“It is a threat to which we are accustomed. “I’ve been in the vanilla business for more than 30 years, and every time I hear the same refrain: Buyers are looking for other origins, buyers will be working with farmers in other countries,” he said. Tam Hun Man Tombo, a vanilla exporter in Madagascar, is skeptical farmers elsewhere are up to the task. Pratt said he doesn’t yet know how much Indonesia would have to produce to calm market prices. Though it has historically been cultivated in Mexico, it mostly has been produced in Madagascar for the past century because many farmers elsewhere found it such a time-consuming, delicate crop, not worth the uncertainty and price fluctuations.
And they must be grown close to the equator.īourbon vanilla, which McCormick sells, is by far the most popular variety in the world. The vines can flourish only if intertwined with small trees that provide support and shade.
From bloom to sale, the average production cycle is 16-18 months, and 600 hand-pollinated flowers yield only about 1 kilo of dried beans. New vanilla vines take three to four years to produce orchids and can only be pollinated - by hand – a few days each year during a pre-dawn, four-hour window. Vanilla is valuable largely because it is laborious to grow.įor a graphic on vanilla cultivation and cost, see tmsnrt.rs/2WzjXmM And some others who have tried to cultivate a secondary source for vanilla have not been successful - Unilever’s Ben & Jerry’s, for instance, “invested heavily” in a similar project that backfired in Uganda. Indonesia produces only about 100 tonnes of whole vanilla beans a year, a far cry from Madagascar’s output of about 2000 tonnes, Pratt said. Now, Donald Pratt, managing director of McCormick’s global procurement arm, said the company is looking to Indonesia as a possible solution to the industry’s supply problem.īut pulling this off may be an uphill task. General Mills, which sells Haagen-Dazs outside the United States and in the brand’s international ice cream parlors, said higher vanilla costs were forcing prices upward. The Swiss food giant makes Haagen-Dazs, Edy’s and Skinny Cow ice creams, which tout natural vanilla flavoring or beans on their labels. ice cream products in 2017, partly due to mounting vanilla prices, he said. The world’s No.1 food company raised prices for U.S. While this isn’t quite the spice’s record-high of $635 per kilo - reached after a ruinous cyclone in 2017 - it is still nearly six times the price of $87.50 per kilo in early 2015.īack-to-back typhoons in 20 “definitely put input pressure on costs,” Nestle SA U.S. The price of black whole-bean Madagascar vanilla, the benchmark product, costs $520 per kilo. McCormick, which sells vanilla and its extract to retailers, restaurants and packaged food makers, said it has been passing the higher costs on to buyers. The African island nation produces about 80 percent of the world’s vanilla.įor McCormick & Co, the world’s largest spice company, the scarcity of vanilla has become too big a risk to ignore, spurring it to begin cultivating an alternative source on the north coast of Papua, Indonesia. But supply is an issue too: Cyclones, drought and crop-theft have hit Madagascar in recent years, slashing into the tender crop’s quality and quantity. In less than five years, the wholesale price has risen nearly 500 percent, partly because of growing global demand for healthy, natural ingredients. REUTERS/Clarel Faniry Rasoanaivo/File PhotoĬultivated painstakingly over years from an orchid plant, vanilla is the second most expensive spice in the world, after saffron.
FILE PHOTO: Fresh vanilla pods are seen at a plantation in Ambavala, near Andapa, Sava region, Madagascar July 14, 2018.
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