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Vanilla is so valuable that it’s been called “green gold.” At its peak in 2017, prices hit nearly $600 per kilo — making the second most expensive spice in the world. But by 2024, prices had crashed to roughly $50 per kilo.
That volatility stems from one major factor: the world depends heavily on Madagascar, which has historically supplied about 80% of natural vanilla. When storms, theft, early harvesting, or policy changes hit Madagascar’s crop, the entire global market feels it.
Now buyers are looking for another source — and Uganda is quickly emerging as vanilla’s next big player. With two harvest seasons a year, improving quality controls, and growing demand from major brands, like Ben and Jerry's and Nielsen-Massey, Uganda could help make natural vanilla more stable and affordable.
So, why is vanilla so expensive? And can Uganda step in to help stabilize global prices?
That volatility stems from one major factor: the world depends heavily on Madagascar, which has historically supplied about 80% of natural vanilla. When storms, theft, early harvesting, or policy changes hit Madagascar’s crop, the entire global market feels it.
Now buyers are looking for another source — and Uganda is quickly emerging as vanilla’s next big player. With two harvest seasons a year, improving quality controls, and growing demand from major brands, like Ben and Jerry's and Nielsen-Massey, Uganda could help make natural vanilla more stable and affordable.
So, why is vanilla so expensive? And can Uganda step in to help stabilize global prices?
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00:03These farmers are arming themselves to stop thieves from stealing one of the
00:07world's most valuable spices, vanilla. In its boom years, the average price of
00:15vanilla hit $300 per kilogram. For years, one country has dominated the
00:24industry, Madagascar. It has historically accounted for about 80% of the global
00:32vanilla supply. So if anything threatens the country's harvest, prices will
00:37skyrocket even more. Like they did in 2017, when vanilla hit a record high of
00:43nearly $600 per kilo. But this country is offering an alternative. In just five
00:52years, Uganda has become the second-largest vanilla exporter by
00:56volume. And if Uganda's production continues to grow, it could lead to
01:01more affordable, stable prices. Now big brands like Ben & Jerry's are even using
01:08Ugandan vanilla. So how did vanilla become such an expensive spice? And can Uganda
01:16step in to help stabilize global prices? Madagascar may lead the vanilla market, but
01:24that hasn't always been the case. The spice's roots lie elsewhere. Grown on
01:31climbing orchid vines, vanilla is primarily native to Mexico and other
01:35Central and South American countries. For centuries, only the Totonacs cultivated
01:40vanilla, while neighboring indigenous groups like the Maya and Aztecs used it to
01:45flavor cacao drinks. It was all made possible by native bees that pollinated
01:49the vanilla orchid. But all that changed in the 19th century, when Edmund Albius, a
01:55gardener born into slavery, devised a technique for pollinating the orchid by
01:59hand. Suddenly, those native bees weren't the only way to pollinate vanilla. As other
02:05countries began cultivating vanilla, Mexico lost its edge. That's where
02:10Madagascar comes in. With its humid rainforest conditions and space to scale,
02:16Madagascar was ideal for vanilla. By the 1920s, Madagascar had become the
02:22world's largest vanilla producer, a position it's held ever since. When
02:27Business Insider filmed in Madagascar in 2022, Razafin Salama, a vanilla farmer,
02:33showed us how he pollinates each flower by hand.
02:43Vanilla orchids take two to five years to flower. But Razafin Salama has only a few
02:49hours to pollinate them before the flowers wither. After pollination, farmers have to
02:54wait another six to nine months before the flowers bear green vanilla pods, which
02:59happens only once a year in Madagascar. This labor-intensive, years-long process
03:06makes vanilla so pricey that it's earned the nickname green gold. Labor is just one factor.
03:18A single weather event can also shake global prices. In March 2017, Cyclone Anawa tore through
03:27Madagascar's vanilla region, damaging about 30 percent of the crop. At the time, prices were
03:33already around $500 a kilo. Within months, vanilla surged to nearly $600 a kilo, as the Cyclone further
03:41tightened supply. And when global vanilla prices rise, so does the risk of theft. Farmers can spend their
03:49four nights patrolling their fields, weapons in hand.
03:53The pressure to harvest crops before they're stolen can push some farmers to pick their beans
04:08too soon, resulting in lower quality vanilla. With poor quality beans at sky-high prices, demand for vanilla
04:17to decline. In an effort to counteract this, Madagascar's government imposed a minimum export
04:24price of $250 per kilo in 2020. The policy didn't go as planned. Buyers largely ignored the price floor
04:33since it didn't reflect actual market prices. Instead, some buyers switched to artificial vanilla,
04:40a much cheaper alternative. By the time Madagascar lifted the $250 price floor in 2023, the country was
04:49sitting on an oversupply of beans and vanilla prices went into freefall. By 2024, the average export value
04:57had plummeted to roughly $50 per kilo. Given Madagascar's unpredictable supply, global buyers are looking to
05:06other countries for a dependable secondary source of vanilla. And Uganda in particular is stepping up
05:15to the plate. For Uganda and vanilla, we are saying there is an alternative source and we want the
05:24alternative next source to be Uganda. In the global vanilla market, Uganda stands out because it's the
05:31only place in the world with two vanilla harvest seasons each year. That's thanks to its ideal
05:38climate and rainfall patterns. We have two seasons. We have the December, January and we have June, July.
05:47In Uganda's Ibanda district, Thomas and his wife Madrid built their vanilla farm a few steps away from
05:53their home so they can stay close in case thieves strike. This is the farm. We are sharing with the
06:03family.
06:05So my wife and even the children, when they are not at school, they join us and we do weddings.
06:11I started in 2015. Before I started, there was the vanilla gardens in Ibanda with a few farmers.
06:18We visited in March, just as the rainy season was starting, which meant more upkeep for Thomas.
06:25He brings long vanilla vines down to the ground to keep them at a manageable height and to stimulate
06:31growth, a process called looping. When the rain is too high, you find the fungal diseases,
06:37the dropping of the flowers. I am looping because the rain has started. When I loop, the veins
06:48gain strength and move up and come back. Farmers like Thomas contend with the rain. But since Uganda
06:56is landlocked, it doesn't face the same cyclone threats as Madagascar. Uganda is also right on the
07:03equator, which gives its vanilla beans a unique flavor profile. But to truly become an alternative to
07:10Madagascar's vanilla, it also has to deliver on quality. Uganda's government, vanilla industry,
07:18and researchers are working together to improve quality through science. And the U.S. Department
07:24of Agriculture has invested $13 million into the industry. PROSI leads the Association of Vanilla
07:32Vanilla Exporters of Uganda Limited, or Vanex, a trade group shaping the quality and global reach
07:38of Ugandan vanilla. Using various scientific methods, Vanex and Makareire University conduct
07:45maturity surveys to determine the optimal time to harvest vanilla. Once the maturity period is determined,
07:52We make sure we do the declaration of the harvest window that is declared by the Ministry of Agriculture.
08:02And in the last five years, this has proven to give us improvement in quality of Ugandan vanilla.
08:08These harvest dates are strictly enforced. And farmers who harvest too soon can face penalties,
08:15while thieves and buyers can be apprehended for buying or selling outside of those dates.
08:20Since the introduction of official harvest windows in 2019, some farmers have seen reduced vanilla theft.
08:27I planted the veins and it was taken away by thieves before it started growing. But because of the
08:36connection and network, the thieves were arrested and they paid back the veins.
08:42For farmers like Thomas and Madrid, this removes the incentive to pick beans prematurely.
08:48Instead, they make sure they harvest only fully ripe vanilla pods.
08:53These are typically green, do you see? But towards harvesting, it turns to light green, light yellow.
09:03When it keeps moving to yellow, it means it is getting ready for harvesting.
09:08But producing high quality green beans is only half the equation. Quality control continues in the curing process.
09:18Israel Kawiza, a vanilla processor, shows us the first step to curing — sorting the beans.
09:25This one, it's going under grade A. It's a premium grade because it's not busted, did not split anywhere.
09:34Next to the smooth premium beans are other beans, split open and streaked with black.
09:40They aren't defective. They're ideal for vanilla extract.
09:44Once sorted, the beans are thoroughly washed before undergoing something called the killing process,
09:50where they're submerged in hot water. Getting the temperature and timing just right is crucial
09:56to avoid destroying the enzymes that give vanilla its flavor and aroma.
10:00Israel times the premium beans to the second — just two minutes in hot water.
10:06The beans are then placed straight into sacks, where they trap steam and sweat for a day.
10:12Next, the beans enter a cycle of sun exposure and sweating.
10:16These are the beans that have gone under curing.
10:21That have been exposed to the sun for one month and a half.
10:26As you see the beans right now, they are looking into a black color.
10:31To develop vanilla's aroma, the cured beans go through conditioning.
10:37In this room alone, there are over 3,500 kilos of cured beans.
10:42Here, the beans rest and are cooled in boxes, which allows them to fully develop their natural oils.
10:49The best stage of vanilla, it could be around four months.
10:54Whenever the beans come to this level, they are ready for the world market.
11:00After processing, quality control continues in the lab.
11:04Here, technicians measure vanillin content, which is the main compound that gives vanilla its flavor and aroma.
11:11Reported vanillin levels in Ugandan vanilla typically average above 2%,
11:16with the best beans containing as much as 4%.
11:20That's right on par with, or sometimes higher than, Madagascar's vanillin content,
11:24which typically ranges from 2% to 3%.
11:29From there, the beans are packed and readied for export.
11:33Each kilo of premium grade, of this premium grade, can go to our $100.
11:39That is, from the factory, like us, $100, $120, $130.
11:47With all these efforts to maintain quality, Uganda is gaining traction in the global market.
11:54Whether it's Ben & Jerry's vanilla ice cream, or some of the finest quality vanilla extracts,
11:59Ugandan beans are finding their way into products around the world.
12:04From Uganda, we crossed the Atlantic to the U.S.,
12:08where Nielsen Massey Vanillas showed us how the spice moves from bean to bottle.
12:14Madagascar is the number one place that we source from, and Uganda would be the second.
12:18Jonathan J.T. Thompson is the CEO of Nielsen Massey, a third-generation family business
12:24and one of the most recognized names in vanilla today.
12:28This is our Uganda extract. It's fantastic because it's got a nice chocolatey note to it.
12:33To make the company's signature vanilla extracts, workers first check the beans
12:37for quality, and then grind them for extraction.
12:40A lot of our beans will come in bundled. Once they've cut those bundles off,
12:45they'll get transferred over to our grinding machines, and then once that's
12:51done the chopping, they'll get put into these transferred totes.
12:55Other ingredients will then be added and we'll start the extraction process.
12:59We went to Uganda first off because it is a very similar profile to Madagascar,
13:05from just a sensorial organoleptic perspective.
13:08Organoleptic is a fancy way of saying how something looks, tastes, smells, and feels.
13:14But number two is actually a much more stable region to go to. The government's a bit more stable.
13:19They've also brought in a lot more farmers into growing vanilla, and that's actually really
13:24attractive because in times where you have supply shocks or you have some adverse weather in,
13:30say, Madagascar, they're able to get by a little bit better.
13:34While the company sources beans from other countries, JT shares where Ugandan vanilla shines.
13:40I think every country that is really into vanilla has its merits for different flavor profiles,
13:46but I would say Uganda is one of the up-and-coming from a dessert perspective.
13:50But one of my favorites is actually ice cream. And whenever we do our internal taste test,
13:54Uganda seems to always come out on top along with Tahitian, even more than Madagascar.
13:58Four ounces of Nielsen Massey's top-selling Madagascar bourbon vanilla extract costs around $19.
14:07That's 60% more expensive than the vanilla extract sold by McCormick, the world's largest spice company.
14:15Nielsen Massey attributes its premium pricing to its focus on quality.
14:20What makes Nielsen Masseys a bit more expensive is, first off, we start with the highest quality,
14:25most premium beans. But number two, what really distinguishes us is we go through this cold
14:29extraction process versus a lot of other folks are going to use a hot extraction process. It's
14:35part of the special sauce that the Nielsen family developed over many, many years.
14:39The company's director of quality, Jonathan Wall, showed us the cold extraction process, which can take
14:45weeks to complete. But for Nielsen Massey, the slower, more tedious process is worth it.
14:52Hot extraction, you can lose some of the flavors. It's quicker. It's a cheaper way of doing it.
14:59But we're all more focused on quality.
15:04Investments from major vanilla players like Nielsen Massey, combined with Uganda's own efforts,
15:09have put the country on the global vanilla map. It took just five years for Uganda to become the
15:15second largest vanilla exporter by volume after Madagascar. The country's export quantity went
15:21from 30 metric tons in 2019 to over 600 metric tons in 2024. Despite Uganda's progress, the country
15:29still accounts for only about 10 percent of the U.S. market and a smaller share in Europe.
15:36When it starts to get above 10 percent, which it is now, it's actually starting to provide
15:40a bit of a diversification and stabilizing function. So the more that that happens,
15:45the more stabilization we're going to see. One of its biggest hurdles? Most of the world
15:50doesn't know that Uganda has quality vanilla. We have not come out to invest in marketing.
15:57We have not branded who we are. And in 2024, that's why we launched a branding and marketing campaign.
16:08While Ugandan beans have historically been cheaper than Madagascar's, those patterns are starting to
16:14shift. Since 2022, Madagascar's vanilla prices have fallen faster than Uganda's, shrinking the price gap
16:21from $123 a kilo to just $15 in 2024. A lot of that comes down to the price of labor.
16:28It's just a
16:29little bit more affordable and cheaper labor when you get into Madagascar. But even with vanilla prices
16:36down, there may be a silver lining. What's really interesting is when prices are really low, what you
16:43typically see is actually the quality of the bean goes up. With quality beans at lower prices, more
16:50buyers can afford to choose natural vanilla over synthetic. And Uganda is ready to answer that call.
16:57I would like to inform the world that Uganda has everything that it takes to grow as much vanilla as
17:06possible.
17:07The future is bright because when you look at the projected global demand for natural vanilla,
17:14it is unmet. It is unmet. And this is the message that we give to our farmers.
17:20It is the message that we give to our members. The future of vanilla is in Uganda.
17:42It is the message that
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