The vanilla market - France (2024)

1.2 An extremely volatile global market

World vanilla production World, **** - ****, tonnes FAOSTAT

In ****, world vanilla production was estimated at **** tonnes, recovering after several years of steady decline. In fact, global vanilla production fell by almost **% in **** compared with ****, mainly due to the decline in exploitable land in the main producing countries, as well as several seasons of poor harvests that affected them. However, production has not returned to its **** level, notably due to cyclone Batsirai, which hit Madagascar in early ****. The impact of climate change and the reduction in the number of flowers compared to **** are likely to result in a future drop in production in Madagascar of between **% and **%.

Global vanilla production remains highly concentrated in a few countries. The main international producers are Madagascar,Indonesia and Mexico, with **.*%, **.*% and *.*% of world production respectively. It is interesting to note that Indonesian production is destined for its domestic market, placing Madagascar at the center of the export market, with almost **% of exports, i.e. some *,*** tonnes of vanilla exported from the island. Main vanilla producers World, ****, in % of global production FAOSTAT

Main vanilla exporters, by value World, ****, in Source: ****

1.3 Vanilla, a product mainly imported into France

While a small proportion of the vanilla consumed in France comes from overseas territories such as Réunion and Martinique, the majority is imported. In ****, France imported *,*** tonnes of vanilla, with an estimated total value of *** million euros.

French vanilla imports and exports France, ****-****, in millions of euros French Customs

This level of vanilla imports makes France the world's second largest importer of vanilla (***). Madagascar is France's main supplier of unground and unpowdered vanilla: in ****, the Big Island alone accounted for **.*% of French vanilla imports, representing a total value of **.* million euros, according to French Customs. Vanilla importing countries World, ****, in % of global imports Tridge

In addition to production in the French overseas territories, some raw vanilla (***) from France, accounting for **%, **.*% and *.*% of the value of these exports respectively.

Breakdown of French exports of unground and pulverized vanilla by country France, ****, in % of export value French Customs

Some raw vanilla is also processed in France, crushed and/or pulverized to make a semi-finished product used in the cosmetics industry (***). In ****, France exported just over *** tonnes of ground or pulverized vanilla, for a total value of over **.* million euros[***] to various trading partners, mainly in Europe.

Breakdown of French exports of ...

2.1 Strong demand for vanilla in France

France consumes an average of *** tonnes of vanilla a year, making it the world's second-largest vanilla consumer, after the United States. Most of the vanilla consumed in France is imported, notably from Madagascar. As can be seen from the following graph, France is the second largest market for Madagascan vanilla (***). [***]

Export destinations for Madagascar vanilla World, ****, as % of total Tridge

2.2 France's vanilla-consuming industries are booming

Vanilla, in its raw, pulverized or ground form, is used in a wide variety of ways. It is used on a large scale in France:

By the food industry, in particular industrial chocolate makers (***). By the cosmetics industry, notably during the industrial processes involved in the production of perfumes and other skincare products. By private individuals directly, or by craftsmen (***).

Food industry

In ****, the agri-food market in France represented ***.* billion euros, making it the *ᵉ biggest European agri-food market behind Germany[***]. Nevertheless, the contribution of the sector's different segments is widely differentiated, as can be seen in the following graph.

Sales by agricultural sector, including exports France, ****, in M€

The different sub-segments of the agri-food sector that integrate vanilla and its by-products into their industrial processes have experienced different dynamics. The bakery products manufacturing segment, which fully integrates vanilla and its derivatives as part of its industrial processes, is the sub-segment that has seen the strongest growth, pulling up French demand for vanilla.

Sales index for agri-food sub-segments - Domestic and export markets France, ****-****, base *** in **** INSEE

Cosmetics industry

The cosmetics market in France (***), which includes cosmetics manufacturing and international exports. [***]

Cosmetics sales by category France, ****, in FEBEA

2.3 Vanilla, a product prized by French consumers in its various forms

Vanilla is considered the favorite spice of the French, who consume it in many different forms. Vanilla is marketed in a variety of forms, from natural vanilla beans to synthetic vanillin molecules.

Vanilla ice cream is one of the most popular flavors consumed by the French. In recent years, the ice cream segment has experienced very strong growth, notably due to repeated heatwaves. In ****, sales in this sector rose by **.*%. In ****, most ice cream will be bought in supermarkets (***).

Main criteria when buying ice cream France, ****, in Source: ****

Fragrance is therefore the number * choice criterion when buying ice cream, with "classic" flavors in first place, including vanilla.

Choice criteria for ice cream flavors France, ****, in Source: ****

2.4 French consumers are increasingly sensitive to the composition of their products and the origin of their ingredients

Consumers are increasingly wary of the cosmetics and food industries, and are paying more and more attention to product quality and the sustainability of the value chain.the Yuka start-up responds to consumers' need for transparency by, for example, enabling cosmetics and food products to be scanned and classified according to their harmfulness to the body. It had ** million users by January ****. This application recommends products that are better for your health.

Buying beauty products guided by transparency France, ****, in Source: ****

Despite inflation, in **** consumers remain demanding when it comes to brand transparency and ethics in the beauty sector. Over a third of French people (***) say they frequently use organic and natural products, while *% plan to start doing so. Despite the current economic climate, over **% of those surveyed said they would not hesitate to allocate a larger budget to sustainable, environmentally-friendly beauty products. A similar percentage consider it "essential" that ingredients are ethically sourced, and over a third (***) of those surveyed consider it important that brands are transparent about their practices. What's more, **% of respondents prefer to buy from brands that prioritize sustainability. [***]

Poll: what criteria of ethics and transparency are important when buying a cosmetic product? Europe, in ****, in Source: ...

3.1 A complex value chain

Source: ****

The global vanilla value chain is complex, involving many different players of varying sizes. While production is mainly carried out by small-scale producers in poor countries (***), numerous specialized companies are positioned between small-scale producers and exporters, to ensure the import of vanilla beans and their distribution. Companies specializing in the brokerage of agricultural raw materials, notably vanilla, play an important intermediary role between exporters and industrial sectors.

The major agri-food groups (***) are the biggest consumers of Madagascan vanilla: around **% of production is destined for the agri-food sector. This is mainly due to the high use of vanilla in industrial pastries, confectionery and dairy products, as well as its use in a growing number of specialized products such as baby food and alcoholic beverages.

Nestlé (***), the world's and France's leading food company, has announced that since ****, the vanilla flavors used in chocolate products have been exclusively natural. In addition, the company announced that **% of products containing vanilla flavorings were prepared with traceable vanilla from Madagascar[***]. The rest of the world's natural vanilla production is destined for various other industries, including cosmetics. The growing use of vanilla and its extracts in beauty and perfumery products, combined with the trend towards organic natural ...

3.2 Largely traditional production methods

Vanilla production is concentrated in countries with little or very little development, such as Madagascar, which accounts for **.*% of the world's vanilla production but ranks ***ᵉ in terms of HDI [***]. These countries are characterized by archaic production methods, as well as high exposure to climatic hazards, which reinforces the fluctuation in volumes produced each year. Cyclone Enwo, for example, which hit Madagascar's east coast in ****, where the country's vanilla production is concentrated, destroyed **% of the region's vanilla fields.

Harvest in ****

The passage of cyclone Gamane in March **** has raised uncertainties about vanilla production on the Grande Île. Flooding caused by this phenomenon is said to have destroyed **% of the harvest. In ****, Madagascar produced around *,*** tonnes of green vanilla. For the ****/**** season, a **% reduction in production is anticipated. Nevertheless, the country claims to have sufficient stocks to meet demand, with around *,*** tonnes of vanilla ready from unsold stock from the three previous campaigns. Price instability in **** has led to tensions between vanilla exporters and the government in Antananarivo. Buyers, seeking to influence negotiations, had accumulated stocks from previous campaigns and had abandoned the **** campaign, when the price had been set at *** dollars. Faced with this situation, the Malagasy authorities finally abandoned the idea ...

3.3 An unbalanced value chain

The fragmentation of the value chain, as well as the large number of intermediaries, gives major industrial groups significant market power, to the detriment of small-scale producers. According to the study Recipe for Change, the need for improved livelihoods of vanilla farmers in Madagascar, more than **,*** small-scale producers make their living from vanilla cultivation in Madagascar: **% live below the poverty line. The highest margins go to the various exporters and intermediaries who collect the vanilla from small producers and export it to international industrial companies.

4.1 Highly diversified production

There are over *** varieties of vanilla in the world. Nevertheless, three varieties of natural vanilla are commonly marketed, each distinguished by its characteristics and place of origin:

Vanilla planifoliavanilla planifolia: the most widespread variety on the market today, it is produced in Madagascar, Indonesia and Mexico. It is considered by many to be the variety with the best quality, thanks in particular to its high vanillin content Vanilla tahitiensisvanilla tahitiensis: this variety is mainly grown in the Pacific Ocean: French Polynesia, notably on the island of Tahiti, but also in Papua New Guinea.It differs from vanilla planifolia by its larger size (***) Vanilla pompona: this variety grows mainly in Guadeloupe, Martinique, Brazil and French Guiana. It is considered a lower-quality vanilla than its cousins because of its low vanillin content.

These vanilla varieties are marketed under different names, each corresponding to the geographical area of production:

Vanillle Bourbon: This label was created in **** to distinguish vanilla produced in the Indian Ocean, particularly Madagascar, from other varieties. This variety is prized by the French, who consume **% of their vanilla under this label[***] Vanille de Taïhti: This label mainly designates the production of the vanilla tahitiensis variety Vanille du Mexique: Vanilla produced ...

4.2 An exponential rise in vanilla prices called into question

Vanilla is considered the most expensive spice in the world, behind saffron. Indeed, a kilogram of vanilla costs between €*** and €*,***, far behind saffron, which generally sells for around €**,*** a kilogram, but well ahead of other spices such as cumin, pepper and others, whose price per kilogram is often less than €***.

The world's most expensive spices World, ****, €/kg Source: ****

In recent years, the price of vanilla has grown exponentially. Indeed, between **** and ****, the price per kilogram of vanilla on the world market increased more than *-fold, from $**/kg in **** to $***/kg in ****, a CAGR of **.*%. The surge in the price of vanilla can be explained in particular by the large share that Madagascar's production represents in global production, combined with the climatic disasters that have affected the island. For example, cyclone Enawo, which killed ** people in ****, also destroyed **% of this year's harvest. [***]

Exponential growth in vanilla prices World, ****-****, $/kg Bloomberg, Vanillanomics

When vanilla prices fell by almost **% in ****, countries heavily dependent on the vanilla industry were hit hard. Vanilla accounts for around **% of Madagascar's GDP. So, in early ****, Madagascar's government introduced a minimum export price of $***/kg for all types of vanilla, still in place today. For if **% of Madagascar's economy ...

5.1 Some regulatory points applicable to food flavorings

Flavors are subject to regulatory harmonization at European level under regulation CE/****/****. Regulation (***) no. ****/**** lays down the conditions for the use of flavorings. This regulation also specifies the prohibited flavors and substances, the maximum doses that can be used for certain flavors, and the labeling rules applicable at European level. [***]. Food labelling is subject to regulations governing the labelling of foodstuffs delivered to the final consumer, governed at Community level by Directive ****/**, the provisions of which are set out in articles R-***-* et seq. of the French Consumer Code.

Another obligation concerns the indication of allergens for flavors derived from allergenic ingredients, or simply for flavors on allergenic carriers. This is the subject of directive no. ****/**, which amended́ the "labeling" directive of November **, ****, and stipulates that allergenic ingredients present in a product must be indicated on the label.requires that allergenic ingredients present in the flavoring be cited immediately after the mention of the flavoring concerned.[***]

5.2 A regulatory framework specific to vanilla

A precise regulatory framework applies to vanilla at European level. Regulation (***) governing flavors and certain food ingredients considers vanilla to be a basic material with food status, and lists the various traditional treatments used to develop the aroma of the bean.

In France, the vanilla appellation is governed by a decree dating from ****. According to Decree no. **-***, the "Vanille" appellation may be obtained under certain conditions:

For the fruits of Vanilla planifolia and related species of the Orchid family. These fruits must be picked before ripening, and must have undergone treatments designed to develop their aroma. These fruits must contain all their useful principles.

The Syndicat National des Industries Aromatiques Alimentaire has also clarified this framework by establishing various rules concerning labeling, vanillin content, vanilla extracts and flavors in articles ***-*** of the Lamy Droit Alimentaire .

6.1 A fragmented market

• Unilever Groupe
• Eurovanille
• Symrise
• Danone Groupe
• Nestlé Groupe
• Vanille Labelle Odhoris
• Le Comptoir Colonial
• Naturex (Givaudan)
• Vanille de Madagascar
• Touton
• CPVD Foulon
• Laline Saveurs
• Produits G. Vernier
• ADC Séléction
• Prova