Ice cream lovers could be left with a bad taste after a dip in the quality of vanilla caused by global shortages.
Earlier this year Madagascar was ravaged by a tropical cyclone that led to several vanilla crops being destroyed. The island nation off southern Africa’s east coast is responsible for growing 70 per cent of the world’s supply of the ingredient, which is also used in chocolate, yoghurts and perfume.
The crisis has meant the pods have also doubled in price compared with last year, making vanilla now more expensive than silver. Growers are using production shortcuts to bring their goods to market more quickly to take advantage of the higher prices.
Vanilla has been selling at £415 per kilogram this month while silver goes for £406 per kilogram, according to analysis by Mintec, a data science firm specialising in food. Today’s value is in stark contrast to the price being fetched a few years ago with a kilogram of vanilla being sold for approximately £23 on the commodity markets in 2012.
The price rise has been fuelled by declining yields of beans, greater demand from increasingly wealthy nations such as China, as well as food companies looking to use more of the natural ingredient in their products.
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Another factor in the price’s increase is the speculative hoarding of the ingredient, with the commodity not traded on an exchange.
Explaining how growers were cutting corners in vanilla production, Jara Zicha, an analyst at Mintec, said: “Vanilla is harvested as a green bean before it is then cured in a lengthy process to enhance the flavour and to darken the colour. “However, producers have developed a new method called ‘quick curing’, speeding up the process to take advantage of high global prices, but at a cost of the vanillin content, the main flavour compound in vanilla.
“Unfortunately for consumers, this means that while we are paying a premium for the vanilla, its quality has actually deteriorated.” He added that the present prices were “unsustainably high” for food manufacturers and would have to come down eventually.
“Following the reports of 20-30 per cent decline in production in Madagascar, buyers appear to be resisting further price increases.
“In addition, high prices bring higher levels of investment. Vanilla production has been increasing in other origins such as Indonesia, Papua New Guinea and Uganda, while methods to produce natural vanillin derived from sugar or rice bran have been slowly developed.”
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Vanilla is now the world’s second most expensive spice after saffron.