Its price has tripled in two years and quality has deteriorated. Experts point to a disappointing harvest in Madagascar, the world’s producer, speculation and money laundering.


In Madagascar, vanilla prices soar, its quality deteriorates

Vanilla, popular for ice cream and confectionery, has a bitter taste for buyers: its price has tripled in two years and quality has deteriorated, according to experts who point to a disappointing harvest in Madagascar, the world’s producer, speculation and money laundering.


Madagascar, a poor island in the Indian Ocean off Mozambique, provides over 80% of world production. In 2014, Madagascar vanilla kilo sold for about $ 60, before moving on to some 135 dollars in 2015 and to 220 dollars currently.


Vanilla has become so expensive that in some supermarkets in the capital Antananarivo, the pods are not found in the spice department but close crates, to deter thieves.


“The Malagasy harvest in 2015 was not excellent: about 1,200 tonnes against 1,800 the previous year,” says Emmanuel Born, head of department at Touton ingredients, including vanilla French trader.

“But this does not justify a price increase as it has seen this year,” he adds immediately AFP. “Operators are highly speculative,” he notes, denouncing an “irrational” market.


“There are large operators who have large stocks and outbid” adds Dominique Rakotoson, head of a family business vanilla collection Sambava (northeast) and one of the few players in the sector Malagasy vanilla loan to testify.


Due to the soaring prices, “many buyers abroad have had to cancel or reduce their control,” he complained, while half of the Malagasy vanilla is exported to Europe and one third to the States United.

Industrialists in the food also raise the question of greater use of synthetic vanilla, cheaper, in their products, says Emmanuel Nee.


Especially as the quality of the spice has deteriorated in recent years producers gather vanilla while it has not yet reached maturity to take advantage of rising prices, but also prevent theft in planting.

Money laundering

The use of vacuum packaging, while vanilla is still full of water, is also increasingly common. “The vacuum interrupt the drying process, which deteriorates the quality of vanilla,” admits Njaka Landry, secretary of the National Platform of vanilla, Madagascar private organization bringing together industry players.


The complex process of preparation of vanilla – scalding, steaming, drying in the sun and in the shade – is sloppy. “The trainers are forced to redo work” before exporting the pods, which also contributes to the increase in prices, says Emmanuel Nee.


To fight against the production of poor quality vanilla, the government recently many announcements including the prohibition of the vacuum packaging.


To mark the occasion, the government also burned in March 500 kilos of vanilla that was not mature, according to the director of foreign trade at the Ministry of Commerce, Sylvia Pages.


Authorities also announced the setting up of special brigades responsible for preventing theft or picking immature vanilla, measures including Emmanuel Born however doubts the effectiveness.


But another reason less blameless says soaring prices: trade vanilla used to launder money from illegal traffic of rosewood, very sought after by Chinese for making furniture and musical instruments, say AFP several actors.


Vanilla and rosewood pull in the same region, northeast of Madagascar. Illicit money timber traffic and “reinvested” in the legal trade of vanilla, fueling speculation on this spice. “It is in the wood strongholds of pink found speculators on the price of vanilla,” says Dominique Rakotoson.


In the medium term, the Big Island could be herself a victim of the price increase. Due to its current profitability, several countries such as Vietnam, India and Indonesia are interested again in vanilla production.


It takes about five years to produce a first crop. But such competition would deal a blow to Madagascar, where the industry directly employs 200,000 people and generated $ 192 million in exports in 2015.



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