A sharp fall in the global production of natural vanilla has pushed up its price four-fold in just four months. The global tag on processed beans is $80-120 a kg, up from $30 last season. The main reason is reports of a huge drop in production in various countries, including Madagascar, the world's largest supplier. It appears production in Madagascar would be confined to 1,000 tonnes of processed beans, from a normal crop size of 2,000 tonnes.
A fungus attack has spoilt the crop this time, leading to a supply crunch in the global market. Quality beans are now rare. China and Mexico, two other producing countries, have also reported big fall in production. In Mexico, production is expected to be 10 per cent of the normal size.
In India, the price of green beans has risen to Rs 400 a kg; it was Rs 60-90 last year. The price of processed beans is Rs 4,000 a kg. According to
M C Saju, director, Vanilla India Producers Company Ltd (Vanilco), a pioneering entity in Vanillin, the extract, they're getting offers of Rs 20,000 a kg for the latter, when there were no takers at Rs 5,000 last year. Vanilco has a stock of 400 kg of extract and expects to cash in on the favourable market.
However, Saju told Business Standard, India cannot benefit much, as production is almost nil. Over 90 per cent of growers in Kerala and Karntaka had abandoned the crop after the price crashed post-2005-06 season. Exports had stopped five years earlier and annual production has dropped to below 50 tonnes in recent years.
