Covid impact on agrifoods: 8 exciting investment themes with food/farming expert Dr. Evan Fraser

Last night we had a lively, enlightening discussion with Dr. Evan Fraser a leading global expert on agrifoods with audience from around the globe. Evan wrote the book “Empires of Food” linking the rise and fall of empires to food systems; he also wrote “Food Crisis” and made the Feeding9Billion series of videos to discuss global food security; and he will soon publish “Uncertain Harvest” to talk about the future of food in a warming climate.

We started the talk with host San Eng asking and Evan convincingly explaining why agrifoods (farming, production/distribution of foods) is perhaps humanity’s greatest challenge. For example, how do we feed 9–10 billion people while “upgrading” 2 billion smallholder farmers in poverty to more, more sustainable farming? How can we produce more nutritious, healthier foods? Evan shared that most diseases including covid-19 can be traced back to food systems; thus, how do we prevent future outbreaks in our rapidly growing and urbanizing societies? Also, how can countries achieve food security in an era of anti-globalization?

(Inspired by Evan, San had earlier published this article in Family Office Magazine with a more detailed problem definition and investment opportunities tied to agrifoods, as reference.)

With great problems come incredible opportunities. San and Evan agree that savvy entrepreneur and investors can not only help save humanity by solving agrifood problems but also stand to profit handsomely as they do so.

Evan shared his top 8 agrifood tech investment themes:

1. Genomic tools

a) We can now analyze in real-time individual plants and animals that have beneficial traits and then sequence the genome of those individuals to identify what genes are responsible for those traits. Gene editing tools then allows us the potential to customize crops and livestock for specific environments.

b) The benefits of this technology are the huge range of applications possible.

c) Another benefit of this technology is that the cost and speed of making innovations is radically lower.

2. Alternatives to antibiotics

a) The world currently faces a major public health crisis linked with the overuse of antibiotics. In short, we have so overused our primary tool in the fight against infectious diseases that our front-line tools in the fight against infectious diseases are no longer as effective as they once were.

b) Agriculture plays a major role in this problem because approximately 75% of all antibiotics used in North America are used by the livestock industry.

c) Consumers are now demanding antibiotic free meat while regulators are moving quickly to a situation where the use of antibiotics will be significantly restricted if not banned.

d) However, if farmers do not have access to antibiotics than we can expect instances of food safety and livestock diseases to rise.

e) The race is on, therefore, to find alternative antibiotics and a present the most promising options seem to be probiotics that stimulate the micro biome livestock and enhance their inherent immunity.

f) The benefit of this is that the market for this is potentially huge and could. include all domestic livestock.

g) The challenge includes the long regulatory process before alternative antibiotics could be like for use especially in Canada or US.

3. Vertical farming and the circular economy

a) Industrial manufacturing and urban areas produce three core waste products: heat, nutrients and carbon dioxide. These are the three primary ingredients for plant growth and therefore, represent the potential to do food production within the city. Using waste products such as carbon dioxide, heat and nutrients therefore represents an opportunity to create a ”circular” economy such that the waste of one generation becomes the resources for the next.

b) There will be two main manifestations of this. The first is high quality locally produced horticulture; the second is further off and could take the form of algae production where the algae is used for livestock feed in the first the instance and processed human food subsequently. It is also possible the insect production will become sufficiently advanced that we feed insects on organic waste and then either consume the insect directly or use them as a source of livestock feed [especially farmed fish].

c) To achieve this vision there will be a need for significant regulatory changes with in urban and industrial zoned areas.

d) In addition, recommend another basic science is still going to have to go into understanding things like disease transmission in insect farms. Viruses and bacteria maybe on waste organic matter do not end up being transferred back into livestock or human hosts.

4. Alternative proteins

a) There is a significant and sustained movement away from livestock based proteins towards. alternative proteins. This move is being stimulated a combination of consumer demand. [younger consumers eat less meat], Industry innovation that is creating new alternatives, and regulatory pressures such as new government sponsored food guides that recommended plant-based diet (e. g. the Eat Lancet Report or the Canadian Food Guide).

b) At the moment, this still feels a bit like a fad to me, and I don’t think that meat eaters will ever embrace plant-based diets wholesale. That said, I think there is a huge opportunity in the alternative protein space and that in the future we will seek alternative proteins increasingly mixed with conventional proteins in blended products burgers, premade burritos etc. that have a mixture of plant and livestock based protein).

c) The fake meat world (or is it clean meat?) is also likely to show huge growth.

5. Robots in the field and the need for data integration

a) The whole area of precision agriculture is exploding, and the next generation of farm implements are likely to be smaller networked instruments that are able to tend fields on the meter by meter scale. At the other end of the spectrum, large autonomous tractors will continue to harvest commodities on vast farms but still have the artificial intelligence to farm on a meter to meter based on soil and moisture conditions.

b) One of the big barriers towards achieving this vision is the need to integrate a vast number of data sets that are currently owned by different actors. Hence, one of the big opportunities in the space provided data integration services.

c) Another barrier is rural broadband.

d) This area is heavily invested in some very big players but I can see some opportunities for smart startups to find niche opportunities.

6. Alternatives to plastic packaging and smart containers

a) Everyone now knows the plastic packaging is a problem so the race is on to find biodegradable alternatives. This is a huge area where demand is going to explode driven by consumer demand and regulatory imperatives.

b) In addition, food waste is widely recognized as a massive problem both economy and the environment. Smart packaging that changes color the food spoils and other innovations of the semi nature replace to help reduce food waste in a cost- effective and innovative way.

7. E-commerce platforms and tokens

a) There are approximately 2,000,000,000 rural people who are chronically under serviced, don’t have access to adequate financial services, cannot gain access to markets, et cetera.

b) E-commerce platform backed by securitized tokens offer an opportunity to rural people to gain access to financial services and market.

8. Transparency, bio tracers, and distributed ledgers

a) Today, complex supply-chain link producers and consumers in ways that are very difficult to scrutinize. As a result, food fraud is endemic and current estimates suggest that as much as one third of the seafood purchased in North America is fraudulently mislabeled. This has significant health and sustainability implications.

b) Genetic bio Tracers such as”DNA barcoding” in combination with the distributed ledgers such as block chain offer the potential to provide consumers they guarantee that what they are buying is indeed what is on the label.

c) Such transparent systems Will also help improve efficiency of food safety inspections and food recalls. For instance, Walmart recently piloted a trace back system using a block chain for their mango production system. Whereas using the previous seven days to trace the path a mango took from Farmer to consumer with the block chain system this could be done in a matter of seconds.

d) Such systems will increasingly become the norm and will likely be driven by retailers and processors who are exposed to the reputational hazards associated with food safety problems.

Thank you, Evan, for these insights. What do you think? Please share your views!

Thank you,

San