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The Role of Information Ignorance in Consumers’ Willingness-to-Pay for Local Honey

Jenny Beiermann

Summary

Honeybee colony loss in the U.S. is drastically affecting both world and domestic pollination and honey markets. In 2008, the number of honey-producing colonies in the U.S. was 2.3 million, a 61% drop from the high of 5.9 million colonies in 1947. Many honeybee-dependent commodities could experience upwards of 90% yield reduction without pollination, threatening U.S. food security. To meet demand, the U.S. has gone from importing 120 million pounds of honey in 1986, to importing 323.6 million pounds in 2013. Yet, a large quantity of the imported honey available on the U.S. honey market has a high risk of having trace amounts of illegal antibiotics and heavy metals.
Historically, beekeepers in Wyoming received lower prices for their honey than the national average, creating a disincentive for Wyoming beekeepers to produce honey and maintain high colony numbers. With an ever-decreasing supply of domestic honeybees, determining ways to increase domestic honeybee colony numbers is of the utmost importance. To combat this price gap, local producers have begun exploring new markets and product labeling strategies.
Economic research was conducted to determine if, given the risks associated with consuming honey of unknown origin, consumers would purchase local (specifically Wyoming) honey, guaranteed as safe, for a premium. Results indicate that 53% of respondents were willing to pay a premium for Wyoming honey, implying that producers should develop a labeling strategy and take advantage of niche markets available for local honey. Consequently, producers can diversify their risks by allocating land resources to this alternative use. It also encourages producers to increase their colonies, helping combat the widespread loss of honeybees threatening U.S. food security.

Details

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