd., vol. 38(1), pages 45-72, January.
    3. Matthias Staudigel & Aleksej Trubnikov, 2022. "High price premiums as barriers to organic meat demand? A hedonic analysis considering species, cut and retail outlet," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(2), pages 309-334, April.
    4. Smed, Sinne & Hansen, Lars Garn, 2018. "Consumer Valuation of Health Attributes in Food," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 43(2), May.
    5. Carlson, Andrea & Greene, Catherine & Raszap Skorbiansky, Sharon & Hitaj, Claudia & Ha, Kim & Cavigelli, Michel & Ferrier, Peyton & McBride, William, 2023. "U.S. Organic Production, Markets, Consumers, and Policy, 2000-21," USDA Miscellaneous 333551, United States Department of Agriculture.
    6. Bittmann, Thomas & Scharnhop, Johann, 2021. "Price Premiums for Private Labelled Milk in German Retail: A Hedonic Price Analysis," 61st Annual Conference, Berlin, Germany, September 22-24, 2021 317049, German Association of Agricultural Economists (GEWISOLA).
    7. Jessica Bosseaux & Philippe Aurier & Alain François-Heude, 2019. "The official quality signs influence on prices and volumes: the case of organic fresh eggs [L’influence du label Bio sur les prix et les ventes : Le cas des oeufs]," Post-Print hal-03079779, HAL.
    8. McFadden, Jonathan R. & Huffman, Wallace E., 2017. "Willingness-to-pay for natural, organic, and conventional foods: The effects of information and meaningful labels," Food Policy, Elsevier, vol. 68(C), pages 214-232.
    9. Moon, Donghyun & Kim, Sanghyo, 2021. "Implicit Values of Functional Attributes of Fluid Milk Products: Hedonic Analysis of Korean Fluid Milk Market," 2021 Annual Meeting, August 1-3, Austin, Texas 313948, Agricultural and Applied Economics Association.
    10. Jessica Bosseaux & Philippe Aurier & Alain François-Heude, 2019. "The Effects of Organic Label on Marketing Performance (Prices, Sales, and Margins) [Les Effets du Label Bio sur la Performance Marketing (Prix, ventes et marges)]," Post-Print hal-03079843, HAL.
    11. Hallstein, Eric & Villas-Boas, Sofia Berto, 2009. "Are Consumers Color Blind?: an empirical investigation of a traffic light advisory for sustainable seafood," CUDARE Working Papers 120535, University of California, Berkeley, Department of Agricultural and Resource Economics.
    12. Brockmeier, M., 1991. "Entwicklung und Aufhebung von Reinheitsgeboten im Nahrungsmittelbereich – Analyse und Bewertung," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 27.
    13. Empen, Janine, 2011. "Preissetzung Auf Dem Deutschen Joghurtmarkt: Eine Hedonische Analyse," 51st Annual Conference, Halle, Germany, September 28-30, 2011 115362, German Association of Agricultural Economists (GEWISOLA).
    14. Ahmad, Waseem & Ahmed, Tanvir & Ahmad, Bashir, 2019. "Pricing of mobile phone attributes at the retail level in a developing country: Hedonic analysis," Telecommunications Policy, Elsevier, vol. 43(4), pages 299-309.
    15. Elofsson, Katarina & Bengtsson, Niklas & Matsdotter, Elina & Arntyr, Johan, 2016. "The impact of climate information on milk demand: Evidence from a field experiment," Food Policy, Elsevier, vol. 58(C), pages 14-23.
    16. Alessandro Bonanno, 2016. "A Hedonic Valuation of Health and Nonhealth Attributes in the U.S. Yogurt Market," Agribusiness, John Wiley & Sons, Ltd., vol. 32(3), pages 299-313, July.
    17. Utami, Anisa & Harianto, Harianto & Krisnamurthi, Bayu, 2021. "Price Interdependence in Indonesian Rice Market in the Presence of Quality Differential," 2021 Conference, August 17-31, 2021, Virtual 315229, International Association of Agricultural Economists.
    18. N. Koffi Amegbeto & Victor M. Manyong & Ousmane Coulibaly & Robert Asiedu, 2008. "Estimating market demand for fresh yam characteristics using contingent valuation: implications for crop breeding and production choices," Agricultural Economics, International Association of Agricultural Economists, vol. 39(3), pages 349-363, November.
    19. Hyberg, Bengt & Uri, Noel D. & Oliveira, Valencia, 1996. "The quality characteristics of Japanese soybean imports," Japan and the World Economy, Elsevier, vol. 8(1), pages 81-98, March.
    20. Nelson, Mack C. & Styles, Erika K. & Pattanaik, Nalini & Liu, Xuanli & Brown, James, 2015. "Georgia Farmers’ Perceptions of Production Barrier in Organic Vegetable and Fruit Agriculture," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196868, Southern Agricultural Economics Association.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:uersrr:242448. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/ersgvus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.