A Consumer Price Perspective on Local and Non-Local Foods Purchased in Iowa
A report from the Leopold Center for Sustainable Agriculture written by Rich Pirog and Nick McCann of the Leopold Center, December 2009.
Interest in local food systems has increased dramatically as has the number of farmers’ markets in Iowa and nationwide. This growing popularity has sparked common questions: Is local food more expensive than its non-local counterpart? A research scan finds a dearth of studies showing the prices consumers pay for locally grown food products. Given these developments, the Leopold Center for Sustainable Agriculture’s Marketing and Food Systems initiative conducted consumer market research in June, July and August 2009 to examine what Iowa consumers pay for locally grown products and how these prices compare to the non-local market channel prices.
The research had three principal objectives:
- Document prices for a market basket of foods across Iowa farmers’ markets, supermarkets , natural foods markets and butcher shops.
- Compare prices among foods that are grown locally and sold at farmers’ markets, similar locally grown items sold at retail venues (supermarkets and natural foods markets), and food sold at retail venues that are procured from national or international sources.
- Conduct price comparisons of local products on a city-by-city basis.
The data were collected on five dates, in four cities, and four different retail venues. The market basket was designed to include products that commonly could be found at farmers’ markets and in the typical Iowan’s food basket. For each farmers’ market date when data were taken, supermarket prices were tallied on the same day, while butcher shop prices were recorded within the same week.
Specific findings of the research show that the mean price per pound for the local farmers’ market vegetable basket* is $1.25, while the mean price per pound for the non-local supermarket vegetable basket is $1.39. It should be noted that differences in price between the local and non-local vegetable baskets were not statistically significant. Additionally, if an individual were to buy one pound of each vegetable in the vegetable market basket, the local vegetable basked would total $8.84 while its non-local supermarket counterpart would total $10.45. Local price advantages mainly stem from the competitive pricing of zucchini and summer squash at farmers’ markets. These price advantages could be due to factors such as abundant supply, seasonality and weather.
If a family of four was to purchase half the Iowa per capita consumption of each vegetable in the vegetable basked, the amount paid for the entire market basked would look somewhat different. The total amount of half the monthly per capita consumption for local vegetables was $15.03 while the total price for the non-local counterpart was $16.91.
The complete report can be viewed at: http://www.leopold.iastate.edu/pubs/staff/prices/prices.pdf
*The vegetable basket consists of zucchini, summer squash, cucumbers, string beans, sweet onions, tomatoes, and sweet corn.