The live seafood market is an important market channel for fish producers in the Northcentral region of the US. This channel begins with the fish farmer, through a wholesaler, a broker or aggregator, retailer/restaurant, and ends with the consumer. Processing of the fish is done at the retailer/restaurant level and consumers who patronize live seafood markets are served fish products that have not undergone industrial processing or preservation, which is important for meeting their taste, freshness, quality, and food safety preferences. If these consumers are willing to pay premiums for different live seafood species, fish farmers can receive a high percentage of the dollar amount paid. This study focuses on 4 seafood species: Largemouth bass, hybrid striped bass, bluegill, and barramundi, which are major species produced in the Northcentral region.
A national online survey was conducted to assess consumer willingness-to-pay (WTP) for live fish. We collected information on consumer demographics and responses from a choice experiment. The experiment presented respondents with hypothetical purchasing choice scenarios where each choice scenario had four labeled alternatives and a no-buy option to simulate a real purchasing situation. Each species was presented with two attributes - price and source region (Northcentral vs non-Northcentral source). There was a total of 1,278 choices made by 215 respondents in the choice experiment.
Statistics of respondents show 62% are male, 80% are aged less than 45 years, 59% earn less than $100,000 annually, and 77% is white. The Asian racial/ethnic group was 6% of the respondents. In the choice experiment, hybrid striped bass was chosen the most (25.5%), followed by largemouth bass, 23.1%; bluegill, 22.2%; barramundi, 13.5%; and the none option, 15.6%. Two regression analyses, Random Parameters Logit (RPL) and Error Component Random Parameters logit (EC-RPL) were estimated with the choice experiment data.
RPL Model: Both the total and marginal WTP estimates show total WTP of $20.17 for hybrid striped bass, $19.37 for bluegill, $17.67 for largemouth bass, and $14.71 for barramundi. These estimates show consumers are willing to pay $15 - $20 for live fish while the reference prices used in the study range from $7 - $15, signifying a higher consumers' stated WTP for live fish species. The absolute values of marginal WTP, which give an idea of how fish prices would differ in the real market, range from $0.80 to $5.46 for the three species.
EC-RPL Model: The EC-RPL model incorporated demographics and results show that male, age less than 45 years, and $100,000+ income earners are more likely to purchase live fish. Asians are also found to prefer barramundi than the other species. Male consumers are willing to pay $20.50 for largemouth bass, $20.07 for hybrid striped bass, $23.64 for bluegill, and $23.14 for barramundi. High-income earners are willing to pay $5.69 for bluegill, $6.55 for hybrid striped bass, $6.73 for barramundi, and $8.90 for largemouth bass. The low WTP estimates for high income earners suggest that there is only a marginal difference between high- and low-income groups. Asians -consumers are willing to pay $12.39 for barramundi relative to non-Asian consumers.