The Hindu Business Line : Exim Bank study calls for compulsory use of natural vanilla in ice-cream

A STUDY by Exim Bank on vanilla's potential in the country has recommended enactment of laws for mandatory use of natural vanilla concentrates in the high-price ice-cream segment.

The study has identified issues hampering vanilla cultivation that include using synthetic import substitute when the local vanilla bean is in great demand in the global markets and farmers' dependence on export price realisation alone in a highly competitive market.

The study has suggested labelling of products to distinguish the use of natural or synthetic vanillin in ice creams.

The domestic cured bean production hovers around 130 tonnes from an area of over 3,540 hectares, but the consuming sector (food and beverages industry) in the countryimports about 600-700 tonnes of synthetic vanillin a year.

The crop is cultivated in Karnataka, Kerala, Tamil Nadu, the North-Eastern region, Lakshwadweep and the Andaman & Nicobar Islands.

With an annual supply of about 100 tonnes, India is currently the sixth largest exporter. The US alone accounts for two-thirds of the world imports, followed by the Netherlands, France, United Kingdom and Germany.

In the absence of domestic demand, the entire vanilla production (without much of value-addition) is offloaded in the global market.

Lack of large-scale units for extracting vanillin, the main flavouring compound, is said to trigger the export of the cured beans.

Uncertainty of supply from the leading production belt of Madagascar has driven importers in the developed countries to look to India as an alternative supply base in the organic or gourmet variety of vanilla.

Due to high price realisations (amongst spices) and comparatively low cost of cultivation, the cash crop has managed to stand out as a highly profitable one, especially when grown as an inter crop. However, the volatility in price has an adverse impact on the Indian grower.

The study observed that the issue of price volatility could be addressed through creation of domestic demand for vanilla by setting up of extraction units and adding value to the farm produce.