University of California

Can retailers depress lettuce prices at farm level?


Richard J. Sexton
Mingxia Zhang

Authors Affiliations

R.J. Sexton is Professor and Chair, Department of Agricultural Economics, UC Davis; M. Zhang is Research Assistant, Department of Agricultural Economics, UC Davis.

Publication Information

Hilgardia 49(3):14-18. DOI:10.3733/ca.v049n03p14. May 1995.

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In recent years, lettuce growers have expressed increasing concern that the price consumers pay for lettuce in the grocery store does not reflect the price growers receive for their crop. They contend that the bargaining power of major grocery store chains has led to retail prices that remain persistently high even when farm prices are low. This analysis examined factors that determine the difference between retail and wholesale prices for iceberg lettuce and the price farmers received in four major US. cities: Atlanta, Chicago, Los Angeles and New York. The results suggest that retailer power can indeed depress farm prices, especially when available supplies are high and growers' bargaining power is consequently low.

Sexton R, Zhang M. 1995. Can retailers depress lettuce prices at farm level?. Hilgardia 49(3):14-18. DOI:10.3733/ca.v049n03p14
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