Two years ago, I was informed that this was such a risky business because we didn’t know how to cure the vanilla.  This month we are vindicated.  We still don’t know how to grow it or to cure it, but we have learnt that nobody else does either!  Everywhere is different and all the experts argue.  What we have done is develop our own methods and the quality of the vanilla is wonderful.

We still don’t have enough investment to build our laboratory, but the reaction of chefs to the vanilla is extremely pleasing.

Rex: “What price should we sell this Grade A for?”

Chef: “Rp 8 million.” About US$525

Rex: “We can’t sell it that high!”

Chef: “You should, it’s worth it!”

I guess I need somebody else to head up the sales team for vanilla…

Phase 1

The Gardens are progressing.  Flowers are already appearing, a month early.  Encouragingly, many of our plants still bearing beans, showing the health of that plant and confirming we will get a crop every year.

We have decided on several varieties of trees for support to replace the Gliciridia, which is proving to be shallow rooted and unable to grow well at the density we have planted.  This is a slow process, as we are not ripping up the plantations, rather planting the new trees to replace the failing Gliciridia.  We also have to grow the new trees which takes time.

The varieties we have so far selected are:

Moringa.  We have received an order for 200kg a month of dried leaves, powdered, and been offered two machines to do the powdering.  Plus, I have somebody who is interested to run this division.  Moringa is an easy tree to grow and grows fast, very similar to the Gliciridia, just putting a fresh stake into the ground.  However, I am informed that we will get better quality from seed.

Amazonian Butternut.  This is a wonderful fruit that many chefs ask us for a supply.  We use it to create a delicious jam that accompanies pate in the café.  No additives at all.  Sadly, doesn’t last longer than a week!  We have two methods of propagating this, green cuttings and seed after we remove the jam!  This needs to get to a certain size before use, so this whole process is taking time.

Eucalyptus melaleuca.  A valuable oil may be extracted from the leaves, and the commercial method of growing is ideal for growing vanilla as its partner.  You have to be careful to keep it in constant growth, for in poor growth conditions it will actively harm other plants.  So, this is a tree that will do better in a mixed plantation.  We haven’t worked out propagation yet, experimenting with various cuttings.

Avocado.  Vanilla likes avocado, and we like avocado!  Easy to propagate, but it takes 5 years to fruit.  We already have some in a few of the gardens.  This needs plenty of space around it, but that gives us better quality vanilla at a cost of being land hungry.

Mangosteen.  Really you would think too dark for vanilla, and it is better on the borders where it gets more light.  A massive tree, it can only be used sparingly and although the fruit is quite delicious, it has no shelf life.

Jackfruit.  Another huge tree, we can really only manage a couple per garden, but easy to propagate and the fruit is in growing demand, so versatile from a delicious snack to a meat substitute.

Tamarillo.  We have just succeeded in germinating the seeds, so this could be a very beneficial addition.

As you can see, we need more varieties that are the standard as too many of these need lots of space.  Maybe mulberry will get in there.  One huge disappointment is that the shaggy trees, Aren and Oil Palm, are not liked by vanilla.  I thought they would be ideal, with lots of damp pockets full of soil, but the vanilla just fades away.

Notice that all of these plants represent another income stream.

Now, this refining of the growing method will have an impact on our production, as we increase the acreage needed for the vanilla and we thin the growing vines.  We are discussing with a few people for the use of their land to increase our gardens.  We are mulling over what to do in some of our gardens where the land is really too flat.  It has been suggested that we build eco villas there amongst the vanilla.  There are people who are keen to finance this, and indeed one of our advisors has recommended that doing this will make it much easier to raise the finance we need.  My biggest concern here is the lack of experience and knowledge within the company for this venture, so we do need partners.  Having said that, one of the best methods of growing a plantations company is acquiring land and in due course building upon it.  Look at Syme Darby in Malaysia, now one of the biggest global companies.  We cannot use this method, because we must bring the landowners with us.  Nevertheless, we can work in partnership to them to our mutual benefit.  Any of our shareholders who would like to discuss this further, please get in touch.

Harvesting is going well, as the workers are learning to harvest later and later.  Still not into the full harvest, and flowering has already started, a month early.  Applying the lessons of this season and not pollinating so many.

Soon we can arrange tours for Flower Fairies to learn how to pollinate vanilla!

Phase 2

We have bought less vanilla in July, essentially because we didn’t receive enough investment last month.  We do have one and a half tons of vanilla in the warehouse, as you may have seen on social media.

The buying season in Java is just coming into full swing, so we can still obtain enough vanilla to pay a dividend.

Phase 3

No new cooperative farmers, but some interest.  We really haven’t started this.

Phase 4

The process is being refined every day, and we have now brought the Café manager and Chef, Samantha Travis (Indonesian despite her name) into the equation with her excellent nose for grading the vanilla.  This allows us to experiment.

There is a big change in the vanilla after a month maturing, when it goes up at least a grade.  This has caused us to process more and more slowly, with improved quality.

The new products keep coming!  Vanilla Pate, Vanilla Butter, Vanilla Caviar, Extract, Vanilla Paste, Anti Mosquito Body Mist.  Working on packaging as I write.

A small issue with the syrup, which is the difficulty of getting unadulterated sap in Bali, where it all goes into alcohol.  We will get better and cheaper supplies in Java and the islands, which will fit in with new depots as we open them.

If you haven’t been to the Café yet, do so!  The Vanilla Passion Martini is a delight, and I am learning to restrict guests to no more than 4, as we have no experience with drunken guests!  Remember, shareholders get a 20% discount and happy Hour from 4 to 6pm gets you a free cocktail for every 2 ordered.

Phase 5

We have first orders from America and Italy, although we are still working through our pricing.  We have just started marketing our vanilla to local buyers.  Our vanilla products are so superior to rivals, that is where our focus lies.  More profitable than the beans.

We are negotiating with Javanese to open a depot there.  This will take months.

Lobsters

The revamp of the ponds is almost complete, and the lobsters appear to appreciate the change.  They make life difficult by eating the new plants as fast as we plant them.  Sufficient to supply the Café.

Blue Lotus

This is the cold season so hard to judge how many flowers we will get.  Still not found a source from other farmers.

Vanilla Syrup

We have one trusted supplier of sap at present, and expansion of this really depends on opening new depots in other islands.

Agarwood and Oud Oil

This is very much on the back burner.

The Royal Spice Café

The Café is fulfilling its first purpose of being a showroom, and an outlet for vanilla and lobster.  The quality of the food is such that a recent visitor who owns one of Ubud’s finest restaurants, exclaimed that it was Michelin standard.  Very keen that we open a branch in Ubud.  This is appealing, because it would mean we would sell all our vanilla at retail price… However, it demands considerable additional finance in an area where we have no track record.  Yes, we have achieved superior food, but that doesn’t mean we know how to operate a large-scale restaurant.  A partner joining us to run the restaurants who would also finance them is another matter.

Investment

While no new investment has come in, we are in conversation with brokers in the Middle East and America who are interested in loan financing, which is cheaper for the company than investment.  There are a number of people interested in investing small amounts who will hopefully come through shortly.  This keeps us going and buying small quantities, but we still need sufficient to finish the factory and to open buying depots in Java, Sulawesi and Sumba.  There are large investors maintaining interest and we have opened a new pipeline for small investors which looks as if it will bring in reasonable finance each month.

Financial Outlook

The green vanilla season has opened in Madagascar, and I have seen two reports.  One says the price has increased twofold and the other three times, which is in line with our expectations from the destruction of the crop in March by a storm.  The reports do not mention a reduction in crop size, which I expect.

We are seeing more people interested in Indonesian vanilla, and we are opening relations with them.

We do expect the price of vanilla to increase next season, if not later this year, and we are able to work with local farmers to access as much vanilla as required.  The quality of our vanilla is sufficient to make the future look very rosy indeed.

Rex Sumner