Will consumers pay less for fat on beef cuts? The case in Bloemfontein, South Africa
There is increasing evidence that most of the fear expressed by consumers in terms of the link between cholesterol in the diet and heart disease is, amongst others, related to the amount of fat in red meat and dairy produce. The result is that many consumers are cutting back on, if not avoiding, red meat products. A major challenge ahead of the beef industry is to supply a product that complies with the demands of more sophisticated and health conscious consumers. But, even if the beef industry could respond positively to consumers needs, it is uncertain whether consumers would pay more for beef containing less fat. In this paper the willingness of consumers to pay for less fat in selected beef cuts (T-bone and rump) was investigated with a log-linear hedonic price model. The results showed that more affluent consumers in Bloemfontein were (i) willing to pay for additional external fat (this was contrary to expectations). This was attributable to the culture of food consumption and traditional cooking style (braai). The result does not imply that the amount of external fat can be unlimited, but rather that current external fat levels are desired by consumers; (ii) seam fat had a negative impact on prices of the selected beef cuts in Bloemfontein indicating that reducing the amount of a less desired attribute could shift the demand curve outward; (iii) marbling fat did not have a significant impact on prices of selected cuts in Bloemfontein; and (iv) cuts classified as bone-in was discounted by consumers in Bloemfontein. The study further found that one can't merely assume that international trends are applicable to the South African situation, but this needs further research. It is hence proposed that a similar study is conducted for South Africa as a whole.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lucas, Robert E B, 1975. "Hedonic Price Functions," Economic Inquiry, Western Economic Association International, vol. 13(2), pages 157-78, June.
- Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
- Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132.
- Unnevehr, Laurian J. & Bard, Sharon K., 1993. "Beef Quality: Will Consumers Pay For Less Fat?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 18(02), December.
- Kinnucan, Henry W. & Chang, Hui-Shung (Christie) & Venkateswaran, Meenakshi, 1993. "Generic Advertising Wearout," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 61(03), December.
- John D. Jackson, 1997. "Effects of Health Information and Generic Advertising on U.S. Meat Demand," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 13-23.
- Ferguson, Meagan & Anderson, John D., 2001. "Value Of Ultrasound-Based Predictions Of Carcass Quality Grade," 2001 Annual meeting, August 5-8, Chicago, IL 20620, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
When requesting a correction, please mention this item's handle: RePEc:ags:agreko:8018. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.