"Castoreum is a yellowish-brown, oily secretion from the castor sacs of beavers, which are located near the base of the tail (and close to the anal glands). Beavers use this musky-smelling substance, mixed with urine, to mark their territory.

​Here's how it relates to vanilla:

​Historical Use in Flavoring: Due to its complex, musky, sweet, and sometimes vanilla-like aroma, castoreum extract was historically used in very small amounts as a "natural flavoring" to enhance vanilla, raspberry, and strawberry flavorings in food and beverages. The FDA in the US lists castoreum extract as "generally recognized as safe" (GRAS), and it could be labeled simply as "natural flavorings."