Prized for it's dominance in the industry, Madagascar vanilla continues to receive high demand throughout the world. Although the crop brings economic opportunities to thousands of farmers, recent events have brought the Madagascar vanilla industry into a period of hard times.
In late 2016, a strong cyclone rocked the eastern part of the island of Madagascar, which destroyed roughly 40% of the world's vanilla farms.
Madagascar produces roughly 75% of the world's vanilla, so you can imagine the global deviation by all those who work in the industry.
The island was also hit by Cyclone Enawo in March 2017, which destroyed many of the vanilla orchids which produce the seed pods. The second cyclone was followed by a major drought. Not ideal.
As demand for natural vanilla products continues to rise, the price of the commodity continues to increase. The scarcity of natural Madagascar vanilla has brought prices from $50 per kilogram in 2011 to over $550 in late 2018. Low supply + high demand = high prices.
Vanilla, once seen as a staple crop in Madagascar, is now seen similar to gold. The high prices have brought a significant increase in theft and looting of vanilla farms. The people who work in and own vanilla farms are at a constant threat of violence.
Many vanilla farmers are now employing a 24/7 armed security guard and tattooing their vanilla crops to prevent theft.
Countries like Indonesia and Malaysia have increased their vanilla production to fill the global demand, and they're brilliant for doing so.
Madagascar's government required farmers to work with a variety of "certified" people who will sell to overseas buyers, like us, Origin. This has only created more problems as farmers are now selling unripe and low quality beans at low prices.
Many farmers are so concerned that they will willingly pick their crops before they're ripe so they aren't stolen.
The current state of the Madagascar vanilla industry is, well, incredibly concerning.
At Origin, we're currently staying away from vanilla grown in Madagascar as we believe the quality has significantly dropped, and the government is unfortunately profiting off of a worrisome economic and agricultural disaster.
We're hopeful that the vanilla industry heals soon.