Presentation of the Study Result Consumer Awareness and Market Demand Survey for GAP Certified Fruits and Vegetables in Siem Reap and Kampong Cham Towns Presentation of the Study Result By KHIN Pisey and MEAS Thong March 2016

Contents Study objective and methodology Consumption pattern of fresh produce Consumer perception of fresh produce safety Awareness assessment of certified safe produce Market demand assessment of certified safe produce Conclusion

1. Study Objective and Methodology

1.1. Main Objectives To evaluate consumer’s perception on safety of fresh produce sold in Siem Reap and Kampong Cham towns; To evaluate consumer’s awareness on GAP concept and its roles in ensuring fresh produce safety; To determine consumer’s willingness to pay (WTP) for GAP-certified produce; To identify fresh produce which are perceived to pose the greatest risk to human health and the greatest potential for GAP certification;

1.2. Sample Selection Randomization process is applied Sample selection and interview location are as follow: Category Interview location Consumer Market, either fruit stall or vegetable stall Hotel owner Hotel address Restaurant owner Restaurant address Wholesaler Market Retailer

1.3. Sample Size Town Consumer Hotel Restaurant Kampong Cham 160 5 9 Siemreap 239 22 23 Total 399 27 32  Town Retailer Wholesaler Vegetable Fruit Kampong Cham 20 18 2 Siemreap 25 1 Total 45 43 3

1.4. Analytical Framework Descriptive statistics and graph illustration are used for data analysis which mainly follows the contents of the ‘consumer’ questionnaire. Specifically for willingness-to-pay determination, the Contingency Valuation method will be employed. Overall, the analysis focuses on three sample groups: All (both Siem Reap and Kampong Cham Towns), Siem Reap Town, and Kampong Cham Town.

1.5. About Respondent Respondents aged of 30s and 20s or younger represent 60% of the total household respondents.

1.5. About Respondent (cont.) The average monthly income is USD 536 for households in Kampong Cham town, about 22% lower than the USD 691 in Siem Reap town.

2. Consumption Pattern of Fresh Produce

CONSUMER – Vegetable Purchase (%Sample) 2.1. Purchasing Frequency CONSUMER – Vegetable Purchase (%Sample) 6.4 days/week 6.3 days/week 6.3 days/week

2.1. Purchasing Frequency (cont.) CONSUMER – Fruit Purchase (%Sample) 2.3 days/week 2.7 days/week 2.5 days/week

2.2. Average Quantity and Expenditure Purchased Quantity (Kg/week) Vegetable: quantity of vegetable purchased by hotels in Siemreap is 3.6 times larger than that in Kampong Cham Fruit: quantity of fruits purchased by consumers in Siemreap is 28% higher than that in Kampong Cham. For hotels, the difference is almost 10 times. CONSUMER HOTEL RESTAURANT

2.2. Average Quantity and Expenditure (cont.) Expenditure (USD/week) Vegetable: significant difference among hotels of the two sample areas. Fruit: significant difference among consumers and hotels of the two sample areas. These differences are in line with purchased quantity, since no significant difference in prices is observed. CONSUMER HOTEL RESTAURANT

2.3. Fresh Produce Most Commonly Purchased by Households CONSUMER – Vegetable Purchase (%Sample) 5 most commonly purchased vegetables: water convolvulus, cucumber, curly-wrap pak choy, Chinese green, cabbage.

2.3. Fresh Produce Most Commonly Purchased by Households (cont.) CONSUMER – Fruit Purchase (%Sample) 5 most commonly purchased fruits: longan, banana, green orange, grape, apple.

3. Consumer Perception of Fresh Produce Safety

3.1. Safety Perception by Fresh Produce Origin Domestically grown produce is perceived to be safe, and the imported is unsafe All sample locations Note: Other countries: China, Korea, USA

3.1. Safety Perception by Fresh Produce Origin (cont.) Limited use of chemical fertilizers and pesticides, and naturally- grown method are three main reasons which make domestic produce perceived safer than the imported. All sample locations, domestic (%Sample) VEGETABLE FRUIT

3.1. Safety Perception by Fresh Produce Origin (cont.) Excessive use of chemical fertilizers and pesticides, and use of growth hormones and preservatives are four main reasons which make the imported from Vietnam perceived unsafe. All sample locations, imported from Vietnam (%Sample) VEGETABLE FRUIT

3.1. Safety Perception by Fresh Produce Origin (cont.) Four main reasons similar to the case of Vietnam: limited use of chemical fertilizers and pesticides, and naturally-grown method All sample locations, imported from Thailand (%Sample) VEGETABLE FRUIT

3.2. Safety Perception by Fresh Produce Commodity CONSUMER – Vegetable Most unsafe vegetable: Napa cabbage, Chinese kale, bok choy, and cabbage .

3.2. Safety Perception by Fresh Produce Commodity (cont.) CONSUMER – Fruit Most unsafe fruit: grape, apple and pear.

3.3. Consumer Experience on Fresh Produce Consumption CONSUMER (%Sample) Less than 20% of respondents reported health problem caused by fresh produce consumption Among those reported, three common problems include: diarrhea, vomit and stomach ache. CONSUMER (%Sample)

3.3. Consumer Experience on Fresh Produce Consumption (cont.) Key fresh produce causing health problem include: 4 vegetable commodities (cucumber, cabbage, Napa cabbage, and Chinese green), and 6 fruit commodities (durian, longan, apple, rambutan, watermelon, and grape). CONSUMER - Vegetable (%Sample) CONSUMER - Fruit (%Sample)

3.4. Consumer Behavior on Fresh Produce Hazard All sample locations (%Sample) Cleaning Practice: 3 methods for vegetable (soaking in solution of salt, washing multiple times and soaking in water); one method for fruit (washing multiple times). Selecting practice: 4 methods for vegetable (having some damage by insects, small in size, locally grown, produce that is fresh); 2 method for fruit (locally grown, produce that is fresh). All sample locations (%Sample)

4. Awareness Assessment of Certified Safe Produce

4.1. General Perception Awareness of safe produce: Only a small proportion of respondents reported that they know about safe produce. However, after being read the definition of GAP: Fewer respondents reported that they know about safe produce.

4.1. General Perception (cont.) Respondent’s description/perception of safe produce

4.2. Credibility of Certification Program Across categories, most of the respondents expressed that they will “somewhat trust” or “totally trust” the program.

4.2. Credibility of Certification Program (cont.) The top concern reported was that the label many be easily forged and used.

4.2. Credibility of Certification Program (cont.) Methods to improve trust, including dissemination and inspection.

5. Market Demand Assessment of Certified Safe Produce

5.1. Certification Potential 3 vegetable commodities: cucumber, cabbage and curly-wrap pak choy.

5.1. Certification Potential (cont.) 3 fruit commodities: longan, rambutan and green orange.

5.2. Willingness to Pay Premium for GAP certified vegetable (% retail price) The premium for GAP certification ranges from 600 to 850 Riel/kg. Calculated as % of retail price, it could be as low as 13% for Chinese kale and Cauliflower (vegetables with high retail price) to as high as about 30% for water convolvulus, cucumber and Chinese green (vegetables with low retail price).

5.2. Willingness to Pay (cont.) Premium for GAP certified fruit (% retail price) For fruit, the premium for GAP certification ranges from 400 to 1,100 Riel/kg . Calculated as % of retail price, it could be as low as 7-9% for orange, durian and Longan (fruit with high retail price) to as high as about 30% for watermelon (fruit with low retail price).

6. Conclusion

Consumers perceive that domestically grown fresh produce is somewhat safe, while imported produce is somewhat unsafe. However, this safety evaluation does not accurately reflect the actual situation in the country, given that the judgment was based on consumer’s perception rather than knowledge based on actual testing on residue on produce. There is a misperception among both consumers and sellers that chemical fertilizers pose an adverse effect to produce safety. Since GAP does not entirely eliminate chemical application from production, the public should be communicated that chemical application in a proper amount and at an appropriate time does not affect the safety of produce. The majority of consumers are not aware of the GAP concept, as what expected earlier prior to the study implementation. However, they tend to anticipate the important role of the GAP in ensuring fresh produce safety.

For vegetables, five potential commodities recommended by households and retailers include cucumber, cabbage, curly wrap pak choy, Chinese green, and water convolvulus. Among hotels and restaurants, in addition to cucumber and cabbage, they recommended the other three potential commodities comprising lettuce, tomato and bok choy. For fruit, households and retailers recommended five commodities: longan, rambutan, green orange, durian, and dragon fruit. Hotels and restaurants also share common views on rambutan and dragon fruit, and add three more fruit commodities including pineapple, watermelon and banana.