Vanilla beans are becoming a pricey commodity, and bakeries and ice cream companies are feeling the pinch as vanilla beans are now more expensive, per-pound, than silver. Vanilla beans right now are priced at $600 a kilogram, which is more expensive than silver.
Even big companies like Baskin Robbins, a division of Dunkin Brands, are feeling the effects with the cost of vanilla, says Dunkin’ Chief Executive Officer Nigel Travis, according to Bloomberg.
“It puts pressure on both our margins internationally and the costs to our franchisees, so we’ve taken this very seriously. We’ve got a task force working on it.”
Inclement weather in places like Madagascar has hurt vanilla bean production, which is driving up the cost. Vanilla is used for ice cream flavoring and a flavoring for cakes, cookies, and doughnuts also. Adam Brackbill, founder of Urban Churn, a Pennsylvania ice cream company, explains that due to the rise in cost, he has stopped buying whole vanilla beans, and is now buying vanilla bean paste instead.
“With the prices they are nowadays, it’s better to buy vanilla bean paste. That is, if you want the beans for that visual appeal.”
The black flecks in vanilla ice cream are the seeds of the vanilla bean.
Thanks to supply shortages in Madagascar, vanilla is now more valuable than silver. https://t.co/Xcf9J7P5FN— Twitter Moments (@TwitterMoments) May 7, 2018
Several ice cream makers in Europe have decided to stop producing a vanilla or at least a vanilla bean ice cream because of the cost of vanilla beans out of Madagascar. Another company, Snugburys Ice Cream, says it’s now paying over 30 times more for vanilla beans, says PennLive. Production manager Cleo Sadler says a cyclone that hit Madagascar hurt the vanilla bean crop. Madagascar grows approximately 75 percent of the vanilla around the world, and the balance of the world’s vanilla beans are grown in Papua New Guinea, India, and Uganda.
“It has really gone up, so last year we decided to buy it forward by a year’s worth.”
Vanilla is now worth more than silver... https://t.co/x7Pn6CbAHq— Kristie Batten (@kristiebatten) May 7, 2018
The Daily Mail says that in the ice cream trade, vanilla beans are not just used to flavor vanilla ice cream, but the base for many other flavors too. Vanilla has become so valuable that it is now at the center of crime, and the Mafia has even gotten involved in the trade. Over the last decade, vanilla beans have skyrocketed in price from $65 a kilo to $600 a kilo. In the spice trade, vanilla is now a close second to saffron. Harvesting both vanilla beans and saffron is extremely labor intensive.
Cyclone Enawo destroyed a number of vanilla bean vines, and even though new vines have been planted, it takes five years for the new vines to mature to the point where they can bear fruit.