Research to study consumer understanding and willingness-to-pay for production practices | cage-free, farmers, ranchers | Michigan Farm News

Research to study consumer understanding and willingness-to-pay for production practices

Category: Livestock

by The Foundation for Food and Agriculture Research

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The Foundation for Food and Agriculture Research (FFAR), a nonprofit established in the 2014 Farm Bill with bipartisan congressional support, has awarded a $50,000 grant to the Food Marketing Institute (FMI) Foundation and Animal Agriculture Alliance to study consumer understanding and willingness-to-pay for alternative production practices in animal agriculture. The FFAR grant has been matched with funding from the FMI Foundation and the Alliance for a total investment of $100,000.

Farmers, ranchers and agricultural businesses are seeking to respond to consumer demand for cage-free egg production and slow-growth broiler chickens, and there is a need by food retailers to better understand consumer knowledge, beliefs and willingness-to-pay for these attributes.

The increasing transition to cage-free production practices by farmers and commitments by businesses to adopt alternative production practices for broilers have begun to impact the supply-demand paradigm. Gaining knowledge of consumers’ preferences and beliefs will help to guide choices in research, production, and retail sales.

“The Foundation for Food and Agriculture Research is pleased to partner with food retailers, farmers and agricultural business to better understand how animal production practices influence consumer decision-making in the retail setting,” said Sally Rockey, Ph.D., FFAR executive director.

While several studies have estimated consumer willingness-to-pay for fresh agricultural products, few have linked these estimates to consumer knowledge, beliefs and to information treatments that will help determine future demand for attributes. This research employs state-of-the-art choice modeling techniques, including choice experiments and latent class modeling, to estimate diversity in consumer preferences and willingness-to-pay for cage-free eggs and slow-growth broilers now and in the future.

Led by Jayson Lusk, Ph.D., who is a food and agricultural economist at Purdue University, the research team will custom build consumer surveys distributed to at least 3,000 respondents that mimic decision-making in the retail environment.

Respondents will make a series of choices between products that vary in price and other attributes, such as production practices (cage-free, pasture-raised, slow growth, conventionally raised), labeling claims, packaging, product color and appearance.

“Shoppers suffering from data fatigue are turning to their food retailers for trusted and curated information about their food purchases,” said Susan Borra, RD, executive director of the FMI Foundation. “The FMI Foundation believes that funding research on emerging health and social concerns affecting consumer confidence in the food and consumer goods industry will impact the public conversation and build consumer trust.”

“Consumers are key stakeholders in the food system,” said Kay Johnson Smith, Alliance president and CEO. “It is critical to develop a firmer understanding of shoppers’ values and priorities when making choices about the food they purchase and feed their families. Our mission at the Alliance is to bridge the communication gap between farm and fork, and this research will help us do just that more effectively.”