Vanilla Shortage Is Back on the Menu

https://en.wikipedia.org/wiki/Vanilla#/media/File:Vanilla_florentine_codex.jpg

Six years ago, a vanilla shortage was making headlines and pushing up prices of baked goods, ice cream, and other products that incorporate vanilla as a key ingredient. And that wasn't the first time: A vanilla shortage also made headlines in 2004.

Now, the shortage is back, due to poor crop harvests in Madagascar, where much of the world's vanilla is grown. Although the shortage is not as bad as originally feared, it is causing headaches for marketers that must use vanilla in their recipes. "Eighty per cent of the market is industrial vanilla, and that's what drives the pricing," says a senior exec of one vanilla import firm. In other words, consumers aren't the big buyers--businesses are the big buyers of this key ingredient.

As a result of the shortage, some businesses are raising prices to cover the higher cost of buying vanilla. Ice cream marketers are cautiously increasing prices, for instance. Others are seeking out alternatives, such as "vanilla flavor" rather than "vanilla extract." Watch for more research on vanilla as the world copes with periodic shortages that affect the marketing plans of food businesses, perfume businesses, and others that rely on this key ingredient.