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Hit by low prices, farmers turn away from vanilla cultivation

Hit by low prices, farmers turn away from vanilla cultivation
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First Published: Wed, Mar 12 2008. 11 56 PM IST

Updated: Wed, Mar 12 2008. 11 56 PM IST
Kochi: A.V.Jose had great expectations of his organic vanilla gardens, much more so than for his traditional coconut, arecanut or spices farms. That was around 2003, when raw or green vanilla beans sold for Rs3,500 a kg.
These days, his vanilla farms, near Koothatukulam in Ernakulam district, Kerala, lie abandoned, with the beans selling at Rs40 a kg.
Out of season: Artificial pollination being done on a vanilla flower. Raw vanilla beans fetched Rs3,500 a kg in 2003, but the price has now fallen to Rs40 a kg, forcing farmers to abandon their gardens. (Photo: Ajayan/ Mint)
A host of other farmers have joined Jose in deserting their vanilla gardens, and production of the dried beans in India is expected to be below 100 tonnes this year, from an estimated 233 tonnes in 2006-07. High prices for the raw beans had drawn several farmers to large-scale vanilla cultivation in 2003, in some instances after uprooting their rubber and nutmeg trees.
Jose, for instance, started vanilla cultivation on some 10 acres. Similarly, M.C. Saju, a farmer and director of Vanilla India Producers Co. Ltd (Vanilco), a company of farmers, had started cultivation in nearly 3 acres. Several others even took land on lease, including Anup G., who started vanilla cultivation in 5 acres.
The average investment on an acre was around Rs1.75 lakh. This included costs for planting material vines at Rs100 a metre, a good irrigation system and a large labour force to artificially pollinate the vanilla flowers.
But the dream didn’t last long. Rates had shot up following a cyclone in Madagascar, a major vanilla producing nation with an output of more than 4,000 tonnes of cured beans a year. The situation improved in Madagascar the next year and vanilla turned sour for farmers in Kerala.
“The agony was too much to bear. I began farming at the age of 20, way back in 1958. But with the vanilla price crash, I have even stopped tending to my other gardens— coconut and arecanut palms, and spices and fruits. I have large quantities of pipes that I had bought for irrigation lying waste now,” says Jose.
While some farmers cut down vanilla vines, others waited, expecting the prices to shoot up again. When that didn’t happen, they started abandoning their gardens.
The government trade promotion body, Spices Board, had promoted cultivation of vanilla in early 2000. A metre of vanilla vine used to cost Rs100, so the board intervened and, through tissue culture, started supplying planting material at Rs5 apiece.
C.J. Jose, the then chairman of the board, justifies the promotion.
“It was meant to be an inter-crop to be grown in the arecanut, coconut, banana and spice gardens to give the farmers additional income,” he said. “The problem was that farmers took to vanilla cultivation after destroying the crop in these gardens and lost money. The board had taken an initiative to support the farmers who had formed the company Vanilco by arranging an agreement to supply natural vanilla extract to Amul for use as a flavouring agent in making ice-cream instead of using synthetic ingredients.”
Saju, Vanilco director, says the company is still supplying small quantities to Amul. Vanilco has been procuring raw beans from about 2,500 member farmers. This year, it proposes to procure vanilla at Rs65 a kg. Around 5kg of raw beans is needed to produce 1kg of dried or cured vanilla. Extraction of the essence is a costly affair and 1kg of natural vanilla extract is priced at around Rs15,000.
The synthetic essence, usually a byproduct of coal tar or wood pulp, is available at Rs750-800 a kg.
To support these farmers and also to promote the use of natural material, the Spices Board has proposed a subsidy scheme for promoting the use of natural vanilla by ice-cream companies and other food manufacturers. The commerce ministry had a round of discussions over this late last week and the proposal is likely to get clearance, says current board chairman V.J. Kurian.
The board has proposed an agency to procure vanilla beans, extract essence and supply it to ice-cream and food product manufacturers at prices matching those of synthetic essence. The loss incurred can be supported through a subsidy, says Kurian.
If the government makes at least 5% use of natural vanilla mandatory for the foods and flavour industries, it will create demand and give farmers an incentive to cultivate vanilla along with other crops, says Saju.
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First Published: Wed, Mar 12 2008. 11 56 PM IST
More Topics: Vanilla | Farmers | Spices | Production | Pollination |