Understanding the Economics of Saffron

Let's start by debunking a myth. 

 

"Saffron is worth its weight in gold!" -- I particularly hate this phrase, and I cringe every time I hear it or read it. The current market value of 1 gram of gold today: $43.36; the price of saffron, by comparison, floats at about $7 per gram. If somebody tries to sell you saffron for $43.36 per gram, laugh, and then walk away. This phrase is anachronistic. It's like comparing apples to oranges. People don't buy gold for the same reasons they buy saffron, the inherent values of each differ vastly. Gold derives its speculative value from its low, finite supply. The value of saffron is not speculative, rather, it is based on the manual labor required to harvest and process it. Unlike gold, saffron is not a monetary asset, because it is a perishable, consumable organic commodity. However, saffron is notable as a consumable because of its varied uses as both a culinary spice and a nutritional supplement; this is its inherent value. If you're buying saffron because you think its comparable to gold: it's not, and you're completely missing the point. But perhaps a little reeducation can help ...

 

So what factors determine the price of saffron? Supply and demand -- a good harvest yield will keep prices stable. Potency and manual labor -- in relation to saffron, potency refers to the absence of yellow-style; this requires intensive manual labor, as trimming saffron can only be done by hand due to its delicate nature. 

 

 

Post-harvest, our saffron is sorted into bunches, with a clear visual delineation between the saffron stigma and the style. This expedites the trimming of the style. 

 

 

The result, sargol saffron, uniform trim, yellow-style fully removed, all-red stigma.

 

 

Due to the delicate nature of saffron, this process can only be done by hand, as it has been done for thousands of years. The labor required, therefore, necessitates the higher price of sale to keep the saffron business profitable. There have been documented instances of foul play to create wider margins, and while such behavior certainly still exists, there was a time when the spice trade was a massive economic driver (like the energy and tech industries of today). In those times, the consequences for dishonesty were far more brutal. In the 14th century in the city of Nuremberg, in what is now Germany, some merchants would counterfeit their stock by mixing marigold petals with saffron, therefore increasing the weight of their supply. When this was discovered by the authorities of Nuremberg, the punishment for this crime was death by burning, in order to preserve the integrity of the market. 

 

Today, there are no burnings, yet the saffron trade has grown exponentially as demand comes from all corners of the globe. Counterfeiting still exists, a problem which we ourselves encountered in our many years in the restaurant industry. Here at Mazaeus Saffron, we hope to be a resource for you to learn about saffron, its many uses and benefits, and to be your goto source when you need to refill your pantry. Reach out to us anytime, we are a small team, but we're here, and we're always happy to help.

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