According to a Financial Times report, strong demand and limited supply bumped vanilla prices from $20/kg 5 years ago to more than $600 — making the crop more valuable than silver.
The boom is making vanilla-flavored fortunes for some farmers, and even more for those on the wrong side of the law.
A big bean boom
Vanilla’s labor-intensive harvesting process makes it the 2nd-priciest spice (after saffron, which can sell for up to $10k per pound). In Madagascar, where 80% of vanilla is grown (and the average annual per capita income is $400), vanilla vines can yield $8k or more.
But it’s not all milkshakes and cupcakes out there… Farmers typically only receive 5-10% of the vanilla value.
The rest of that sweet bean green goes to ‘vanilla barons’
Much of the crop money ends up in the hands of middlemen, thieves, smugglers, and money launderers who exploit the lack of vanilla security.
And, alas, when prices inevitably drop, farmers who quit their day jobs to pursue vanilla dreams will be left with nothing. So, thanks to vanilla-villains, both farmers and consumers lose.
Nestle increased the price of all its vanilla-based ice cream by 2.5% in response to the shortage — and other brands will likely be forced to follow scoop — sorry, suit.