Cultivated Meat: Climate Change, the Presence of Plant-Based Food & Science

My last two reports refer to the lab-grown/cell-cultured/cell-based meat space as ‘Clean Meat’; however, new terminology has been adopted to reflect neutrality, understandability and appeal. Cultivated meat is the same (just meat) but involves a cultivation process similar to how plant cultures are performed.

Climate change urgency

I just re-watched ‘Before the Flood’, Leonardo DiCaprio’s 2016 documentary film about Climate Change. The statistics are quite astonishing – it claims a further 1.1 billion people in India will need fossil fuel power, most likely from coal, because it is the cheapest. And as stated, why should they not?

They deserve to be able to enjoy the riches of life that the western world has been accustomed to over the past 100 years. At present an individual in the USA requires 34x more energy than the equivalent individual in India. If 1/7^th of the current population (over 3x the population of the US) require this much energy, then surely we will breach our world’s capacity?

Delving more deeply, the documentary reiterates thoughts that have recently become well publicised – reducing meat consumption is the single greatest action an individual can do to alleviate climate change. Beef is a very inefficient meat producer; global warming potential is a measure of how much heat a greenhouse gas traps in the atmosphere up to a specific time horizon, relative to carbon dioxide, and , according to this report, Beef has a global warming potential of 48.4 kg carbon dioxide equivalents per carcass (in other words, beef traps 48.4 times more heat in the atmosphere than carbon dioxide). Indeed, the methane expelled via burping accounts for 42.6% of the beef’s overall greenhouse gas emissions.

Your dairy cow is just as guilty – with 46.5% of their total greenhouse gases’ from enteric methane, which is a by-product of the digestive process and is expelled through burping. 1kg of methane has the warming potential equivalent of 25 carbon dioxide molecules (in other words, methane alone traps 25 times more heat in the atmosphere than carbon dioxide).

Statistics outlined, cutting the cow out of your diet could be your method to support the planet – Greta Thunberg would certainly approve.

My time in front of the TV has also been boosted by the release of the Netflix documentary on Bill Gates, ‘Inside Bill’s Brain: Decoding Bill Gates’. Part 3/3, as expected by the tech worshipper, praises the innovation of cultivated meat. But since it is at least 5 years away, plant-based is taking prominence…

The private vs. public plant-based patty war

Impossible Foods and Beyond Meat (NASDAQ: BYND) have finally crossed paths. Impossible finally joined Beyond Meat by launching in its first supermarket stores in California, Wegman’s. This adds to Impossible’s strong distribution line of White Castle and Burger King (the Impossible Whopper).

Its imitation meat perfectly blends in disguise next to the ‘real’ version in the meat aisles; however, one difference is distinct: price. Impossible Food’s 12oz. packs are marketed at US$ 8.99, three times more expensive.

This raises the question – how will plant-based products ever be able to achieve price parity? A Seattle-based company, Rebellyous Foods, is attempting to achieve exactly this. The company pioneers itself as an innovative manufacturing company that can bring the cost of plant products, specifically chicken nuggets, down to match industrial chicken nuggets in taste, price and texture.*

*Not currently available in the UK; as always, the pacific coast of America gets first dibs.

BYND was sailing again last week, up 11.6% on Thursday, following the announcement of the ‘P.L.T’ (Plant, Lettuce Tomato) burger pilot with McDonalds (NASDAQ: MCD), which has begun in 28  restaurants in Ontario, Canada. Despite strong performance execution of BYND continuing, its valuation is still well exaggerated.

Agro update

Agronomics (LON: ANIC) is just getting going. Jim Mellon and Anthony Chow’s trip to attend the Good Food Conference in San Francisco was more than a success, and as with most Septembers, it has been a hectic month. Jim, Anthony and I popped off to Berlin at the end of the month to visit the strong food tech hub – perhaps lesser known than in the Bay Area.

As our portfolio continues to grow, we remain heavily excited by our first three investments in Bond Pet Foods, New Age Meats and BlueNalu. The teams are all immensely busy in R&D phases. BlueNalu is developing cultivated finfish, which leads me on to discuss…

Fish stocks, or, the lack of them.

Yet another article I read reiterates the same points made by its predecessors: ‘numbers of North Sea cod and wild Atlantic salmon are depleting’. The Good Fish guide rates fish species by which are most under threat – an immense number of 27 species are ranked as unsustainable choices. Cultivated finfish is needed just as much as cultivated meat is, especially since 4.3 billion people depend on fish for protein. If we cannot farm sustainably, the stocks will be gone.

Whilst the future of our food supply appears bleak, I remain highly positive, like Bill Gates, that technological evolution can solve these problems.

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Laura Turner

Laura Turner is an analyst at the AIM-listed investment company Agronomics, which targets life science investments such as the emerging alternative food technology. She graduated from the University of Oxford, with a Master’s degree in Chemistry.