May 2016
Shoppers willing to pay premium in certain cases
By: Ron FriesenMany North American consumers are willing to pay a premium for beef raised under conditions that support the environment, according to a U.S. livestock research specialist.
Recent studies show the average consumer would pay anywhere between seven and 33 per cent more for beef produced with environmental benefits, with an average willingness around 15 per cent, says Robin White, a livestock researcher at Virginia Tech University.
That’s surprising because consumers these days are bombarded by campaigns claiming livestock production is bad for the environment, White says.
But many people, especially those who like eating meat, aren’t overly influenced by such claims, she adds.
“There’s a portion of the population that is swayed by this type of argument. There’s also a portion of the population that really loves steak. For those of us who really love steak, it’s going to take a little more than some of those sensationalized arguments to change our purchasing habits,” she said in a telephone interview from her office.
“Based on my experience, the public is really looking for information that doesn’t come in this type of package. They’re just looking to understand.”
This apparent open-mindedness by consumers gives beef producers a chance to show them their industry is environmentally sound, she said.
“Producers have an opportunity to leverage consumers’ interests I things like reduced environmental impact, both from an economic standpoint and to communicate concepts about beef production to the public.”
White spoke recently agriculture students and staff at the University of Manitoba.
SINCE 1998
During her presentation at the U of M, White cited a 2014 study which found consumers were willing to pay more for beef with “pure” environmental benefits such as sustainable water and land use.
Surprisingly, North American consumers showed a greater willingness to pay than Europeans, maybe because people in the United States and Canada have more free choice when selecting the conditions under which food is produced, she suggested.
However, during a question period, White acknowledged what people say and what they do are two different things.
White said the willingness-to-pay factor is about two to one. For example, shoppers might say they are willing to pay 12 per cent more at the meat counter but will actually pay only six per cent more. Still, the fact that consumers say they would pay more for environmental benefits is significant, given campaigns by environmental groups claiming livestock production is unsustainable, she said.
Such claims include: livestock produce 40 per cent more greenhouse gas emissions than cars; a pound of meat requires 2,400 gallons of water compared to only 25 gallons for wheat; one acre of land can yield 53,000 pounds of potatoes but only 250 pounds of beef.
But White said beef’s environmental footprint is actually shrinking, thanks to improvements in conventional production.
She said research shows that in 2007, the U.S. beef industry used only 67 per cent of the land and 88 per cent of the water it did in 1977. Beef animals also excreted 88 per cent of the nitrogen and generated only 84 per cent of the carbon footprint than in 1977.
It’s true that removing meat from the diet can reduce carbon dioxide emissions. But that would make less protein available for export to feed a hungry world, said White.