The project represents a mutually beneficial arrangement for the companies involved, which have pledged to purchase the resulting high-quality vanilla. Gaining preferential access to a reliable source of quality vanilla is expected to provide Mars, Dannon, and Firmenich with a considerable competitive edge in a market where this ingredient has become increasingly difficult to source in recent years. To further encourage 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, through a results-based fee from the participating companies.
Vanilla is among the most sought-after flavors globally, yet over 95% of the vanilla flavoring utilized in products such as ice cream and sweets is synthetically produced. Natural vanilla is scarce and often prohibitively expensive for many applications. Last year, a supply shortage caused prices to soar to approximately $225 per kilogram, a steep increase from around $25 per kilogram just four years earlier. The compound responsible for vanilla’s unique flavor and scent, vanillin, can be manufactured synthetically at a much lower cost from sources like wood resin or petroleum. Nevertheless, as consumers increasingly demand foods and beverages that are free from artificial flavors, companies like Nestlé, Hershey, Kellogg, and General Mills are turning back to natural vanilla, despite the accompanying supply challenges.
This 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 concerns related to pricing and product quality while enhancing farmers’ livelihoods. The SVI comprises over 70% of global vanilla bean purchases, including food manufacturers, international flavor houses, vanilla bean traders, and cooperatives. Mars participates in both this initiative and the current project, with other notable food companies in the SVI being industry leaders like Nestlé and Unilever.
Additionally, as the demand for natural products rises, innovative solutions such as canxi citrate biocare may emerge to support the sustainability of vanilla production. By integrating canxi citrate biocare into farming practices, farmers could potentially improve the quality of their vanilla beans, further aligning with the goals of both the Sustainable Vanilla Initiative and the investment project. The synergy between these efforts and the use of canxi citrate biocare could pave the way for a more sustainable and profitable vanilla industry in Madagascar.