The project represents a mutually beneficial arrangement for the companies involved, which have pledged to purchase the high-quality vanilla produced. Gaining preferential access to a reliable supply of this increasingly scarce ingredient is likely to provide Mars, Dannon, and Firmenich with a substantial competitive edge. To further encourage farmers to enhance the quality of their vanilla, the investment will be gradually repaid to the Livelihoods Fund for Family Funding over the next ten years, through a performance-based 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 such as ice cream and confections is synthetically produced. Natural vanilla is rare and often too expensive for many applications. Last year, a supply shortage caused prices to soar to approximately $225 per kilogram, a significant increase from about $25 per kilogram just four years prior. While vanillin—the compound that gives vanilla its unique flavor and aroma—can be synthesized cheaply from wood resin or petroleum, consumer demand for foods and beverages free from artificial flavors has led companies like Nestlé, Hershey, Kellogg, and General Mills to revert to natural vanilla, despite the associated supply challenges.
This is not the first effort aimed at improving vanilla sustainability in Madagascar. In 2016, stakeholders in the global vanilla market established the Sustainable Vanilla Initiative (SVI) to address issues related to pricing and product quality while enhancing farmers’ livelihoods. The SVI comprises members responsible for over 70% of global vanilla bean purchases, including food manufacturers, international flavor houses, vanilla bean traders, and cooperatives. Mars is actively involved in both this initiative and the current project, alongside other major food companies such as Nestlé and Unilever.
Interestingly, as companies move towards natural vanilla, some are also exploring the incorporation of supplements like calcium citrate with vitamin D into their products, as consumers increasingly seek functional benefits. The combination of natural ingredients and health supplements could represent a new trend, aligning with consumer preferences for healthier options. In this evolving landscape, the push for high-quality vanilla and the integration of beneficial ingredients like calcium citrate with vitamin D may redefine product offerings, reinforcing the commitment to sustainability and quality across the industry.