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Vanilla sky high

A plain old bean carries a rather gaudy price tag. The result: a downgrade in flavor for Americans not willing to pay.



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By Noel C. PaulStaff writer of The Christian Science Monitor / August 11, 2003

One teaspoon of vanilla. It's an essential ingredient in hundreds of recipes, from cookies and cakes to ice cream and cream soda.

Americans have been cooking with the spice for centuries. For many consumers, a tiny bottle of vanilla extract is as common to their kitchen as bread and butter.

But a quick glance at the price tag on that bottle in any grocery store, and it might seem that the rich and creamy liquid is almost too precious to pour out.

In 2000, a 4-ounce bottle of pure vanilla extract cost consumers about $5. They now pay $15. On the commodities market, vanilla beans cost importers about $33 per kilogram in 2000. That cost is now about $156.

The high prices are changing the American pallet. Between 2000 and 2003, Americans began to buy much more imitation vanilla, according to market- research firm ACNielsen. The change has logically reshaped the character and caliber of certain baked goods and other snacks, say experts.

Moreover, worldwide demand for vanilla, which is primarily purchased by American food manufacturers, is projected to fall from 2,000 tons in 2000 to 1,500 tons by next year.

The result: Many food companies that make such treats as candy, cookies, and ice cream are taking vanilla out of their recipes altogether, or substituting artificial flavoring.

Vanilla's presence in the American kitchen and shopping cart is clearly declining, say experts, largely because of a crisis in production. The spice's troubling story shows the vulnerability of the most mundane food products, even in an age in which science promises to replicate everything from farm animals to fresh citrus.

Madagascar, an island off Africa's southeast coast, produces about 70 percent of the world's vanilla crop. Two unexpected events there - one political the other environmental - prompted vanilla's global price spike.

The first hit in 1994, when the International Monetary Fund required Madagascar to abandon price controls restricting the amount of vanilla its farmers could sell to buyers.

Soon after, the nation's vanilla reserves, which had numbered about 2,000 tons annually, were sold out.

The second surprise: A massive cyclone that ripped through Madagascar in the spring of 2000, destroying an estimated 25 percent of the nation's vanilla crop and more than 100 tons of inventory waiting for export.

The economic effect was swift. "Immediately, prices started to rise," says Matthew Nielsen, vice president of Nielsen-Massey Vanillas, a vanilla manufacturer in Waukegan, Ill. "Retail prices have gone up every month since and have doubled overall."

Consumers have responded by buying different varieties of extract. Sales of imitation vanilla extract jumped 4 percent between 2000 and last month, according to ACNielsen.

A two-ounce bottle of McCormick pure vanilla extract, for example, costs $7, while an eight-ounce bottle of the company's imitation vanilla flavor costs only $1.80.

Imitation vanilla tastes much less rich and textured than pure vanilla extract, say experts. But both products' essential ingredients are virtually the same.

Vanillin, the vital chemical that gives natural vanilla its flavor, is also the key ingredient in most bottles of imitation vanilla.

But most vanillin does not come directly from a vanilla bean. More often it is collected as a byproduct of wood-pulp or petroleum production. It is then combined with several other natural and artificial ingredients to create vanilla taste.

People who don't know the difference between a teaspoon and tea cozy probably won't care about substituting artificial vanilla in a recipe. But consumers who snack, which includes most of America, are probably already tasting the vanilla downgrade in their candies, cookies, and ice cream.

McCormick, which manufactures pure and imitation vanilla for consumers and industrial clients, says many of its corporate clients have switched to a lower-quality vanilla. "There has definitely been an increase in that," says Laurie Harrsen, McCormick's director of public relations.

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