BloombergBusinessweek December 23, 2019heat-seeking,laser-guidedabilitytostretcha resourceto
thelimit.Forthosearguingthatglobalizationis unreason-
ableandexploitative,thevanillafarmersofMadagascarhave
becomea problemtosolve.Variousnongovernmentalorga-
nizationshaveintroducedcampaignstoraisewages,stamp
outchildlabor,anddirectmoreprofitstothefarmersandvil-
lagescarryingtheindustryontheirback.Manyflavorcom-
panieshavegottenonboard,too,creatingtheSustainable
VanillaInitiative.
InnortheasternMadagascarthere’swidespreadsuspi-
cionthatmiddlemen—thecollectorsandlocalexporters—are
sponging up more than their fair share of the cash flowing
into the region. This year, Lochhead devised a plan to try to
work around them. She and a former vanilla farmer named
Dylan Randriamihaja formed a cooperative consisting of
63 farmers from four villages. Throughout the growing sea-
son, Randriamihaja visited the farmers, monitoring their
techniques, making sure they complied with organic stan-
dards, and checking the quality of the beans.
The plan was that after harvest, the co-op members
would take their beans to one of thelittleregionalmar-
kets. The collective, negoti-
ated price would still apply
to their crop, but Lochhead
would pay a premium of
about 2% above the going
rate, and they’d direct all of
their beans to her. Lochhead
would get as many as 15 tons
of beans she could trust were
organic and of high quality;
the farmers in turn would
pocket more money from her
than they’d get from a collec-
tor. What’s more, Lochhead
wouldn’t have to pay any col-
lectors a commission for negotiatingthesale,and—because
Randriamihaja had an exporting license—the two of them
could ship the beans overseas themselves.
Lochhead and Randriamihaja sent an assistant to the mar-
ket where the co-op farmers gathered—the same one, across
the river and up in the hills, that we visited. He’d oversee
the sale and haul the beans back to Sambava, the city clos-
est to the remote vanilla markets and the capital of the inter-
national trade.
That was the plan, anyway. But the vanilla trade did what
it often does to a well-thought-out plan: It wrecked it. Or,
rather, a mysterious man in a red hat wrecked it.W
hile the collectors milled around the market,
Marcel Sama walked among them, sweating
under a fierce sun. He was the emissary sent
to the market by Lochhead and Randriamihaja, and he
called the members of their co-op together for a meetingbehind the auction building, away from the others.
He explained to them that he expected the collective sale
price at this market to be close to $55 per kilo for the raw,
uncured beans. (Raw vanilla beans generally sell for about
one-seventh or one-eighth of what cured ones do, partly
because beans shrink during the curing process.) Some of
the farmers grumbled; they’d been hoping for a little more.
Sama let them talk out their frustrations until the meeting
ended in smiles and backslaps.
The weigh-in was finishing up, and negotiations were
about to commence. Two young men grabbed two packed
rice sacks from the cargo racks of their motorbikes and
hoisted the parcels onto a pile of bagged beans. They gen-
tly draped two jackets over the bags, as if to hide them,
but everyone knew they were full of cash. The men told
us they’d hauled the money to the market on behalf of
Symrise AG, a multibillion-dollar German flavor and fra-
grance company, which buys more Madagascar vanilla than
anyone else.
Another collector, a man in a red baseball cap and an
olivegreenjacket,lingeredatthe perimeters of the mar-
ket, keeping a lower profile
as the other buyers began to
discuss their collective bid.
Most of them agreed that
a bid of about $55 per kilo
was fair. Sama was happy
to hear it. But then the man
in the red hat piped up, say-
ing he’d be willing to pay $62
per kilo.
Sama couldn’t believe it.
It was too much. If the bid
held, the co-op would have
to pay its farmers about $65
per kilo—20% more than
Lochheadhadpaidforseveral tons of beans a few days ear-
lier at another market. Some of the other collectors indi-
cated they might be willing to go higher than $55, but this
bid seemed excessive. And the unbendable custom of the
market is that all beans must sell at the same price. The
manintheredhatindicatedthatthiswouldn’tbea prob-
lem:Hewouldbuytheentireinventoryat$62perkilo,if
thefarmers agreed. Even the members of the co-op couldn’t
resist such an offer.
There was just one thing. The money, the man explained,
was still in offices on the other side of the river. It would take
him several hours to get all of it hauled out to the market hut.
As it was already afternoon, he asked them to give him until
the next morning, when he’d return with the cash, first thing.
It was a deal. Some of the farmers spent that night sleeping
next to their beans, to make sure nothing was stolen.
The next morning, all of the farmers reconvened. But the
man in the red hat was nowhere to be found. Hours ticked
by. He didn’t return.67Average Price of Vanilla per Kilogram$6004002000DATA: NIELSEN-MASSEY
2013 2014 2015 2016 2017 2018