Consumer Willingness to Pay for Organic Rice: With reference to Kurunegala District in Sri Lanka

Abstract

Consumer willingness to pay is a dynamic phenomenon that depends heavily on consumers’ perceptions and attitudes. Organic rice purchasing behavior has been increased in recent years due to the perception that such products are safer, healthier and more environmentally friendly than conventionally produced alternatives. This study was focused to examine: consumers’ willingness to pay for organic rice, consumers’ perceptions on willingness to pay organic rice, and effect of socio demographic characteristics on willingness to pay for organic rice in Sri Lanka. A questionnaire survey was conducted with 100 consumers selected by multi-stage sampling technique in Kurunegala district which is highly vulnerable for agro chemical based diseases in Sri Lanka. Data analysis was done by using Contingent Valuation Method and Ordered Probit Regression analysis. The study found that 100 percent of consumers have selected organic rice at the same bid price and 96 percent of consumers agreed to pay an additional payment on organic rice. Monthly income, education level, and positive perceptions on organic rice increase willingness to pay for organic rice and price premiums. Consumers who perceive to have low residues of pesticide, higher nutrient and higher quality of organic rice than non-organic rice hold a probability of paying high premium. Consumers’ main motivation for buying organic rice is the health concern. Policy makers can identify the range of price increase of such organic rice without damaging the existing demand for organic rice and it is a timely need to introduce new marketing strategies to expand the market segment in organic rice in Sri Lanka.

Japanese consumer's visual marketing preferences and willingness to pay for rice produced by biodiversity‐friendly farming

“…The price premium for organic rice; however, has varied among countries and respondents' income. In many countries, one of the main reasons consumers give for purchasing organic rice is the enhanced safety due to the non‐use of pesticides (e.g., Ara, 2003; Hosseini et al, 2019; Li et al, 2019; Sriwaranun et al, 2015; Wijesinghe & Nazreen, 2020). Other positive motivations have been given for purchasing behavior, such as improved taste, better product quality, environmental considerations, and support for the local economy (Hughner et al, 2007; Sriwaranun et al, 2015).…”

“…pesticides (e.g., Ara, 2003;Hosseini et al, 2019;Li et al, 2019;Sriwaranun et al, 2015;Wijesinghe & Nazreen, 2020). Other positive motivations have been given for purchasing behavior, such as improved taste, better product quality, environmental considerations, and support for the local economy (Hughner et al, 2007;Sriwaranun et al, 2015).…”

Consumer Attitudes towards Organic Food Consumption: Focus Group Discussion in Colombo District, Sri Lanka

“…And price premiums of organic foods have made organic dishes to be unpopular among some customer segments. As per, Wijesinghe and Nazreen (2020) also declared that consumer willingness to pay is a fluctuating phenomenon that is greatly influenced by consumer perceptions and attitudes. And, it is further explored that consumers who demand organic foods are tend to be health conscious and aware on foods' growth compared with the conventional alternatives in the restaurant industry of Sri Lanka (Jayawardena, Wijesundara & Pradeepamali, 2022).…”

“…Previous studies of Wijesinghe and Nazreen (2020) stated organic farming as a form of crop and livestock production that does not use pesticides, fertilizers, GMOs, or growth hormones. Furthermore, it is usually seen as being more environmentally friendly than food tourism because it conserves the environment.…”

Assessing Urban Consumer Intention on Purchasing of Organic Food in Sri Lanka

“…But amount of using chemicals such as pesticides, weedicides and synthetic fertilizers are still remaining as it is due to the effectiveness of such products and not widely adapting to organic methods. The use of pesticides in food production is perceived to be associated with long-term and short term unknown effects on health (Wijesinghe and Nazreen, 2020;Hughner et al, 2007;Alphonce and Alfnes, 2019). Rana and Paul (2017) revealed that modern consumers are greatly influenced by the rising incidents of lifestyle diseases caused by the chemical usage in agricultural productions, and hence, they show growing preference for organic food products.…”