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Abstract
Demand for animal products has been increasing rapidly in Bangladesh due to urbanization
and increases in per capita income. There are rudimentary indications that demand for
improved food quality and safety has also been increasing and that consumers were willing
to pay higher prices for such attributes of products. However, there is little empirical
evidence on the criteria and indicators of quality and safety that consumers use in their
buying decisions, or that suppliers use in differentiating products to promote sales, or
the extent to which consumers are willing to pay for such attributes. This study is the first
attempt to comprehensively characterize and quantify Bangladeshi urban demand for animal
products with a focus on quality and safety. Based on a multi-stage sample survey of 900
households from Dhaka and Mymensingh cities, successive analyses present statements of
preference based on ratings, identified quality criteria, stated sources of supply and recent
purchasing behaviour both at home and away from home, and econometric analysis of
relationships between price ratings and quality ratings across attributes, so as to generate
willingness to pay for those attributes. The findings show that officially defined grades and
quality standards of livestock products are either absent or poorly defined and enforced. On
the other hand, producers and consumers in the market use specific attributes or criteria
and indicators to differentiate quality and safety of livestock products and they also charge
and pay different prices based on those attributes. Although targeted at urban populations,
considerable variation between locations in terms of the product preferences and attributes
used to differentiate quality was identified. Establishment of standards and grades will
become necessary to meet consumer demand on the one hand and facilitate producers and
market agents to respond to consumer demand on the other. Whether smallholders will have
any comparative advantage in supplying an expanding market requiring more homogenous
and better quality and safer products need to be studied regularly along with studies on
consumer demand because of the dynamic nature of the emerging and evolving market, the
industry and the sector.