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This info is well over a year old, but I figured it might be a good

start for folks to begin to understand the Vanilla market a bit better :)

 

*Smile*

Chris (list mom)

 

http://www.alittleolfactory.com

 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

 

 

World Market for Vanilla

RAP Market Information Bulletin No. 7

 

INTRODUCTION

 

Vanilla is the name given to a genus of orchids that grow in tropical

climates and to the flavor extract obtained from the fruit pods or beans

of several orchid species. The best and most important commercial

extract is obtained from Vanilla fragrans, also known as Vanilla

planifolia.

Vanilla beans produced commercially are pollinated by hand with a wooden

needle. Harvested before they are ripe, the golden-green beans are cured

through alternating exposure to moist and dry heat, a process that

produces the characteristic flavor and aroma. Curing continues for 10 to

20 days, after which the beans are bundled for drying and development of

the full aroma. This curing and drying process requires four to six

months. The resulting bean is wrinkled and chocolate colored.

 

The flavor and odor of the extract comes partially from a white crystal

vanillin, which develops during the curing process. Vanilla beans,

extracts, tinctures (alcoholic extracts), and resinoid (hydrocarbon

solvent extracts) are the foremost food flavors for ice cream, puddings,

cakes, chocolates, baked goods, syrups, candies, liqueurs, tobacco, and

soft drinks. Vanilla tincture is also used in perfumes.

Tahitian vanilla, a reddish-brown vanilla bean derived from Vanilla

tahitensis, is cultivated in the South Pacific and is used mostly in the

perfume industry. Vanillon (West Indian or Guadeloupian vanilla),

derived from Vanilla pompona, has a cherry like odor, from heliotropin.

It is used to flavor tobacco, soaps, perfumes, medicines, and liqueurs

and is sometimes blended with true vanilla.

Artificial vanilla extract, or vanillin, is produced from eugenol

(derived from clove-stem oil) or acid hydrolysis of lignin (wood) and is

used as a compound mixed with real vanilla.

 

PRODUCTION

 

No exact statistics on worldwide production of vanilla are available;

most statistics provided by producing countries are based on estimation

and contain assessment and reporting errors.

 

World production of cured vanilla beans averages between 2,000 and 2,400

metric tons (MTs) per year. Madagascar is the largest producer, with

1,000-1,200 MTs per year, followed by Indonesia, which has just expanded

its production to 700-800 MTs from 400 MTs in the late 1980s. The

third-largest producer is Comoros, with average production of 200 MTs

per year. Smaller producers include Tonga (40 MTs), R,union (20 MTs),

French Polynesia (20 MTs), and Mexico (10 MTs).

 

Madagascar

Vanilla was first introduced to Madagascar in 1873. With favorable

climatic conditions, production rapidly expanded, and now Madagascar is

the world's largest producer. Production is located in the northeastern

part of the island, where 55,000 farmers are involved in cultivation.

Madagascar produces Bourbon type vanilla from Vanilla fragrans ( " Bourbon

type " refers to the conditions of growing and the technique of curing

the vanilla pods), which is considered the world standard for quality.

The production of vanilla beans in Madagascar fluctuates depending on

weather. Production averages 1,000 MTs per year, with peak production of

2,164 MTs reported in 1987. In 1994, production was 974 MTs, down from

1,200 MTs the previous year (Table 1).

 

Indonesia

Indonesia produces Java vanilla (grown on the island of Java) and

Bourbon-like vanilla (grown on the island of Bali). Both varieties are

produced from Vanilla fragrans, but Java vanilla is of a lesser quality

than the Bourbon type, whereas Bourbon-like vanilla is similar in

quality to the original Bourbon type. In the last few years, the

Indonesian government has been encouraging farmers to grow vanilla. The

government also seeks to improve the aroma, flavor, strength, and

character of pods produced. The curers and Indonesian research

institutes are working with the British Natural Resources Institute to

improve curing techniques, in particular the measuring of moisture

content. As a result, the quality of Indonesian production is beginning

to rival that of Madagascar. No formal statistics on production are

available, but Indonesian production is estimated at 700-800 MTs per

year, up from 400 MTs in the late 1980s and from 200 MTs in the

mid-1970s. In 1960, production was estimated at only 100 MTs.

 

Comoros and Runion

Situated in the Indian Ocean close to Madagascar, Comoros and Runion

also produce Bourbon type vanilla. Production in Comoros has remained

around 200 MTs per year with periodic reductions caused by cyclones and

other bad weather. Runion was once a more important producer of vanilla,

but increases in growers' wages have reduced its production drastically,

from 100 MTs in the 1960s and 1970s to 20 MTs in recent years.

 

Tonga

The Pacific island country of Tonga produces a small but consistent

amount of vanilla beans. Production grew in the late 1980s and early

1990s and currently stands at 30-40 MTs per year. Tonga also grows the

Vanilla fragrans, the same variety grown in the major Indian Ocean

producing countries.

French Polynesia

The only producer of Vanilla tahitensis, French Polynesia (mainly

Tahiti) ranked with Madagascar as a dominant producer prior to 1930.

Production in French Polynesia, however, has fallen from 200 MTs in 1960

to 15-20 MTs in the last few years as Tahitian producers have turned to

plantation-style crops such as coffee and sugar cane. A viral problem

also may have contributed to the contraction of the Tahitian industry.

In addition, the Tahitian species is regarded as producing a low-quality

aroma. Vanilla tahitensis is used mostly in the perfume industry and

therefore does not compete directly with Vanilla fragrans.

 

Mexico

Mexico, the original producer of Vanilla fragrans, no longer ranks as a

significant producer. High wages have forced production down, and sales

have dropped as a result of bad production practices. Mexican-made

vanilla is frequently adulterated with extract from beans of the tonka

tree (tonka beans do not meet the food safety requirements of the Food,

Drug, and Cosmetic Act of the United States). Although Tonka bean

extracts smell like vanilla, they contain coumarin banned as a food or

food additive by the U.S. Food and Drug Administration since 1954, when

it was found to damage the liver and other organs of laboratory animals.

 

Uganda

Although it does not yet export vanilla, Uganda is engaging in a

high-intensity effort to start a vanilla industry. Vanilla production in

Uganda, which ceased during the political upheaval of the 1970s, is on

the rise again. Recent reports indicate that more than 10,000 farmers

already grow the crop. One Ugandan processor, which produces two-thirds

of the country's vanilla, uses rapid curing to cut curing time from six

months to four days. The vanillin content of the rapid-cured vanilla is

reportedly twice that of pods cured by the traditional Bourbon method.

 

EXPORTS

For each of the last five years, 1,600 to 1,800 MTs of vanilla beans

entered world markets. Madagascar and Indonesia each accounted for 40

percent of that trade; Comoros 15 percent; and Tonga, R,union, and the

other producers the remainder. World exports of vanilla beans by the

major producing countries rose from 515 MTs in 1980 to 1,756 MTs in 1992

(Table 2).

Madagascar, until recently, dominated the world market for vanilla,

supplying 70 percent of world demand in the 1970s and 1980s (Table 3).

Export volumes fell from 1,700 MTs in 1977 (72 percent of world supply)

to only 485 MTs in 1993 (31 percent of world supply). In 1994, exports

rebounded to 900 MTs.

 

From 1961 to 1987, Madagascar's nominal export revenues increased

continuously, from US$8 million in 1961 to an all-time high of US$89

million in 1987. Export revenues fell to US$41 million in 1988 and to

US$34 million in 1993 (Table 2). For 1994 a slight recovery is expected,

and export revenues may approach US$50-60 million.

 

The Government of Madagascar decided in 1995 to liberalize the vanilla

sector. The government phased out official export prices, allowing the

price of vanilla to be determined by market forces. In May the

government also set a fixed tax of US$21 on each kilogram exported,

instead of charging the 80 percent export tax in effect from 1989 to

1994. New York brokers reported an early June 1995 trading price of

US$35 per kilogram for vanilla from Madagascar. This price was down from

the official export price of US$74 per kilogram applied from 1989 to

1993, and from the US$50-60 per kilogram price applied in 1994.

 

Indonesian exports jumped from 77 MTs, with a freight on board (FOB)

value of US$1.3 million in 1980, to 720 MTs (US$21 million) in 1993.

Indonesia was the world's largest exporter of vanilla in 1989 and again

from 1991 to 1993, with a world market share of as high as 46 percent

(1993). In the United States, where 80 percent of Indonesian exports are

sent, import unit value over the last several years has ranged in cost,

insurance, and freight (CIF) terms from US$30 to US$35 per kilogram,

half the CIF value of Malagasy product.

 

Exports from Comoros have been rising in recent years. In 1993, they

reached 285 MTs, equivalent to 18 percent of the world supply and US$1.9

million FOB. This value is up from 236 MTs (US$1.3 million) in 1992 and

238 MTs (US$1 million) in 1991. Generally the export price applied in

Comoros is the same as that applied in Madagascar. These two producers,

together with R,union, comprised the Vanilla Alliance, a cartel to

handle marketing arrangements on the world market. Although the cartel

broke up, both Comoros and Madagascar continue to follow the same price

policy.

Other world exporters are smaller players. In the early 1960s, French

Polynesia exported 180-190 MTs per year. In 1967, exports dropped to 59

MTs, and in 1975 they were only 8 MTs, about the same level as in 1993

(9 MTs, US$463,000). Mexican exports have fallen from 103 MTs in 1961 to

just 7 MTs in 1993. In 1994, R,union's exports were 13 MTs (US$588,000

FOB), down from 28 MTs (US$1,884,000) in 1993. Tongan exports have been

increasing, from 14 MTs (US$ 853,000 FOB) in 1987 to 36 MTs (US$2

million) in 1993, although prospects for increased production and

exports are limited.

 

MARKETS

Vanilla is the second-most expensive spice (after saffron) and the spice

most subject to competition from imperfect substitutes (low-cost

artificial flavorings). The aggregate global demand for real vanilla is

estimated at 2,000 MTs per year, primarily for high-quality vanilla

flavoring. Between 1965 and 1989, world consumption grew at an average

annual rate of 2 percent. Between 1980 and 1989, demand expanded rapidly

particularly in the United States, where it grew at 7 percent a year in

volume. In Europe, the rate of consumption was more modest: 2-3 percent.

Highest consumption per capita is found in Denmark (4.57 grams), the

United States (3.85 grams), France (2.54 grams), and Canada (1.00 grams).

Synthetic vanillin accounts for more than 90 percent of the U.S. vanilla

flavoring market and about 50 percent of the French market (the lowest

national share). One ounce of artificially produced vanillin has roughly

the same flavoring power as a gallon of natural vanilla extract.

Synthetic vanillin costs one-hundredth the price of the natural product

and not only substitutes for vanilla but also supplements adulterated

vanilla extracts. Despite the strong competition from synthetic vanilla,

a number of factors have strengthened the demand for vanilla beans

during the past decade: increased health awareness and preference for

natural products; escalating consumer demand for processed foods, which

use new flavors and spices; and an explosion in popularity of gourmet

ice creams, which tend to use pure natural flavors exclusively. In major

markets the United States and Europe vanilla is the only spice that

benefits from a Standard of Identity, which helps shield vanilla beans

from competition from substitutes.

From 1991 to 1993, the United States, France, and Germany accounted for

80 percent of world imports of vanilla beans, the United States

absorbing 50-60 percent, and France and Germany between 10 and 15

percent each (Table 4). These three countries were also major

re-exporters of both vanilla beans and processed vanilla products.

Germany consumed only 30-40 percent of its imported beans, and its

re-exports were by far the most significant, reaching approximately

180-250 MTs per year in the early 1990s. France's annual re-exports were

30-50 percent of imports (70-120 MTs), and U.S. re-exports were 60-80

MTs annually (4-6 percent of imports).

 

United States

U.S. imports of vanilla beans fell slightly in 1994 to 1,245 MTs (CIF

US$61.9 million), down from 1,332 MTs in 1993 (US$63.5 million) and from

1,262 MTs (US$65.7 million) in 1992 (Table 5).

From the 1960s through the 1980s, Madagascar was the largest supplier

of vanilla beans to the United States. Indonesia occupied first place

from 1989 to 1993, supplying 47-50 percent of all U.S. imports. Then, in

1994, Madagascar again became the largest supplier with an import share

of 45 percent (556 MTs), while Indonesia's import share fell to 42

percent (528 MTs). Import prices of vanilla beans from Madagascar to the

United States increased from US$10 per kilogram in 1970 to US$55 per

kilogram in 1980, and to US$74 per kilogram from 1990 to 1993. Prices

fell to only US$35 per kilogram in June 1995. For the last two years,

import prices of the Bourbon-like vanilla from Indonesia were US$30-35

per kilogram; prices for Java vanilla were lower.

 

More than 95 percent of the vanilla beans consumed in the United States

are processed into extracts sold to flavor manufacturers or to the

retail trade. Most U.S. purchases are therefore of lower-grade beans,

because quality and general appearance are less critical for extraction

purposes. Forty-four percent of all vanilla extracts are used in the

production of ice cream. Other major industrial users of vanilla

extracts and flavors are the confectionery, baking, and beverage

industries. From 1990 to 1993, U.S. re-exports amounted to 60-80 MTs

annually, mostly to Canada. Synthetic vanilla production in the United

States increased by 135 percent between 1984 and 1988.

 

Canada

Canada is a smaller market than the United States for vanilla beans.

From 1991 to 1992, Canadian imports jumped from 56 MTs to 132 MTs, and

in 1993 they reached 188 MTs (US$11 million CIF). Imports remained

relatively stable in 1994 (187 MTs, US$9.7 million CIF). In 1994,

Madagascar supplied 126 MTs (67 percent of total imports), and Indonesia

supplied 23 MTs (12 percent). Other suppliers were France (13 MTs, 7

percent), the United States (11 MTs, 6 percent), and Comoros (8 MTs, 4

percent). As in the United States, nearly all the beans are used for

extraction purposes.

 

France

From 1987 to 1993, France imported between 220 and 260 MTs of vanilla

beans per year. As seen in Table 6, imports in 1993 were 248 MTs (CIF

value US$14.5 million), and in 1994 they jumped to 324 MTs (CIF value

US$18.9 million). In 1994 Madagascar supplied 184 MTs (57 percent),

other European Union (EU) countries 72 MTs (22 percent), Comoros 36 MTs

(11 percent), and Indonesia 15 MTs (5 percent). Because French extract

regulations mandate a high vanillin content, the French market favors

high-quality vanilla beans. Twenty percent of imported vanilla beans are

consumed directly by consumers, one of the highest rates for major world

markets. Re-exports of vanilla beans are usually 30-40 percent of

imports. However, in 1993 re-exports reached 52 percent.

 

Germany

German imports of vanilla beans have shown consistent growth since 1985,

with 1994 imports registering 346 MTs (Table 7). In 1994 Madagascar

supplied 215 MTs (51 percent), other EU countries 35 MTs (10 percent),

Comoros 19 MTs (5 percent), and Indonesia 13 MTs (4 percent). German

re-exports, too, are on the rise. Most re-exports are intended for other

European countries, but many also are sent to the United States, Canada,

and Japan. As in France, high-quality vanilla beans are preferred.

 

Japan

In 1994, Japanese imports of vanilla beans reached their highest level

ever (82 MTs, CIF value of US$5.4 million). This is up from 45 MTs

(US$3.4 million) in 1993, and 72 MTs (US$10.6 million) in 1992 (Table

10). In 1994, Madagascar supplied 66 MTs (80 percent of total imports),

and Indonesia 12 MTs (15 percent). The remainder came from Comoros (2

percent), Germany (1 percent), and other countries. No Japanese

re-exports were reported.

 

Switzerland

During the past 10 years, Switzerland's imports of vanilla beans have

been between 32 and 57 MTs, averaging 46 MTs per year. In 1994, imports

were 43 MTs (CIF value US$2.9 million), up from 38 MTs (US$2.7 million)

in 1993, but down from 51 MTs (US$3.5 million) in 1992. In 1994,

Switzerland's major suppliers were Germany 17 MTs (40 percent of total

imports), Madagascar 15 MTs (35 percent), and France 10 MTs (23 percent).

 

United Kingdom

In 1994, U.K. imports reached 50 MTs (CIF value US$1.6 million), their

highest level ever. In previous years, U.K. imports of vanilla beans

were between 32 MTs (1990) and 13 MTs (1993). Of the 50 MTs imported in

1994, the major suppliers were France (21 MTs) and Germany (19 MTs). The

United States accounted for 4 MTs, and Indonesia 1 MT. No imports from

Madagascar were reported.

 

Minor Importers

The Netherlands, Ireland, Denmark, and Saudi Arabia import between 20

and 50 MTs each, and Botswana, Australia, and other EU countries between

10 and 20 MTs each (Table 8).

 

EXPORTS GRADES AND STANDARDS

Grading standards differ among producing countries and are relatively

complex. Classifications are based on bean length; aroma; color;

moisture content; consistency; and freedom from blemishes, insect

infestation, and mildew. Bourbon vanilla is classified by Madagascar

into five main grades of whole and split beans 1st, 2nd, 3rd, 4th, and

an additional grade for all other beans.

 

.. 1st - Good flavor, length greater than 14 centimeters, supple, full,

no spots, no scratches, tannish-brown uniform color, moisture content

less than 25 percent

.. 2nd - Good flavor, length greater than 14 centimeters, supple, some

spots and scratches, moisture content 25-28 percent

.. 3rd - Good flavor, length greater than 14 centimeters, supple or dry

spots and scratches, red blemishes, moisture content more than 30 percent

.. 4th - Broken or cut, length less than 14 centimeters, red blemishes,

moisture content more than 30 percent

 

In the United States, a minimum content of 2 percent of vanillin is

preferred. In Europe, French importers require vanilla to have a minimum

vanillin content of 2 percent and the moisture content to be between 15

percent and 17 percent.

 

The grades of whole and split beans are subdivided according to size

(length) and then put into bundles, each containing 70-100 beans and

weighing between 150 and 200 grams. The bundles are packed into

waxed-paper-lined tin boxes, which hold between 20 and 40 bundles. The

tins have traditionally been packed into wooden boxes, each holding six

tins. More recently, cardboard boxes have been used.

 

SOURCES OF TECHNICAL INFORMATION

Sasikumar, B.; Rema, J.; Ravindran, P.N. " Vanilla. " Indian Cocoa,

Arecanut and Spices Journal. 1992, 16: 1, pp. 6-10.

Pruthi, J.S. " Post-harvest Technology of Spices: Pre-treatments, Curing,

Cleaning, Grading, and Packing. " Journal of Spices and Aromatic Crops.

1992, 1: 1, pp. 1-29.

Rosengarten, F., Jr. The Book of Spices. New York: Pyramid

Communications Inc. 1973.

Ranadive, A.S. " Vanillin and Related Flavor Compounds in Vanilla

Extracts Made from Beans of Various Global Origins. " Journal of

Agriculture and Food Chemistry . Washington, D.C.: American Chemical

Society. Oct. 1992, 40:10, pp. 1922-1924.

Ranadive, A.S. Vanilla - Cultivation, Curing, Chemistry, Technology and

Commercial Products. Amsterdam: Elsevier Scientific Publications. 1994.

34: pp. 517-577.

Carnero-Ruiz, C.; Heredia-Bayona, A.; Garcia-Sanchez, F. " Derivatives

Spectrophotometric Determination of Vanillin and P-hydroxybenzaldehyde

in Vanilla Bean Extracts. " Journal of Agriculture, Food and Chemistry.

Washington, D.C.: American Chemical Society. Jan. 1990. 28: 1, pp. 178-181.

Fouche, J.G.; Coumans, M. " Vanilla: Pollination. " American Orchid

Society Bulletin. West Palm Beach, Florida: The Society. Nov. 1992.

61:11, pp. 1118-1122.

Funk, C.; Brodelius, P.E. " Vanilla Planifolia Andrews: in Vitro

Biosynthesis of Vanillin and Other Phenylpropanoid Derivatives. "

Biotechnol-agricult-for. Berlin: Springer-Verlag. 1994. 26: pp. 377-402.

Westcoot, R.J.; Cheetham, P.S.J.; Barraclough. A.J. " Use of Organized

Viable Vanilla Plant Aerial Roots for the Production of Natural

Vanillin. " Phytochemistry-Oxford . Oxford: Elsevier Science Ltd. Jan.

1994. 35:1, pp. 135-138.

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Hi Chris,

 

I was just reading something very close to this article.. and then wondering

WHY I was ever wondering why, LOL, it's so hard now to get good vanilla beans,

absolute or even oleo-resin from a good source at a good price!

Thanks for even more info, I'm depressed! <grin>

 

Hugs,

 

Marilyn

 

Chris Ziegler wrote:

 

> This info is well over a year old, but I figured it might be a good

> start for folks to begin to understand the Vanilla market a bit better :)

>

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Share on other sites

Hi Chris, that was interesting. Now I can see why it costs so much!

*guess I won't be growing my own* :-)

 

Selket

 

, Chris Ziegler <chrisziggy1@a...> wrote:

> This info is well over a year old, but I figured it might be a good

> start for folks to begin to understand the Vanilla market a bit

better :)

>

> *Smile*

> Chris (list mom)

>

> http://www.alittleolfactory.com

>

> ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

>

>

> World Market for Vanilla

> RAP Market Information Bulletin No. 7

>

> INTRODUCTION

>

> Vanilla is the name given to a genus of orchids that grow in

tropical

> climates and to the flavor extract obtained from the fruit pods or

beans

> of several orchid species. The best and most important commercial

> extract is obtained from Vanilla fragrans, also known as Vanilla

> planifolia.

> Vanilla beans produced commercially are pollinated by hand with a

wooden

> needle. Harvested before they are ripe, the golden-green beans are

cured

> through alternating exposure to moist and dry heat, a process that

> produces the characteristic flavor and aroma. Curing continues for

10 to

> 20 days, after which the beans are bundled for drying and

development of

> the full aroma. This curing and drying process requires four to six

> months. The resulting bean is wrinkled and chocolate colored.

>

> The flavor and odor of the extract comes partially from a white

crystal

> vanillin, which develops during the curing process. Vanilla beans,

> extracts, tinctures (alcoholic extracts), and resinoid (hydrocarbon

> solvent extracts) are the foremost food flavors for ice cream,

puddings,

> cakes, chocolates, baked goods, syrups, candies, liqueurs, tobacco,

and

> soft drinks. Vanilla tincture is also used in perfumes.

> Tahitian vanilla, a reddish-brown vanilla bean derived from Vanilla

> tahitensis, is cultivated in the South Pacific and is used mostly

in the

> perfume industry. Vanillon (West Indian or Guadeloupian vanilla),

> derived from Vanilla pompona, has a cherry like odor, from

heliotropin.

> It is used to flavor tobacco, soaps, perfumes, medicines, and

liqueurs

> and is sometimes blended with true vanilla.

> Artificial vanilla extract, or vanillin, is produced from eugenol

> (derived from clove-stem oil) or acid hydrolysis of lignin (wood)

and is

> used as a compound mixed with real vanilla.

>

> PRODUCTION

>

> No exact statistics on worldwide production of vanilla are

available;

> most statistics provided by producing countries are based on

estimation

> and contain assessment and reporting errors.

>

> World production of cured vanilla beans averages between 2,000 and

2,400

> metric tons (MTs) per year. Madagascar is the largest producer,

with

> 1,000-1,200 MTs per year, followed by Indonesia, which has just

expanded

> its production to 700-800 MTs from 400 MTs in the late 1980s. The

> third-largest producer is Comoros, with average production of 200

MTs

> per year. Smaller producers include Tonga (40 MTs), R,union (20

MTs),

> French Polynesia (20 MTs), and Mexico (10 MTs).

>

> Madagascar

> Vanilla was first introduced to Madagascar in 1873. With favorable

> climatic conditions, production rapidly expanded, and now

Madagascar is

> the world's largest producer. Production is located in the

northeastern

> part of the island, where 55,000 farmers are involved in

cultivation.

> Madagascar produces Bourbon type vanilla from Vanilla fragrans

( " Bourbon

> type " refers to the conditions of growing and the technique of

curing

> the vanilla pods), which is considered the world standard for

quality.

> The production of vanilla beans in Madagascar fluctuates depending

on

> weather. Production averages 1,000 MTs per year, with peak

production of

> 2,164 MTs reported in 1987. In 1994, production was 974 MTs, down

from

> 1,200 MTs the previous year (Table 1).

>

> Indonesia

> Indonesia produces Java vanilla (grown on the island of Java) and

> Bourbon-like vanilla (grown on the island of Bali). Both varieties

are

> produced from Vanilla fragrans, but Java vanilla is of a lesser

quality

> than the Bourbon type, whereas Bourbon-like vanilla is similar in

> quality to the original Bourbon type. In the last few years, the

> Indonesian government has been encouraging farmers to grow vanilla.

The

> government also seeks to improve the aroma, flavor, strength, and

> character of pods produced. The curers and Indonesian research

> institutes are working with the British Natural Resources Institute

to

> improve curing techniques, in particular the measuring of moisture

> content. As a result, the quality of Indonesian production is

beginning

> to rival that of Madagascar. No formal statistics on production are

> available, but Indonesian production is estimated at 700-800 MTs

per

> year, up from 400 MTs in the late 1980s and from 200 MTs in the

> mid-1970s. In 1960, production was estimated at only 100 MTs.

>

> Comoros and Runion

> Situated in the Indian Ocean close to Madagascar, Comoros and

Runion

> also produce Bourbon type vanilla. Production in Comoros has

remained

> around 200 MTs per year with periodic reductions caused by cyclones

and

> other bad weather. Runion was once a more important producer of

vanilla,

> but increases in growers' wages have reduced its production

drastically,

> from 100 MTs in the 1960s and 1970s to 20 MTs in recent years.

>

> Tonga

> The Pacific island country of Tonga produces a small but consistent

> amount of vanilla beans. Production grew in the late 1980s and

early

> 1990s and currently stands at 30-40 MTs per year. Tonga also grows

the

> Vanilla fragrans, the same variety grown in the major Indian Ocean

> producing countries.

> French Polynesia

> The only producer of Vanilla tahitensis, French Polynesia (mainly

> Tahiti) ranked with Madagascar as a dominant producer prior to

1930.

> Production in French Polynesia, however, has fallen from 200 MTs in

1960

> to 15-20 MTs in the last few years as Tahitian producers have

turned to

> plantation-style crops such as coffee and sugar cane. A viral

problem

> also may have contributed to the contraction of the Tahitian

industry.

> In addition, the Tahitian species is regarded as producing a low-

quality

> aroma. Vanilla tahitensis is used mostly in the perfume industry

and

> therefore does not compete directly with Vanilla fragrans.

>

> Mexico

> Mexico, the original producer of Vanilla fragrans, no longer ranks

as a

> significant producer. High wages have forced production down, and

sales

> have dropped as a result of bad production practices. Mexican-made

> vanilla is frequently adulterated with extract from beans of the

tonka

> tree (tonka beans do not meet the food safety requirements of the

Food,

> Drug, and Cosmetic Act of the United States). Although Tonka bean

> extracts smell like vanilla, they contain coumarin banned as a food

or

> food additive by the U.S. Food and Drug Administration since 1954,

when

> it was found to damage the liver and other organs of laboratory

animals.

>

> Uganda

> Although it does not yet export vanilla, Uganda is engaging in a

> high-intensity effort to start a vanilla industry. Vanilla

production in

> Uganda, which ceased during the political upheaval of the 1970s, is

on

> the rise again. Recent reports indicate that more than 10,000

farmers

> already grow the crop. One Ugandan processor, which produces two-

thirds

> of the country's vanilla, uses rapid curing to cut curing time from

six

> months to four days. The vanillin content of the rapid-cured

vanilla is

> reportedly twice that of pods cured by the traditional Bourbon

method.

>

> EXPORTS

> For each of the last five years, 1,600 to 1,800 MTs of vanilla

beans

> entered world markets. Madagascar and Indonesia each accounted for

40

> percent of that trade; Comoros 15 percent; and Tonga, R,union, and

the

> other producers the remainder. World exports of vanilla beans by

the

> major producing countries rose from 515 MTs in 1980 to 1,756 MTs in

1992

> (Table 2).

> Madagascar, until recently, dominated the world market for vanilla,

> supplying 70 percent of world demand in the 1970s and 1980s (Table

3).

> Export volumes fell from 1,700 MTs in 1977 (72 percent of world

supply)

> to only 485 MTs in 1993 (31 percent of world supply). In 1994,

exports

> rebounded to 900 MTs.

>

> From 1961 to 1987, Madagascar's nominal export revenues increased

> continuously, from US$8 million in 1961 to an all-time high of

US$89

> million in 1987. Export revenues fell to US$41 million in 1988 and

to

> US$34 million in 1993 (Table 2). For 1994 a slight recovery is

expected,

> and export revenues may approach US$50-60 million.

>

> The Government of Madagascar decided in 1995 to liberalize the

vanilla

> sector. The government phased out official export prices, allowing

the

> price of vanilla to be determined by market forces. In May the

> government also set a fixed tax of US$21 on each kilogram exported,

> instead of charging the 80 percent export tax in effect from 1989

to

> 1994. New York brokers reported an early June 1995 trading price of

> US$35 per kilogram for vanilla from Madagascar. This price was down

from

> the official export price of US$74 per kilogram applied from 1989

to

> 1993, and from the US$50-60 per kilogram price applied in 1994.

>

> Indonesian exports jumped from 77 MTs, with a freight on board

(FOB)

> value of US$1.3 million in 1980, to 720 MTs (US$21 million) in

1993.

> Indonesia was the world's largest exporter of vanilla in 1989 and

again

> from 1991 to 1993, with a world market share of as high as 46

percent

> (1993). In the United States, where 80 percent of Indonesian

exports are

> sent, import unit value over the last several years has ranged in

cost,

> insurance, and freight (CIF) terms from US$30 to US$35 per

kilogram,

> half the CIF value of Malagasy product.

>

> Exports from Comoros have been rising in recent years. In 1993,

they

> reached 285 MTs, equivalent to 18 percent of the world supply and

US$1.9

> million FOB. This value is up from 236 MTs (US$1.3 million) in 1992

and

> 238 MTs (US$1 million) in 1991. Generally the export price applied

in

> Comoros is the same as that applied in Madagascar. These two

producers,

> together with R,union, comprised the Vanilla Alliance, a cartel to

> handle marketing arrangements on the world market. Although the

cartel

> broke up, both Comoros and Madagascar continue to follow the same

price

> policy.

> Other world exporters are smaller players. In the early 1960s,

French

> Polynesia exported 180-190 MTs per year. In 1967, exports dropped

to 59

> MTs, and in 1975 they were only 8 MTs, about the same level as in

1993

> (9 MTs, US$463,000). Mexican exports have fallen from 103 MTs in

1961 to

> just 7 MTs in 1993. In 1994, R,union's exports were 13 MTs

(US$588,000

> FOB), down from 28 MTs (US$1,884,000) in 1993. Tongan exports have

been

> increasing, from 14 MTs (US$ 853,000 FOB) in 1987 to 36 MTs (US$2

> million) in 1993, although prospects for increased production and

> exports are limited.

>

> MARKETS

> Vanilla is the second-most expensive spice (after saffron) and the

spice

> most subject to competition from imperfect substitutes (low-cost

> artificial flavorings). The aggregate global demand for real

vanilla is

> estimated at 2,000 MTs per year, primarily for high-quality vanilla

> flavoring. Between 1965 and 1989, world consumption grew at an

average

> annual rate of 2 percent. Between 1980 and 1989, demand expanded

rapidly

> particularly in the United States, where it grew at 7 percent a

year in

> volume. In Europe, the rate of consumption was more modest: 2-3

percent.

> Highest consumption per capita is found in Denmark (4.57 grams),

the

> United States (3.85 grams), France (2.54 grams), and Canada (1.00

grams).

> Synthetic vanillin accounts for more than 90 percent of the U.S.

vanilla

> flavoring market and about 50 percent of the French market (the

lowest

> national share). One ounce of artificially produced vanillin has

roughly

> the same flavoring power as a gallon of natural vanilla extract.

> Synthetic vanillin costs one-hundredth the price of the natural

product

> and not only substitutes for vanilla but also supplements

adulterated

> vanilla extracts. Despite the strong competition from synthetic

vanilla,

> a number of factors have strengthened the demand for vanilla beans

> during the past decade: increased health awareness and preference

for

> natural products; escalating consumer demand for processed foods,

which

> use new flavors and spices; and an explosion in popularity of

gourmet

> ice creams, which tend to use pure natural flavors exclusively. In

major

> markets the United States and Europe vanilla is the only spice that

> benefits from a Standard of Identity, which helps shield vanilla

beans

> from competition from substitutes.

> From 1991 to 1993, the United States, France, and Germany

accounted for

> 80 percent of world imports of vanilla beans, the United States

> absorbing 50-60 percent, and France and Germany between 10 and 15

> percent each (Table 4). These three countries were also major

> re-exporters of both vanilla beans and processed vanilla products.

> Germany consumed only 30-40 percent of its imported beans, and its

> re-exports were by far the most significant, reaching approximately

> 180-250 MTs per year in the early 1990s. France's annual re-exports

were

> 30-50 percent of imports (70-120 MTs), and U.S. re-exports were 60-

80

> MTs annually (4-6 percent of imports).

>

> United States

> U.S. imports of vanilla beans fell slightly in 1994 to 1,245 MTs

(CIF

> US$61.9 million), down from 1,332 MTs in 1993 (US$63.5 million) and

from

> 1,262 MTs (US$65.7 million) in 1992 (Table 5).

> From the 1960s through the 1980s, Madagascar was the largest

supplier

> of vanilla beans to the United States. Indonesia occupied first

place

> from 1989 to 1993, supplying 47-50 percent of all U.S. imports.

Then, in

> 1994, Madagascar again became the largest supplier with an import

share

> of 45 percent (556 MTs), while Indonesia's import share fell to 42

> percent (528 MTs). Import prices of vanilla beans from Madagascar

to the

> United States increased from US$10 per kilogram in 1970 to US$55

per

> kilogram in 1980, and to US$74 per kilogram from 1990 to 1993.

Prices

> fell to only US$35 per kilogram in June 1995. For the last two

years,

> import prices of the Bourbon-like vanilla from Indonesia were US$30-

35

> per kilogram; prices for Java vanilla were lower.

>

> More than 95 percent of the vanilla beans consumed in the United

States

> are processed into extracts sold to flavor manufacturers or to the

> retail trade. Most U.S. purchases are therefore of lower-grade

beans,

> because quality and general appearance are less critical for

extraction

> purposes. Forty-four percent of all vanilla extracts are used in

the

> production of ice cream. Other major industrial users of vanilla

> extracts and flavors are the confectionery, baking, and beverage

> industries. From 1990 to 1993, U.S. re-exports amounted to 60-80

MTs

> annually, mostly to Canada. Synthetic vanilla production in the

United

> States increased by 135 percent between 1984 and 1988.

>

> Canada

> Canada is a smaller market than the United States for vanilla

beans.

> From 1991 to 1992, Canadian imports jumped from 56 MTs to 132 MTs,

and

> in 1993 they reached 188 MTs (US$11 million CIF). Imports remained

> relatively stable in 1994 (187 MTs, US$9.7 million CIF). In 1994,

> Madagascar supplied 126 MTs (67 percent of total imports), and

Indonesia

> supplied 23 MTs (12 percent). Other suppliers were France (13 MTs,

7

> percent), the United States (11 MTs, 6 percent), and Comoros (8

MTs, 4

> percent). As in the United States, nearly all the beans are used

for

> extraction purposes.

>

> France

> From 1987 to 1993, France imported between 220 and 260 MTs of

vanilla

> beans per year. As seen in Table 6, imports in 1993 were 248 MTs

(CIF

> value US$14.5 million), and in 1994 they jumped to 324 MTs (CIF

value

> US$18.9 million). In 1994 Madagascar supplied 184 MTs (57 percent),

> other European Union (EU) countries 72 MTs (22 percent), Comoros 36

MTs

> (11 percent), and Indonesia 15 MTs (5 percent). Because French

extract

> regulations mandate a high vanillin content, the French market

favors

> high-quality vanilla beans. Twenty percent of imported vanilla

beans are

> consumed directly by consumers, one of the highest rates for major

world

> markets. Re-exports of vanilla beans are usually 30-40 percent of

> imports. However, in 1993 re-exports reached 52 percent.

>

> Germany

> German imports of vanilla beans have shown consistent growth since

1985,

> with 1994 imports registering 346 MTs (Table 7). In 1994 Madagascar

> supplied 215 MTs (51 percent), other EU countries 35 MTs (10

percent),

> Comoros 19 MTs (5 percent), and Indonesia 13 MTs (4 percent).

German

> re-exports, too, are on the rise. Most re-exports are intended for

other

> European countries, but many also are sent to the United States,

Canada,

> and Japan. As in France, high-quality vanilla beans are preferred.

>

> Japan

> In 1994, Japanese imports of vanilla beans reached their highest

level

> ever (82 MTs, CIF value of US$5.4 million). This is up from 45 MTs

> (US$3.4 million) in 1993, and 72 MTs (US$10.6 million) in 1992

(Table

> 10). In 1994, Madagascar supplied 66 MTs (80 percent of total

imports),

> and Indonesia 12 MTs (15 percent). The remainder came from Comoros

(2

> percent), Germany (1 percent), and other countries. No Japanese

> re-exports were reported.

>

> Switzerland

> During the past 10 years, Switzerland's imports of vanilla beans

have

> been between 32 and 57 MTs, averaging 46 MTs per year. In 1994,

imports

> were 43 MTs (CIF value US$2.9 million), up from 38 MTs (US$2.7

million)

> in 1993, but down from 51 MTs (US$3.5 million) in 1992. In 1994,

> Switzerland's major suppliers were Germany 17 MTs (40 percent of

total

> imports), Madagascar 15 MTs (35 percent), and France 10 MTs (23

percent).

>

> United Kingdom

> In 1994, U.K. imports reached 50 MTs (CIF value US$1.6 million),

their

> highest level ever. In previous years, U.K. imports of vanilla

beans

> were between 32 MTs (1990) and 13 MTs (1993). Of the 50 MTs

imported in

> 1994, the major suppliers were France (21 MTs) and Germany (19

MTs). The

> United States accounted for 4 MTs, and Indonesia 1 MT. No imports

from

> Madagascar were reported.

>

> Minor Importers

> The Netherlands, Ireland, Denmark, and Saudi Arabia import between

20

> and 50 MTs each, and Botswana, Australia, and other EU countries

between

> 10 and 20 MTs each (Table 8).

>

> EXPORTS GRADES AND STANDARDS

> Grading standards differ among producing countries and are

relatively

> complex. Classifications are based on bean length; aroma; color;

> moisture content; consistency; and freedom from blemishes, insect

> infestation, and mildew. Bourbon vanilla is classified by

Madagascar

> into five main grades of whole and split beans 1st, 2nd, 3rd, 4th,

and

> an additional grade for all other beans.

>

> . 1st - Good flavor, length greater than 14 centimeters, supple,

full,

> no spots, no scratches, tannish-brown uniform color, moisture

content

> less than 25 percent

> . 2nd - Good flavor, length greater than 14 centimeters, supple,

some

> spots and scratches, moisture content 25-28 percent

> . 3rd - Good flavor, length greater than 14 centimeters, supple or

dry

> spots and scratches, red blemishes, moisture content more than 30

percent

> . 4th - Broken or cut, length less than 14 centimeters, red

blemishes,

> moisture content more than 30 percent

>

> In the United States, a minimum content of 2 percent of vanillin is

> preferred. In Europe, French importers require vanilla to have a

minimum

> vanillin content of 2 percent and the moisture content to be

between 15

> percent and 17 percent.

>

> The grades of whole and split beans are subdivided according to

size

> (length) and then put into bundles, each containing 70-100 beans

and

> weighing between 150 and 200 grams. The bundles are packed into

> waxed-paper-lined tin boxes, which hold between 20 and 40 bundles.

The

> tins have traditionally been packed into wooden boxes, each holding

six

> tins. More recently, cardboard boxes have been used.

>

> SOURCES OF TECHNICAL INFORMATION

> Sasikumar, B.; Rema, J.; Ravindran, P.N. " Vanilla. " Indian Cocoa,

> Arecanut and Spices Journal. 1992, 16: 1, pp. 6-10.

> Pruthi, J.S. " Post-harvest Technology of Spices: Pre-treatments,

Curing,

> Cleaning, Grading, and Packing. " Journal of Spices and Aromatic

Crops.

> 1992, 1: 1, pp. 1-29.

> Rosengarten, F., Jr. The Book of Spices. New York: Pyramid

> Communications Inc. 1973.

> Ranadive, A.S. " Vanillin and Related Flavor Compounds in Vanilla

> Extracts Made from Beans of Various Global Origins. " Journal of

> Agriculture and Food Chemistry . Washington, D.C.: American

Chemical

> Society. Oct. 1992, 40:10, pp. 1922-1924.

> Ranadive, A.S. Vanilla - Cultivation, Curing, Chemistry, Technology

and

> Commercial Products. Amsterdam: Elsevier Scientific Publications.

1994.

> 34: pp. 517-577.

> Carnero-Ruiz, C.; Heredia-Bayona, A.; Garcia-Sanchez,

F. " Derivatives

> Spectrophotometric Determination of Vanillin and P-

hydroxybenzaldehyde

> in Vanilla Bean Extracts. " Journal of Agriculture, Food and

Chemistry.

> Washington, D.C.: American Chemical Society. Jan. 1990. 28: 1, pp.

178-181.

> Fouche, J.G.; Coumans, M. " Vanilla: Pollination. " American Orchid

> Society Bulletin. West Palm Beach, Florida: The Society. Nov. 1992.

> 61:11, pp. 1118-1122.

> Funk, C.; Brodelius, P.E. " Vanilla Planifolia Andrews: in Vitro

> Biosynthesis of Vanillin and Other Phenylpropanoid Derivatives. "

> Biotechnol-agricult-for. Berlin: Springer-Verlag. 1994. 26: pp. 377-

402.

> Westcoot, R.J.; Cheetham, P.S.J.; Barraclough. A.J. " Use of

Organized

> Viable Vanilla Plant Aerial Roots for the Production of Natural

> Vanillin. " Phytochemistry-Oxford . Oxford: Elsevier Science Ltd.

Jan.

> 1994. 35:1, pp. 135-138.

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