We are on the brink of a New Agrarian Revolution that will transform the global food system. My new book, Moo’s Law: An Investor’s Guide to the New Agrarian Revolution, sets out why modern intensive farming needs to be overhauled, and how science is fortunately catching up to the problem.
The first major problem is pandemic risk. Covid-19 probably arose due to agricultural malpractice, just like the Spanish Flu, SARS and almost every other pandemic of the last century. A deadly coronavirus circulating among bats was brought to a wet market in Wuhan, China, where it infected an intermediary species (perhaps pangolins) before jumping to humans. This risk is not necessary, but will persist for as long as we keep animals packed together in filthy conditions for our gastronomic pleasure.
The second issue is animal cruelty. I don’t think most people are aware of just how much cruelty is involved in modern intensive farming. Animals often never see the sun before the day they are transported to the slaughterhouse. Chickens’ legs buckle under their own weight, because they have been selectively bred to be four times heavier today than they were in 1950 – not that that matters, when they only live to an average of six weeks.
Finally, animal agriculture is playing a big role in the environmental crisis. Agriculture is the single biggest anthropogenic source of greenhouse gases. The primary reason for deforestation in the Amazon is to grow soybeans for animal feed. Husbandry is a major factor in droughts, as one kilo of beef requires 15,000 litres of water. This problem is only going to get worse. The average American eats 21,000 entire animals in their lifetime – imagine the implications once developing nations such as China and India become rich enough to demand a similar level of animal protein.
Fortunately, scientists and entrepreneurs are riding to the rescue of our food supply, in what promises to be one of the most lucrative investment bonanzas of our times. The global meat industry is the same size as the entire Spanish economy, so the rewards will be enormous for the disruptors that can provide a sustainable alternative to traditional meat at a competitive price.
I call it ‘The New Agrarian Revolution’. The first wave of this revolution is already here, in the form of plant-based meat analogues. Many people will have heard of Impossible Foods and Beyond Meat, which both manufacture animal-free burgers by mashing together various vegetables and extruding them into a mince-like mixture. Both companies are now worth many billions of dollars. Similar things can be done with nuggets, sausages and milk (using oat or pea protein instead of dairy).
But it’s the second wave that I’m most excited about. It’s cellular agriculture – also known as lab-grown meat, cell-based meat or cultured meat. The process, derived from biotech, involves taking a small biopsy from an otherwise unharmed animal, before proliferating and differentiating those stem cells in a bioreactor. After around 40 days (much quicker than the time it takes to raise a cow), you have a gloopy batch of muscle or fat cells that are identical to traditional meat – except for the hormones, antibiotics, faecal contamination and environmental damage.
There are about 60 companies in the world producing cell-based prototypes, including meat, seafood and materials such as leather and cotton. (I’m even aware of an Australian company culturing kangaroo meat!) Last month, Singapore approved Eat Just’s cell-based chicken nuggets in a world first. Having interviewed many leaders in this industry, I expect these products to enter high-end restaurants within two or three years, and the mass market within a decade.
The key to entering the mass market will be increasing the scale of production and reducing the price. It was the similarity between this idea and Moore’s Law, the famous concept in the semiconductor industry, that inspired the title of my book, ‘Moo’s Law’. Here, we should be very optimistic. The world’s first lab-grown burger was unveiled to the world’s press in London in 2013 at a cost of approximately $250,000. Professor Mark Post, who led that 2013 project, is now Chief Scientific Officer of Mosa Meat, where they can produce a cell-based beef patty for only €10. It’s not quite at price parity with traditional meat yet, but it’s clearly heading in that direction.
As an investor, I couldn’t be more enthusiastic about this sector. By reducing pollution, cruelty and human health risks, it ticks all the boxes for today’s zeitgeist. At the same time, canny investors can achieve extraordinary returns by backing the right companies. The last chapter of my book is actually a compendium of every company in the field with my assessment of how likely they are to succeed commercially.
I think we need to see action at a governmental level too. Given that Britain has the ability to set its own food regulations after Brexit, it would be fantastic to foster a high-tech domestic cellular agriculture industry. Apart from the USA, the world leaders in this field tend to be countries such as Israel or Singapore with highly developed networks of scientists and venture capitalists, as well as an unwelcome reliance on food imports. Britain fits the bill on both counts.
The environmental and ethical imperatives of the New Agrarian Revolution are irresistible – cell-based meat is coming whether we like it or not. That being so, let’s hope Britain seizes the opportunity to join the vanguard of this revolution and build a new, truly futuristic industry.
Click here to subscribe to our daily briefing – the best pieces from CapX and across the web.
CapX depends on the generosity of its readers. If you value what we do, please consider making a donation.