The Current

Why the soaring cost of vanilla could put your favourite ice cream flavour off the menu

Taking the kids for ice cream this holiday weekend? Soaring prices in the vanilla bean market are having an impact on ice cream mixtures — and a lot of other products too.

2017 cyclone has contributed to soaring costs of popular and ubiquitous flavouring

Versace, a French bulldog, takes a break from his ice cream at the beach on Key Biscayne, Fla., on May 2, 2017. Vanilla is sold as a flavour in its own right, but also used as a base for other flavours. (Patrick Farrell/Miami Herald, Associated Press)

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How much is a humble vanilla bean worth? More than silver, actually.

When Billy Friley started his ice cream business in 2012, he was paying $50 a gallon for the flavouring. But as prices have skyrocketed in recent years, he's become one of many business owners re-evaluating whether they can afford it.

"Now the quotes I'm getting are around $550 US a gallon," said Friley, who is the owner of Village Ice Cream in Calgary. "With shipping and the weak Canadian dollar, that rounds up to about $800 Canadian."

Vanilla is sold as its own flavour, but it's also used as a base for many others. Friley said that if prices continue to increase, it may be removed from the menu.

Prices have soared for a number of reasons, including a 2017 cyclone in Madagascar that damaged about 30 per cent of the island's crop. Pound-for-pound, it now costs more than silver, and is the second most expensive flavouring in the world; only saffron costs more.

Demand for vanilla has been rising every year steadily, driving up prices. (Shutterstock/Suto Norbert Zsol)

A versatile and popular ingredient

"Vanilla is a crop that takes about three years to come to harvest from the moment you start planting it, unlike other crops, so there is a bit of a lag," said David van der Walde, the director of Aust & Hachmann. His Montreal-based company imports most of its beans from Madagsascar, where 80 per cent of the world's vanilla crop is grown.

"Demand for vanilla has been rising every year steadily, quite a bit in the last few years, and eventually the demand exceeds the supply and prices start to rise," he told The Current's guest host Laura Lynch.

"You often have speculation and rampant buying that takes place while the price is going up."

Green vanilla pods, on the vine. Eighty per cent of the world's vanilla crop comes from Madagascar. (Submitted by David Vanderwalde )

Van der Walde said people might be surprised at how many products contain vanilla.

"Vanilla is in a lot of things: chocolate products, all kinds of confectionery products, perfumes, alcoholic beverages," he said.

"It's used in tobacco products, it's even used in cleaning compounds to soften the chemical smells when prices are more reasonable.

"It is by far the most popular flavour, and fragrance, globally speaking."

Vanilla pods drying in the sun. The flavouring is used in everything from perfume to cleaning products. (Submitted by David Vanderwalde )

Effect on farmers

In Madagascar, the rising prices are having a mixed effect, according to Joey Moscovitch, who runs the JHA Fund, an NGO that helps communities in the country.

"People don't really know what to do with a lot of money here," she said, "and if they're making a quick buck they tend to spend it as quick as they make it."

Moscovitch also said the soaring cost of vanilla is leading to a dangerous situation for the farmers who grow the valuable crop, often in isolated areas.

"It's almost a  lawless country ... especially out here in the bush where there's no real police," she said.

Listen to the full conversation at the top of this page.

Written by Michael O'Halloran. This segment was produced by Vancouver Network producer Anne Penman and Calgary Network producer Michael O'Halloran.