Price premium of organic salmon in Danish retail sale

Abstract

The year 2016 will be pivotal for organic aquaculture producers in EU, because it represents the deadline for implementing the complete organic life cycle in aquaculture production. Depending on the sturdiness of farms already producing, such a shift in the industry may affect production costs of exclusively using organic fry for production. If the profitability of the primary organic aquaculture producers should be maintained, then farmers must be able to correspondingly receive higher prices, transmitted through the value chain from the retail market. This study identifies the price premium for organic salmon in Danish retail sale using consumer panel scanner data from households by applying a random effect hedonic price model that permits unobserved household heterogeneity. A price premium of 20% was identified for organic salmon. The magnitude of this premium is comparable to organic labeled agricultural products and higher than that of eco-labeled capture fishery products, such as the Marine Stewardship Council. This indicates that the organic label also used for agricultural products may be better known and trusted among consumers than the eco-labels on capture fishery products.

Price premiums for ecolabelled seafood: MSC certification in Germany

“…; Ankamah‐Yeboah et al . ; Bronnmann and Asche ). These studies typically estimate a single parameter for each product attribute, with Asche et al .…”

Does information about organic status affect consumer sensory liking and willingness to pay for beer?

“…Consumer WTP and price premium analysis for organic products have been studied for a variety of products (see, for example, Ankamah‐Yeboah, Nielsen, & Nielsen, ; McCluskey, Durham, & Horn, ; Verhoef, ). Although many studies conclude that consumers are willing to pay a price premium for organic food products, high prices have been shown to be a deterrent for organic consumption despite indicating a preference for organic products (Hughner, McDonagh, Prothero, Shultz, & Stanton, ; Lockie, Lyons, Lawrence, & Grice, ).…”

Consumers’ Willingness to Pay for Sustainable Seafood Made in Europe

“…Therefore, at least, some of the consumers have to be convinced that European products are worth higher prices. Recent research shows that the promotion of sustainability in seafood bears potential for product differentiation and thereby higher premiums and market shares (Ankamah-Yeboah et al, 2016;Asche, Larsen, Smith, SognGrundvåg, & Young, 2015;Jaffry, Pickering, Ghulam, Whitmarsh, & Wattage, 2004;Roheim, Asche, & Santos, 2011). Earlier research stressed that a particular consumer segment which appreciates additional ethical values of products and is willing to pay higher prices exists (Altintzoglou et al, 2010;Feucht & Zander, 2015;Kalshoven & Meijboom, 2013;Lasner & Hamm, 2014;Mauracher, Tempesta, & Vecchiato, 2013;Risius et al, 2017).…”

“…Many consumers are increasingly interested in additional product attributes such as ecofriendliness, organic production, and domestic/ European origin, given that general expectations with respect to price and quality are met (e.g., Ankamah-Yeboah, Nielsen, & Nielsen, 2016;Bergleiter & Meisch, 2015;Brécard, Hlaimi, Lucas, Perraudeau, & Salladarre, 2009;Brunsø et al, 2008;Carlucci et al, 2015;Claret et al, 2012;Olesen, Alfnes, Bensze Rora, & Kolstad, 2010;Whitmarsh & Palmieri, 2011).…”