Markets and Trade Routes
Two types of trade routes are to be distinguished—on the one hand, th*e local trading routes and on the other, the international trading routes.
Locally, good parts of the vanilla from the Kagera region in Tanzania and from Eastern Congo are purchased green and cured in Uganda and later marketed as Ugandan vanilla. The proportion of Tanzanian vanilla entering the global market as such is in the range of 1–3 tons. Congo currently exports 6–8 tons of homegrown vanilla. It is estimated that at least the same amount enters Uganda and is sold as Ugandan vanilla.
With regard to international markets, most gourmet vanilla is sold to Europe and small volumes of extraction and gourmet beans are sent to Japan. The main market for extraction beans appears to be the United States. The main markets in Europe are the United Kingdom and Germany. The volumes sold in France, which is in overall a big buyer of vanilla, appear small and can be attributed to the French bias towards products from their former overseas territories.
During the last few years, clients from Madagascar regularly bought extract grade vanilla for blending and upgrading vanillin-poor Madagascar vanilla. The trend continues.
Gourmet vanilla is nearly always transported by air. Extract vanilla is transported by air when prices are high. Otherwise, it is transported via the port of Mombasa in Kenya by sea.
Present Situation
The Ugandan vanilla market is completely liberalized, without any government interventions or regulations. A similar situation prevails in the neighboring countries. The consequence is that the production levels fluctuate strongly and in line with supply and demand.
With regard to actual volumes, as was mentioned earlier, it is notoriously difficult to get accurate information and figures on vanilla production in this region. The figures presented below are derived from different but usually unconfirmed sources and from direct communication with key stakeholders. Individual figures should therefore be treated with caution.
However, it is undeniable that the revival of the vanilla sector by an USAID-funded project let to an increase in vanilla production from basically nil in 1995 to about 150 tons in 2004.
The end of the project coincided with an unseen period of high prices, which resulted in many more farmers entering vanilla production and increasing the yield to around 200 tons in 2006.
Since then, because prices collapsed, a decline in production can be observed and by 2009 the production declined to about 120 tons (Table 21.2).
| 1994 | 1995 | 1996 | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Volumes (tons) | 0.2 | 16 | 17 | 54 | 70 | 120 | 185 | 195 | 200 | 150 | 120 | |||||
| Value (‘000s USD) | 8 | 25000 | 8400 |
Probably, the production will further decline in the coming years. Prices are low and other crops such as cocoa that are grown concurrently with vanilla currently experience a boom. It is not uncommon to see farmers actively uprooting vanilla to give way for cocoa!
Outlook
The conditions for growing vanilla in East Africa are very favorable and the resulting vanilla is of good quality. Over the last 15 years this region has established itself in the global market as a supplier of quality vanilla, which is sought after by extract makers. The gourmet sector is developing too and the vanilla offered in such forms competes favorably with vanilla from the Indian Ocean islands.