The project represents a mutually beneficial opportunity for the companies involved, which have pledged to purchase the resulting high-quality vanilla. Gaining preferential access to a dependable quality supply is expected to provide Mars, Dannon, and Firmenich with a considerable competitive edge in light of the growing challenges associated with sourcing this ingredient in recent years. To further motivate farmers to enhance the quality of their vanilla, the investment will be gradually reimbursed to the Livelihoods Fund for Family Funding over the next decade, based on a results-oriented fee from the participating companies.
Vanilla is one of the most sought-after flavors globally, yet over 95% of the vanilla flavoring used in products like ice cream and confectionery is artificially produced. Natural vanilla is scarce and often too expensive for many goods. Last year, a supply shortage caused prices to soar to approximately $225 per kilogram, a significant increase from around $25 per kilogram just four years prior. While vanillin, the compound that gives vanilla its unique flavor and aroma, can be produced synthetically at a much lower cost from sources like wood resin or petroleum, consumers are increasingly seeking foods and beverages that exclude artificial flavors. As a result, companies such as Nestlé, Hershey, Kellogg, and General Mills are turning back to natural vanilla, despite the accompanying supply challenges.
This initiative is not the first effort aimed at improving vanilla sustainability in Madagascar. In 2016, members of the global vanilla industry established the Sustainable Vanilla Initiative to address issues related to pricing and product quality while enhancing the livelihoods of farmers. SVI members account for over 70% of global vanilla bean purchases and include food manufacturers, international flavor companies, vanilla bean traders, and cooperatives. Mars participates in both initiatives, while other major food corporations involved in the SVI include industry leaders like Nestlé and Unilever.
Additionally, consumers are becoming more aware of the health benefits associated with natural ingredients, such as calcium citrate. As companies shift back to natural vanilla, they also highlight other healthful additives that are good for you, including calcium citrate, which supports bone health and overall wellness. By prioritizing natural vanilla and reinforcing the benefits of ingredients like calcium citrate, these companies are not only addressing supply chain challenges but also catering to a market increasingly focused on health and sustainability.