Split vanilla beans in half lengthwise with a knife and remove the seeds. Reserve the vanilla beans.
Add the seeds to the bowl with the sugar.
Using your hands (and preferably wearing gloves), mix the sugar and vanilla seeds until vanilla seeds are fully incorporated into the sugar.
Fill a jar halfway with vanilla sugar. Add reserved vanilla bean to jar. Fill the rest of the jar with sugar.
Notes
Use vanilla beans to make this vanilla sugar - if you would like to use vanilla extract, it requires different proportions than the ones listed in this recipe.
Once you've placed the vanilla sugar in jars, let it sit for at least one month before using. This will give the vanilla time to infuse into the sugar.
The vanilla sugar will last up to one year.
I used tahitian grade A vanilla beans to good results. But you can use any type of vanilla bean (tahitian, madagascar, mexican) - grade A or B, and you will get good results.
Since vanilla beans are quite moist (especially grade A beans), adding the beans to the sugar can add extra moisture to the sugar and cause it to harden up a bit. Don't worry if this happens! Simply soften the sugar a bit with a spoon and it will be ready to use.
I used 10 small IKEA jars with a seal to store the sugar.