It’s not just for elites anymore. A survey of Midwesterners finds that even average food shoppers are willing to pay a premium for locally grown food. They’ll pay as much as a third more if the food comes from a small local farm rather than a corporate farm. The study from Ohio State University, published in the American Journal of Agricultural Economics, shows that more shoppers are willing to pay for ripe local food—suggesting small farmers might be less efficient on the production side and still manage to be more profitable on the revenue side by selling at the premium price.
Shoppers were surveyed at 17 Ohio locations, including seven retail grocery stores, six on-site farm markets and four farmers’ markets. They were presented with two product options. Both were baskets of strawberries, but they were presented under 80 combinations of price, freshness, farm location, and farm type. Data from 477 surveys revealed the average shopper was willing to pay 48 cents more for local strawberries. Shoppers at farm markets were willing to pay almost a third more, 92 cents above the $3 base for a quart of berries. Freshness was also important. Farm market shoppers were willing to pay 73 cents more for newly-harvested food and retail shoppers 54 cents more. The researchers tested interest in supporting small versus large farms by naming one fictional berry producer “Fred’s” and the other “Berries Inc.” Shoppers in grocery stores were willing to pay 17 cents extra for berries from Fred’s, and farm market shoppers were willing to pay 42 cents more.
Listen up small farmers, boutique farmers, disenchanted farmers, your day may be coming (again). Many of us want fresher, tastier food grown carefully and closer to home. Rising fuel prices mean cheap cherries from Chile won’t be cheap forever.