Vanilla Shortage to Raise Price of America's Favorite Ice Cream

A vanilla shortage threatens to bump up ice cream prices after farmers in far off Madagascar experienced a poor harvest of its higher quality vanilla beans last year.

Madagascar is one of the most dominant producers of food-grade vanilla, known as black vanilla, noted International Business Times, and while the ice-cream industry will be the hardest hit by the rise in vanilla prices, makers of soft drinks, cakes and perfume will also be affected.

"Vanilla is every ice-cream company's biggest-selling product," said New Forest Ice Cream's production manager Dave Bishop, adding his vanilla costs had increased by 18.5% and he had no choice but to pay up. "You can bring out a niche flavor but vanilla will still be top. You've just got to take the hit on it because customers would notice the difference."

Madagascar's prices for vanilla have increased nearly 150 percent because of the bad harvest, according to The Guardian.

"The market price of vanilla has risen over the past 12 months, and sharply over the last 12 weeks," according to Silver Spoon, which distributes American Nielsen-Massey vanilla in the United Kingdom. "This has been driven largely by a poor quality harvest in Madagascar. Our hope is that vanilla prices will return to a more stable level in the future."

Vanilla is already the world's second most expensive spice because of its intensive cultivation and production, according to the website ZME Science. Vanilla from Madagascar is favored over other producers like Indonesia for "having a more pleasant and deeper flavor," said ZME Science.

"You can get vanilla extract all over the world but we chose Madagascar because it had the greatest depth of flavor," said Charlie Thuillier, the founder and managing director of ice cream producer Oppo.

The vanilla shortage creates other problems that could become circular in nature, said the website Grub Street.

"Higher prices are tempting farmers into picking beans prematurely," said Grub Street. "When they do that, flavors diminish, making buyers pickier. Thieves are also exacerbating that issue, and then there's an unrelated problem caused by the industry-wide shift to natural ingredients. And companies that used to get around price spikes by subbing in artificial substitutes aren't necessarily doing that anymore, thanks to everyone's desire to eat more 'natural' food."

Grub Street said the 2016 Madagascar crops appears to be doing well so far.

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