Steamed about the prices you’re paying at the gas pump? The price of vanilla is headed in the same direction: Up, way up.
The price for a kilo of vanilla jumped from around $25–where it had been for several years–to $40 in a single day, which could translate into higher prices for ice cream this summer.
Nearly all of the world’s vanilla supplies are grown in three countries: Mexico, Madagascar and India. But in the past year, Mexico’s yield has dropped by about 90 percent due to poor weather.
India’s yields are down dramatically as well, leaving Madagascar as virtually the only source of vanilla.
As a result, the markets have gone a little berserk, rising some 60 percent in one day caused by panic buying and stockpiling of Madagascar vanilla. It’s not only ice cream that’s likely to be impacted. Vanilla is used in medicines, perfumes and, of course, all kinds of foods.
Vanilla is expensive. It’s actually the second-most expensive spice in the world next to saffron.
As for ice cream, analysts expect the price of a scoop of vanilla ice cream will soon go up by around 10 percent to help manufacturers preserve margins, according to a Management Today report.
Well, when the temperature hits 90 degrees (or higher) this July (or sooner), I expect we’ll all be able to swallow that 10 percent hike with very little complaint.
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