We have all benefited from cheap vanilla prices, but the vanilla certainly has not. Vanilla is the most labor-intensive spice after saffron, and when the price goes under $35/kg the repercussion is felt directly at grower level. For us to be able to compete in this market we have to buy green vanilla. Vanilla vines take 4 years to be productive and the upkeep of the fields is backbreaking, flowering only happens once a year and the window to hand pollinate each flower is only a few hours. The curing of vanilla is an art that requires years to perfect and requires 2 months of constant attention, you need

total collaboration with nature during this period (vanilla needs sun drying to start developing its flavor and lack of sun can be disastrous). Storing of the vanilla is also a big challenge; some qualities are stable at 35% moisture and other can dry all the way to 12%. Carrying this inventory is a skill that, if not mastered can result in huge losses. Then when you have done all that, you are just half way there. To get into play, you have to find a buyer wanting that flavor profile, origin and type.

I think that to be successful in this business you need to be passionate about it. At Tripper we process various spices, but vanilla is what got us started and is still the only spice that gets me out of my seat and running to the warehouse when we receive a new shipments. In times when the vanilla prices are really low, we can push other products, but farmers and supplier are often mono crops. When you compare all the work that is needed to get vanilla ready for harvest, and farmer can only sell it for $1.50/Kg once a year, it’s hard not to rip those vines out and start ginger, today over $2.50/Kg with harvest twice per year and if prices aren’t good at time of harvest you can always store it and improve the quality (not like green vanilla… you have 4 days max). It’s hard to resist when your neighbor is working less and making more.

The key with vanilla is to satisfy the farmers and the worst is yet to come and with such low prices the farmers have over pollinated vines making them weak, stopped tending to their fields, and left them overgrown and prone to disease… and here comes the Fusarium (this disease has been prevalent in all growing regions for more than 10 years, destroying entire growing areas).

Now that we are at the bottom of the curve the sensible thing to do would be to establish a floor price. This would make it interesting for the farmers to get back into the game. We should take long term commitment to growing areas and make sure that the price goes where it is most valued: to the farmers. Madagascar’s attempt to do exactly this last year was (as always) for the wrong reason, they established a minimum floor price of $27/Kg export price. However, they didn’t bother to enforce the most important price: the one to the farmers who are currently paid under $10/Kg. So in 2010, the ones that are going to make the most profit are going to be ones bringing in the least value in the trade, but that’s nothing new. In 2011 we will come to realize that there is very little vanilla left in the world and we are going to go back to crazy prices. This pushes new opportunistic players in a market needing savoir-faire every step of the way, therefore resulting in poor quality vanilla at premium prices.

It’s hard for me to admit, but the old school vanilla trade with prices established a year in advance over a coffee at the Bedford Hotel in Paris might have been the best time for vanilla.