Annatto is remarkable for its mild and penetrating flavor and for its vivid color.
To reduce the seeds to a fine powder it is best to use a coffee mill or spice grinder. Ground annatto is then mixed with other spices to make pastes and marinades. Annatto seeds can also be heated in vegetable oil until it is saturated with color, at which point the seeds are removed. This fragrant and flavorful oil is used to add a deep orange color and delicate seasoning to rice, fish, poultry and pork dishes.
While imparting a warm, aromatic flavor, Annatto is still used mostly for its coloring. It is famously the yellowing agent for many packaged macaroni and cheese brands. More traditionally, it is used in cochonita pibil, a Yucatan dish of braised pork. It's well suited to rice dishes.