The assessment of market potential and marketing prospects of of organic fruits and vegetables in Kumasi Metropolis of Ghana
Organic products are considered to be superior in quality compared to conventionally produced products, since it has been proved that organic products help prevent several health and environmental hazards. Therefore, the demands for organic products are increasing all over the world, as well as in Ghana. Given this increasing demand for organic products, this study was conducted with the aim of estimating the market potentials and consumer willingness to pay for organic fruits and vegetables in the Kumasi metropolis of Ghana. Further, the study identifies the factors that influence the consumers‘ willingness to pay premium for organic fruits and vegetables. A face-to-face household-level survey of 450 respondents was conducted in Kumasi, Ghana in 2008 with a structured questionnaire. The double-bounded dichotomous choice contingent valuation method (CVM) was employed to elicit consumers‘ WTP information. The study found that, most consumers had positive perception on organic fruits and vegetables with benefit perception index (BPI) of 0.76, quality perception index (QPI) of 0.60 and environmental risk perception index (EPI) of 0.55. The empirical results revealed that consumers‘ willingness to pay (WTP) premium for organic fruits and vegetables were more than 20% of the prices of the conventional products. Also consumers were willing to pay 6% to 39% premium for organic fruits and vegetables in Kumasi. The estimated market potential for organic fruits and vegetables were GH¢839,407,549 (US$ 599,576,821) and GH¢ 3,714,112,152 (US$ 2,652,937,251) respectively. The empirical results also show that age, education, income, gender, and household size significantly influence consumers‘ WTP for organic fruits and vegetables. Also product characteristics such as colour, size, hardness, freshness and cleanliness statistically influence consumers‘ WTP for organic fruits and vegetables.
A thesis submitted to the Department of Agricultural Economics, Agribusiness and Extension of the Kwame Nkrumah University of Science and Technology in partial fulfilment of the requirements for the degree of Master of Philosophy, 2009