According to other popular belief, the Totonac Aztec-age people, who inhabit the east coast of Mexico in the present-day state of Veracruz, were among the first people to cultivate vanilla in the 15th century. Aztecs invading from the central highlands of Mexico conquered the Totonacs, and developed a taste for the vanilla pods. They named the fruit tlilxochitl, or "black flower", after the matured fruit, which shrivels and turns black shortly after it is picked.
Until the mid-19th century, Mexico was the chief producer of vanilla. In 1819, French entrepreneurs shipped vanilla fruits to the islands of Réunion and Mauritius in hopes of producing vanilla there. After Edmond Albius discovered how to pollinate the flowers quickly by hand, the pods began to thrive. Soon, the tropical orchids were sent from Réunion to the Comoros Islands, Seychelles, and Madagascar, along with instructions for pollinating them. By 1898, Madagascar, Réunion, and the Comoros Islands produced 200 metric tons of vanilla beans, about 80% of world production. According to the United Nations Food and Agriculture Organization, Indonesia is currently responsible for the vast majority of the world's Bourbon vanilla production and 58% of the world's total vanilla fruit production.
The market price of vanilla rose dramatically in the late 1970s after a tropical cyclone ravaged key croplands. Prices remained high through the early 1980s despite the introduction of Indonesian vanilla. In the mid-1980s, the cartel that had controlled vanilla prices and distribution since its creation in 1930 disbanded. Prices dropped 70% over the next few years, to nearly US$20 per kilogram; prices rose sharply again after tropical cyclone Hudah struck Madagascar in April 2000. The cyclone, political instability, and poor weather in the third year drove vanilla prices to an astonishing US$500/kg in 2004, bringing new countries into the vanilla industry. A good crop, coupled with decreased demand caused by the production of imitation vanilla, pushed the market price down to the $40/kg range in the middle of 2005. By 2010, prices were down to $20/kg. Cyclone Enawo caused in similar spike to $500/kg in 2017.
Madagascar (especially the fertile Sava region) accounts for much of the global production of vanilla. Mexico, once the leading producer of natural vanilla with an annual yield of 500 tons of cured beans, produced only 10 tons in 2006. An estimated 95% of "vanilla" products are artificially flavored with vanillin derived from lignin instead of vanilla fruits.
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