Shortage in vanilla market drives prices higher

Vanilla prices have risen sharply, up 120% y-o-y, on the back of supply shortages. Production problems in Madagascar, the main global producer, have been the driver behind the price hike.  Due to poor flowering towards the end of 2014, vanilla production declined in 2015, estimated at around 1100MT. 

Vanilla prices have been increasing since 2012 and with low production forecasts in 2015, farmers harvested some of their crop prematurely which reduced quality. The situation has been exacerbated by importers who stocked up early in anticipation of price hikes, further reducing supplies in the market.

Despite the upward trend in prices, caused by limited supply, global demand for vanilla has remained firm, further aggravating the market imbalance.

Vanilla Madagascar

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