The Hindu Business Line : Cured vanilla production estimated at 100 tonnes

AS harvesting of vanilla has almost come to an end, the total production of cured beans in the country is estimated at around 100 tonnes against the world demand of about 2,000 tonnes this year.

However, the actual demand and price trend will be known after March 15 when buying is expected to begin in Madagascar.

In Madagascar, semi-processed beans are sold below $5 a kg. While, in India, green beans have been bought at around Rs 270, industry sources told Business Line. Hence, the domestic price is relatively better, they said. Market sources here said the international price was expected to stabilise at $60-$70 a kg for cured beans.

After drying, the beans have to be conditioned. Hence, buyers enter the market about four to six months after harvesting. They said some US buyers were expected in Kerala next month.

According to the sources, there are enquiries for `Gaurmet' grade beans, which are selected from A grade beans and are longer than 15 cm. Normally, 20-25 per cent of the total production from a scientifically cultivated farm might be of this grade, they said.

The demand will pick up if the prices remain at moderate levels as companies that shifted to synthetic vanillin when vanilla prices shot up to over $400 a kg would have to revert to natural vanillin, they said.

The demand has dropped from around 2,500 tonnes last year to about 1,000 tonnes due to high prices. In fact, except for a very few companies in the US which could absorb the loss and were buying at high prices, many switched to synthetic substitutes, the sources said.

"This year, there could be a lull in the market but the prices will pick up in the coming year and stabilise at a better levels," a major processor-exporter said. According to him, when natural vanillin is available at reasonable rates, the demand will pick up.

India, he said, was the sixth largest producer of vanilla and has the potential to rise to the third position in the days ahead. The current crisis in the vanilla market due to the sharp dip in prices is temporary. The rationalisation of demand and supply is expected to happen only by 2008, he said.

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