Vanilla Market Report | Right Before the 2019 Green Season

The vanilla crop gross yield estimates in Madagascar are going to be relatively unknown for 2019 until the green season starts around July 10 and after. In the meantime, vendors will try to push prices high spinning news and storing away or strategically selling off the 2018 crop that was declared stock up until the open of the 2019 season, which itself is moved back to November 25 legally by Antananarivo authorities, later than last year’s October 15 start date and hence allowing more opportunity to predatory price squeezing to pre-emptively laser on profitable exports. The demand for splits, red, or drier vanilla as flavor fodder has picked up remarkably, and in general farm and collective pricing has held before export papers and taxes (as farmers and growers in villages do not pay any such taxes nor do they usually have bank accounts) between $350-450, bracketing $300-500 in deviation of price and quality over a sampling representative of all the farmers throughout Madagascar’s reservoirs of flavor, deep into the countryside all the way to the coasts of sunny SAVA and Masaola and Marojejy. Other entrants and challengers rise farther afield in Pacific Papua New Guinea, a much harder vanilla supply line, with a long way to go and greater risks and learning curves to quality and local legalities of export, but making marked and measurable quality progress in both Tahitensis and Planifolia species of vanilla. Demand has grown, not abated, from the United States and Asia, while about steady or declining in Europe. Much vanilla is traded unreported in market quotas and export statistics in the grey or black market, and statistics remain laughable more than laudable from Madagascar, Indonesia, and PNG, all of which are infected with rampant bean smuggling, hiding, hoarding, and misreporting. Madagascar’s government under the new president has made very positive and admirable steps to curb some of this as well as targeting the terrible illegal rosewood trade, that laundered its largesse in vanilla, as well as commendably setting solid quality controls for exported beans – which have counterbalanced the protests and gripes over export taxes by the producer groups and broken cartels, and thus achieved a balance this summer for vanilla export tax rates and bulk fees. Many of the core source problems still exist, foremost that the infrastructure in the vanilla coast needs serious upgrades to bring more beans to market, combat general poverty and seclusion, and help bring the price back into the $300’s or lower. However for now, the quality around the world has improved for vanilla at the same price levels, winning $500-1000 a kg in its end-user base, never having undergone the promised and prophetized serious “correction” (so-called experts were seriously incorrect about the correction, so to speak) that was predicted to pricing early in 2019. For now, the pricing seas are steady, and stocks will probably begin to be underreported soon to drive prices higher for as long as possible until the later new export date around the beginning of the North American Holidays at the end of November.