Tanzania’s Kilimanjaro, Mbeya and Morogoro regions offer ideal conditions to grow premium quality vanilla. But without proper processing facilities the farmers’ crops will not yield high returns. After the arrival of Natural Extracts Industries (NEI), local smallholder farmers are proud to produce first-class vanilla products that are exported under the brand name ‘Epicurious Hedgehog’, to keen users in bakeries and restaurants as well as to discerning ‘home chefs’ all over the world.
Until recently, the fertile soil and high altitude advantages in this part of Tanzania did not do local farmers much good. Selling cocoa, oranges and vanilla on the local market only barely offered an additional income. Some of the crops were sold to traders as raw materials for processing elsewhere, fetching low prices. Over the years, many farmers were discouraged about the prospects of growing these crops.
The arrival of the NEI social enterprise to the region offered the new perspective of adding value locally and producing a premium quality export level that could compete on the world market. The development of a local processing plant changed the whole perspective of local farmers, as Jeanne Bruns, VP Business Development of NEI, explains: “The raw material of cocoa and vanilla quickly loses quality when it is not processed within three days. By offering local processing facilities, we win valuable ‘food miles’. We can begin processing the products in less than three days after harvest, before the raw product starts to diminish.”
Supply chain program
With the help of impact investors such as Hooge Raedt Social Venture (HRSV) (that put in $20k in equity funding and $100k in debt financing) NEI invested over $200k in a supply chain program, planting about 40,000 vines and recruited about 1,200 farmers to join the program. In a region where cooperatives were almost non-existent, investing in a 10,000 liter capacity processing plant from scratch was not an easy task, says Jeanne Bruns. “The technology required for value added processing in East Africa has been cost-prohibitive for the small farmer. Setting up facilities at this scale was even daunting for even a company like NEI that is processing hundreds of kilos of vanilla. There are also regulatory challenges. As the only company in East Africa who processes natural extracts we are defining new standards for the country.”
Getting small farmers aboard
Another challenge of the project was getting small local farmers aboard. “Current vanilla farmers needed to be convinced that their crop had a great future, offering a serious source of additional income. We also had to build trust among other farmers, who were new to the crop. It was hard for them to look beyond their horizon; after planting small vanilla plants, it takes three to five years before there is an actual crop, with vanilla to be sold.”
Furthermore, there is a great deal to learn about these and other crops that are relatively new to the region. Bruns: “To help farmers learn about the best practices for optimal growth and crop protection, we launched the ‘Champions Farmers’ program, in which experienced farmers educate those who are new, about natural and eco-friendly cultivation and production methodologies that help minimize the impact on the environment. Visiting other farmers and offering their advice earns them great respect in their local communities.” Currently there are over forty Farmer Champions, with more to come.
The NEI approach has proven to be successful, as the company exports its products at a very competitive rate to both East African markets as well as to Europe and the US, under the brand name of Epicurious Hedgehog. Jeanne Bruns: “We offer a variety of extract strengths for typical home use to higher strengths for discerning chefs, dairy producers and food connoisseurs. In the solid flavours and spices area, we offer both gourmet vanilla pods and cacao solids (powder and nibs). The global prices for vanilla have gone up, partly because of poor harvests in typical vanilla markets like Madagascar. In general, the demand for vanilla and natural products like the premium extracts we provide is increasing globally. There seems to be a growing number of people that appreciate food quality and prefer the true rich vanilla flavour that is produced in a sustainable way over the cheap synthetic alternatives.”
Model for Africa
With this tailwind, Jeanne Bruns and her colleagues at NEI hope to build on the social enterprise’s current success. “In each of the next years we hope to add 800 farmers to our network which will increase the impact of NEI across Tanzania. NEI is a model for social enterprises across Africa and we've been recognised by many organisations (like Unreasonable.is and Nestlé) for the work we have done. Currently we have no plans to start branches in other countries based on this model, but we have strong ties with several organisations that are interested. We are eager to share our learnings.”
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