Madagascar vanilla is currently going through a crisis that could prove fatal. Arrangements are needed to save the industry.
Exporter, but also member of the board of directors of the National Vanilla Council (CNV), the businessman, Mamy Ravatomanga, obviously had his words (and his troubles) to say about the vanilla sector, during his last friday tv show.
Back to liberalization
Regarding more specifically the crisis that Madagascar’s vanilla is currently going through, the CEO of the SODIAT group declares that the vanilla sector has been the victim of interference from politicians. A way of saying that politicians were behind the demand expressed by players in the vanilla industry for the return to liberalisation. “I have always been against a wild liberalization of the vanilla sector, but that is what some operators wanted”, declared Mamy Ravatomanga. It is recalled that a regulation was initiated by the authorities, led by the Ministry of Industrialization, Trade and Consumption. This consisted in particular of a more rigorous selection of approved exporters, particularly in the tax field and in terms of the obligation to repatriate foreign currency. But also and above all, and with the aim of better protecting the interests of peasant producers, the establishment of a minimum price of 75,000 ariary for the kilo of green vanilla and 250 dollars per kilo of prepared vanilla. A policy which did not have time to prove its effectiveness but which was finally abandoned, following the request of some of the players in the sector. And by decision of the competent authorities who therefore finally accepted the return to liberalisation.
Growls
Be that as it may, the vanilla industry currently finds itself in a very difficult situation. Especially for the peasant producers who barely manage to sell the green vanilla at 2,000 ariary per kilo. From then on, discontent rose in the vanilla production areas. Especially in Maroantsetra where the peasants have started to erect dams as a form of protest. And to ask the competent high authorities to take the necessary measures to give Madagascan vanilla the price it deserves. A challenge that remains very difficult to meet when we know that the sector is currently in a situation of overstock. According to forecasts, with an estimated carryover of 1,500 tons and a production of at least 2,500 tons, we will end up with at least 4,000 tons of vanilla supply from Madagascar for a world demand of 2,500 tons.
Nicotine
But another threat hangs over Madagascan vanilla with the European Union’s decision to lower the maximum tolerated limits of nicotine residues in vanilla. This level, which was 0.3 mg per kilo so far, should no longer exceed 0.02 mg from September 14th. This will obviously have an impact on vanilla from Madagascar, of which almost 80% of the pods could simply no longer access the European market because they exceed this new maximum limit imposed by the European Union. Unless the latter reconsiders, in the meantime, this decision taken without prior consultation of the Malagasy authorities, but which could deal a fatal blow to the living conditions of thousands of peasants and economic actors living from this sector whose weight on the Malagasy economy is far from negligible. Faced with this threat, the government set up an “operational force” made up of the Ministry of Industrialization, Trade and Consumption, the Ministry of Agriculture and Livestock and finally the Ministry of Foreign Affairs. This ” task force which should include private players in the sector will have the heavy task of convincing the European Union to abandon this new limitation. Or at least to postpone it, the time to see what is really going on with these nicotine residues. Verdict, within a month.
R.Edmond.
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