Hedonic Analysis of Apple Attributes in Metropolitan Markets of Western Canada

Abstract

ABSTRACTOver the last decade, the level of competition in the Canadian apple industry has been affected by growing competitive pressures from increasing imports and the availability of other fresh fruits. In response to intensifying competition, the industry has introduced new apple varieties that are more desirable to consumers in terms of eating quality and improve growers’ profitability. British Columbia (BC) apple sales data were employed to examine the implicit value of apple attributes for apples sold in several metropolitan areas of western Canada (Vancouver, Calgary, Edmonton, Saskatoon, and Winnipeg). Linear hedonic price functions were estimated to determine price premiums paid for newer varieties, higher grades, and larger fruit size. In addition, the price effects of cold storage and seasonality were considered because of their association with apple quality. Wholesale prices were significantly influenced by apple fruits of newer varieties, grades, fruit sizes, and metropolitan area. Wholesalers also distinguished between Canadian and BC grades of different varieties. Wholesale prices varied across urban centers; they were relatively higher in Winnipeg and Saskatoon than in Vancouver [EconLit Classifications: Q110, Q130].