Living Income Reference Price for
Vanilla from Uganda and Madagascar
Report prepared by Dr. Hendrik Hänke for Fairtrade International

Dr. Hendrik Hänke
Independent consultant & researcher at Department of Agricultural Economics
and Rural Development, Georg-August University of Göttingen, Germany

I

ABSTRACT
Vanilla has received increasing attention by the global public in recent years. On-going highvanilla prices, vanilla theft, and quality problems from vanilla beans harvested before fullmaturity have brought vanilla repeatedly to the headlines. This is a consequence of the extremeboom-and-bust cycles experienced by the natural vanilla market with long periods of excess
supply, low prices and concerns about farmer poverty, and short periods of tight supply withexcessive high prices but resulting vanilla bean quality shortages. A “living income reference
price” for vanilla has been put forward as one reference tool to help stakeholders work towards
a more stable vanilla market which would in term help both, stabilize the supply of high-quality
vanilla and support vanilla farmers´ livelihoods.

This report presents a study to establish Living Income Reference Prices (LIRP) for vanillafrom Madagascar and Uganda, based on a methodology recently developed by Fairtrade
International to determine minimum price levels that would enable the equivalent of a living
wage (called a living income) for smallholder farmers of different agricultural commodities.
The study analyses the costs of a decent standard of living, as well as the costs of sustainableproduction for vanilla farmers in both countries. The living income reference price is calculated
as the minimum price needed for smallholder vanilla farmers to earn sufficient net income toafford a decent standard of living, assuming that they have a large enough farm to be “fully
employed” growing vanilla and have implemented good agricultural practices leading toadequate productivity and quality.

In order to estimate the benchmarks of living income and to establish the minimum“professional” productivity conditions in both countries, 250 interviews were conducted withsmallholder vanilla farmers in both Uganda and Madagascar. The interviews were
supplemented with focus group discussions, market surveys and stakeholder reviews.
Moreover, a realistic sustainable vanilla productivity level that can be achieved by farmers
implementing good agricultural practices, and a “full employment” farm size was defined inconsultation with vanilla farmers, cooperatives, and both local and international buyers.
Throughout the project, stakeholder feedback was systematically taken into account andintegrated into the research process.

IIThis report provides insights into the farm economics and context of vanilla farmers in
Madagascar and Uganda, which are needed for calculating the minimum required farmgate
price for vanilla farmers to earn sufficient return for a decent standard of living.

Household sizes, levels of livelihood diversification, food self-sufficiency and costs of living
differ substantially between the two countries, as well as vanilla production and its surrounding
market conditions. The costs of a decent living were estimated at 5750€ (per household peryear) in Madagascar and at 7297€ in Uganda, respectively. Productivity benchmarks indicating
sustainable target yields for vanilla were established at 350 kg/ha for Madagascar and 500 kg/ha
for Uganda, as in Uganda two vanilla harvest are possible a year. To achieve a living income,an average vanilla farming household would need a minimum farmgate price of 15.6€ to 16.6€
per kg of green vanilla.

Fairtrade International would like to thank Ben & Jerry’s for their contribution to thisresearch

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TABLE OF CONTENT
ABSTRACT ........................................................................................................................................................ IITABLE OF CONTENT ......................................................................................................................................... III
TABLE OF FIGURES............................................................................................................................................VTABLE OF TABLES ............................................................................................................................................VITABLE OF APPENDIX ........................................................................................................................................VI
1. BACKGROUND .............................................................................................................................................. 8
2. METHODOLOGICAL APPROACH .................................................................................................................. 10
2.A LIVING INCOME ............................................................................................................................................... 11
2.B FAIRTRADE´S REFERENCE PRICE MODEL ................................................................................................................. 11
2.C SAMPLING AND METHODS ................................................................................................................................. 12
2.c.a. Sampling design and study regions .................................................................................................... 12
2.C.B PILOT PHASE ................................................................................................................................................ 14
2.C.C QUESTIONNAIRE DESIGN AND STRUCTURE .......................................................................................................... 15
2.C.D. MARKET SURVEYS ON PRICES AND LOCAL UNITS .................................................................................................. 15
2.C.E. FOCUS GROUPS ............................................................................................................................................ 15
2.C.F. LIMITATIONS OF THIS STUDY ........................................................................................................................... 16
3.RESULTS ...................................................................................................................................................... 17
3.1. LIVING INCOME BENCHMARK ............................................................................................................................ 17
A. Demographics.......................................................................................................................................... 17(i.) Uganda ................................................................................................................................................................ 17(ii.) Madagascar ........................................................................................................................................................ 17

B. Cost of decent living for an average household ....................................................................................... 18(i) Model diet ............................................................................................................................................................ 18(ii) Housing................................................................................................................................................................ 23(iii) Electricity ............................................................................................................................................................ 26(iv) Education ............................................................................................................................................................ 26(v) Healthcare ........................................................................................................................................................... 29(vi) Clothing .............................................................................................................................................................. 30(vi) Transportation .................................................................................................................................................... 30(vii) Communication ................................................................................................................................................. 31(viii) Margin for unexpected events.......................................................................................................................... 32(ix) Total Living Income per year............................................................................................................................... 32

C. Value of self-produced food ..................................................................................................................... 33(i.) Uganda ................................................................................................................................................................ 33(ii.) Madagascar ........................................................................................................................................................ 34

D. Conclusion: Cost of decent living minus value of self-consumed food .................................................... 35(i.) Uganda ................................................................................................................................................................ 35(ii.) Madagascar ........................................................................................................................................................ 35

3.2. ACTUAL FARM SIZE AND FULL EMPLOYMENT FARM SIZE .......................................................................................... 36
a. Land distribution / crop diversification / typical farm model .................................................................. 36(i.) Uganda ................................................................................................................................................................ 36(ii.) Madagascar ........................................................................................................................................................ 38

b. “Full Employment” vanilla farm size and land used for other crops ........................................................ 39(i.) Uganda ................................................................................................................................................................ 41(ii.) Madagascar ........................................................................................................................................................ 41c. Household labour availability (FTE) and occupation ................................................................................ 42(i.) Uganda ................................................................................................................................................................ 42(ii.) Madagascar ........................................................................................................................................................ 42

d. Labour requirements for vanilla and other crops in 2018........................................................................ 42(i.) Uganda ................................................................................................................................................................ 42(ii.) Madagascar ........................................................................................................................................................ 45

e. Labour requirements for viable vanilla farm size ..................................................................................... 46
f. Conclusion full employment farm size and labour .................................................................................... 48(i.) Uganda ................................................................................................................................................................ 48

IV

(ii.) Madagascar ........................................................................................................................................................ 48

3.3. SUSTAINABLE YIELDS........................................................................................................................................ 48
a. Maximal feasible yields ........................................................................................................................... 49(i). Uganda ................................................................................................................................................................ 49(ii.) Madagascar ........................................................................................................................................................ 49

b. Other farm-income when considering a typical, diversified full employment farm size .......................... 50(i.) Uganda ................................................................................................................................................................ 50(ii.) Madagascar ........................................................................................................................................................ 50

c. Conclusion: total target vanilla yields from viable vanilla plot size and estimated income from othercrops in typical farm model ......................................................................................................................... 50(i.) Uganda ................................................................................................................................................................ 50(ii.) Madagascar ........................................................................................................................................................ 51

3.4. COST OF SUSTAINABLE PRODUCTION .................................................................................................................. 51
a. Description of different cost items ........................................................................................................... 51(i.) Uganda ................................................................................................................................................................ 51(ii.) Madagascar ........................................................................................................................................................ 52

b. Analysis of security costs for LIRP ............................................................................................................ 53(i.) Uganda ................................................................................................................................................................ 53(ii.) Madagascar ........................................................................................................................................................ 54

c. Living Wage and cost of hired labour ...................................................................................................... 54(i.) Uganda ................................................................................................................................................................ 54(ii.) Madagascar ........................................................................................................................................................ 54

d. Conclusion: Total cost of vanilla production per hectare, when living wages are paid and realistic
security expenses ......................................................................................................................................... 55(i.) Uganda ................................................................................................................................................................ 55(ii.) Madagscar .......................................................................................................................................................... 55

3.5. OVERVIEW AND LIRP CALCULATIONS................................................................................................................. 56
3.5.a Price models in relation to poverty line and LIRP in Uganda .............................................................. 57
3.5.b Price models in relation to poverty line and LIRP in Madagascar ....................................................... 57
7. DISCUSSION AND CONCLUSION .................................................................................................................. 58
7.1 LIVING INCOME ............................................................................................................................................... 58
7.2 PRICE SCENARIOS AND PRODUCTION COSTS ........................................................................................................... 60
7.3 FEASIBLE PRODUCTION /FARM SIZE ..................................................................................................................... 61
7.4 IMPACT OF LIRP ON FARMER LIVELIHOODS AND THE VANILLA MARKET ....................................................................... 62
REFERENCES ................................................................................................................................................... 64
APPENDIX....................................................................................................................................................... 68

TABLE OF FIGURESFIGURE 1: GLOBAL VANILLA PRICES 1999-2017. SOURCE: COOK´S VANILLA 2017................................................. 8
FIGURE 2: MAP OF THE STUDY REGIONS IN MADAGASCAR AND UGANDA ............................................................. 13
FIGURE 3: EXAMPLES OF HOUSES OF MALAGASY VANILLA FARMERS IN NON-ACCEPTABLE (LEFT), MEDIUM
ACCEPTABLE (MIDDLE) AND IDEALISTIC HOUSES IN LINE WITH INTERNATIONAL MINIMUM STANDARDS(RIGHT). SOURCE: OWN PHOTOS ................................................................................................................... 25
FIGURE 4: COMPOSITION OF LIVING INCOME OF UGANDAN VANILLA FARMERS PER HOUSEHOLD AND YEAR ........ 32
FIGURE 5: COMPOSITION OF LIVING INCOME OF MALAGASY VANILLA FARMERS PER HOUSEHOLD AND YEAR ...... 33
FIGURE 6: SUBSISTENCE CROPS CULTIVATED BY UGANDAN VANILLA FARMERS.................................................... 36
FIGURE 7: CASH CROPS CULTIVATED BY UGANDAN VANILLA FARMERS ................................................................ 37
FIGURE 8: LAND SIZES DISTRIBUTION OF DIFFERENT CROPS OF UGANDAN VANILLA FARMERS .............................. 37
FIGURE 9: SUBSISTENCE CROPS CULTIVATED BY MALAGASY VANILLA FARMERS ................................................. 38
FIGURE 10: IRRIGATED RICE IN THE ANDAPA REGION (LEFT) AND HILL RICE CULTIVATION (RIGHT), SOURCE:
ANNEMARIE WURZ ...................................................................................................................................... 38
FIGURE 11: CASH CROPS CULTIVATED BY MALAGASY VANILLA FARMERS ............................................................ 39
FIGURE 12: LAND SIZE DISTRIBUTION OF DIFFERENT CROPS OF MALAGASY VANILLA FARMERS............................ 39
FIGURE 13: VIABLE FARM SIZE MODEL, CROP DISTRIBUTION IN UGANDA .............................................................. 41
FIGURE 14: VIABLE FARM SIZE MODEL, CROP DISTRIBUTION IN MADAGASCAR ..................................................... 41

VFIGURE 15: FAMILY LABOUR (IN MAN DAYS) FOR CASH CROPS BY UGANDAN VANILLA FARMERS OVER THE YEAR IN
2018 (MAN DAYS WERE MULTIPLIED WITH THE NUMBER OF HOUSEHOLD MEMBERS WHO CONTRIBUTE) ...... 42
FIGURE 16: DISTRIBUTION OF AGRICULTURAL ACTIVITIES (VANILLA) OVER THE YEAR IN UGANDA ...................... 43
FIGURE 17: VANILLA FIELDS THAT ARE FENCED (LEFT) AND SECURITY DOGS ON VANILLA PLOTS (MIDDLE) IN
UGANDA (SOURCE : OWN PHOTOS). RIGHT: TRAPS BEING INSTALLED ON VANILLA FIELDS IN MADAGASCAR(SOURCE: JOHANNES OSEWOLD) .................................................................................................................. 44
FIGURE 18: LABOUR DIVISION OF VANILLA-RELATED ACTIVITIES IN UGANDA ...................................................... 44
FIGURE 19: FAMILY LABOUR (IN MAN DAYS) FOR CASH CROPS BY MALAGASY VANILLA FARMERS OVER THE YEAR
IN 2018 (MAN DAYS WERE MULTIPLIED WITH THE NUMBER OF HOUSEHOLD MEMBERS WHO CONTRIBUTE) .. 45
FIGURE 20: DISTRIBUTION OF AGRICULTURAL ACTIVITIES (VANILLA) OVER THE YEAR IN MADAGASCAR ............ 45
FIGURE 21: LABOUR DIVISION OF VANILLA-RELATED ACTIVITIES IN MADAGASCAR ............................................. 46
FIGURE 22: DISTRIBUTION OF FAMILY LABOUR (IN MAN DAYS) IN VIABLE FARM SIZE MODEL COMPARED TO THE
LABOUR DISTRIBUTION IN 2018 (UGANDA). ................................................................................................. 47
FIGURE 23: DISTRIBUTION OF FAMILY LABOUR (IN MAN DAYS) IN VIABLE FARM SIZE MODEL COMPARED TO THE
LABOUR DISTRIBUTION IN 2018 (MADAGASCAR). ........................................................................................ 47
FIGURE 24: EXPENSES FOR HIRED LABOUR FOR CASH CROPS IN UGANDA .............................................................. 51
FIGURE 25: EXPENSES FOR HIRED LABOUR FOR CASH CROPS IN MADAGASCAR ..................................................... 52
FIGURE 26: DISTRIBUTION OF HIRED LABOUR COSTS IN UGANDA PER HA IN 2018 ................................................. 53
FIGURE 27: DISTRIBUTION OF HIRED LABOUR COSTS IN MADAGASCAR PER HA IN IN 2018 .................................... 54
FIGURE 28: REFERENCE PRICE FOR TARGET PRODUCTIVITY OF UGANDAN VANILLA FARMERS.............................. 57
FIGURE 29: REFERENCE PRICE FOR TARGET PRODUCTIVITY OF MALAGASY VANILLA FARMERS............................ 57
FIGURE 30: MARGINAL AGRICULTURAL LAND IN THE BUNDIBUYGO DISTRICT IN UGANDA ................................... 61

TABLE OF TABLESTABLE 1: HOUSEHOLD CHARACTERISTICS OF UGANDAN VANILLA FARMING HOUSEHOLDS ................................... 17
TABLE 2: HOUSEHOLD CHARACTERISTICS OF MALAGASY VANILLA FARMING HOUSEHOLDS ................................. 17
TABLE 3: MODEL DIET FOR UGANDAN VANILLA FARMERS .................................................................................... 19
TABLE 4: MODEL DIET FOR MALAGASY VANILLA FARMERS .................................................................................. 22
TABLE 5: HOUSING CONDITIONS IN UGANDA AND MADAGASCAR ......................................................................... 23
TABLE 6: EXPENSES FOR EDUCATION PER HOUSEHOLD PER YEAR IN UGANDA ...................................................... 27
TABLE 7: EXPENSES FOR EDUCATION PER HOUSEHOLD PER YEAR IN MADAGASCAR ............................................. 28
TABLE 8: EXPENSES FOR CLOTHING IN UGANDA PER HOUSEHOLD PER YEAR ......................................................... 30
TABLE 9: EXPENSES FOR CLOTHING IN MADAGASCAR PER HOUSEHOLD PER YEAR ............................................... 30
TABLE 10: CASH VALUE OF SUBSISTENCE CROPS PRODUCED BY UGANDAN VANILLA FARMERS ............................ 33
TABLE 11: VALUE OF A. SELF-CONSUMED, AND B. SOLD LIVESTOCK BY UGANDAN FARMERS ............................... 34
TABLE 12: CASH VALUE OF SUBSISTENCE CROPS PRODUCED BY MALAGASY VANILLA FARMERS .......................... 34
TABLE 13: VALUE OF A. SELF-CONSUMED AND B. SOLD LIVESTOCK BY MALAGASY FARMER ................................ 35
TABLE 14: SUMMARY OF KEY VARIABLES FOR LIRP MODELS IN UGANDA AND MADAGASCAR ............................ 56

TABLE OF APPENDIX
APPENDIX 1: COOPERATIVES AND NUMBER OF VANILLA FARMERS IN RWENZORI FARMER´S COOPERATIVE UNION..................................................................................................................................................................... 68
APPENDIX 2: SECTIONS OF THE QUESTIONNAIRE .................................................................................................... 68
APPENDIX 3: PRICES AT LOCAL MARKETS IN UGANDA (IN UGX) .......................................................................... 70
APPENDIX 4: MINIMUM AND MAXIMUM PRICES IN THE LITTORAL OF NORTHEASTERN MADAGASCAR (MAROJALA)..................................................................................................................................................................... 71
APPENDIX 5: MINIMUM AND MAXIMUM PRICES IN THE MID-HIGHLANDS OF NORTHEASTERN MADAGASCAR(ANTANAMANGOTROKA) ............................................................................................................................. 72
APPENDIX 6:MINIMUM AND MAXIMUM PRICES IN THE LITTORAL OF NORTHEASTERN MADAGASCAR(AMPANAKANA) ........................................................................................................................................... 73
APPENDIX 7: FOOD CONSUMPTION AND EXPENDITURES......................................................................................... 74
APPENDIX 8: CONSUMPTION OF FOOD ITEMS PER WEEK BY UGANDAN VANILLA FARMERS .................................... 74
APPENDIX 9: EXPENDITURES ON FOOD (PER YEAR AND HOUSEHOLD) IN UGANDA ................................................. 74
APPENDIX 10: FOOD SELF-SUFFICIENCY OF UGANDAN VANILLA FARMERS............................................................ 75
APPENDIX 11: CONSUMPTION OF FOOD ITEMS PER WEEK BY MALAGASY VANILLA FARMERS ................................ 75
APPENDIX 12: EXPENDITURES ON FOOD (PER YEAR AND HOUSEHOLD) IN MADAGASCAR ...................................... 76

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APPENDIX 13: FOOD SELF-SUFFICIENCY OF MALAGASY VANILLA FARMERS.......................................................... 76
APPENDIX 14: RANKING OF CASH CROPS BY VANILLA FARMERS IN UGANDA AND MADAGASCAR ......................... 77
APPENDIX 15: VANILLA SALES, PRODUCTION AND THEFT ...................................................................................... 78
APPENDIX 16: VANILLA SALES (GREEN) OVER THE YEAR IN UGANDA IN 2018 ...................................................... 78
APPENDIX 17: DISTRIBUTION OF VANILLA HARVESTS PER HOUSEHOLD IN 2018 IN UGANDA ................................. 79
APPENDIX 18: VANILLA SALES (GREEN) THROUGHOUT THE YEAR IN MADAGASCAR IN 2018 ................................ 79
APPENDIX 19: DISTRIBUTION OF VANILLA HARVESTS PER HOUSEHOLD IN 2018 MADAGASCAR ............................ 80
APPENDIX 20: STATUS QUO OF VANILLA FARMERS IN 2018 IN RELATION TO POVERTY LINE AND LIVING INCOME . 80
APPENDIX 21: AVERAGE VANILLA INCOME IN MADAGASCAR IN RELATION TO INTERNATIONAL POVERTY LINE AND
LIVING INCOME IN 2018 ................................................................................................................................ 81
APPENDIX 22: MINIMUM MARKET CONDITIONS FOR VANILLA TO CONTINUE TO BE ATTRACTIVE IN UGANDA ....... 82

VII1. Background
Vanilla is an orchid, which requires shadow and is grown in agroforestry systems. The same
botanical vanilla species (Vanilla planifolia) is cultivated in Madagascar and Uganda with adistance of around 3,500 km between the two vanilla growing regions. Madagascar is by-far
the world´s largest vanilla producer. Here, an estimated 70,000 to 80,000 vanilla farmers
produce around 80% of the world´s premium vanilla (1500-1800 metric tonnes). Uganda iscurrently the world´s fourth biggest producer (FAOstat 2019), accounting for around 5% of
global vanilla production with exports of 23 metric tonnes in 2018 (MAAIF 2019).

Madagascar is among the 10 poorest countries globally and Uganda ranks on place 27 (IMF2019). Consequently, many vanilla farmers in both countries are poor and face ample risks,
ranging from price instability to extreme climate patterns.

Vanilla has attracted increasing attention from the global public in recent years. Prices higher
than silver and reports on theft and crime in the media brought vanilla frequently to theheadlines. This is part of the extreme volatility experienced on the vanilla market, where prices
fluctuate heavily in cycles of boom and bust, often influenced by cyclones in Madagascar(Brown 2009), which can significantly impact vanilla harvests. In recent years, global demandand speculation by non-vanilla actors have likewise contributed to increased vanilla prices.

Figure 1: Global vanilla prices 1999-2017. Source: Cook´s Vanilla 2017

Over the past five years, export vanilla prices have remained remarkably high (Figure 1) ,including at the farm gate, which has benefited farmers. However, when farm gate prices are
high, vanilla becomes extremely valuable in the context of the main producing origins, which
creates serious problems with quality as farmers are pressured to harvest immature vanilla inresponse to theft concerns. During the low-price period between 2005 and 2015 when there8was sufficient supply on the market, quality was high but many producers in the main origins
of Madagascar and secondary origins like Uganda experienced low incomes and seasonal foodinsecurity due to small parcels, relatively low productivity, and the low farmgate prices
received.

In recent years, vanilla stakeholders have been collaborating to try and address the problems of
quality and sustainability. For example, the Sustainable Vanilla Initiative1 (SVI) was started in2016 as a voluntary industry initiative to contribute to increasing the supply of sustainable
vanilla, improve the livelihoods of vanilla farmers, and to address the crisis in the quality ofvanilla. A major challenge for the vanilla market is the extreme price volatility, which iscompounded by such low prices during the “bust” face of the market that farmers outside of the
primary origin of Madagascar remove their vines and/or switch to alternative crops, e.g. in
Uganda to coffee or cocoa. SVI members believe that stronger alternative countries of origin,such as Uganda, would help stabilize the overall market, which would benefit producers –including in Madagascar - by reducing the extreme price swings and improving the consistencyof quality and, therefore, the potential to grow the market for natural vanilla. As natural vanilla
only serves about 2% of the total vanilla flavour market, there is considerable potential for
growth.

Fairtrade International has recently developed a model to establish the price for a specific cropfrom a specific region that is needed for an average farmer household with a “full-employment
farm size” and an adequate productivity level to earn a living income from the sales of thatcrop. This so-called Living Income Reference Price (LIRP) is an essential part of Fairtrade’s
Living Income Strategy, which serves as a tool for raising awareness on income gaps andprovides guidance to producers, traders and governments on sustainable pricing as a criticallever for achieving living incomes.

To help inform the debate and strategies about the minimum market conditions required tosupport a sustainable livelihood for vanilla producers, as well as what would be needed to growstronger alternative origins, Fairtrade International has commissioned research into theeconomic conditions of vanilla farming households in the main vanilla producing country

1

The SVI is a voluntary sustainability initiative uniting consumer goods manufacturer, global flavor/ fragrancecompanies, international vanilla bean traders and cooperatives. SVI members represent over 70% of worldwide
vanilla bean purchases and have focused so-far on Madagascar, whereas Uganda is being developed as a second
origin.

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Madagascar and an alternative origin Uganda, with the objective to establish Living Income
Reference Prices for vanilla from these countries, in collaboration with key stakeholders, i.e.,
vanilla farmers, farmer groups and the vanilla industry.

This case study contributes to the development of a standardized methodology for establishing
Living Income Reference Prices with a broad applicability across commodities and farmer
realities by Fairtrade International, in support of its ambition to enable sustainable livelihoodsof farmers.

When implemented, the reference price should support smallholder farmers in achieving
sustainable livelihoods by earning a sufficient return to cover the cost of a decent standard ofliving when certain baseline conditions are met. Sustainable prices, such as the LIRP, arebelieved to contribute to a market stabilisation and increases in sustainable vanilla production.
Likewise, the establishment of a LIRP for vanilla could empower local farmer organisations tonegotiate suitable prices in the long run.

However, the present study does not represent every vanilla farmer in both countries and thesituation for impoverished vanilla farmers might look different than the data presented in thisreport. Many of the sampled vanilla farmers are Fairtrade certified. In fact, there are indicesshowing critical differences between certified/contracted farmers compared to “average
farmers” such as benefits due to contrcat partners and prices received (Hänke et al. 2018).
Therefore, we also tried to include a share of ~25% non-certified vanilla farmers in this study.

2. Methodological approach
The frame for the present vanilla study was to define the values for 4 key parameters needed toestablish a Living Income Reference Price: (i) cost of a decent standard of living, (ii) sustainable
yields, (iii) full employment farm size and (iv) cost of sustainable production in both countries.
To do this, 6 weeks of data collection through household (HH) surveys took place in Uganda
and Madagascar, market surveys were conducted, 6 focus group discussion were conducted,
and a continuous validation of research findings accompanied the research process. This
process comprised of intermediary milestones and feedbacks, i.e. progress presentations andregular communication with affected actors such as farmers, farmer groups, cooperatives,
researchers, NGOs and members of the SVI. Throughout the project, data was sense-checked
and feedback by relevant stakeholders was systematically recorded and taken into account.
10

2.a Living Income
A commonly accepted methodology for establishing Living Wage (LW) and Living Income(LI) benchmarks is based on the calculation of the cost of ”decent living”, also known as the“Anker methodology” (Anker and Anker, 2017). Living Income is defined as sufficient income
generated by a household to afford a decent standard of living for all household members.
Elements of a decent standard of living include food, water, housing, education, healthcare,transportation, clothing and other essential needs, including a provision of 5% for unexpected
events. LW and LI serve as reference points to set wages in the case of hired labour (LW) or
target incomes for self-employed smallholder farmers (LI). In Uganda as well as in Madagascar,
vanilla farmers are self-employed smallholder farmers, suggesting that the LI framework ismost relevant.

2.b Fairtrade´s reference price model
In 2017, Fairtrade International developed its Living Income Reference Price (LIRP) model as
an integral part of its holistic roadmap towards living incomes. The basic principle behind
Fairtrade´s LIRP is the question: What price do farmers under a viable, “full employment” farm
size and sustainable production regimes need to reach a living income? In the LIRP, value ofself-produced food is deducted from the costs of living (as it reduces the food expenditures forthe household).
Key variables of the Fairtrade’s Living Income Reference price model include:(i.)

Sustainable yields:

Adequate productivity levels are based on feasible yields when implementing sustainableagricultural practices. The idea is to base the reference price model around a level ofproductivity that is realistically achievable for farmers who have implemented therecommended good agricultural practices (e.g. not demo farm productivity).
(ii.)“Full Employment Farm Size”/ Viable land area

Fairtrade follows the principle that self-employed farmers working full-time on their farms
should be able to make a living income from their farm proceedings, provided there is a formal
market for the goods produced. In order to establish a full-employment farm size, the labour
intensity of the main cash crop is leading, whereas potential other crops on the farm are assumed
to absorb the available household labour during the low labour seasons of the main crop.
Because of the real-world high variability in farm size and diversification, the Fairtrade living
11

income reference price is based on a maximum vanilla area that can be managed primarily
through family labour, that is a full employment vanilla farm size.
(iii.)

Cost of Sustainable Production:

The costs associated with producing sustainable yields should reflect an adequate farminvestment. Hence, the costs of production are calculated based on the investment needed toreach sustainable yields, considering fully employed, non-remunerated, household labour.
Additional hired labour needs are factored in at a living wages.
Per se the LIRP covers a living income for the vanilla farming households and a living wage
for hired workers on smallholder farms. The corresponding formula for Fairtrade´s LIRP is:
Living Income Reference Price =cost of decent living + cost of sustainable production
viable land area∗sustainable yields

2.c Sampling and Methods
The questionnaires, the sampling design and the implementation were designed by the authorof this study. However, in both Uganda and Madagascar, one sub-consultant and 7 research
assistants supported the data collection, respectively.

2.c.a. Sampling design and study regions
In Uganda, vanilla farmers were sampled from an umbrella vanilla cooperative: the Rwenzori
Farmers’ Cooperative Union (RFCU). RFCU unites 12 cooperatives and around 920 farmers.2
All 12 cooperatives and its farmers are distributed over 3 districts and 30 subcountys in centralwestern Uganda, bordering the Democratic Republic of Congo (see Figure 2). The region lies
directly on the equator, Kasese (south-west) represents a lowland partly in a valley, the terrain
in Bundibygo and Ntorko (north) is hilly, which also includes the Rwenzori mountains(west).
In all three districts most of the rural inhabitants are farmers and cultivate various subsistencecrops. However, vanilla, coffee, cocoa, tea and cotton are also common cash crops in the region.

We received farmer lists of RFCU headquarters but found that they were not up to date. Aftercontacting most of the 12 individual cooperatives, we partly updated the number of farmers in
the cooperatives (see Appendix 1) but could not access all of them. Likewise, we also foundmany new farmers, that is, growing but not yet harvesting vanilla as vanilla can only be

2This number is an estimation.

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harvested after 3 years. Likewise, some of the farmers left the cooperative and others were notaccessible.

Figure 2: Map of the study regions in Madagascar and Uganda

We sampled 4 cooperatives in the Bundibuygo district, 1 in Ntorko and 4 in Kasese as we
wanted to sample the different districts to the same extent. The Ntoroko district has only one
vanilla cooperative. Due to the difficulties explained above (non-accessibility, members leaving
the cooperative, members who did not harvest yet) our sampling design did not work out
completely as initially planned. In fact, vanilla farmers in Bundibygo were proportionallyoversampled as Kasese has the highest number of vanilla farmers in all RFCU cooperatives(see Appendix 1). After choosing 9 from the 12 cooperatives, the farmers were randomly
selected from the member lists we received. Hence, the sampling design is a stratified random
sample which led to a total of 248 farmers.
In Madagascar, vanilla cultivation mainly takes place in the north-eastern SAVA region. The
SAVA region is by-far the largest vanilla producing area in the world. The vanilla growing
region consists of the littoral (east), intermediate zone (east-centre) and mountainous zone
(west). The Sambava and Antalaha districts lie chiefly in the littoral - intermediate zone, while
the Andapa district is mainly in the mountainous zone (see Figure 2). As the Andapa region13

(west) is around 500m above sea level, it has a different climate than the littoral zone (east).
Here, vanilla -and other crops- reach its maturity ~4 weeks later than in the littoral zone.

In our sample, we tried to balance the different geographical vanilla growing districts equally.
Therefore, 4 villages in the Antalaha district were chosen, 4 in Sambava and 4 in Andapa,
respectively, leading to a total of 12 villages. From the 12 villages, 7 have Fairtrade vanilla
cooperatives.
In the other villages (non-Fairtrade cooperatives), we sampled from village associations’ listthat usually exist in villages were vanilla farmers live. From Fairtrade cooperatives as well as
non-Fairtrade associations, we randomly selected farmers from member´s lists. Every 3rd farmer
was chosen from these lists so that we could sample proportionally to members in these farmer´sorganizations. In Madagascar, this led to a total sample of 252 vanilla farmers. In both countries
10% of the sampled farmers are non-vanilla farmers. They were included as a control group inorder to estimate the value that vanilla brings to local livelihoods as compared to non-vanilla
farmers.

2.c.b Pilot phase
Prior to conducting the household survey, pilot phases took place in Uganda and Madagascar.
The questionnaire design was a process involving local experts in Madagascar and agriculturalextension officers in Uganda, who helped to adapt the questionnaire to the local context. The
process was supported by local assistants who translated the questionnaire into local dialects.
This was particularly relevant in Uganda where 43 different languages are commonly spoken(Ethnologue 2005). After establishing a first draft of the questionnaire, one week of datacollection took place in each country, feedback by the respondents and enumerators wasreceived and incorporated into the final questionnaire.

Data collection was done through the use of tablets using the freely available Kobo Collect
Application (see https://www.kobotoolbox.org/). All research assistants received 5 days of
training on its use and could contribute to the interface structure and design.

14

2.c.c Questionnaire design and structure
Most of the questions in the questionnaire addressed the entire household. Therefore, we tried
to conduct -whenever possible- the interview together with the father and mother of thehousehold as both have different knowledge and information. For example, in Uganda male
HH members usually have little knowledge on markets, prices and food costs, but they know
better when they engaged hired labourers, or the time spent for guarding of vanilla fields.

If questions on agricultural production, production costs, expenditure or income were surveyed,
the questions addressed the entire year of 2018. See Appendix 2 for the questionnaire sections.
In order to estimate the accuracy of respondents´ self-reported field sizes, 10% of the
agricultural fields were measured through GPS devices by the research team. The fields wererandomly selected.

2.c.d. Market surveys on prices and local units
In each district (3 in Uganda, 3 in Madagascar), market surveys were conducted. Prices for themost common crops were surveyed in local units and local units were converted into kg throughself-measurements with scales. Each local unit was measured 3 times and subsequently
converted to an average value. Additionally, vendors and farmers were asked about pricefluctuations, min. and max. prices throughout the year (see Appendix 3).

2.c.e. Focus groups
A total of 6 focus group discussions were complemented (3 in each district Uganda, 3 in each
district in Madagascar). In every focus group discussion, a total of 8 people were invited basedon the following criterion: vanilla farmers with at least 5 years of experience, half of theparticipants male, half of them female, and they should live constantly in their villages.
Cooperative executives usually assisted the discussions. During the focus groups, a maximal
manageable vanilla field size by the households was discussed as well as a maximal reasonablefeasible yield. Likewise, findings from individual HH surveys was sense-checked and feedback
received. This was particularly important to understand the local context and to validate ourresearch findings. Other key questions discussed were: the costs of living, cost of housing,schooling, health, transportation and food expenditures incl. seasonality.

15

2.c.f. Limitations of this study
Time for planning, designing, conducting the study, analysing the data and writing the present
report were 7 months in total. This is a short time span given the complex reality of vanillafarming and the livelihoods of vanilla farmers. Extensive experience of the author in conducting
research in Madagascar on vanilla and great support in Uganda through Catholic Relief Services(CRS) and other partners contributed to a successful accomplishment of this study.

However, the present study does not represent every vanilla farmer in both countries and thesituation for impoverished vanilla farmers might look different than the data presented in thisreport. Many of the farmers sampled for this study are certified. In fact, there are indicesshowing critical differences between farmers in certification and/or contracts compared to“average farmers” such as benefits due to buyers and prices received (Hänke et al. 2018). Also,
farmers who are not members of a cooperative and sell their vanilla on the spot market, aremore likely to sell their vanilla immature (Hänke et al. 2018). As many farmers sampled forthis survey are certified, selling mature vanilla is most likely a precondition of thesecooperatives. Thus, the situation might not reflect the situation of other vanilla farmers.
Therefore, we also included non-certified vanilla farmers.

Another important point is that we could not include very remotely living vanilla farmers due
to a lack of time and budget. In north-eastern Madagascar all roads except the highways
Sambava-Andapa, Sambava-Antalaha and Sambava-Vohémar are dirt roads, which are difficult
to drive during the rainy season, the period the surveys were conducted for this study. In
Madagascar some vanilla farmers live in very remote areas, that are only accessible throughpirogues and/or several days of walking. However, infrastructure in Uganda is much better
developed than in Madagascar.

Intercropping is common in both countries and the proportions of each crops were, therefore,
estimated through proportional allocation of stones. One field consist of 10 stones and thefarmers allocated a number of stones for a given crop. This is an estimation and was nottechnically measured in situ.
Most presented data are average values along with standard errors (mean ± standard error) toshow the variances around the mean values presented. This should allow readers aninterpretation of the deviations around the average values.
16

3.Results
3.1. Living Income benchmark
A. Demographics(i.) Uganda
Table 1: Household characteristics of Ugandan vanilla farming households
Per household

Mean

Adults total (>18 years)

3.23

Male (%)

47.78

Female (%)

52.22

Non-adults total (<18 years)

3.40

Male (%)

51.73

Female (%)

48.27

Total household size

6.62

St. Error
0.14

0.13

0.21

The average household (HH) size in Uganda is 6.6 ± 0.21 (Mean ± Standard Error) consistingof 3.2 adults and 3.4 children, respectively. 52% of adults are female compared to 47.8% ofmales. Regarding non-adults, there are slightly more males (51.7%) than females (48.3%).
(ii.) Madagascar
Table 2: Household characteristics of Malagasy vanilla farming households
Per household

Mean

Adults total (>18 years)

2.37

Male (%)

52.2

Female (%)

47.8

Non-adults total (<18 years)

1.84

Male (%)

48.9

Female (%)

51.1

Total household size

4.223

St. error
0.07

0.12

0.19

The average household (HH) size in Madagascar is 4.2 ± 0.19 consisting of 2.4 adults and 1.8
children, respectively. 47.8% of adults are male compared to 52.8 % of males. Regarding nonadults, there are slightly more females (51.1%) than males (51.1%).

3

Some stakeholders questioned the HH size of 4.2 persons in this study when preliminary results of this study
were presented. However, the largest survey ever conducted in the region (Hänke et al. 2018) found an average
HH size of 4.74 ± 0.61, which is roughly in line with this study. Also, vanilla farming HHs who are certified, havesignificantly larger HH sizes than non-certified HHs indicating a selection bias (Hänke et al. 2018). Other factors
leading to decreasing HH size over time may be immigration by farmers from other areas and social change. Thatis, younger people tend to establish their own HHs leading to a higher number of- but smaller average sizes ofhouseholds (cf. INSTAT 2014).

17

B. Cost of decent living for an average household
Living Income is defined as sufficient income generated by a household to afford a decent
standard of living for all household members. Components of a decent standard of living
include food, water, housing, education, healthcare, transport, clothing and a provision for
unexpected events. The methodology is based on Anker and Anker (2017, see below for moredetails).
Below, data on each of the variables is presented, based on data collected through HHquestionnaires, market surveys and focus group discussions, and partly on secondary data.
(i) Model diet
The model diet is based on low-cost nutritious food which is in line with recommendations by
the FAO/WHO on consumption of calories, carbohydrates, proteins, fats, fruits and vegetables.
Anker and Anker (2017) provide two Excel tools4 in which edible grams, nutritional data, local
food prices and household composition including activity level, age and gender areincorporated. Given the fact, that many of the sampled adults are farmers, their kcal
requirements are higher than those of non-agricultural workers (Anker and Anker 2017,
Biesalski et al. 2017). Data on nutrition, i.e. carbohydrates, calories, proteins, fat contents andedible weights of all food items were taken from the United States Department of Agriculture
Food Composition Database (USDA 2019).

The food items in Anker´s model diet can be adapted so that they correspond to local food
habits and preferences. Frequency of consumption of food, subsistence crops planted and its
prices throughout the year are presented in Figure 6, Figure 9, Appendix 4-7, respectively.
However, for the model diet, additional data from focus group discussions is included. These
involve (i.) costs for meat, fish, oil and sugar, and (ii.) price fluctuations and seasonality of foodcrops throughout the year. Moreover, data collected on local markets on food prices wascrosschecked in focus group discussions. The food data was entered into the tool by Anker andAnker (2017) along with socio-demographic charatcteristics of the HH (HH size, age, gender,
activity level), based on own HH surveys, and the model caclulates the average costs of a model
diet per household per day.

4

The tools are for free and can be found at: https://www.elgaronline.com

18

i. Uganda
Local food habits are presented in Appendix 8 for Ugandan vanilla farmers and prices for the
local food items are presented in Appendix 4-7.
For a typical Ugandan vanilla farming HH (0.39 adults sedentary, 0.47 adults in moderate
activity and 2.46 in vigorous activity plus 3.4 children at a moderate activity level), an average
household member needs 2003 kcal per day.
Table 3: Model diet for Ugandan vanilla farmers
Food group

Food item

Cereals andgrainsMaize

Roots andtubersStarchy fruit /vegetable
Pulses, legumes,
beans

Ediblegrams

Cost perday/person
in €5
0.03

Comment

100

Cost perday/person
in UGX
123

Millet

25

82

0.02

Once a week

Sorghum

20

41

0.01

Once a week

Cassava

150

82

0.02

5 times a week

Yams

30

41

0.01

Once a week

Plantains

200

164

0.04

Every day

Beans

80

247

0.06

4 times a week

Groundnuts

60

288

0.07

3 times a week

206

0.05

For kids one glass per day

Dairy

Milk

Eggs

Chicken Eggs

50

534

0.13

Meats & Fish

Beef

70

557

0.23

2 times a week

Chicken

10

164

0.04

Once a week

Fish

80

721

0.27

2 times a week

Dodo
Cassavaleaves
Onion

60

82

0.02

2 times a week

50

41

0.01

2 times a week

51

41

0.01

2 times a week

Tomato

52

123

0.03

2 times a week

Mango

60

82

0.02

3 times a week

Banana

50

41

0.01

3 times a week

Vegetable oil
57
123
Total cost of model diet excluding additional costs
indicated below
Percentage added for salt, spices, sauces, andcondiments
Percentage for spoilage & waste

0.03

Every day

Green leafy
vegetables
Other
vegetables
FruitsOils & fats

Percentage added for variety
Total cost of model diet including additional costs
indicated below (UGX)
Cost of model diet per family per day

5

4 times a week

3782 UGX

0.92 €

1%
5%
10%5231 UGX

1.27€

35 096 UGX

8.52€

Exchange rate during the survey 1€= 4113 UGX (Ugandan Shillings)

19

In the vanilla growing areas in western Uganda, cassava and plantain are almost daily consumed
food crops (see Appendix 8) as well as the cheapest food sources ( see Appendix 3). They
contain high levels of carbohydrates but are poor in proteins, fats, vitamins and minerals(USDA 2019). Therefore, the food diet was slightly adapted so that the food diet becomes morediverse and healthier based on recommendations by the FAO /WHO. Cassava and plantain are
still included with a substantial share of consumption as well as beans, given their low prices
and local abundance.

As illustrated in Appendix 8, local vanilla farmers barely eat cereals. A key adaptation for themodel diet in Table 3 was that maize, and smaller amounts of sorghum and millet are includedin the food diet, which are sometimes planted as cash crops, bought in smaller quantities, andlocally available (see Figure 7 and Appendix 3). These cereals include crucial micronutrients,
vegetable fats and proteins (USDA 2019). Also, they are easier to store and, therefore, decrease
food spoilage. The equatorial climate in the Ugandan study region makes food spoilagecommon and fridges are rare. Only 0.4 % of the sampled HHs possess a fridge. However,sorghum and millet are relatively expensive compared to maize and were, therefore, added insmall quantities to the model diet (around 1 dish per week). Likewise, amounts of vegetables
and fruits was increased in the model diet to meet recommendations by the FAO/WHO.

Percentage added for salt, sauces and condiments was put as low as 1% of additional costs.
Local sauses consumed are often based on tomatoes and onions, which are already included asvegetables. Likewise, consumption of groundnuts is fairly high in the model diet as it iscommonly used for a local sauce ”Binyebwa”, which is eaten along with plantain and meat or
fish. Groundnuts are a rich source for unsaturated fatty acids and proteins (USDA 2019).
Prepared cereals are uncommon in the region and rice is a luxury product, eaten mainly during
festivities. Fish, chicken and beef are commonly eaten and were the also largest expenditureclass for food in 2018 (see Appendix 9).
Total food costs in the model diet sum up to 1.27€ per person, that is, for an average HH of 6.7
persons 8.52€ taking into account gender, age and activity levels of all HH members,

20

i. Madagascar
With regard to nutrition and food availability, the context in Madagascar is different than in
Uganda. Food availability is seasonal due to only one rainy season. Moreover, lean seasons arecommon in Madagascar lasting usually from January to April meaning that food savings are
scarce, farmers rely on food purchases and food prices increase on local markets (see Appendix
4-7). Local farmers rarely stock rice to prepare for the lean season as production is often
insufficient (FAO & WFP 2015).

Local vanilla farmers are smallholders and grow rice, cassava and yams roots, few fruits andvegetables. Most vegetables and pulses are generally purchased in semi-urban markets and most
livestock products except chicken and fish are imported from other regions (Kunz 2018).
Northeastern Madagascar is largely isolated from the rest of the island and transportation isexpensive due to a weak infrastructure. Consequently, food prices are higher than in other partsof Madagascar.

For the case of Malagasy vanilla farmers, food habits are presented in Appendix 11 and average
prices for the local food items are presented in Appendix 4-7. As there are less children in an
average Malagasy household compared to Uganda, the average kcal required per person issimilar with 2010 kcal/person (based on activity level of each HH member).

As illustrated in Appendix 11, Malagasy vanilla farmers eat rice daily (many eat rice 3 times aday) and rice causes the highest expenditures for food (Appendix 12). An average Malagasy
eats 120-130 kg of rice per year (Madamaginze 2018, FAO 2004), translating into 328-356
grams per day. Rice is theoretically a nutritious food source but only when the entire grain
including its hull is consumed (USDA 2019). However, in Madagascar, the hull is cracked andonly the white seed is eaten. Consequently, rice seeds lose important minerals and vitamins,
and the white rice seed contains almost exclusively carbohydrates (USDA 2019). This often
leads to physical underdevelopments and diseases in rural Madagascar as the food diet isunbalanced and far too much centred on carbohydrates leading to protein and vitamin deficits(Golden et al. 2019, USAID 2018, Schlecht & Hänke forthcoming).

Therefore, in the model diet, the rice consumption is reduced to 100 grams per day/person inorder to establish a healthy and nutritious diet. This would mean that rice is only eaten 2-3 times
a week. Tuber roots and fruits are cheap and locally available (see Appendix 4-13). Moreover,21

tuber roots can be harvested throughout the year and don´t depend as much on rain as annual
plants (e.g. rice, maize, beans). In addition, vegetable and animal protein consumption areslightly increased in the model diet to satisfy WHO/FAO recommendations. Percentage added
for sauces was put on 1%, the lowest option according to Anker & Anker (2017). Despite thefact that Madagascar is a so-called the “spices island”, spices are in fact rarely used in local
dishes. Only oil, salt and Sakay, a chilly sauce consisting of chillies, garlic, vinegar and ginger
are commonly added in small quantities.
Table 4: Model diet for Malagasy vanilla farmers

Food group

Food item

Grams perday

Cereals and grains

Maize
Rice
Cassava
Yams
Plantains
Beans
Groundnuts
Milk

25
25
150
50
200
80
60
200

Roots and tubers
Starchy fruit /vegetable
Pulses,legumes,
beans
Dairy

Cost perday/personin Ariary

Cost perday/person
in €6

95
212
115
215
538
380
238

0.02
0.05
0.03
0.05
0.13
0.09
0.06

200

0.05

Eggs
Meats & Fish

Chicken eggs
50
1136
Beef
30
674
Chicken
10
294
Fish
30
633
Green leafy
Bred
60
42
vegetables
Cassava
50
56leavesOther vegetables
Onion
51
142
Tomato52
379
FruitsMango
60
51
Banana50
90
Oils & fats
Vegetable oil
57
398
Total cost of model diet excluding additional costs indicatedbelow
Percentage
added for salt, spices, sauces, and condiments
Percentage for spoilage & waste
Percentage added for variety
Total cost of model diet including additional costs indicatedabove model diet per family per day
Total

0.28
0.17
0.07
0.16
0.01
0.01
0.03
0.09
0.01
0.02
0.10
5887 Ar
1%
3%
10%68614 Ar
28948 Ar

Comment
4 times a week
2-3 times a weelk
4 times a week
Once a week
4 times a week
3 times a week
3 times a week
For children one glass per day

2 times a week
Once a week
2 times a week
5 times a week
2 times a week
3 times a week
3 times a week
3 times a week
3 times a week
Every day
1.45 €
5

1.69 €
7.13 €The model diet leads to daily costs of 7.13€ per average household or 1.69€ per person. Thus,
for a total year the costs sum up to 2597.2€ per Malagasy household.

6

Exchange rate during the survey 1€= 4060 Malagasy Ariary

22

(ii) Housing
Contrary to other poverty lines, the Anker method accounts for detailed measures of non-foodcosts. Housing costs are estimated by summing up estimates of the costs of rent for an
appropriate home or a rental equivalent. In fact, in both Uganda and Madagascar housing
rentals are rather uncommon in rural areas. Instead, farmers build their own houses or inherit
them. Sometimes workers are engaged to support house construction. However, e.g. in
Madagascar there is increasing immigration of other ethnic groups due to the vanilla boom whosometimes rent houses, according to respondents.

In both countries, housing conditions are generally poor, even though housing standards in
Uganda are better than in Madagascar (see Table 5). In Madagascar, there are rarely separate
rooms for kids and adults, many houses are huts made of wooden sticks and fibres. Some of thehouses´ roofs are made of plant material, which has to be renewed every year. However, agradual improvement of housing conditions was observed during fieldwork. The housing
conditions are compared between Madagascar and Uganda in Table 5.

Table 5: Housing conditions in Uganda and Madagascar
House feature

Floor

Electricity

Electricity Source

Energy source for cooking

LatrineMaterial/Asset

Uganda (%)

Madagascar (%)

Clay

71.0

2.2

Cement

24.2

28.3

Wood

3.6

63.2

Yes

71.8

83.4

No

28.2

16.6

Solar panel

72.2

83.5

From neighbours

3.6

1.5

Electricity grid

2.0

0.0

Wood

92.7

87.3

Charcoal

4.4

12.7

Electricity/Gas

0.0

0.0

Yes/No

95/5

71/29

Covered with walls/shelter

66.9

9.2

Clay

16.9

0.6

Hole in the ground

8.9

53.3

Wood

5.7

18.7

Porcelain

0.4

0.6

23

71% of the Ugandan farmers and 83.5% of the Malagasy farmers have an electricity source athome mainly through solar panels (72.2% and 83.5%, respectively). Wood and charcoal are theonly energy sources used for cooking in both countries. This makes a separate cooking area
particularly important as smoke and gases lead to respiratory diseases and lung cancer,
predominantly if people live, sleep and cook in the same rooms (WHO 2019).

In Uganda, the latrines are mainly open spaces covered with walls/shelter (66.9%), clay (16.9%)
and only 0.4% of respondents possess porcelain toilets. In Madagascar, 71.1% of farmers havea latrine; however, 42% share the latrine with neighbours. More than 20% of sampled Malagasy
farmers practice open defecation. Many diseases are transmitted that way in Madagascar, i.e.,
typhus, cholera and other diarrheal diseases (UNICEF 2011). Almost none of the latrines fulfil
hygienic standards satisfying criterion by the Millennium Development Goals (UN 2019).
Neither in Uganda (24.2%) nor in Madagascar (28.3%) floors are frequently cemented.
Housing conditions of an average vanilla farmer both in Uganda and Madagascar are thus notin line with international minimum standards (Anker and Anker 2017).

So as to estimate housing costs (rent and utilities) in both countries, international minimum
standards of housing conditions were presented to focus group participants. Data for housing
costs were collected in 6 focus groups discussions in each of the different districts (3 in Uganda,
3 in Madagascar). Costs for a decent house include the following (Anker and Anker 2017):
i.

separate rooms for children and adults, that is, 3 separate rooms for an average HH (dependingon HH size)ii. each room with at least 9m2
iii. a safe roof, so that no water can penetrate
iv. air ventilation
v. a cemented floor
vi. concrete walls (wood can be mixed with cement or clay)vii. a separate cooking areaviii. outside porcelain or improved latrineix. access to water and electricity
x. maintenance/reparation costs

Questions discussed with focus group participants were: How much would it take to build sucha house, how long would it last and/or what would be a renting equivalent?

24

Figure 3: Examples of houses of Malagasy vanilla farmers in non-acceptable (left), medium acceptable(middle) and idealistic houses in line with international minimum standards (right). Source: own photos

ii. Uganda
The reality of housing conditions in Uganda is described in Table 5. Among each of the focus
group discussions, there was at least one person who recently build a house in line with thepresented characteristics above. Those were mainly better-off vanilla farmers benefitting fromthe on-going vanilla boom and its high prices. Still, focus group participants found it easier todiscuss a renting equivalent. As no water pipes are locally available, improved fountains thatare kept safe and clean were suggested by the focus group participants. Also, the water can be
purified at very low costs either through solar water disinfection or heating (WHO 2019).
In Uganda, the renting equivalent was estimated at 600,000UGX/year for such a model house,
which would lead to an average cost of 7,200,000 (1748.9€), per year.
The variance of the price range was low in all 3 different Ugandan districts (500,000- 700,000
UGX/year).

ii. Madagascar
Also in Madagascar some of the focus group participants constructed houses in line with the
housings standard described above. Participants agreed that the construction for a similar house
would costs 70,000,000- 90,000,000 Ariary (~17,000€ - 22,000€) and would last for around40-50 years. However, focus group participants agreed that a rental equivalent is more realistic
as few farmers are able to build a similar house and/or lack experience in estimating the costs.
A rental equivalent, however, would me more expensive than just construction costs for ahouse, particularly when it is furnished. Local farmers estimated the rental equivalent to 650,000 Ariary (145.6€-169.9€) per month, on average. The variances in all three districts were low(600,000- 700,000 Ariary) indicating good estimates by respondents.
Hence, the annual housing costs were established at 1,926€/year.

25

(iii) Electricity
As solar panels are the most common source of electricity in both the sampled Ugandan andMalagasy region, the costs for solar panels, its maintenance and the time span it can be used
was discussed in focus group discussions. Most of the focus group discussion participants
possess solar panels and could provide good estimates.

iii. Uganda
89.5% of the surveyed HHs have a mobile phone, 83% a radio and 9.2% a TV. These items
together with lighting are regionally the main consumers of electricity. In order to produce
enough energy for the listed items, solar panels can be bought locally for 300,000 – 1,500,000
UGX (900,000 UGX (218.6€)), on average. The more expensive the solar panel, the more
powerful it is, and the more electronic items the HH usually possesses. However, most solar
panels are low-quality Chinese fabrications and both, key informants and farmers confirmedthat they last for around 3 years only. Consequently, the average costs per solar panel and HH(900,000 UGX/3 years) lead to costs of 72.9€ per year.

iii. Madagascar
Contrary to Uganda, only 44% of the sampled Malagasy farmers possess a mobile phone.
However, this number might be limited by network availability. Still, 41 % of the farmers
possess a TV and 93% a radio. In Table 5 we saw that 83.4% of the Malagasy farmers have asolar panel but solar panels are expensive in the SAVA region of Madagascar (see also Figure
3 left). A solar panel producing 450 Watts, a battery of 300 Amph and a converter can be locallybought for 4,000,000 Ariary (988€) and will have to be renewed after 3 years. Another example
mentioned was a solar panel for 5,000,000 (1,235€) Ariary, which lasted 4 years. These costs
translate into an average cost of 111,110 Ariary per month (27.4€) or 328.8€
per year.
(iv) Education
Education is an international human right (UNESCO 2019) and the Anker methodology
assumes that every child has the right to complete at least secondary school.

Even though schooling conditions are underdeveloped in both countries, schooling conditions,schooling success, and general educational levels -particularly for adults- are higher in Uganda

26

than in Madagascar (compare UNICEF 2019a, UNICEF 2019b). However, schooling fees in
Uganda are much higher than in Madagascar (Glick and Sahn 2006, UNESCO 2016).

Uganda has kept the British schooling system including primary, secondary and tertiary school.
Madagascar has kept the French schooling system consisting of pre-, primary and lower- andupper secondary school. In both countries, there is lack of equipment, teachers are insufficiently
trained, and particularly in Madagascar, many parents have to support local schools due to alack of governmental funds (UNICEF 2017). Because of the weak quality of governmental
schools, public schools are on the rise in many parts of rural Africa (UN 2017). In both Uganda
and Madagascar, there are public as well as private schools and private schools are generally
considered better than governmental schools as teachers get better salaries and are more
motivated than in public schools, according to respondents.

iv. Uganda
In Uganda, the schooling fees differ substantially from school to school and place to place.
Also, schooling costs depend on the class pupil are visiting (usually the higher the class thehigher the school fees). In addition to schooling fees, there are development funds, obligatory
school clothes, equipment (mathematical sets, pens, books) and excursions to be paid byparents. However, these fees don´t include food costs that otherwise would have to be deductedfrom the model diet (Anker & Anker 2017).

Schooling costs up to secondary school per child per year were collected by HH surveys andsubsequently summed up per HH (Anker & Anker 2017). Table 6 below shows (i.) the average
number of children per HH visiting a particular school and the average costs per year for the
given school. The results were post-checked in focus group discussions and were confirmed tobe realistic by participants.

Table 6: Expenses for education per household per year in Uganda
SchoolNumber of kids inaverage householdSt error

Average costs(€) /year

Factored (costs* number of school
kids in average household)Primary school

2.1

0.1

229.7

482.6

Secondary school

0.8

0.1

428.0

322.3

Total

2.9

0.2

804.8927

Each HH has an average of 2.9 ± 0.2 children visiting school, mainly in primary school (2.1
and secondary school (0.8). Consequently, total education costs per HH sum up to 804.9€ per
year, on average.
iv. Madagascar
Even though Madagascar has made progress in terms of literacy and schooling rates in the past
decade, schools remain mainly underdeveloped and the governmental support is weak,particularly in rural areas (UNICEF 2017). Secondary schools are often far away from villages
where vanilla farmers live. Teachers are irregularly paid, parent´s support is often necessary,and corruption is common in all school types7. In the vanilla growing region of the SAVA,
parents often take care of the teacher´s vanilla plantations as they are often farmers at the sametime.

In Madagascar there is the primary school (école primaire), lower secondary school (Collège
d’Enseignement Générale), a secondary school (Brevet d’Étude Primaire Complémentaire),
and upper secondary school (Lycée). Here, fees barely differ. Moreover, expenses for school
are low and include school fees, FRAM8, school shirts, books and pencils and sometimes
transportation, even though >95% of pupil in this sample walk to school. School fees don´tinclude food costs.
Table 7: Expenses for education per household per year in Madagascar
SchoolNumber of kids inaverage householdSt error

Average costs(€) /year

Factored (costs* number of school
kids in average household)Primary school

0.9

0.1

37.9

34.1

Secondary school

0.3

0.2

37.9

11.3

Total

1.2

0.1

45.4

Each HH has an average of 1.2 ± 0.1 children visiting school. Both analysis (primary &secondary school) showed average expenses of 37.9± 2.9€, leading to an average cost of 45.4€
per household per year.

Many parents complain about “unofficial fees” to be paid to teachers and school directors, which are not includedin the model. These costs can be high according to respondents (> than schooling costs).
8
FRAM is abbreviation for Fikambanan'ny ray aman-drenin'ny mpianatra , “the association of the parents ofpupils”
728

(v) Healthcare
Due to the tropical-equatorial climate and partly inappropriate hygienic conditions in bothregions, dangerous diseases such as malaria, dengue, typhus and cholera are common.
Moreover, fountains - the most common water source- are often contaminated with pathogenic
bacteria. However, public health facilities in Uganda are generally better, and governmental
funding’s higher in than in Madagascar (World Bank 2019b).

Expenses for health care are all private and were surveyed through HH surveys for each HH
member. The costs include professional health treatments, medicine expenses andtransportation costs.

v. Uganda
Health treatments are fairly expensive in Uganda. On average, each HH member visits 2.5 times
a health centre, doctor or pharmacy per year leading to an average cost of 43.5€ per person per
year. Expenses for elderlies and children are higher than for age classes 14 to 50 years old.
Consequently, for an average HH size of 6.6 members, health expenses sum up to 287.3€± 72.1€ per HH per year, on average.

v. Madagascar
In the SAVA region of Madagascar, diarrheal diseases, malaria and typhus cause most damage
and lead to a particular high child and mother mortality rate (INSTAT 2014, Meekers and
Yukich 2016). Sanitation and health facilities are poor in Madagascar, with insufficient number
and training of employees, a lack of equipment and low numbers of trained doctors (Centre deRecherches 2013). In Madagascar, many farmers use traditional medicine due to long distances
to public health facilities and lower costs compared to western medicine (ibid).
On average, each HH member visits 1.7 times a health centre, doctor or pharmacy per year
leading to an average cost of 21.1€ per person per year 9.
Consequently, for an average HH size of 4.2 members, health expenses sum up to 88.9€ ± 1.4€
per HH per year, on average.

9

The number was post-checked with local key informants and confirmed to be realistic if public/western
medicine is used instead of traditional medicine.

29

(vi) Clothing
Data on clothing costs were collected in focus group discussions. Costs were separately
discussed by gender for children and adults. School clothes were included under educational
expenses above as they are obligatory and have uniform costs. Clothes for adults include clothes
for on-farm work, daily clothes and clothes for festivities. In both countries, proper dresses e.g.
for visiting churches on Sundays are socio-culturally essential.

vi. Uganda
Table 8: Expenses for clothing in Uganda per household per year
Costs in €(mean)

Number of persons in average
household

Sum

Adult

115.4

3.2

372.3

Children

66.8

3.4

226.9

Total

599.2

Expenditures for clothing are higher for adults (115.4€) than for kids (66.8€), and higher for
women than for men. For a typical household with 6.6 persons, total costs for clothes sum up
to 599.2€ per year.

vi. Madagascar
Table 9: Expenses for Clothing in Madagascar per household per year

Adult

Costs in €(mean)
52.6

Number of persons in average
household2.4

126.24

Children

64.7

1.8

116.46

Total

242.7

Sum

Expenditures for clothing are higher for children (64.7€) than for adults (52.6€), and generally
higher for females than for males. Total costs for clothes sum up to 242.7 € per average
household per year, considering the HH size of 4.2 persons.
(vi) Transportation
All transportation costs are based on individual HH surveys and were post-checked in focus
groups. Transportation costs include commuting to markets for buying/selling food and vanillaand visiting relatives. Transportation of children to school and to doctors are included in schooland health expenses, respectively, as we explored during the pilot phase that this was easier toestimate for respondents.
30

vi, Uganda
In Uganda, 14.9% of Ugandan vanilla farmers possess a motorbike and 10.9% a bicycle. 84.7%of the surveyed farmers in Uganda walk to their vanilla plots, 1.6% use a motorbike and 0.8%
a bicycle, respectively. Almost all children walk to their schools. The closest market/town is
on average 3.3 km away from home. To sell their vanilla, farmers travel, on average, 1.5 km.
However, the farmers sampled for this study are members of cooperatives which often havetrading centres close-by or sell vanilla together with neighbouring vanilla farmers in-situ.

Yet, total transportation costs are low as private bush-taxis are most commonly used, whichcost ~2-3€ per roundtrip for a distance of ~10 km. Due to the lack of food storage and fridges,
local farmers visit markets frequently (5.09 ± 0.24 times a month). The average transportation
costs sum up to 17.5€ per month leading to 210€ per year per HH.

vi. Madagascar
In Madagascar, 14.0 % of vanilla farmers possess a motorbike and 21.6% a bicycle. However,
95% of the surveyed farmers walk to their vanilla plots, 0.8% use a motorbike and 4% a bicycle,
respectively. Almost all children walk to their schools even though secondary schools are often
far away from home (>5 km). The closest market/town is on average 9.5 km away from homeand farmers visit these markets 4.8 times a month, on average. To sell their vanilla, farmers
travel 0.4 km, on average. Many of the vanilla farmers sell their vanilla in their own villages orclose-by. Thus, in Madagascar total transportation costs are relatively low. Likewise, in
Madagascar bush-taxis are most commonly used, leading to an average cost of 76.2€ per HH
per year.
(vii) Communication
Communication with family relatives, social networks and to receive information on vanilla
prices and markets is essential for vanilla farmers. Data for telephone/communication costs
were discussed in focus group discussions.

vii. Uganda
89.5% of the surveyed HHs have a mobile phone and the mobile phone grid is well establishedin the region. Telephone and mobile data costs are generally cheaper in Uganda than in31

Madagascar. 30,000 - 50,000 UGX were defined as an average cost for regional farmers permonth and HH. Extrapolated to a year, the costs sum up to 117€/year for a HH.

vii. Madagascar
43.8% of the respondents have a mobile phone and communication is relatively expensive in
Madagascar. On average, communication expenses were estimated at 58,750 Ariary/month
converting into 14.3€ per month, and hence to 171.1€/year.
(viii) Margin for unexpected events
In the Anker methodology, a small margin for unforeseen events is provided. This margin
should ensure sustainability and help workers avoid getting into a poverty trap or debt cycle(Anker and Anker 2017). Therefore, a margin (5%) of the sum of the variables above (i.-vi)
was added to both total living income estimates.
(ix) Total Living Income per year
ix. Uganda
Taking into the account all variables from above (i.-vii.), total living income for an average
sampled HH in Uganda sums up to 7297.1 € per year, translating into 3.03 € per person per day
considering the HH size of 6.6 persons.

50€ per houhsold per year

3110

3000
2000

40
30

1749

20
1000

805

599
347

0

287

210

10
117

73

0

% of total ving income

Living Income for Ugandan vanilla farmers/household/year

Figure 4: Composition of Living Income of Ugandan vanilla farmers per household and year

ix. Madagascar
Taking into account the benchmarks for a decent living for Malagasy vanilla farmers, total
living income sums up to 5750.5€ per HH per year, or 3.75€ per person per day (HH size 4.2
persons).
32

Living Income for Malagasy vanilla farmers/household/year€ per household per year

50
2000

1926

40
30

20

1000
329

274

243

171

10
89

76

45

0

% of total living income

2597

0

Figure 5: Composition of Living Income of Malagasy vanilla farmers per household and year

C. Value of self-produced foodAll home-consumed subsistence crops and livestock in 2018 were surveyed per HH andsubsequently converted into cash units.
(i.) Uganda
Table 10: Cash value of subsistence crops produced by Ugandan vanilla farmers
Crop% of farmers cultivating crop

Average value per
year in €Avocado

29.0

2.7

1.1

Beans

75.8

76.5

13.0

Cassava

87.9

51.8

5.6

Leafy vegetables

9.3

0.1

0.2

Groundnuts

21.4

20.1

9.5

Irish potato

5.6

0.9

1.4

Maize

28.6

46.8

28.1

Plantain

95.6

480.5

71.3

Sweet potato

22.6

3.9

1.7

Tomato

4.4

3.9

9.5

Yams

2.0

0.2

0.6

687.4

109.5

Total

St. Error

Plantain (480.5€), beans (76.5€), cassava (51.8€) and maize (46.8€) generate most cash value,
on average, indicating large quantities harvested. However, the standard errors, particularly forplantain, are relatively high representing significant differences between the vanilla farmers
sampled. Many other crops provide little value, on average, partly because of (i.) low quantities
harvested, (ii.) low prices particularly for fruits and vegetables and (iii.) they are cultivated by
few farmers leading to low average values. Production costs for subsistence crops are very33

low, agricultural inputs are rarely used, seeds are self-produced and engagement of hiredlabourers is uncommon. Thus, most input consists of household labour. The total value of selfproduced food was 687.4€ ±109.5€ per average HH in 2018.
Table 11: Value of a. self-consumed, and b. sold livestock by Ugandan farmers
Livestock classa. Self-consumed

b. Sold

Mean €

St error

Mean €

St error

Chicken

24.49

25.07

81.24

25.94

Goats

21.51

22.25

75.56

4.38

Other Poultry

0.67

1.40

1.52

0.44

Pigs

2.33

2.52

21.97

2.77

Cows

-

-

31.86

15.69

Total

49.01

51.24

212.1649.22

On average, 2.7 chicken and 0.47 goats were home consumed in 2018 converting into a cash
value of 24.5€ and 21.5€, respectively. However, other self-produced livestock classes wereless commonly consumed. The standard errors indicate substantial differences in livestock
home consumption by the vanilla farmers sampled.
On average, 9.0 chicken were sold for a total value of 81.24€ and 1.7 goats were sold for an
average total value of 75.56€. As well as for home consumption, other livestock classes wererather uncommonly sold in 2018.
(ii.) Madagascar
Table 12: Cash value of subsistence crops produced by Malagasy vanilla farmers
Value €

Crop

% of farmers cultivating crop

Avocado

4.17

1.3

Banana

33.33

14.2

Beans

12.50

8.2

Bred

10.65

1.6

Cassava

15.74

4.3

Coffee

5.09

6.9

Cucumber

5.09

2.1

Maize

9.72

10.7

Peanuts

1.39

0.7

Rice

94.44

306.8

Sweet potato

3.24

0.8

Yams

6.02

1.2

Total

358.7

34

For this analysis hill rice and irrigated rice were combined and the value of self-consumed rice
is highest (306.8€). Other import crops were bananas (14.2€), maize (10.7€) and beans (8.2€),
on average.
Table 13: Value of a. self-consumed and b. sold livestock by Malagasy farmer
Livestock classa. Self-consumed

b. Sold

mean

St. error

Mean €

St. error

Chicken

18.99

0.42

13.1

0.7

Other Poultry

10.08

1.24

13.6

2.4

Pigs

2.50

0.00

2.8

3.2

Cows (zebu)

24.06

0.93

3.1

3.2

Total

55.63

2.59

32.6

9.4

54.4% of Malagasy farmers possess livestock. Most common are chickens (42.4 %), followedby zebus (22.5%), pigs (10.1%), and other poultry (18.1%), respectively.
Chickens that were self-consumed (18.99€) convert to more cash value than income generated
through sales (13.1€), on average. Zebu cattle is rarely sold in the region and mainly eaten
during festivities. In general, livestock husbandry is weakly developed in north-eastern
Madagascar; zebu cattle and other small ruminants are often imported from other Malagasy
regions (Kunz 2018).
The total value of self-consumed livestock in 2018 was 55.6€, on average, and the income
generated through sales 32.6€, respectively.

D. Conclusion: Cost of decent living minus value of self-consumed foodIn Fairtrade’s LIRP model the value of self-produced food is deducted from the cost of decent
living.
(i.) Uganda
The total costs of living were estimated at 7297.1€ per year or per day per person thistranslates into 3.03€ considering the HH size of 6.6 persons. Total value of self-consumed
food was 736.4€ (subsistence crops + livestock). Thus, the total costs of decent living is6,560.7€ per HH per year.
(ii.) Madagascar
The total costs of living income were estimated at 5750.5€ per HH per year or 3.75€ perperson per day (considering the HH size of 4.2 persons). Value of self-consumed food was35413€ (self-produced food + livestock). The total costs of decent living is 5337€ perhousehold per year.

3.2. Actual farm size and full employment farm sizea. Land distribution / crop diversification / typical farm model
Farmers were asked which crops they plant on their fields, how many agricultural fields they
farm and designated 10 beans proportionally to the different crops on each field. That is, one
field was divided into 10 beans leading to an accuracy of 10%.

(i.) Uganda
Subsistence crops cultivated by Ugandan vanilla farmers% of households

100
75
50

25

TomatoPumpkin

Eggplants

Leafy vegetables

Soya Beans

Groundnuts

Frui trees

Sweet potatoe

Yams

Avocado

Maize

Beans

Cassava

Plantain0

Figure 6: Subsistence crops cultivated by Ugandan vanilla farmers

Ugandan vanilla farmers cultivate, on average, 4.7 different subsistence crops. In the vanilla
growing region of Uganda, plantain10 (95.6%), cassava (88.7%) and beans (75.4%) are the mostcommonly cultivated subsistence crops. Maize (27.8%), avocado (25%), yams (25.0%) andsweet potato (22.6%) are also common as well as fruit trees (22.6%), mainly mango andjackfruit. Vegetables, however, are less common: 9.7% of the farmers grow green leafy
vegetables, mainly dodo11 and cassava leaves. Eggplants, pumpkin and tomatoes are onlygrown by 6.9% - 4.4% of farmers.

10

In western Uganda a plantain variety locally called Matooke is mainly cultivated but many different varieties
are common; the same is true for bananas.
11
Dodo, locally often referred to as spinach, belongs to Amaranthaceae and is commonly added in small quantities
to side dishes.

36Cash crops cultivated by Ugandan vanilla farmers

75
50

Pineapple

TomatoOnion

Groundnuts

Soya beans

CottonMaize

AvocadoMoringa

Fruit trees

Plantain

Cassava

CoffeeCocoa

Vanilla

0

Beans

25
Prunus…

% of households

100

Figure 7: Cash crops cultivated by Ugandan vanilla farmers

Ugandan vanilla farmers cultivate, on average, 2.6 different cash crops. Many vanilla farmers
also plant cocoa (83.2%) and coffee (73.2%). However, all other cash crops are cited by lessthan 4% of farmers as cash crops.
Distribution of crops in Uganda (in ha)ha per household

1.2

1.0

0.9
0.6

0.5
0.4

0.3

0.2

0.3

CoffeeOther cash
crops

0.0

Cocoa

Subsistence
crops

VanillaFigure 8: Land sizes distribution of different crops of Ugandan vanilla farmers

On average, sampled Ugandan vanilla farmers have a total of 2.8 ± 0.1 of agricultural fields.
Each field has an average size of 0.8 hectares (ha) ± 0.1 ha summing up to a total land size of
2.3 ha ± 0.1 ha per household. Figure 8 shows the land sizes dedicated for subsistence crops(summed), cocoa, vanilla, coffee and other cash crops.

Most of the agricultural fields is used by subsistence crops (1.0 ha in sum), mainly plantain,
cassava and beans. Cocoa covers 0.5 ha and coffee 0.2 ha, respectively. Vanilla covers 0.4 ha,on average. “Other cash crops” (0.3 ha) include cotton, soya beans, sugar cane and palm oil.

37

(ii.) Madagascar
Subsistence crops planted by Malgasy vanilla farmers% of households

100
75
50
25

Yams

None at all

Pineapple

Maize

Bred

Beans

Cassava

Rice (tavy)

BananaRice(irrigated)

0

Figure 9: Subsistence crops cultivated by Malagasy vanilla farmers

Malagasy vanilla farmers cultivate 1.9 different subsistence crops, on average. The mostcommon subsistence crop is irrigated lowland rice (74.3%), followed by bananas (30.1%). Hillrice in tavy systems, is planted by 17.8% of respondents12. Cassava (15.6%), beans (11.4%) andbred (Acmella oleracea, 9.7%) are less common. Six percent of the vanilla farmers plant no
subsistence crops at all.

Figure 10: Irrigated rice in the Andapa region (left) and hill rice cultivation (right), Source: Annemarie Wurz

Sampled Malagasy vanilla farmers plant, on average, 1.8 of cash crops. Coffee (30.2%) andcloves (13.7%) are relatively common. All other cash crops are planted by less than 7.5% of
respondents (Figure 11).

12

Tavy is a slash-and-burn shifting cultivation practice and among the main sources of deforestation in northeastern Madagascar (Zaehringer et al. 2017). Still, the yields of Tavy rice (hill) is only around ¼ th of irrigated rice.

38

Cash crops cultivated by Malagasy vanilla farmers% of households

100
75

50
25

PepperSugar Cane

Cassava

Maize

Beans

Rice
(irrigated)

BananaBred

ClovesCoffeeVanilla0

Figure 11: Cash crops cultivated by Malagasy vanilla farmers

The sampled vanilla farmers in Madagascar possess, on average, 2.08 ± 0.06 agricultural fields
whereas each field has a size of 0.91 ha ± 0.06 ha, leading to a total land area of 1.89 ha ± 0.12
ha.

ha per household

Distribution of crops in Madagascar (in ha)
1.0

0.9

0.8
0.6

0.6
0.4

0.3
0.2

0.2
0.0

VanillaRice

Cash crops

Substitence crops

Figure 12: Land size distribution of different crops of Malagasy vanilla farmers

Most agricultural land is covered by vanilla agroforestry systems (0.9 ha), followed by rice(0.6 ha). “Other cash crops” include coffee (0.1 ha), cocoa (0.1 ha) and cloves (0.1 ha); 0.3 hain sum. Subsistence crops - other than rice - cover in sum only 0.2 ha.

b. “Full Employment” vanilla farm size and land used for other crops
A critical component of this study was to establish a full employment farm size benchmark
based the available labour in each HH. This is not to be mistaken as a recommendation tofarmers to grow only vanilla; instead this is a critical assumption to establishing a reference
price. Because of the real-world high variability in farm size and diversification, the Fairtrade39living income reference price is based on a maximum vanilla area that can be managed
primarily through family labour, that is a full employment vanilla farm size. The idea is that if
farmers grow vanilla on a smaller area of land, the reference price covers a proportionate shareof the living income relative to the full-employment vanilla farm.

In individual interviews vanilla farmers were asked what the maximum farm size would be thatthey can manage with their own household labour. Vanilla has labour peaks over the year, i.e.
vanilla farmers hand-pollinate every single vanilla flower. Labour for pollination is rarely
outsourced as flowers have to be pollinated within a short period of time which largely
coincides for all vanilla farmers. Therefore, available household labour for pollination is among
the main limiting factors for the maximum manageable vanilla area, along with securing thevanilla fields given the current high theft pressure.

Subsequently, assumptions on full employment farm size were discussed in focus group
discussion including cooperative leaders, together with different stakeholders and experts, aswell as the vanilla industry grouped through the SVI by means of video conferences and apresentation at their General Assembly.
In addition to household labour occupation, the results of this survey showed that “available
land to increase vanilla production” was commonly cited as a limiting factor to extend thevanilla area in both countries, indicating that there is land scarcity. For the model, we looked atwhat crops farmers could give up to achieve a full employment vanilla area. It would be most
realistic to transform cocoa or coffee plantations, which also grow in agroforestry systems andrequire shadow as well as vanilla. Other fields, e.g. subsistence crops, are unrealistic as
immediate vanilla plantations since for a successful vanilla plantation trees are necessary as
both tutor and shadow trees.

Coffee prices have crashed to a historical low level (FAO 2019). Consequently, thetransformation of coffee plantations is currently the most obvious transformation option for thismodel. Accordingly, field sizes, labour requirements and generated income from coffee are
reduced in the LIRP model.

40

(i.) Uganda
The maximum feasible vanilla area a Ugandan farmer household can manage is 0.8 ha.
This was suggested by farmers and confirmed by cooperatives and vanilla companies as arealistic estimation. The main limiting factor for Ugandan vanilla farmers is available HH
labour for pollination but currently also for securing the fields (see also d. Labour requirementsfor vanilla and other crops in 2018). Currently, the average vanilla farm size is 0.4 ha (seeFigure 8) but many farmers are enlarging their vanilla plots due to high vanilla prices (ownsurvey data) at the expense of coffee land.
Viable farm size model (Uganda)
1.2
0.9
0.6
0.3
0.0
VanillaCocoa

CoffeeOther cash
crops

Subsistencecrops

Figure 13: Viable farm size model, crop distribution in Uganda

For this model, we assume Ugandan vanilla farmers would switch from coffee and “other cash
crops” to reach the full employment farm size of 0.8 ha. Subsistence crops and cocoa remainunchanged as full employment on the vanilla plot still has labour time available outside of thevanilla peak labour needs to care for these other crops.

(ii.) Madagascar
Malagasy vanilla farmers estimated the full employment farm size at 1.0 ha. This was
likewise confirmed by cooperative heads and SVI members as a realistic maximal manageable
area by a typical household. As in Uganda, limiting factors are available HH labour for
pollination and currently for securing the fields. Presently, the average vanilla farm size is 0.9
ha (see Figure 12).
Viable farm size model (Madagascar)
1.2
0.9
0.6
0.3
0
VanillaRice

CoffeeCocoa

Substitence Cash crops
crops(other)Figure 14: Viable farm size model, crop distribution in Madagascar

41

c. Household labour availability (FTE) and occupation(i.) Uganda
Concerning the adult Ugandan population, more females (76.4%) than males (61.2%) work fulltime on the farm. Yet, more males work part-time on the farm (16.2%), outside the farm
(11.6%) or still visit school (11.1%). Looking at non-adults, most household members visit
school (75.8% of males and 76.7% of females, respectively) and many non-adult HH members
are too young for school, i.e., below 6 years old. The full time equivalent (FTE) is 3.15 persons.

(ii.) Madagascar
Concerning adult HH members, more males (73.7%) work full time on the farm compared tofemales (47.3%) in Madagascar. On the contrary, more females (33.3%) than males (11.4%)
work only part time on the farm or outside of the farm (13.5% of females; 7.6% of males).
Looking at the non-adults, more males than females work full or part-time on the farm. Quite
the reverse, more females visit school (66.8%) than males (59.6%).
The FTE is 2.06 persons.

d. Labour requirements for vanilla and other crops in 2018(i.) Uganda
Family labour (in man days) for cash crops by Ugandan vanilla farmers

man days per month80

60

Vanilla40

Coffee
Cocoa

20

0
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sept

Oct

Nov

Dec

Figure 15: Family labour (in man days) for cash crops by Ugandan vanilla farmers over the year in 2018(man days were multiplied with the number of household members who contribute)

Vanilla dominates farmer´s family labour throughout the year, however, they have different
phases. Labour peaks for vanilla occur between March-May and August-November.
42

September-November clash with labour needs for cocoa and coffee. As illustrated above,
Ugandan vanilla farmers harvest twice a year vanilla compared to only once in Madagascar.

Below, we look more precisely at which vanilla-related activities are practiced over the year.
Vanilla activities over the year by Ugandan vanilla farmers% of farrmers citing activity

100

75

Harvesting
50

Securing Plot
Pollination

25

0

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug Sep

Oct

Nov Dec

Figure 16: Distribution of agricultural activities (vanilla) over the year in Uganda

As we see in Figure 15 and Figure 16, the agricultural activities conducted by Ugandan vanilla
farmers have different peaks.

Vanilla takes around 9 months to ripen (Havkin-Frenkel and Belanger 2011). Consequently,
the flowers are pollinated 9 months before harvest, i.e. in March/April and in September/
October (compare Figure 15 and Figure 16). The flowers of the vanilla plant open for somedays only, usually when there is sun and mainly in the morning (Havkin-Frenkel and Belanger2011). Every flower is pollinated by hand as the naturally vanilla pollinating bee from the
Melipona genus, originating from Mexico, has never been introduced in other parts of the world
successfully. Also, its pollination rate is insufficient for vanilla production on an agriculturalscale (Rodolphe et al. 2011). Accordingly, pollination is among the most labour-intense
activities (see Figure 16). The month of March, in which vanilla is pollinated to be harvested
in December is the labour peak (see Figure 15). Pollination requires skills and experience by
the farmer. Harvesting is mainly done between May-June and October-December indicatingthat many farmers harvest their vanilla prematurely.

Given the current high prices of vanilla, securing the vanilla plots is also an exceptional labourintense activity (Figure 16), particularly before the harvest seasons, i.e., in May and September43

November before the main harvest.

Some farmers sleep on their fields for several weeks,others arm themselves (63.9%), engage security guards (27.8%), build fences, install traps on
their fields or buy dogs (see Figure 17).

Figure 17: Vanilla fields that are fenced (left) and security dogs on vanilla plots (middle) in Uganda (Source :own photos). Right: Traps being installed on vanilla fields in Madagascar (Source: Johannes Osewold)

Apart from the farm activities -from a chronological perspective- in the following section wewill also look at who does the different activities, i.e. male/female HH members, community
members or hired labourers.

Figure 18: Labour division of vanilla-related activities in Uganda

Particularly planting of trees, pruning & looping and securing of the plot is mainly done by thefather of the HH. However, mothers contribute to all activities, particularly to land preparation,
weeding and harvesting. Land preparation, weeding, pollination and harvesting are more or lessdone equally by the mother & father. While many vanilla-related activities are equally done by
the mother and the father of the HH, “other male HH members“ contribute more commonly
than “other female HH members” to vanilla related labour (see Figure 18).
44

Hired labourers are mainly engaged by farmers for securing the plots (by 20.7% of farmers)
and to a smaller degree for land preparation (8.6%), weeding (9.1%), pollination (6.9%),
harvesting (2.4%), pruning & looping (5.5%) and planting of trees (5.4%). Support bycommunity members is uncommon: ~1% of respondents cite their support for land preparationand ~1% to pollination, respectively.
(ii.) Madagascar
Family labour (in man days) for cash crops by Malagasy vanilla farmers

man days per month120

Vanilla80

Rice
Cloves

40

0
Jan

Fev

Mar

Apr

Mai

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 19: Family labour (in man days) for cash crops by Malagasy vanilla farmers over the year in 2018(man days were multiplied with the number of household members who contribute)

In Madagascar, vanilla dominates HH´s family labour in October and November and has
another peak between March-July. December-March overlap with labour needs for rice. Labour
for rice increase gradually from November-January and remains high from February-April.
Cloves, a less important cash crop, demands less labour and is harvested around OctoberNovember. In Figure 20 we will look more precisely at which vanilla-related activities arepracticed over the year.
Vanilla activities over the year by Malagasy vanilla farmers% of farrmers citing activity

100
75

Pollination
50

Securisation
Harvesting

25
0
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec

Figure 20: Distribution of agricultural activities (Vanilla) over the year in Madagascar

In Madagascar, pollination occurs at the end of the dry season with its peak between OctoberDecember. As well as in Uganda, vanilla needs 9 months to ripen from pollination to harvest.
45

However, in Madagascar only one vanilla harvest per year is possible. Harvesting is mainly
done between June-August, depending on the geographical region. The Antalaha and Sambava
districts are predominantly in the littoral and intermediate zone, while the western Andapa
district is mostly in the mountainous zone. The Andapa region is around 500 m above sea level
and has a different climate than the littoral zone. Therefore, the maturity as well as the harvest
dates for green vanilla differ here. 25% of the sampled farmers start securing the fields alreadyin February and continually increase guarding their fields from March (61.4%) until June
(95.4%), just before harvesting.

Some farmers arm themselves as a response to theft (27.9%), harvest vanilla premature(14.7%), hire guards (8.9%) or install traps on their fields (see Figure 17).

Labour division of vanilla related activities (Madagascar)
100

Title

80
60
40
20
0
Land
preparation

Weeding

Pollination

FatherOther female HH members

Securing plot

Mother
Hired labourers

Harvesting

Shadow
magement

Pruning &looping

Other male HH members
Community members

Figure 21: Labour division of vanilla-related activities in Madagascar

In Madagascar, many vanilla-related activities are done by the father and "other male HH
members”. Pollination is done equally by the father and mother; mothers also contribute
substantially to harvesting. However, land preparation, weeding, shadow management/plantingof trees are largely done by the father of the HH. Other male HH members contributeparticularly to harvesting, securing the plot and weeding. Hired labourers, however, arecurrently rarely engaged. Mainly for guarding of the fields (6.9%), weeding (6.0%), land
preparation (5.4%) and pollination (5%).

e. Labour requirements for viable vanilla farm size
We asked respondents what their household labour distribution would look like if they would
farm exclusively vanilla, i.e. on a full-employment vanilla farm size.

46

Figure 22 and Figure 23 show what the labour distribution would look like on a viable farm
size throughout the year as compared to the labour distribution in 2018, based on actual vanillafarm sizes and production.
Labour distribution if only vanilla would be cropped vs. status quo (Uganda)
60

40

20

0
Jan

Feb

Mar

Apr

May

Jun

Vanilla as an exclusive crop

Jul

Aug

Sep

Oct

Nov

Dec

Vanilla status quo

Figure 22: Distribution of family labour (in man days) in viable farm size model compared to the labour
distribution in 2018 (Uganda).

Vanilla has labour peaks (pollination, harvesting, currently securing the fields) and even whenthe maximal labour by a HH would be used for vanilla, a vanilla farm would not be a full
employment farm size during the entire year. However, if vanilla would be planted exclusively,
there would be additional labour needs for vanilla to be able to farm the size 0.8 ha. Total man
days used for vanilla are ~twice as high per year than compared to “status quo” in Figure 22,
suggesting around a twofold increase in labour dedicated to vanilla, which is in line with thesuggested farm size increase from 0.4 to 0.8 ha.
Labour distribution if only vanilla would be cropped vs. status quo (Madagascar)
60

40

20

0
Jan

Feb

Mar

Apr

May

jun

only vanilla

Jul

Aug

Sep

Oct

Nov

Dec

status quo

Figure 23: Distribution of family labour (in man days) in viable farm size model compared to the labour
distribution in 2018 (Madagascar).

If Malagasy vanilla farmers would exclusively crop vanilla, less labour increases would beneeded compared to Uganda. This is because the average farm size (0.9 ha) is already close to
the viable, target farm size of 1.0 ha. The average increase in labour would be between 10-20%.
47

In fact, full employment farm sizes have become reality for many Malagasy vanilla farmers,
particularly in the Littoral (eastern SAVA region), where farmers increasingly rely exclusively
on vanilla income.

f. Conclusion full employment farm size and labour
If vanilla farmers in both Uganda and Madagascar increase their vanilla field sizes to the target“full employment” field sizes, the field sizes and labour requirements will go in exchange forother fields, most likely coffee.

(i.) Uganda
In Uganda the viable vanilla field size was established at 0.8 ha for the living income
reference price model. In order to realize this vanilla area, current coffee and other cash crops
would likely be sacrificed, whereas the more profitable cocoa farm area as well as subsistencecrops would remain stable. The labour currently invested for coffee would go into the vanilla
so as to be able to manage a viable farm size (compare Figure 19 & Figure 22).

This scenario reflects the reality on the ground. In fact, coffee is increasingly abandoned in thearea and -according to respondents- does not perform well when intercropped with vanilla.
Vanilla could also be intercropped with cocoa as it has similar labour peaks (see Figure 15) andhas shown promising results in other countries (Hernandez-Hernandez 2011, Borbolla-Pérez etal. 2017). Compared to Madagascar, less land could be managed as there are higher labour
requirements due to two vanilla harvests in Uganda.

(ii.) Madagascar
In Madagascar the viable field size is 1.0 ha for the reference price model. This would bea marginal change to the current farming settings. Coffee would likely be abandoned, while
rice, cloves and subsistence crops remain stable. The additional labour requirements for vanilla
could come from the transformed coffee farms.

3.3. Sustainable yields
In focus group discussion, farmers estimated and discussed what would be the maximum ofvanilla that they can produce on the viable farm size presented above, by implementing therecommended good agricultural practices and density of vines. The time frame discussed was48

5 years in order to account for specific events, i.e. cyclones in Madagascar or droughts in
Uganda, events that occur occasionally in both countries. For vanilla production and themonths in which it was sold in 2018, see Appendix 15.

a. Maximal feasible yields
Agronomic research has shown that vanilla vines can produce around 0.5 kg/year. If a
recommended spacing of 3m*3 m is kept by the farmer, this would lead to 1,100 plants/ha andto a production of >500 kg per year. However, only 1% of farmers in both Uganda andMadagascar meet that target productivity, often due to risk aversion behaviour by farmers. In
both Uganda and Madagascar, many farmers are afraid of theft and price instability, which
limits investments into vanilla farms. Investments needed include replanting of vanilla vines,
maintenance of existing vines, active planting of tutor and shadow trees, shadow management
and no over-pollination of vanilla flowers. However, the “full employment farm size” hasbecome reality for individual farmers in the SAVA region in Madagascar, particularly in the
Littoral and some farmers have reached the target productivity and beyond (see Appendix 19).
(i). Uganda
In Uganda, vanilla farmers estimated that they can produce 400kg on the viable farm size of
0.8 ha (500 kg/ha). This was confirmed as a reasonable assumption by cooperative and vanillacompanies through the review process. The yields are based on two harvest a year, a ”big” onearound December and a “small” one around June (see Appendix 16). Yet, the average harvest
in 2018 was only 65.3 kg on an average vanilla plot of 0.4 ha (163.3/kg/ha13). However, thevariation was large (see Appendix 17).
(ii.) Madagascar
In Madagascar, farmers estimated a maximal feasible field size of 1 ha leading to a harvest of
350 kg green vanilla. This was likewise confirmed as realistic target productivity by different
stakeholders. Farmers agreed that in good years, more might be feasible. However, there is ahigh probability that the region is hit every 4-5 years by cyclones, which would destroy at least
parts of the harvests. Looking at the difference in harvests to Uganda, it has to be consideredthat in Madagascar there is only one vanilla harvest per year.

13

Concerning the self-reported vanilla harvests in both countries, these may be underreported as vanilla farmers
often practice side-selling. That is, parts of the green vanilla could be sold prematurely and another share througha cooperative, which does not accept prematurely harvested green vanilla, and/or farmers may sell vanilla in otherperiods due to immediate cash needs.

49

The average harvests, however, was only 49.2 kg of green vanilla on an average farm size of
0.9 ha. Likewise, the variation in harvest was large (see Appendix 19).

The differences in vanilla (target) harvests between the two countries reflect the realities on the
ground. In Uganda farmers tend to plant vanilla intensively along with plantain/banana and fruit
trees, whereas in Madagascar farmers tend to plant vanilla much less intensively vanilla inagroforestry systems within the forests.

b. Other farm-income when considering a typical, diversified full
employment farm size
As shown above, this (simplified) farm model assumed that the increased vanilla farm size
would come from the transformation of coffee to vanilla plots in both countries. Value of selfproduced food remains stable in both countries.

(i.) Uganda
In Uganda vanilla farmers would lose income from coffee (239.0€, on average) and “other cash
crops” (5.3€, on average). Net income from cocoa (998.7€) and livestock (212.2€) would
remain stable. Thus, other farm-income sums up to 1210.9€ when considering a viable vanillafarm size.

(ii.) Madagascar
In Madagascar, an average vanilla framer would lose income from coffee (27.3). Average
income from cloves (42.7€), rice (70.2€), livestock (32.6€), would remain stable.
Thus, “other farm-income” sums up to 149.8€.

c. Conclusion: total target vanilla yields from viable vanilla plot size andestimated income from other crops in typical farm model(i.) Uganda
The target yield in Uganda is 400 kg of green vanilla, whereas other farm-income, mainly
cocoa, is 1201.9€, on average.

50

(ii.) Madagascar
In Madagascar, the target vanilla yield is 350kg of green vanilla produced on 1.0 ha. Other
farm-income is, on average, 149.8€ mainly cloves and rice.

3.4. Cost of Sustainable production
Vanilla is a plant that is “organic by default” (cf. Brownell 2011) and mainly involves costs for
hired labourers and some equipment, such as vanilla lianas, knives, bags and security
equipment, i.e., torches and batteries. All agricultural activities are done manually, and no
agricultural inputs are used, such as fertilizer or pesticides.

a. Description of different cost items
The survey and particularly the focus group discussions showed a twofold trend. The hiredlabour expenses for securing the vanilla plots are currently high and were the main production
costs for vanilla. On the other hand, relatively few farmers currently engage labourers at all as
many farmers have been victims of theft and don´t allow non-family members to enter theirfields. Some reported to have been victims of theft through hired labourers, some also throughown family members.

Many farmers confirmed that in low-price phases they would engage more frequently hiredlabour for pollination and harvesting, that is, if vanilla prices would be lower they would more
frequently engage labourers as there would be less theft pressure.

(i.) Uganda
Expenses for hired labour over the year (€) for cash crops in Uganda

Expenditure in € per month30

20
VanillaCocoa
10

Coffee

0
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 24: Expenses for hired labour for cash crops in Uganda

51

43% of surveyed vanilla farmers engage hired labour for cash crops in general, while 26% also
engage labourers for vanilla. >1% of the surveyed farmers engage labourers for subsistencecrops. As illustrated in Figure 18, hired workers are often engaged for guarding of vanilla fields
and in Figure 24 we see that the months in which labourers are engaged are the months before
the harvests in April-May and September-November.
Regarding vanilla, the hired labour costs sum up to 132.6€ ± 57.0€ for the year of 2018

Figure 24). Considering that the average vanilla plot has a size of 0.4 ha (see Figure 8), costsfor hired labour translate to 349.0€ ± 151.5€ per ha of vanilla, correspondingly. However, hiredlabourers are not paid in living wages, labourers receive ~1.4€ per man day, on average.
Hired labourers for coffee and cocoa are mainly engaged during harvests and sum up to 54.8€
for cocoa and 55.7€ for coffee in 2018. Considering that the average field size of cocoa is 0.55
ha and 0.23 ha for coffee (see Figure 8), hired-labour costs sum up to 122.8€ for cocoa and242.3€ for coffee. However, the variances were large as some farmers only have cocoa, others
only have coffee, and many abandoned their coffee plantations around the time of this survey14.

Other listed equipment costs by Ugandan vanilla framers are vanilla lianas, knives, silon bagsfor transportation and security equipment, i.e. torches and batteries summing up to 69.9€ per
year per HH. Chemical inputs or fertilizer were not cited by any respondents.

(ii.) Madagascar
Expenses for hired labour for cash crops Madagascar

Expenses per month (€)

40
30

Rice
20

VanillaCoffee

10
0

Jan

Fev

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Coffee prices crashed early 2019 and many farmers converted their plots or sell their plantations’ harvest inadvances to low prices, similar to what in Madagascar´s vanilla market is known as “Contrat de fleurs”, i.e.
getting credit and/or selling the harvest before it is harvested. However, this also means that the coffee farmers
don ´t invest labour in their coffee plantations for a certain time.
14

52

Figure 25: Expenses for hired labour for cash crops in Madagascar

Local vanilla farmers barely engage hired labourers for cash crops other than vanilla and rice.
Concerning vanilla, hired labourers are mainly engaged during the months where danger oftheft is current (Feb-May, cf. Figure 20 & Figure 25) and partly for pollination (Sep-Nov, see
Figure 25). Yearly hired labour costs for vanilla sum up to 288.0€ for an average farm size of
0.9 ha, that is, 310.74€ per ha. Hired labourers are not paid in living wages, labourers receive,on average, 2.3€ per man-day in Madagascar. Other (non-labour) expenses are in sum 29.1€± 17.8€, mainly vanilla lianas/vines and material for guarding the fields such as torches andbatteries. No agricultural inputs were cited.

b. Analysis of security costs for LIRP
If vanilla prices drop to LIRP level, the labour costs for securing the plots would most likely
reduce. However, other costs would remain stable or increase in order to meet the target
productivity. As illustrated, the largest cost item is labour for securing the field. We assume
that other costs remain stable as for a viable farm size more household labour is available ascoffee is abandoned, and security costs decrease.
(i.) Uganda
Distribution of hired labour costs in Uganda (per ha and year)€ per year per ha

125

100
75
50
25
0
Land
prepration

Weeding

Pollination

Securing plot Harvesting

Pruning &Looping

Shadow
management

Figure 26: Distribution of hired labour costs in Uganda per ha in 2018

35% of all hired labour costs are paid for securing the fields (123€, on average, converted toha). We are assuming that security costs would decrease by 50% if vanilla price would drop toa LIRP level. That is, total hired labour costs per ha would be 287.4€/ha. As illustrated above,labourers receive ~1.4€ per day, on average.

53

(ii.) Madagascar
Distribution of hired labour costs in Madagascar (per ha and year)€ per year per ha

125
100
75
50
25
0
Land
preparation

Weeding

Pollination

Securing plot

Harvesting

Pruning &looping

Shadow
management

Figure 27: Distribution of hired labour costs in Madagascar per ha in in 2018

In Madagascar, 26% of all hired labour costs are expensed for securing the plot (80€, on
average). We assume that security costs decrease by 50% and all other cost remain stable.
That is, total hired labour costs sum up to 279.8€ per year per ha. Hired labourers receive, on
average, 2.3€ per man-day.

c. Living Wage and cost of hired labour
For the calculation of living wages, we use data by Guzi and Kahanec (2017) for Uganda andwageindicator.org (2019) for Madagascar. The LW in Madagascar is an averaged value fromthe ranges presented by wageindicator.org (2019).
(i.) Uganda
The LW for a typical family in Uganda at 3.7€ per day (Guzi and Kahanec 2017). However, on
average, hired labourers received only 1.4€ per day in 2018. Converting the hired labour costspresented above into LW, the hired labour costs convert into 922.4€ per ha of vanilla per year.
(ii.) Madagascar
LW is estimated at 4.4€ for a typical HH (wageindicator.org 2019). However, in Madagascar,
hired labourers received only 2.3€ per man day in 2018, on average.
If hired labour costs are converted into living wages, hired labour costs sum up to 594.5€ per
ha of vanilla per year.

54

d. Conclusion: Total cost of vanilla production per hectare, when living
wages are paid and realistic security expenses(i.) Uganda
Hired labour paid at living wages is 922.4€ + additional equipment (174.8€) = 1097.2€ per ha
per year. Thus, the yearly production costs for a target productivity and viable farm size
(0.8 ha) are 877.7€ per year.
(ii.) Madagascar
Hired labour per ha per year paid at living wages is 594.5€ + additional equipment (32.3€) =626.8€ per ha per year. Thus, the yearly production costs for a target productivity andviable farm size of 1.0 ha are 626.8€ per ha per year.

The difference in production costs in both countries can be explained by two harvests in Uganda
contrary to a single one in Madagascar. Also, as there are fewer vanilla farmers in Uganda, e.g.
vanilla lianas and other material is scarce and more expensive than in Madagascar.

55

3.5. Overview and LIRP calculations
As a summary of selected data presented before, Table 14 summarizes key variables that will
be used in the final LIRP models.
Table 14: Summary of key variables for LIRP models in Uganda and Madagascar
Variable*

UgandaMadagascar

Farm size total (ha)

2.4

2.08

Vanilla (ha)

0.4

0.9

Full employment vanilla farm size (ha)

0.8

1.0

Hired labour/year (without living wages)/ha

349.3€

310.7€

Other production costs (equipment)/ha

174.8€

32.3€

Hired labour at living wages /ha/year

922.4€

594.5€

Production costs (incl. living wages)/ha/year

1097.1€626.8€

Farm gate price green vanilla in 2018 (€)

50.4

38.2

Vanilla yields (kg /green/2018)

65.3

49.2

Max. feasible yield per ha of green vanilla (kg)

500

350

Net income from other farm sources

1210.9149.8

Value of self-consumed food

736.4

413.0

Household size

6.6

4.2

Living income benchmark (per household and year)

7 297€ / year

5 751€/year

Extreme poverty line (1.9$/person/day)**3090€ / year

1592€/year* in italic & grey background= model estimations** Power Purchasing Parity (PPP) exchange rates applied based on IPC (2011)56

3.5.a Price models in relation to poverty line and LIRP in Uganda
LIRP for Uganda

Vanilla net income +other net farm income

10000

Threshold in €8000

Vanilla net income(400kg/0.8ha)

6000
Living income
benchmark - self
consumed food

4000
2000

Extreme poverty line
(PPP apllied)

0
€00

€05

€10

€15

€20

€25

Price per kg green vanilla

Figure 28: Reference Price for target productivity of Ugandan vanilla farmers

Figure 28 illustrates the price needed for vanilla farmers in Uganda in relation to living income
and poverty line (PPP applied), when the target productivity of 400 kg of green vanilla isachieved on 0.8 ha. As the model shows, a price of 9.9€ allows farmers to reach the poverty
line level, and a price of 18.6€ to reach living income if we consider vanilla net income only.
However, if we consider vanilla net income & other net farm income (1210.9€), a price of
7.7€ is needed to reach the poverty line level, and a price of 15.6€ (17.2$) to reach living
income.

3.5.b Price models in relation to poverty line and LIRP in Madagascar
LIRP for Madagascar

Threshold in €10000
Vanilla net income +other net farmincome8000

Vanilla net income(350kg/ ha)

6000
4000

Living income
benchmark - self
consumed food

2000

Extreme poverty line
(PPP applied)

0
€00

€05

€10

€15

€20

€25

Price per kg green vanilla

Figure 29: Reference Price for target productivity of Malagasy vanilla farmers

Figure 29 displays the priced needed for Malagasy vanilla farmers to achieve LI and poverty
line (PPP applied) when the target productivity of 350 kg green vanilla is accomplished.
57

Looking at net income from vanilla only, a price of 6.3€ would be needed to be on the poverty
line level and a price of 17.0€ to reach living income. If we consider vanilla net-income andother net farm income (of 150€), there is marginal difference: a price of 5.9€ is needed toreach poverty line and 16.6€ (18.4$) to reach living income.

7. Discussion and Conclusion
This report highlighted that the context of vanilla farming and the livelihoods of Ugandan andMalagasy vanilla farmers are distinctive. Ugandan vanilla farmers have diversified farms,
multiple income sources and are largely food self-sufficient. The data presented for Malagasy
vanilla farmers show the opposite. The livelihood diversification of Malagasy vanilla farmers
is weak, food self- sufficiency low and vanilla farmers increasingly rely on vanilla proceedings
for their livelihoods. In Madagascar, an average vanilla farmer grows only 1.9 subsistence crops
and 1.8 cash crops compared to 4.7 subsistence crops and 2.6 cash crops in Uganda.

However, farmers in both countries cultivate similar crops, currently receive high vanilla prices
and face high theft pressure. Also, the analysis shows that - even though there are differencesin vanilla target productions, living income and HH sizes - the LIRP for both countries is fairly
similar. In the following we will briefly discuss the findings presented above.

7.1 Living Income
Living income was estimated at 3.03€ per person per day in Uganda and 3.75€ in Madagascar,
respectively. This is roughly in line with other findings, for Madagascar rather in the higher
living income ranges (Wageindicator 2019). When deducting the value of self-consumed food,the costs of a decent living convert to 2.5€ (Uganda) and 3.5€ in Madagascar, respectively.
However, comparisons particularly for Madagascar are tricky as most databases and reports
only differentiate between rural/urban areas. In Madagascar, rural areas are geographically,
economically and ethnically very different. The SAVA region is the most isolated on the island
making all transportation expensive. Furthermore, due to high vanilla prices, there is a regional
inflation and a lot of cash circulating. As the data for this study is based on original data from2019, inflation is accounted for in relation to vanilla prices in this year, but the living costs arelikely to change in the future if vanilla prices fall. Therefore, living incomes studies should becontinually updated and can be based on key indicators, such as food costs (Anker & Anker
2017).
58

Education is expensive in Uganda and an average vanilla farmer has around 3 children visiting
school. Other, non-food costs are proportionally higher in Uganda to Madagascar due to larger
HH sizes. Even if Malagasy households are smaller than Ugandan households, the living costs
are higher for Malagasy vanilla farmers than for Ugandans on a per person rate. It is the foodprices that contribute most to the costs of living and food costs are higher in Madagascar thanin Uganda. In Madagascar, this is amplified through low land dedicated to subsistence crops(Figure 12), low production of subsistence crops (Table 10),

low food self-sufficiency(Appendix 13) and fairly high food expenditures, both looking at the actual food expenditure
data from 2018 (Appendix 12) and the model diet (Table 4).

Even though Madagascar is among the top per capita rice consumers globally, and the large
share of the population are farmers (World Bank 2015) it is far from being food self-sufficientand a lot of food, particularly rice, is in fact imported (FAOstat 2019). As Madagascar is an
island, far from the African continent, and its infrastructure is weak, all imports andtransportation are expensive supporting the high food costs in the model diet. On the contrary,
the Ugandan Rwenzori area has a vibrant trade with the Democratic Republic of Congo, Ruanda
and other areas.

In view of the value of self-produced food by Ugandan vanilla farmers (687.4€, see Table 10),value of self-consumed livestock (49.01€, see Table 11) and total food expenditures (1004.4€,
see Appendix 9), the cash value of consumed food in 2018 sums up to 1740.8€ ± 257.9€.
Hence, the model diet in Table 4 differs to 1370€ to the sampled costs in 2018. The main reason
is that local farmers don´t have a sufficiently healthy & diverse diet, which is line withrecommendations by the FAO/WHO that would be more expensive. Instead the cheapest foodsources are most frequently eaten, which are not nutritious and weakly diversified, however.
Also, the quantities of food intake may not be sufficient. In fact, malnutrition is common in thearea, particularly among children, and many regional inhabitants are stunted or suffer fromother physical underdevelopments (Tumwine and Barugahare 2002, FAO 2010, Biondi et al.
2011, WFP 2019).
For the case of Madagascar, the picture looks different. Looking at the value of self-produced
food (357.9€, see Table 12), value of self-consumed livestock (55.63€, see Table 13) and total
food expenditures (811.7€, see Appendix 12), the cash value of consumed food sums up to1224.4€. Hence, the model diet (2597.2€) is ~ twice as high as the sampled costs in 2018. The

59

reason is that food costs for a healthy diet are more expensive and farmers are far from having
a diverse and healthy diet that is in line with recommendations by FAO/WHO.
Despite a huge regional agricultural potential of the SAVA region and a lot of vanilla cash
currently circulating, the nutritional status of many Malagasy vanilla farming HHs is in fact
alarming. Many local people are underweighted and their Body Mass Indexes indicate a chronicenergy deficiency (CREAM 2013, USAID 2018). Even though north-eastern Madagascar
displays a better picture than other regions in the country, malnutrition is common in the area.
40 - 60% of the children suffer from anaemia, underweight, stunting and “low height for age”
as there is an unbalanced food diet and insufficient food quantity and quality (WFP 2016,
USAID 2018). Low-cost nutritious foods -other than rice-, however, is inadequately integrated
into the regional kitchen culture. One of the reasons is the weak infrastructure -isolating
northeastern Madagascar from other parts – and the lack of fridges and food storages; food rots
quickly in the tropical climate. Considering the disadvantages mentioned, rice has obvious
advantages for the farmers as stable crop.
As illustrated, subsistence crops are insufficiently planted and weakly diversified by Malagasy
vanilla farmers (see Figure 9). Consequently, many local people don’t have a diverse diet as
only locally produced food, particularly rice, is commonly eaten (see Appendix 11).
Another key finding through the focus groups was that many Malagasy vanilla farmers(particularly in the Littoral) confirmed findings from the HH surveys, i.e., that they are
increasingly abandoning subsistence crops as they demand too much labour and are not paying
off compared to vanilla. Thus, many farmers expect that vanilla prices will remain high, which
may bring them in a vulnerable situation if vanilla prices fall again.

7.2 Price scenarios and production costs
If vanilla prices decrease and most likely so does theft pressure, production costs will likely
decrease in relation to vanilla price. However, in the price models in Figure 28 & Figure 29,
production costs contribute only a marginal difference to the LIRP vis à vis living income andthe high value of vanilla. Given the biology and farming systems of vanilla, production costs
are generally low, particularly compared to other agroforestry commodities, e.g. coffee andcocoa. If production costs would in- or decrease by 500€, the LIRP would change only ~ ± 1€.

60

7.3 Feasible production /farm size
Agronomic research has shown that vanilla vines can produce around 0.5 kg/year. If a
recommended spacing of 3m*3 m is kept by the farmer, this would lead to 1,100 plants/ha andto a production of >500 kg per year. Thus, the estimation by farmers in both origins seems
reasonable and was confirmed by vanilla exporters and traders. However, only 1% of farmers
in both Uganda and Madagascar are able to meet that target productivity partly because they
don´t have a full employment vanilla farm size, but also due to risk aversion behaviour by
farmers. In both Uganda and Madagascar, many farmers are afraid of theft and price instability,
which limits investments into vanilla farms. Investments needed include replanting of vanillavines, maintenance of existing vines, active planting of tutor and shadow trees, shadow
management and no over-pollination of vanilla flowers. On a country wide level, a better
governance of market control, means to control theft, security and traceability are urgently
needed if vanilla farmers are to invest more into their farms. However, the “full employment
farm size” has become reality for individual farmers in the SAVA region in Madagascar,
particularly in the Littoral and some farmers have reached the target productivity and beyond(see Appendix 19).

Limiting factors to increase to increase production in both countries are available labour for
pollination, land expansion, lack of access to resources such as finances for land & and land
preparation, and technical assistance for good agricultural practices. There is quite a run forland, and we observe that agriculture moves increasingly into marginal areas. In Uganda vanillais partly cultivated without proper shadow management, i.e., trees.

Figure 30: Marginal agricultural land in the Bundibuygo district in Uganda

61

7.4 Impact of LIRP on farmer livelihoods and the vanilla market
In the past decades, vanilla farmers have globally experienced a boom-and-bust cycle, which in high price phases- can lead to interim investments in their farms but also to a risk-aversion
behaviour by the farmers in the long run. Uncertainty hinders sustainable, long-term
investments. As illustrated in Appendix 16 and Appendix 18, the average vanilla farmer
reported to produce only 49 kg (Madagascar) - 65 kg (Uganda) of vanilla and, consequently, isfar from the poverty line and particularly from living income. A minimum price would help
farmers to plan their assets and labour around an assured market, reduce uncertainty, which inturn might lead to higher investments and increases in sustainable vanilla production.

Vanilla is a risky crop and, therefore, an exclusive vanilla farm model should not be promoted.
Scientific evidence shows that livelihood diversification improves well-being of smallholder
farmers (Ellis 1998, Barrett et al. 2001) and increases their resilience to cope with shocks(Hänke and Barkmann 2017, Pelletier et al. 2016). Likewise, a vanilla farm will never be a full
employment farm throughout the year as there are labour peaks and other crops can be planted
along with vanilla. Consequently, other crops are accounted for in the farm models (see Figure
28 & Figure 29). The suggested farm models were supported by many different stakeholders
and -as we found during stakeholder reviews- the present minimum price analysis is generally
regarded as a credible data source.

A key question by many stakeholders is how the LIRP could be implemented on the ground.
Therefore, the development of the vanilla market in the past 5 years requires a closer look. In
fact, the vanilla market has seen dramatic changes in recent years. At one time, vanilla farmers
were characterized as impoverished farmers who depend on many middlemen and received
only small shares of the retail vanilla price. However, many exporters and flavour houses are
increasingly sourcing vanilla directly from farmers and have established complex trading
outposts and made long term investments and commitments to creating value close to thevanilla producers, particularly in Madagascar (Hänke et al. 2018). Among the motivations aresocial and environmental standards that require traceability, which are increasingly demanded
by western consumers. In non-integrated value chains, such social & environmental standards
are difficult to fulfil, and traceability is almost impossible. While the majority of vanilla farmers
in Madagascar still rely on the spot market, estimations show that around 19% of all vanilla
farmers in Madagascar are already in contracts and/or certifications with exporters or traders
integrating them vertically into the vanilla value chain. The number of vertically integrated
62

farmers is increasing and represents a good opportunity to negotiate the LIRP with contracted
farmers as a first step. With contracted farmers as the first target group, this could be stepwise
extended to non-contracted farmers. Most likely there will also be spill-over effects to the spotmarket.

In Uganda, a minimum price for vanilla will also be crucial to keep vanilla attractive for farmers
as they often switched to other crops when prices fall, e.g. cocoa and coffee. As we saw, many
Ugandan vanilla farmers also grow other cash crops. A key finding from the focus group
discussions in Uganda was that many farmers start investing in other crops when vanilla prices
fall below 50 000 UGX (~12.5€) (see Appendix 22 for a short analysis at what price vanilla
can compete with other crops).

63

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67

APPENDIX
Appendix 1: Cooperatives and number of vanilla farmers in Rwenzori Farmer´s Cooperative Union
RFCU list(number offarmers)

Districts

Cooperative

KaseseBalimi Farmers Cooperative Society

61

KaseseBukonzo Farmers Cooperative Society

49

Bundibugyo Bunyangole Farmers Cooperative Society

69

KaseseBwera Farmers Cooperative Society

72

Bundibugyo Izahura Farmers Cooperative Society

96

KaseseKasimire Organic Farmers Cooperative Society

60

NtorkoKarugutu Farmers Cooperative Society

78

Bundibugyo Kisongo Farmers Cooperative Society

57

Bundibugyo Kityo Farmers Cooperative Society

83

KaseseKyondo Kyaburingira Farmers Cooperative Society

89

KaseseKyondo- Kisinga Farmers Cooperative Society

132

KaseseMubuku Farmers Cooperative Society

73
Total

919

Appendix 2: Sections of the questionnaire1.

Socio-demographics, education and activity of all household membersa. Household composition (age, gender)b. Educationc. Occupationd. Agricultural activity level

2.

Agriculture, production & land sizes (subsistence and cash crops)a. List of all cultivated crops
b. Crop productionc. Land sizes and distribution of crops

3.

Labour and production costs (subsistence and cash crops)
a. Family labour for crops, divided into household members and activities
b. Hired labourers (months, man-days and expenditures, divided into different
activities)
c. Costs for equipment and agricultural inputs

4.

Income generated through cash crops
68

a. Based on cash crops mentioned in 2b., volumes and prices received
b. Costs of production, marketing, limitations to increase production, theft
5.

Vanilla preparation and markets
a. Vanilla theft and means to avoid it
b. Vanilla curingc. In which months is vanilla sold for which price to whom?
d. Membership in associations/cooperatives/other farmer groups

6.

Livestocka. Possession of livestockb. Home consumption of livestockc. Sale of livestock

7.

Food consumption and expenditurea. Consumption of foodb. Food self-sufficiency
c. Expenditures on food (months in different foods are bought andexpenditures per week)

8. Expenses for education and healthcarea. Number of kids still visiting schoolb. Expenditures per year on schooling and other feesc. Frequency of doctoral visits per year per HH member
d. Expenditure per HH member per year
9. Housing and living standards
a. Material used for walls at homeb. Material used for floors
c. Material used for roofs
d. Latrine/toilet/sanitation standards
e. Electricity
f. House structure (space for adults & kids)
g. Energy sources for coking at homeh. Possession of assets
10. Transportation
a. Frequency of market visits
b. Distance to markets
c. Expenditures for transportation

69

Appendix 3: Prices at local markets in Uganda (in UGX)

Crop
AvocadoMarket Bundibuygo region
Piece/
silon
Basi
bunch
bag
n
Kg
500

Beans
Cabbagepiece/
bunch

Market Ntoroko region
silon
Basi
bag
n
1000
0

3600
2000

3000

6433

4500

2833

1800

1200

4000

4667

1500

833

6000

4000

4666

1000

7000

6000

3000

1667

1000
0

11667

750

4000

1800
1000
0

200

Groundnuts

5000
1200
0

1000

1800
0

500

500

60000

1000

20000

2000
0

15000

Millet

4000
1000
0

Moringa
1000

Passionfruit

2000
0
5000

1500
0

Maize

Onion

6800
1000
0

2500
0

CottonPlantain

30667

6500

1000

CoffeeIrish Potato
Leafy
vegetables

2600
1000

6000

Cassava

2000003000

200000160000300000Peas

2000

pillari

500

Pineapple
Prunusafricana

2000

Pumpkin

2000

Total
average

300

1000

Cacao

Eggplants

Kg

Market Kasese region
silon
Basi
piee
bag
n
Kg

1000
3000

1000
2000

1000
0

1500
0
3000

3000

rice

4000

3000

4000

3667

Sorghum

2500

2000

2000

21667

soya_beans

5000

2000

3500

3500

2200
00

2067

Sugar_cane
sweet_potatoe2000

tomato

3000

1500
1500
0
2500
0

10000
500
2000
00

vanilla
Yams

1000
1000
0
5000
0

2000
00
2500

1500
0

70

Appendix 4: Minimum and Maximum prices in the littoral of northeastern Madagascar (Marojala)Prix minCultureKapokyKgpaquetAnanasArachides

Prix max

Piéce

autre:

prix
autre

500

Dans
quel
mois

en
Kapokypaquet

En Kg

11-12

200

5-6

Avocat5 pièces

500

2

Bananes

regine6000

Bred_Anana

paqueten
Piéce

autre:

Dans
quel
moins

prix

5000

1

2000

4
2 pièces

500

4-5

12-5

regine

15000

6-11

200

1-3

paquet

200

4-12

Cacao

4000

5-12

10000

1-4

Coco

1500

5-12

2000

1-4

Choux

20003000

Cocombre

500

1-3

Café

4000

4-12

6000

1-3

3

4000

2

Fruit de pain

2 pieces

Gingimbre

2500

3000

6-8

GirofleHaricot

1500

12000

12-1

20000

10

1500
5001000

Igname_Majôla
Jackfruit

5-12

500

10-12
pannier(10-15kg)

Litchi
Maïs

4-12

5000

400

12
4

Mangue5 pièces

200

Maniocpannier

7000

Onion

feullies
vertes1000

Orange5 pièces

500

40000 11 & 1
500

10

12

5 pièces

4-5

5 pièces

500

10003000

12-1

6-3

Patate_douce
Pois

1000

4-6

Poivre noire

5000

6

16000

12

Poivre verte

3000

6

6000

12

Riz_

500

10-1 800-1000

2-9

TomateVanille verte
Vanille noire

160000600 000

7
101200001-2

71Appendix 5: Minimum and Maximum prices in the mid-highlands of northeastern Madagascar(Antanamangotroka)

Prix minCultureKapoky Kg

paquet Piéce

AnanasPrix max
autre:

prix
autre

Dans
en
quel mois Kapoky

enpaquet En Kg Piéce

autre:

Dans quelprix moins

2000

12-01

4000

2

200

04-05

500

07-08

3pièces/200

12-01

200

02-11

Arachides
AvocatBananes
Bred_Anana

200

Choux

02-05

500

09-11

2500

05-06

5000

07-04

500

04-05

2000

06-03

Cacao
Coco
Cocombre
Café

1500

07-09

2500

10-08

Fruit de pain
Gingimbre

2500

03-05

12000

06-02

GirofleHaricot

1000

05-02

Igname_Majôla

2000

Jackfruit

1000
3000Ar pannier de
12kg

Litchi
Maïs

600

2000

03-04

04-11

2000

02-05

2000

06-01
20000Ar pannierde 12kg

12-01
03-05

04-11

600

02-11
03-05

MangueManioc3pièce/2000

8

Onion
OrangePatate_douce
Poids
PoivreRiz_

15000Ar/daba

05-06 et10-1120000Ar/daba

07-09 et12-04

TomateVanille200000872Appendix 6:Minimum and Maximum prices in the littoral of northeastern Madagascar (Ampanakana)Prix minCultureKapoky Kg

paquet Piéce

Ananasautre:

prix
autre

Prix maxDansquel enenmois Kapoky paquet En Kg Piéce autre:

Dans
quel
prix moins

2000

12-01

3500

2

300

04-05

500

07-08

2pièces/200

12-02

200

02-11

Arachides
AvocatBananes
Bred_Anana

200

Choux

03-04

500

09-11

3500

05-06

5000

07-04

500

04-05

2000

06-03

Cacao
Coco
Cocombre
Café

1000

07-09

3000

10-08

Fruit de pain
Gingimbre

2500

03-05

12000

06-02

GirofleHaricot

1000

05-02

Igname_Majôla

2000

Jackfruit

1000
4000Arpannier de
12kg

Litchi
Maïs

600

2000

03-04

04-11

2000

02-05

2000

06-01
15000Ar
pannier de
12kg

12-01
03-05

04-11

600

02-11
03-05

MangueManioc4pièce/2000

8

Onion
OrangePatate_douce
Poids
Poivre

3000

Riz_

6

13000Ar/daba

05-06
et 10116000

1220000Ar/daba

07-09
et 1204

TomateVanille200000873Appendix 7: Food consumption and expenditures

Sampled farmers were asked how many times per week or month they eat the different foodsources over the year. Values were averaged for all months and converted to consumption per
week.
Subsequently, farmers were asked in which months throughout the year they buy the different
food sources and how much the spent for it per week or month. Subsequently, the months inwhich respondents buy the respective food sources were summed into expenditure per year.

a. Uganda
Appendix 8: Consumption of food items per week by Ugandan vanilla farmers

frequency per weak

Average consumption of food crops per week (Uganda)
7
6
5
4
3
2
1
0

Cassava, plantain, beans and vegetable oil are eaten almost every day by the Ugandan HHs.
Groundnuts are used for a local sauce “Bundib yega” which is often eaten along with plantainand fish or meat. Fruits (banana, jackfruit, passion fruit and mangos) are regularly eaten.
However, vegetables are rather uncommon.

In the following section, we will look at food expenditures by Ugandan vanilla farmers.

Appendix 9: Expenditures
on food (per year and household) in Uganda
Average expenditure per year and household on food in Uganda
200€ per year

150

100
50
0

74

Most food expenditures per year are on fish (178€) and beef (167€). Potatoes (78€) vegetableoil (73€) and groundnuts (69€) also represent important food expenditures. Total foodexpenditures sum up to 1 004.4€ ± 97.2€ per household per year, on average.

Appendix 10: Food self-sufficiency of Ugandan vanilla farmers
Food self sufficiency of Ugandan vanilla farmers% of households

100
75
No

50

Yes

25
0

The sampled Ugandan vanilla farmers are largely self-sufficient on food that they regularly eat(compare Appendix 8 and Appendix 10). Ugandan farmers are particularly food self-sufficienton plantain (95.1%), cassava (87.8%), beans (81.8%), fresh fruits (57.6%) and banana (56.9%).
Concerning fish (26.5%), beef (26.2%), poultry (21.8%) the picture looks contrary. Those items
were also the main food expenditures (see Appendix 9).

Appendix 11: Consumption of food items per week by Malagasy vanilla farmers

frequency per week

Average consumption of food crops per week (Madagascar)
7
6
5
4
3
2
1
0

Malagasy vanilla farming HHs eat rice and vegetable oil on a daily basis. Also common arebred (5 times a week), fruits (from trees), banana, beans and leafy vegetables, mainly cassava
leaves. Yet, bred is usually added on top of rice dishes in very small quantities. However,animal products such as milk and eggs are rarely eaten. Out of all animal protein sources zebu
75

meat is most common (1.8 times a week), poultry (1.5 times a week), Fish (1.4 times a week),
and pork less than once per week.
There was little variance between the 3 different districts sampled in Madagascar.

Appendix 12: Expenditures on food (per year and household) in Madagascar
Average expenditure per year and household on food in Madagascar
200€ per year

150

100

50

0

Malagasy vanilla farming HHs spent most cash on rice in 2018 (155.6 €, on average). In fact,a large share of the local population eats 3 times a day rice, a rice soup as breakfast and rice as
main- or side dish for lunch and dinner. Zebu meat is the 2nd highest expenditure class and zebu
meat is regionally expensive (~5€/kg, see below). Local farmers commonly spent smaller
shares on leafy vegetables (bred and cassava leaves), fish, beans, poultry and others.
Total food expenditures per year and HH sum up to 811.7€, on average.
Appendix 13: Food self-sufficiency of Malagasy vanilla farmers
Food self sufficiency of vanilla farmers in Madagascar% of households

100

75

50

no
yes

25

0

Few Malagasy vanilla farmers sampled are food self-sufficient. 43% are self-sufficient on
bananas and rice, and 26% on fruits. However, the percentage of food self-sufficient HHs forall other food items is less than 25%.
76

Appendix 14: Ranking of cash crops by vanilla farmers in Uganda and Madagascar
Ranking of cash crops by Ugandan vanilla farmers% of citations

100
75

Vanilla

54

50

36

34
25

25

30

11

30
11

Cocoa
Coffee110
1st most important

2nd most important

3rd most important

Vanilla farmers were asked which cash crops their most important income sources are. 54%
cite vanilla as most important and 25% as 2nd most important, respectively. Cocoa is the 2nd
most important cash crop in general, often cited as 1st (34%) or 2nd (36%) most important cash
crop. Coffee, however, is less important15, only 11% cite it as most important cash crops, 30%
as 2nd and 30% as 3rd, respectively.

Ranking of cash crops by Malagasy vanilla farmers% of citations

100

96

75

Vanilla50

Cloves
25

23

25
1

1

4

Rice (irrigated)

12
0

6

0
1st most important

2nd most important

3rd most important

96% of the sampled Malagasy farmers cite vanilla as the most important income source. Cloves(23%) and irrigated rice (12%) are regularly cited as 2nd or 3rd most important income source.
Coffee, however, is not among the top 3 important cash crops.

15

However, there are huge differences between the three different districts sampled. Coffee is more common in
the Kasese region and cocoa in Bundibugyo and Ntorko, respectively. Also, coffee prices crashed in recent years
and many vanilla farmers abandoned coffee, meaning that they have coffee plots but currently not farmed orrented out. Some are also transformed to vanilla plantations.

77

Appendix 15: Vanilla sales, production and theft

Vanilla farmers were asked how much vanilla they produced on their farm, in which monththey sold their vanilla and to which price. Multiple answers were possible.

(i.) Uganda
The average production per HH in 2018 was 65.3kg green vanilla on an average size of 0.4 ha,which were sold to an average price of 50.2€ for green vanilla16. This translates into an average
harvest of 163.3 kg/ha. However, as shown in Appendix 17, the variation is large. Almost 100%of vanilla is sold as green vanilla, < 1% of farmers cure vanilla themselves.

Appendix 16: Vanilla sales (green) over the year in Uganda in 2018
Vanilla (green) sales throughout they year in Uganda% of farmers selling this
month

100
75

65

50

42

41

25

15
4

4

6

5

2

Apr May Jun

Jul

11

13

Aug Sep

Oct

2

0
Jan

Feb MarNov Dec

In Uganda there are two vanilla harvests, locally referred to as “mini season” (June) and “bigseason” (December). However, as we see above, farmers also tend to sell vanilla premature.
According to farmers, there is a market for every vanilla quality the whole year long. The key
reason for premature sales is fear of theft but also immediate needs for cash. Premature sales
occur predominantly in the “big season”, 66% of farmers sell at least some immature vanilla
between September-November.
86% of farmers reported that vanilla was stolen from their fields. On average, 22 kg werestolen17. Also, entire vanilla vines are stolen in Uganda.

16

18% of vanilla farmers who are members in RFCU cooperative did not harvest yet and were excluded fromanalysis. Vanilla starts to produce beans after 3 years indicating that many farmers only recently started to growvanilla.
17

This number might be overestimated due to expectations towards the research team by vanilla farmers.

78

Appendix 17: Distribution of vanilla harvests per household in 2018 in Uganda on averagefarm size of 0.4 ha
Histogram of vanilla harvests (Uganda)
0.8

Relative frequency

0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
0

100

200

300

400

500

600

700

800

Vanilla (kg green)(ii.) Madagascar
In Madagascar, the average production per farm and HH was 49.2 kg of green vanilla in 2018,
which were sold to an average price of 38.2 €. The average harvest was 54.7 kg/ ha consideringthat in Madagascar only one harvest per year is possible. As in Uganda, the harvest data showedlarge variations (Appendix 19). 11.6% of the sampled farmers also cure some vanilla, but onlyin small quantities. Farmers repeatedly stated that they gave up on vanilla curing as prices forgreen vanilla are high and there is a danger of theft if vanilla is kept home for long time.

Appendix 18: Vanilla sales (green) throughout the year in Madagascar in 2018
Vanilla sales throughout they year in Madagascar% of farmers selling this
month

100
75

79

75
50
25

11
0

0

0

2

Jan

Feb

Mar

Apr

11
0

0

0

0

Sep

Oct

Nov

Dec

0
May

Jun

Jul

Aug

Contrary to Uganda, there are official vanilla harvest dates in Madagascar18. The official harvest
start dates/market openings in 2018 were the 15th of July in the littoral zone (eastern Sambava
18

The author was informed that for this year´s vanilla campaign (June 2019), harvest dates are to be implementedin Uganda. At the time of this survey (April-May 2019), this was not yet the case.

79

& Antalaha), the 30th of July for the intermediate zone (western Sambava & Antalaha) and the19th of August for the mountainous zone (Andapa). It is forbidden by law to trade vanilla before
the governmental fixed dates. However, as we see above, some farmers sell their vanilla before.
Premature sales occur in May (11%) and June (11%). Given the fact that many of the sampled
farmers are cooperative members, sale of mature vanilla is most likely obligatory. However,the number of-premature sales from non-cooperative farmer members is far higher (Hänke etal. 2018 & own observation).
38.4% of sampled farmers reported that vanilla was stolen from their fields. On average, 26kg were estimated to have been stolen.

Appendix 19: Distribution of vanilla harvests per household in 2018 Madagascar on averagefarm size of 0.9 ha

Histogram of vanilla harvests (Madagascar)
0.7

Relative frequency

0.6
0.5
0.4

0.3
0.2
0.1
0
0

50

100

150

200

250

300

350

400

450

500

Vanilla (kg green)

Appendix 20: Status quo of vanilla farmers in 2018 in relation to poverty line and living income
Status quo of vanilla farmers in Uganda (2018)
10000

Vanilla net income +other net farm income

Threshold in €8000
Vanilla net income(65 kg/0.4 ha/HH)

6000
4000

Living income
benchmark - self
consumed food

2000

Extreme poverty line
0

€00

€10

€20

€30

€40

€50

€60

€70

€80

€90

€100 €110 €120

Price per kg green vanilla

80

The chart above illustrates the situation for an average Ugandan vanilla farmer in 2018, withan average vanilla land size of 0.4 ha and an average harvest of 65 kg of green vanilla. The
refence points relate farm income to international poverty line (1.95$ per person per day) andliving income (minus the value of self-produced food).
As we see above, the average farmer is currently far from the poverty line and in particular toliving income. When only taking into account vanilla net income (income minus all production
costs), Ugandan vanilla farmers are still below the international poverty line even with current
vanilla prices of 50.4 € per kg green vanilla. A price of around 55€ per kg green would beneeded to be beyond the poverty line, and a price of ~90€ to reach living income.
Considering that Ugandan vanilla farmers also generated 1455€ of other on-farm cash value a price of ~35€/kg green would allow them to be on the poverty line level and ~70€ to reachliving income (considering production costs for “other” cash crops). This model represents thestatus quo in 2018.
Appendix 21: Average vanilla income in Madagascar in relation to international poverty line and living
income in 2018
Staus quo of vanilla farmers in Madgascar (2018)

Threshold in €

10000
8000

Vanilla net income +other net farmincome6000

Vanilla net income(49 kg/ 0.9 ha)

4000

Living income
benchmark - self
consumed food

2000

Extreme poverty line

0
€00

€10

€20

€30

€40 €50 €60 €70 €80
Price per kg green vanilla€90 €100 €110 €120

The chart above illustrates the reality for an average Malagasy vanilla farmer in 2018, i.e., withan average farm size of 0.9 ha and an average production of 49.2 kg of green vanilla.
For the case of Malagasy vanilla farmers, farm income-other than vanilla- is low (see Table 14)
and makes almost no difference to the price needed to reach the two reference benchmarks.
Likewise, the value of self-produced food that is deducted from living income, is low (see Table
10). If we consider vanilla net income only, the farmers would need a price of 57.5 € per kg
green to reach the poverty line level, and 112.5€ per kg green to reach living income.

81Appendix 22: Minimum market conditions for vanilla to continue to be attractive in Uganda

Another question raised by many stakeholders was about the minimum market price needed for
current vanilla farmers in Uganda to continue expanding vanilla. The hypothesis is that thevanilla market would be more stable – therefore benefiting both farmers and vanilla quality –if there was a better balance of production origins and an alternative origin like Uganda could
grow back to its historic 400 to 500 mt. Uganda vanilla farmers removed most of the production
following the 2004 market crash, clearly showing that prices after that crash were notsustainable in Uganda.

To answer this question, we looked at the relative net income per ha of vanilla relative to coffee
and cocoa (the two primary cash crops) across the range of prices seen in the last 5 years. For
current vanilla producers (.4ha in vanilla, 65k/ha), vanilla would be more attractive than coffee
and cocoa at between 10€ and 15€ per kg of green vanilla, depending on the market of cocoa
and coffee.
4000

Threshold in €Vanilla status quo(158 kg)
3000

Arabica *2 ( 2500
kg)
Arabica in 2019(2500 kg)2000

Cocoa *2 ( 800 kg)
1000
Cocoa 2019 (800
kg)
0
€00

€05

€10

€15

€20

€25

Price per kg green vanilla82