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Cellular agriculture & emerging markets: Just because we can, does it mean we should?

December 6, 2021

Saron Berhane is an agrifoodtech entrepreneur based in Sydney, Australia.

The views expressed in this guest commentary are the author’s own and do not necessarily reflect those of AFN.

Alt-protein is taking the food world by storm. Plant-based meats ranging from nuggets and burger patties to mince, shrimp, and meaty mushrooms are now widely available on supermarket shelves. With a $7 billion market size that has grown 27% in the last year, everyone from startups to leading food manufacturers are innovating in the space. The price, taste, and accessibility of next-generation plant-based meats are already competitive with conventional meat.

Startups, investors, and food futurists alike are also betting on the promise of cultivated meat — produced via cellular agriculture — to reduce our food system’s dependence on animal-derived protein due to environmental, ethical, and public health concerns. Over $350 million has been invested in cultivated meat startups to date. Whether you believe that cultivated meat will and should displace conventional meat, if you doubt that cultivated meat can replace or supplement animals, or if you believe that both production systems can co-exist, greenhouse gas emissions data makes it clear that change in our animal production system is necessary.

Synthetic biology’s sustainability solution

The overhaul of our food systems has had a ripple effect on other parts of the agriculture industry and is forcing us to recognize the ecological footprint of other byproducts within the sector. Some of the industry sustainability challenges include water scarcity, biodiversity loss, soil erosion, agrochemical dependence, commodity-driven deforestation, waste generation, labour shortages and exploitation, and diminishing availability of arable land, as well as the impact of drought, pests, and disease on yields (just to name a few.)

While there are still challenges of scale associated with the applications of synthetic biology (synbio) and by extension, cellular agriculture, it seems as though we are at the beginning of the synbio gold rush.

Q1 and Q2 2021 brought in record-breaking investment numbers for synbio startups. The resource intensity of the textile and fashion industry makes it no surprise that innovators and fashion houses are looking to synbio for answers. Enter the likes of MycoWorks, Bolt Threads, and Ecovative, using mycelium to engineer sustainable textiles [disclosure: AFN‘s parent company, AgFunder, is an investor in MycoWorks.]

New microbial seed coating technology, designed by companies such as Pivot Bio, Loam Bio, and Indigo Ag, allow farmers to increase their crop yields through improved nitrogen fixation, or sequester carbon and access carbon trading markets. The catalyst for a lot of these companies and their developments in biomanufacturing is the reduction in the cost of next-generation DNA sequencing; as this cost goes down, we’ll continue to see the unleashed potential of industrial biotechnology across many sectors.

Cash crops and cellular agriculture

One of the areas that we are starting to see cellular agriculture expand into is cash crops grown in the tropics (for example, coffee, cocoa, palm oil, and cotton.) The reason that I want to focus on these crops in this article is because there are a range of environmental and socioeconomic issues that make them suitable for growing in a lab.

These crops are typically grown in low-income countries that rely heavily on commodity exports, thus making them critical to local job creation, human development, and food security. However, due to the location of these farms, they are extremely susceptible to rising pest and disease outbreaks (partly a result of climate change) and are affected by socioeconomic challenges such as low farm-gate prices, slave labor, poor working conditions, and land-grabbing. Demand for each of these crops is also rising, so sustainable and resilient production is imperative. 

Chocolate, coffee, and climate change

Worldwide, we consume around 7 million tons of chocolate every year, valuing the chocolate industry at over $150 billion. Roughly 70% of the world’s cocoa beans are grown in West Africa by between around 2 million smallholder farmers, with production concentrated in the Ivory Coast and Ghana.

Traditional cocoa production has a large ecological footprint; it requires a lot of water (1.5x more than beef) and unregulated farming practices result in widespread deforestation. Ghana has lost 80% of its forest cover since the 1950s while the Ivory Coast has lost 70%, with higher rates of protected areas lost. According to the International Cocoa Initiative, more than 2 million children are estimated to work in the cocoa industry across the Ivory Coast and Ghana, where they carry heavy loads, spray pesticides, and fell trees using sharp tools. As of mid-2019, major producers of mass-market chocolate, including Hershey, Nestlé, Mars, and Ferrero, could not guarantee that their chocolates were produced without child labor.

The reality of coffee production isn’t too different. We drink 600 billion cups of coffee worldwide each year, valuing the coffee production industry at over $100 billion dollars. Coffee is the second most-traded commodity in the world, sitting just behind crude oil.

The world’s primary coffee producers are Brazil, Vietnam, Colombia, Indonesia, and Ethiopia, while the world’s primary coffee importers are the US, Germany, France, Italy, and the Netherlands. The sector faces similar sustainability and socioeconomic challenges including deforestation, water pollution, biodiversity loss, pest and disease pressure, labor exploitation, low commodity prices, and an ageing farmer demographic. It has previously been estimated that half of the land used to grow coffee could be unproductive by 2050 due to the climate crisis. The most recent spike in coffee bean prices due to a cold frost in Brazil has been said to be an indication that this is starting to happen.

Not only do these crops have economic significance to these commodity-dependent countries, but they also have cultural significance and serve as a source of national identity and pride. As someone with East African heritage, coffee is integral to my culture. The psychotropic aspect of coffee is irrelevant when compared to the important ritual of roasting and drinking coffee with my family for hours (three brewed cups of coffee are customary.) In a similar vein, the cocoa pod is present on one current edition of Ghana’s 5 cedi banknote, as well as older notes –  a tangible symbol of the country’s pride in producing cocoa.

Cocoa farming as depicted on an old Ghanaian banknote. Image credit: johan10 / iStock

Cellular agriculture companies such as C16 Biosciences, QOA, Compound Foods, California Cultured, MeliBio, and GALY have incredible and ambitious goals for moving the production of crops such as coffee, cocoa, palm oil, honey, and cotton from the field to the lab. As a bioengineer, I’m excited to see fermentation and bioreactor technology advance and scale to meet growing demand for these products. However, I believe it’s important that these cellular agriculture startups recognize not just the sustainability challenges these markets face, but also the socioeconomic dynamics underpinning them too.

Lower incomes for cocoa and coffee farmers — whether due to low prices, low yields, or less business due to an increase in lab-grown alternatives — exacerbates the underlying issues that cellular agriculture seeks to solve. Problems such as labor exploitation, child labor, household poverty, and deforestation don’t just go away ; they might actually get worse.

Can tech innovation and fair solutions go hand in hand?

Every website of the biotech startups mentioned above describe the threat of climate change and socioeconomic instability in the countries that cash crops are grown in. But crucially, they do not address the need to have a solution that also considers the livelihoods of these farmers.

Based on this, I believe that more work needs to be done to develop tech solutions that include smallholder farmers and commodity-dependent economies as part of the solution. One way this can be done is leveraging existing measures that make local farms more resilient. Some examples of this include:

The other way that biotech startups can include commodity-dependent economies as part of the solution is by building and launching locally. Tech startups that launch or are started in emerging economies such as Jakarta, Lagos, Nairobi, or São Paulo have a different set of priorities and challenges to overcome. They operate in environments of scarcity (of capital, talent, and infrastructure) and are usually solving tangible problems. Their balanced formula of growth and a focus on solving real-world problems makes these companies successful despite the environments they operate in. A few examples are:

  • 54gene, a Nigeria-based precision medicine startup using whole-genome sequencing to improve diagnostic and treatment outcomes within Africa and the global community;
  • Zipline, a US drone delivery startup delivering vital medical supplies to remote communities, with local teams and operations in Rwanda, Ghana, and Japan;
  • Komunidad, a Philippines-based environmental intelligence platform helping businesses react to environmental threats. They have operations in several disaster-prone countries such as India, Cambodia, and Vietnam;
  • Future Farm, Brazil’s first plant-based meat company that is now expanding across the Middle East, Europe, and North America;
  • Poladrone, a Malaysian spray drone automation and analytics startup helping palm oil farmers ward off pests in Malaysia, Thailand, and soon Indonesia, the world’s largest palm oil producer;
  • mPharma, a Ghanian-based healthtech startup that manages prescription drug inventory for pharmacies and their suppliers with operations in Nigeria, Kenya, Zambia, Malawi, Rwanda, and Ethiopia.

The common thread between all of the startups mentioned above — apart from the fact that they all have local teams and local operations — is that they have leveraged international private capital markets to solve tangible region-specific problems. Local investors alone are probably unable to provide enough capital to fund their ‘deep tech’ or ‘hard tech’ solutions. By combining the startup team’s knowledge of local dynamics with international capital, they can build solutions for universal human needs in these untapped markets.

Africa’s food and agriculture sector has the potential to become a $1 trillion dollar market by 2030. Similar opportunities exist in other emerging economies. Instead of building solutions miles away in remote countries, what these farmers and emerging economies need is the technology, infrastructure, and financing to solve major regional and global challenges  locally; ultimately, they need to be a part of the solution.

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