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Assessing the Consumer Behavior, Market Coordination and Performance of the Consumer-Oriented Fruit and Vegetable Sector

Investigators
Schatzer, R Joe
Institutions
Oklahoma State University
Start date
2010
End date
2015
Objective

Objective 1: Develop demand and market valuation models for the produce sector that can be used to evaluate effects of increasingly complex product differentiation schemes (organic, enhanced health claims, biodynamic), trade, commodity marketing programs, labeling programs (local, food miles, Fair Trade), traceability systems, and food safety events in the U.S. produce markets.

Objective 2: Analyze the relative benefits and costs, to producers and consumers, of government and industry-led marketing and policy programs (certifications, Leafy Greens marketing order, Country of origin labeling, farmers markets) using both theoretical approaches and empirical evidence from multi-state applied research projects.

Objective 3: Assess the changing coordination and supply chain management strategies being implemented in the fruit and vegetable sector and identify strategic organizational and marketing implications for a set of firms that are diverse in terms of commodity, marketing approach and size of operation (including small and mid size farms).

More information

NON-TECHNICAL SUMMARY:
In recent years, greater concerns with respect to diet and nutrition have led to an increased number of marketing and promotional messages focused on the benefits of eating fresh fruit and vegetables. Both consumers and retailers have responded to the spotlight on fresh produce, resulting in increased purchases, marketing resources and even new legislation to promote Specialty Crop production in the US. The increased popularity of fresh produce represents considerable potential for enhanced marketing revenues to producers if they can recognize and harness opportunities emerging from changes in food purchases. Meanwhile, producers and consumers need to be informed about the emergence of new business strategies, regulations and policies that may influence their confidence in (consumers) and competitiveness within (producers) this quickly innovating marketing sector. In recent years, increasing numbers of consumers have shown increased interest in foods produced in unique ways, including organic, local, pesticide free, Fair Trade or as functional foods. These individuals and households are also fueling changes in the food system as they seek to purchase their produce through channels as diverse as direct marketing and traditional supermarkets, and with expectations as broad as picking their own produce to highly branded products with 3rd party certifications. The potential impacts of this work will be in three realms; market information, recommendations on improved marketing performance and insights on costs and benefits of value to policymakers that are considering oversight, grading and certification programs to enhance market activities.

APPROACH:
On the supply side, there is increasing interest in understanding the costs of production and marketing, especially as the variety of production protocols and marketing strategies proliferate. Research that examines the costs of government and industry-led marketing and policy programs has traditionally started with crop budgets that document detailed information about production costs and revenue streams for a representative farm. The target audience for crop budgets is various stakeholders (including input suppliers and lenders, producers, handlers, and processors), and they have been used to assess profitability issues in specialty crop markets. Crop budgets are now being developed (many by members of this regional research group) with three innovative components. First, the analyses now incorporate much more scale-appropriate information; results are provided for different farm sizes and for farms selling to different customers. Second, revenue streams are now more closely linked to WTP studies to highlight how changes in consumer demand affect farm-level profitability. Third, crop budgets are beginning to consider interactions between biophysical, climatic, and management factors and the costs of production. We will work cooperatively with other states to develop case studies and best practice research focused on how evolving marketing strategies (buy local campaigns, regional food hubs, organics, marketing orders and retail partnerships) impact the competitiveness and performance of fresh produce enterprises. As consumer preferences evolve and globalization of markets continues, change becomes a certainty for U.S. fruit and vegetable industries, as they must constantly assess strategies for remaining (or becoming) competitive in fluctuating markets.

PROGRESS: 2012/10 TO 2013/09
Target Audience: Oklahoma fruit and vegetable producers. Changes/Problems: No changes. What opportunities for training and professional development has the project provided? Nothing Reported How have the results been disseminated to communities of interest? Nothing Reported What do you plan to do during the next reporting period to accomplish the goals? Revise tomato budget information for Extension Fact Sheet on Commercial Tomato production. 6. Impact Statement: Enterprise budgets provide producers and extension agents with information on potential costs and returns from the crop. Economic information helps producers make better production decisions.

PROGRESS: 2011/10/01 TO 2012/09/30
OUTPUTS: Each year, our staff updates enterprise budgets for selected fruit and vegetable crops to reflect current input prices and technology. We disseminate these budgets as part of the Oklahoma State University Department of Agricultural Economics Extension efforts in the area of Enterprise Budgets. Budgets related to grapes and pecans are included in the Oklahoma Grape Management and Fundamentals of Pecan Management courses offered by Oklahoma Cooperative Extension. Provided economic information to producers related to producing and marketing horticulture crops as requested. PARTICIPANTS: Dr. Joe Schatzer, Professor and Roger Sahs, Assistant Extension State Specialist TARGET AUDIENCES: No Changes PROJECT MODIFICATIONS: No Changes

PROGRESS: 2010/10/01 TO 2011/09/30
OUTPUTS: Enterprise budgets for selected fruit and vegetable crops are continually updated to reflect current input prices and technology. These budgets are disseminated as part of the Oklahoma State University Department of Agricultural Economics Extension efforts in the area of Enterprise Budgets. Budgets related to grapes and pecans are included in the Oklahoma Grape Management and Fundamentals of Pecan Management courses offered by Oklahoma Cooperative Extension each year PARTICIPANTS: No Changes TARGET AUDIENCES: No Changes PROJECT MODIFICATIONS: No Changes

Funding Source
Nat'l. Inst. of Food and Agriculture
Project source
View this project
Project number
OKL02806
Accession number
224198
Categories
Education and Training
Policy and Planning
Commodities
Produce
Nuts, Seeds