Growing demand drives vanilla prices up

A vanilla plant in Nakifuma. The commodity is grown in Mukono District and the Western Rift Valley. Photo by Rachel Mabala

What you need to know:

Vanilla farmers have been in dire straits for the last nine years when farmers grew the commodity on a large scale and had to sell it at much lower prices than they had anticipated.

Farmers who remained in vanilla growing after the 2005 bust are now smiling their way to the banks as prices go up.

A kilogramme of green vanilla beans now goes for Shs25,000 at the farm gate price, up from the Shs15,000 it sold the same period last year.
About nine years ago, the price of vanilla which had reached Shs100,000 for a kilogramme of green beans nose dived to almost Shs1,000.

This left farmers who had invested in the commodity frustrated as hundreds were forced to abandon the crop.

However, the drift is gradually changing for those who stayed in the business as prices have continued to go up.

Players in the industry attribute the price rise to increasing demand for the commodity both at the local and international markets.

In an interview with Prosper magazine Uganda Export Promotion Board trade officer, Mr Moses Mabala, shares: “We are seeing international demand for vanilla picking up from the United States of America, German and Japan.”

He said people still don’t believe this is happening judging from what happened in 2005 when the prices fell drastically.

Mr Mabala said one of the reasons the demand for vanilla has grown is the growing food industry which requires the commodity as a spice especially in confectioneries.

Exporters’ view
The managing director of Uvan (U) Ltd, the country’s leading exporters and buyers of vanilla, Mr Aga Sekalala (Sr), said: “The prices have been steadily increasing and because of this many farmers are now going back to vanilla production.”

He said this is encouraging and they expect to see a boost in production judging from the many inquiries from the farmers and those searching for vanilla plantlets.

Mr Sekalala urged vanilla farmers to rehabilitate their gardens and also plant new plantlets, as this will keep them in full production all year around.

Information from UEPB indicates that there has been a promising trend in vanilla exports.
Records show that in 2013, the country exported 69 tonnes worth $2.6 million (Shs6.7 billion), up from 23 tonnes worth $506,000 (Shs1.2 billion) in 2012.

In 2009, the country realised Shs12.2 billion (about $4.9 million) from 271 tonnes exported. In 2010, a total of 230 tonnes were exported, in 2011 the volumes declined to 131 tonnes.

Mr Mabala shares that Uganda’s exports to the world increased by 114 per cent between 2012 and 2013.
“This has pushed Uganda to the 12th biggest exporter in the world and Germany is now the country’s biggest market destination,” Mr Mabala added.

In the mid-90s, vanilla was the leading source of income for people, especially in Mukono, Mpigi, Luweero, Bundibugyo and Kasese Districts.