Nicholas Lander on the new frontier of truffle hunting in Spain

The trade in black truffles which begins in early December in the most inaccessible, rugged but stunningly beautiful parts of rural France, Spain and Italy and lasts until early March, has a lot in common with the world's narcotics trade.

Both are highly secretive. Both are highly profitable cash crops. A great deal of both businesses is carried on in nondescript, discreet corner locations by individuals suspiciously sporting large, gold Rolexes and with powerful Mercedes parked nearby. And some of the faces and characters of those involved in the truffle trade – I cannot speak for narcotics – would excite the imagination of even the most jaundiced Hollywood casting director.

Let me take you straight to a truffle market. It is Friday night in the town of Morella, a small, walled town on the barren sierras of central Spain east of Zaragoza. As we have travelled here from the coast the countryside has grown more and more inhospitable. The orange and lemon groves down at sea level, together with the posters of golfers in short-sleeved shirts, have given way initially to groves of almond trees. Then, as the narrow road climbs and winds, the soil has become even poorer and more windswept and the landscape is broken only by dry stone walls, reminiscent of northern Scotland. But, most importantly for truffle hunters, truffle lovers and chefs worldwide, the hilltops are now covered by that magical combination of oak trees, which nurture the truffles underground, and sheep which fertilise the topsoil.

By the first corner in Morella is an undistinguished café with the distinguished name of El Cid. Its interior looks as though it has come off a corporate drawingboard: everything is pale brown and cheap – the floor, the tables and the bar counter. But I am not allowed to take a picture in here or of the outside. No one is. Nor from the look of the sad tapas on the counter would I recommend a visit for the food.

But every Friday evening during the truffle season from 2200 to 0200 on the Saturday morning this place is packed with men, mostly truffle hunters, the rest 'courtiers' or truffle buyers, who sell on to the main buyer of truffles in Spain who began his business life dealing in second-hand horses.

What is remarkable about truffle markets in Spain is that here and in Teruel to the south, where the market takes place on a Saturday night, there is not a truffle in sight. The hunters leave their catch in their carefully locked cars and walk into the café with only a precise idea of the quantity they have to sell and a prospective price they will settle for. They sit and talk to the buyers for as long as it takes to conclude their deals – nobody seems to be in a rush – and then once an agreed price has been arrived at both parties walk out to the car, exchange pesetas for truffles, and either drive off or walk back in to buy more.

The reasons for the frenzied activity which greets the onset of every truffle season are varied. Firstly, they are hugely, hugely profitable. A young oak sapling, which establishes the necessary 'mycorrhizal' web underground from which truffles can grow in the right combination of rain in the spring and autumn and heat but not drought during the summer or frost in the winter, costs £4 and planted in the right location can bear truffles within five years. A truffle dog can be expensive – in France and Italy the best change hands for up to £1500 – but usually they are trained from small puppies by their owners to associate the smell of truffle with a reward, usually a small piece of bread, so they are not too expensive by the time they are ready to earn their keep at 12-15 months old. (The dog I went hunting with was called Patata because as a puppy she had looked like a potato!)

The right natural conditions, the right weather and a well trained truffle dog (pigs, no longer the common domestic animals they once were, are hardly used any longer and only tend to appear for photographers) can combine to provide French, Spanish and Italian farmers with rich pickings. Last year, perhaps the worst year ever in Spain because of a six-month summer drought, saw hunters getting £140 a kilo and when I asked Daniel, president of the Teruel Truffle Hunters Cooperative, for his biggest daily haul, he muttered rather shamefacedly, '22 kilos' or the best part of £3000.

But what really explains truffle frenzy is not just greed but the very fragility of these exquisite mushrooms.

There are two ways of enjoying black truffles. The first is as fresh, sliced on to eggs or pasta, cooked with potatoes or under the skin of a plump, fresh organic chicken. This is how they will appear at their most expensive, and best, on menus for the next four months. The second is as conserved, a process which cans the same truffles in liquid and allows chefs to cook with truffles in soups, terrines and sauces for the rest of the year.

It is the immediacy of the fresh truffle season which accentuates the frenzy. Once out of the soil a fresh truffle lasts at its very best less than a week before beginning to lose some of its wonderful aroma and therefore value. The challenge every week for the truffle traders is to get the truffles in the best possible condition from the soil on the hills of Provence, Catalonia and Tarragona to kitchens in central London, Paris and Brussels and to do so not by the end of the working week, when the most expensive restaurants tend to be quieter, but by Monday night or Tuesday at the latest.

And in this process no one can be trusted. The other common feature truffles share with drugs is that they are easily transportable, slipping easily into the wrong jacket pocket and quickly convertible at a kitchen door into cash. As a result the delivery system cannot be easily devolved. Within France, for example, SNCF the national railway company refused to accept shipments of trufles several years ago as it could not accept any more insurance losses. If you want to get to the source of the best, freshest European truffles you have to travel.

Which is why every weekend Pierre-Jean Pèybere, whose family has been the biggest traders in truffles since 1897 (in a good year Europe produces 60 tons of truffles – France and Spain 25 tons each, Italy 10 – of which Pèybere's firm handles 10 tons), travels 2500 kilometres to ensure that there are not only enough truffles each week to satisfy the likes of Alain Ducasse and Michel Bourdin but that he buys them at the right price. If he fulfils the roles of buyer, quality controller, gossip gatherer and delivery boy, he ensures that at least 1500 kilos of 'black diamonds' are at his factory in Cahors, south-west France, by late Sunday evening so that on the Monday they can be cleaned, weighed, sorted and vacuum packed by his experienced staff and en route to the best chefs of the world by late Monday afternoon.

Very early each Saturday morning Pèybere sets out alone, or sometimes accompanied by his 13-year-old son, Pierre, whom he believes shows a great aptitude for the trade, and heads west to Richerenche in Provence, still the world's biggest truffle market. There he will meet his courtiers, collect the news and this week's purchases before heading back south-east to a rendezvous at a service station (shades again of the drugs trade!) with his wife Babé near Narbonne. She will take these back to Cahors whilst Pierre-Jean heads off for north-east and central Spain, where lies the future of the black truffle, if it is to have one.

Pierre-Jean, 42, is small, pensive and continually excited by good food. 'The only disappointment during my weekends in Spain,' he confessed as we charged down the N238 at 160 kilometres an hour, 'is that the truffle business in Spain takes place in bars and cafés rather than restaurants so I don't usually eat well until I get home'. Only a hasty lunch of a soup of white beans and half a rabbit grilled with garlic and olive oil at Restaurant Peiro outside Teruel (tel +34 978 78 02 22) was the exception.

And Pierre-Jean had warned me not to expect any truffles en route. 'Although Spain produces the same quantity and quality of black truffles as France today,' he explained 'this has only been the case for the past 50 years and as a result truffles are not an integral part of Spanish cooking as they are of French cuisine. If you go down the Rhône for example during the truffle season you will often come across small restaurants serving truffle dishes at ridiculously cheap prices which they have bought from the local hunters. But never in Spain, sadly, where truffles are the preserve of the grand restaurants in Madrid or Santi Santamaria's three-star Michelin restaurant El Raco de Can Fabes in Sant Celoni, 50 kilometres from Barcelona, which serves the best food in Catalonia' (tel +34 93 867 28 51).

The history of, and potential future for, truffles in Spain has in fact a great deal in common with the story of how New World wine, in particular from California and Australia, has challenged the Old World and in both instances forced France to improve.

Truffles lay dormant under Spanish oaks for centuries until the redevelopment of Catalonia began in the 1950s when the new railways allowed French travellers to recognise the same combination of weather, forest and undergrowth. Catalans quickly began to hunt these wild truffles and to export them to France but the rapid growth of urbanisation around Barcelona has limited the number of truffles available, as it has done sadly in Perigord and south-east France.

As a result, the Spanish truffle hunters moved south to the hills around Morella and Teruel and it is the latter area in particular which excites Pèybere. Sounding like a 19th-century pioneer, or a 20th-century California winemaker, Pèybere explained, 'This is the new frontier. What is exciting about the Spanish approach and is so very, very different from the French, is that they are adopting a completely scientific approach to growing truffles, to choosing the right strain of oak, to planting in the right areas and to cooperating with one another for maximum success. In France, sadly, we are besotted with the memories of a golden era of truffles that was wonderful, that did produce annual harvests of 1000 tons and more and individual truffles so large that Escoffier produced a recipe for a woodcock cooked inside a truffle, but those times sadly have long gone.'

That is why, although Pèybere spends a lot of the weekend on the mobile phone to his courtiers across France, his principal supplier has become Señor Molina of Sagunto, orange grower, meat, horse and second car dealer and for the past 38 years, a major dealer in truffles. Together, we set off for the windswept town of Sarrion to meet Daniel Bertolin, the new generation of oak breeder and truffle hunter.

From the outside Bertolin's warehouse looks no different from the meat and ceramic warehouses in this small town, only the brand new tractor and four-wheel-drive Jeep testify to his status in the luxury food business. But once inside our conversation was immediately drowned out by the sound I always associate with truffle hunting, the baying and barking of dogs. Out the back, next to a greenhouse with 6000 oak saplings ready for planting in the spring, were a dozen dogs all as eager as I to find truffles.

Armed with Patata, our dog, a straight pointed trowel and a 'moral', a strong, leather shoulder bag that will eventually hold the truffles, we set off on a ten-minute drive across rough, rock-strewn roads and were soon in the open countryside which is proving such fertile truffle terrain. The views in every direction are vast, blocked only by the sierras and a darkening sky, the obvious comparison being with the American mid-West. We parked by one of the plantations (Daniel and his associate José currently have 48 hectares planted to oak trees), let Patata out of the back and waited for the fun to start.

It did not take long. Within minutes the dog was pawing at the base of an oak tree, the earth flying up between his back feet and tail quite furiously. It is then time for the truffle hunter to take over, to step in to stop the dog biting or even eating the truffle by replacing it with a piece of much cheaper bread or by using expert eyesight to collect the truffle from the mound of earth the dog has excavated. Once out of the earth the truffles are quickly dusted off and put into the shoulder bag.

We walked the plantations for about three hours until the strong wind from the sierras had brought tears to the eyes of all the truffle eaters if not the hardened truffle hunters. We then drove off, to a nondescript bar of course, where Señor Molina was waiting with the truffles from his other suppliers and the all-important portable scales to weigh each transaction. A few were discarded on quality grounds but the rest were bundled into a sack and transferred from Spanish to French hands along with a case of Seville oranges from Molina's garden, another delivery Molina makes to Pèybere every week, but for which there is no charge.

By Tuesday morning the truffles, cleaned, graded and smelling their very best, are in the top kitchens of Europe and America.