Consumers’ willingness to pay for organic products in Thailand

Abstract

Organically grown products have received increasing attention worldwide. This appears to be due to growing awareness of environmental problems and increased concerns about the health and safety of modern agricultural food production practices. Despite the apparent rise of both supply and demand for organic products in Thailand, the industry is still in its infancy and consumers’ purchasing behaviour towards organic products is not well researched. This paper investigates the factors affecting consumers’ willingness to pay a premium price for organic products. A self-administered questionnaire was used to collect the data at five retail stores in the metropolitan area of Bangkok. Data were analysed using exploratory factor analysis and the double-bound contingent valuation method. Results show that respondents are willing to pay a premium price of 88%, 51% and 51% for organic Chinese kale, organic jasmine rice and organic pork, respectively. Analysis indicates that respondents are willing to pay a premium price for organic products if they have experience in purchasing organic products, have good health, strong ethical and environmental concerns, perceive that organic products provide greater quality and health benefits, and if reside in the city. Respondents with children in the household, however, are less likely to pay a premium price for organic products. Analysis also indicates that the price premium organic products require hinders consumers’ purchase of organic products. Therefore, efforts should be made by policymakers, together with marketers and producers, to lower the price of organic products to attract more consumers.