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Verlet, N. 1993. Herbs, spices, and condiments. p. 616-619. In: J. Janick and J.E. Simon (eds.), New crops. Wiley, New York.

Herbs, Spices, and Condiments

Nicolas Verlet*


  1. THE DEMAND
  2. THE SUPPLY
  3. NEW MARKET FOR HERBS
  4. OPPORTUNITIES FOR THE NORTH AMERICAN AGRICULTURE
  5. REFERENCES
  6. Table 1
  7. Table 2
  8. Fig. 1
  9. Fig. 2

Herbs and spices cannot be really considered as "new crops," as they have been used and produced for many centuries. Nevertheless, herbs have been receiving a lot of positive media attention, and this has contributed to an expansion in the cultivation of herbs during the last decade. In order to get a better idea of the potential herb, spice, and condiment market in the United States, this paper will preview the increasing consumption, the competitiveness of the international supply, and the new markets for herbs.

THE DEMAND

All available date indicate a regular increase in the market for natural products. Between 1987 and 1990, the annual growth in the market for perfumery ingredients has been estimated to be 6%, for food aroma 8.5%, and for raw essential oils 7.5%. The consumption of herbs has risen in France from 10,000 t in 1970 to 32,000 t in 1990. American imports of spices and herbs which were 112,000 t in 1969, were 238,000 t in 1990. The demand for natural aromas remains very strong, and consequently herbs and spices, as well as other natural sources of aroma are preferred to synthetics in the food industry (more than 87% of the aromas used by Nestlé, one of the largest food companies in the world, are from natural origin). In the long term, the future of herbs and spices is closely related to a foodtasting war pitting the "MacDonalds" and other fast/convenience food companies against those seeking high quality food. Fortunately, while MacDonalds has opened an advanced post in Moscow and while fast foods have invaded the Champs Elysées, the spicy ethnic foods have counter-attacked through the east and west coasts of the United States. The industrial processes used in food manufacturing are currently unable to preserve the original tastes of the basic ingredients. Herbs and spices are therefore, more and more useful as flavor ingredients in food preparation.

THE SUPPLY

In the past, trade in herbs had the same degree of importance as trade in gold and precious stones. Twenty five hundred years ago, Heroditus described caravans of 500 elephants, 1,000 dromedaries, and 2,000 horses, escorted by 4,000 mounted soldiers, being used in the transport of rhubarb, cloves, cinnamon, and asa foetida from China, in a round trip, that took four full years (Delaveau 1989). While the relative importance of spices have declined, production and trade have become highly competitive.

The agricultural sector today faces tremendous difficulties. Long term cycles appear to determine commodity prices. The 1970s were characterized by the idea of shortage, related to overpopulation and the petroleum crisis. With the 1980s came oversupply and a fall in prices for the major commodities. In developing countries, the financial return for traditional exports, such as cocoa and coffee, has reached historically low levels. In Europe, an oversupply depresses prices for cereals and other alternative crops. The Eastern European countries, searching more than ever, for foreign currency to be used in the reconstruction of their economies, are attempting to export herbs. Development programs have been initiated throughout the world in the field of herbs and spices, as well as essential oils and medicinal plants. This increasing competition represents new sources of supply for traders. It is also a partial explanation for the decline in prices.

The situation, however, differs according to species, quality requirement, and level of mechanization. The "tropical" spices are produced in developing countries, often with a strong domestic market. Traditional producers of spices, such as India, have to face new competitors in Malaysia and Indonesia. Some herbs have been introduced in these countries, only for export purposes and the supply has increased where optimum production factors exists. Some countries have been able to maintain a monopolistic situation on the international market with specialty production, such as Egypt with basil and India with celery seeds. Bay leaves (Laurus nobilis) are a good illustration of a market commodity having a monopolistic producer with Turkey supplying more than 90% of the world market. Since 1977, the average import of bay leaves into Germany has been 250 t, more than 93% is of Turkish origin. Similar figures for the United States are 450 t (93%), for France 200 t (87%), and for Great Britain 100 t (91%). Many countries have tried to penetrate the bay leaf market offering prices significantly below the Turkish prices. New producers, however, cannot maintain their positions more than one or two years at these price level. Due to the nuclear accident of Chernobyl and supply shortages, the prices of bay were exceptionally high in 1986 and 1987. The percentage of bay leaves coming from Turkey fell to 78% with the benefit going to Spain, Morocco, and Yugoslavia, but Turkey had recovered 99% of the American market by 1988 (Table 1).

The competition is more open for other species when technology and production practices may either increase the yield, reduce the production costs, or allow a better quality at a higher price. The oregano market is particularly interesting with the competition of three major producers (Mexico, Greece, and Turkey), where production is mainly from wild harvesting and the labor cost is the determinant. Israel has been very successful with oregano, introducing selected cultivars and mechanization and able to market at a price very similar to that of Turkey (Fig. 1). Thyme is another example of increasing competitiveness. The world leader in production of thyme leaves is Spain (2, 000 t/year). Most of the harvesting comes from wild plants of different species. In 1970, a few producers started to cultivate thyme in France, benefiting from research on breeding and selection. Clonal selections now combine regular quality with high yield. Since the beginning, the initiative has been supported by Ducros, the main trader in Europe, who has contracted with domestic producers at a relatively high price. This price has enabled production level to reach 100 t of dried leaves per year. The problem is now how to expand. Further expansion of thyme cultivation cannot be considered at current prices and the demand for quality thyme is now satisfied. Any expansion of production will induce a fall in price, progressively reaching the Spanish price (Fig. 2). This is the limit of a development based on better quality standards.

There are a number of herbs such as parsley, dill, and tarragon which are mainly produced and used in industrialized countries. A combination of good cultivars, dehydration processes, and intensive cultivation techniques have allowed these countries a dominant place in the dried market for these plants.

NEW MARKET FOR HERBS

The traditional dried form of herbs and spices is threatened in the future by new processing and preserving methods. Fresh herbs are now cultivated for use as ingredients in large scale food preparation (e.g. vinegars, mustards). New markets for fresh herbs primarily exist in restaurants, but small packages for the consumer are also commanding an increasing market share. Supermarket chains are seeking assurance of a steady, year-round supply of fresh herbs. Yet, storage and transportation of fresh material are costly especially over long distances. These markets represent new opportunities for producers in consuming countries. Nevertheless, the growers starting production face relatively expensive investments, especially during the winter period. Supply from warm countries, shipped by aircraft, is now on the market and relatively inexpensive (the shipping cost from Israel to New York is $1/kg). Frozen herbs are playing an increasing role in the food industry. The appearance of a whole range of consumer frozen products is something new, but it is difficult for new producers to take a place in the frozen market because of the technology and the high investments required.

OPPORTUNITIES FOR THE NORTH AMERICAN AGRICULTURE

It is useful to first present a brief view of production in Europe (Table 2). While herbs are not included in the Common Agricultural Policy of the European Common Market, the situation is very similar for producers in Europe and the United States. Aromatic plants are cultivated now in America for many purposes. Fresh herb production is well developed across the country. California, which benefits from good weather conditions can and does produce many herbs. Production on the East Coast has the advantage of being close to the consumer (e.g. parsley production in New Jersey). Phytofarm of America, located near Chicago, has established a controlled environment facility, where herbs are produced 365 days a year without influence from seasonal variations in temperature and light. At this facility a central computer monitors growing conditions such as temperature, carbon dioxide levels, lighting schedules, allowing for rapid growth without pesticides or herbicides (Wallick 1988). The USDA publishes a weekly National Wholesale Herb Market New Report containing price quotes which cover wholesale herb sales to retailers in 18 major cities (USDA 1989).

Large farms, dealing with vegetable dehydration, are producing dried herbs on a large scale. The domestic production of dried herbs is currently covering only a very small part of the demand. Some growers, like those in Arizona, have obtained good prices for sage, basil, and a few other herbs (approximately $6/kg, more than twice the international price). The domestic production of dried herbs is bought by traders concerned for a higher quality and a more secure supply. In the example of thyme, the demand for domestic production is rather small, and new producers may not expect a high price if the domestic cultivation of dried herbs increases substantially. Organic production allows a better margin of profit, especially for well managed farms like Trout Lake farm in Washington State where 200 ha of herbs are organically grown. Weed control in this type of production system is a crucial point for it is often difficult, after a mechanized harvest, to clean weeds from the final dried produce.

Unfortunately, there are few technical production guides available, and few breeding programs have been initiated. Successful development in production of herbs and spices requires good control of cultivation practices, of postharvest processing and storage, and of marketing technique. Consequently, success calls for active producers, open to innovation and in a permanent dialogue with researchers and consumers.

We have witnessed an increasing role for fresh and frozen herbs at the expense of the traditional dried form. In addition to the well-known oleoresins, more and more sophisticated forms of material and marketing are going to be used in the food industry. Today we have supercritical CO2 extracts, isolates from essential oils, and aromas produced by cell cultures or other biotechnological processes. A "new" crop, unfortunately, quickly can become an "out of date" crop!

REFERENCES


*I thank Lyle Craker for his assistance with the subtleties of the English language, and Jim Simon for his fruitful collaboration.
Table 1. Sources and prices of bay laurel (Laurus nobilis L.) imports into the United Statesz.

Turkey
Year (%) ($/kg) Other countries
1978 88 1.34 Yugoslavia (10%, $0.55)
1979 96 1.55 Greece (3%, $1.18)
1980 96 1.81 Greece (2%, $1.20)
1981 91 1.70 Albania (5%, $0.94)
1982 96 1.26 India (2%, $0.85)
1983 96 1.32 Greece (4%, $1.05)
1984 100 0.91
1985 98 1.19 China (1%, $3.4)
1986 83 1.48 Portugal (4%, $1.42) Albania (2%, $2.50) Spain (l%, $3,11) Morocco (1%, $2.91)
1987 78 2.41 Germany (7%, $2,74) Spain (5%, $2.91) Portugal (3%, $1.75) Morocco (l%, $2.10) Yugoslavia (1%, $1.26)
1988 99 1.58 Mexico (1%, 1.26)
zModified from USDA 1978-1988 U.S. Essential oil trade.


Table 2. Estimation of West European production of herbsz.

CountryArea (ha)Herb
Spain 28,000 Anise, saffron, mint, cumin, poppy, datura
France 20,000 Lavandin, poppy, clary sage, parsley, tarragon, thyme
Italy 2,800 Mint, tarragon, orris, sage
Netherlands 2,200 Poppy, parsley, caraway, digitalis, evening primrose
Denmark 2,000 Caraway
Germany 2,000 Mint, parsley, thyme, balm
U.K. 800 Parsley, evening primrose
zModified from ONIPPAM 1990.



Fig. 1. Imports of oregano into the United States.

Fig. 2. Thyme price in the French market.
Last update September 17, 1997 aw