CBD Oil Concentration and Hemp Flower Drying Preferences of U.S. Consumers

Benjamin D. J. Jacobs, Michael P. Popp, Sunjin Ahn, Wim Verbeke, Brandon McFadden, Tyler B. Mark, Adam N. Rabinowitz and Benjamin Campbell

Research on World Agricultural Economy, 2024, vol. 5, issue 01

Abstract: The method used to dry hemp flowers can impact the concentration of cannabidiol (CBD) and other quality characteristics like mold levels in CBD oil. Understanding consumer preferences is vital for hemp producers and processors because there is variation in drying time, energy use, and capital investment between potential drying methods. This research assesses willingness to pay (WTP) for CBD oil at varying CBD content (mg per 1-oz.(30 mL) bottle) and drying methods to better understand consumer preferences and how consumers make tradeoffs between CBD oil attributes. Specifically, the authors elicit preferences toward drying using: i) controlled ambient conditions (air-drying), ii) infrared radiation (IR), and iii) freeze-drying or lyophilization. Few statistically significant WTP differences between CBD oils, when marketed at average attribute levels, were found for higher or lower CBD concentration or drying method. An exception was respondents 55 years of age or older who had a higher WTP for CBD oil with greater CBD content (2,500 mg) and also preferred the freezedried product over the baseline of a conventionally air-dried product with 1,000 mg of CBD. The lack of distinct preferences among the majority of consumers suggests that producers and processors can choose alternative drying methods based on their cost, time, and energy constraints without risking a WTP penalty. The findings indicate that consumers do not have well-formed preferences for CBD oil as it is a relatively novel product. Yet, the results suggest that consumers may interpret higher prices to reflect higher quality/product safety, thereby offering perceived quality assurance.

Keywords: Consumer/Household Economics; Demand and Price Analysis (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ags:reowae:341828

DOI: 10.22004/ag.econ.341828

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