Building a Resilient Food Supply System & the Investment Opportunities Therein

Coming out of the Bloomberg Intelligence Farm, Food & Fuel Summit where I participated in 1) a one-on-one fireside chat with Senior Bloomberg Analyst, Jen Bartashus, on Diversified Proteins and 2) an overarching panel on the protein sector with representatives from the Cattle Ranchers Association and the Swine sector, I can say this: all parties recognize the need for a more resilient and robust food supply system made possible, at least in part, with the inclusion of diversified proteins.

As noted by my fellow panelists on the protein panel, the current food supply system based on animal-proteins is rife with existential, systems-wide issues:

1) Small margins mean that even small changes in the market render doing business potentially unprofitable.

2) Increased regulation such as that for Prop 12, Scopes 1 and 2 disclosure requirements from the SEC, Scopes 1, 2 and 3 disclosure requirements from the state of California, clean water requirements from the Environmental Protection Agency (E.P.A.) and more is expected to continue. This poses a threat to the industry and society at large by forcing society to choose between such extremes as clean water or meat from large-scale factories.

3) The risk of pandemic outbreaks such as the avian bird flu that jumped to a dairy cow and then a human, noted in the press the exact day of the conference, poses a continued existential threat to the industry, the food supply system and society at large.

Paraphrasing notes from keynote speaker, Ken Zuckerberg, Director of Global Research of CHS, Inc., a global agribusiness owned by farmers, ranchers and cooperatives across the United States and diversified in energy, agroconomy, grains and food, we need a diversified and robust food supply system because

1) Growing global food insecurity is an issue of U.S. national security,

2) Continued Climate Change is an area of high risk for the food supply system and society at large,

3) Continued pandemic threat, per the above, is an area of high risk for the food supply system and society at large.

It is important to connect that, per the United Nations Environment Programme, our animal-based food systems represents 18% of the world's greenhouse gas emissions and, thus, growing this sector to globally feed more people, grows the emissions forcing climate change and the fragility of the food supply system even higher.

Without investing in innovation for diversified alternatives, it is indeed a vicious cycle.

This concept was underscored by Chief Meteorologist of the USDA, Mark Brusberg, in his presentation at the summit. As society continues to push the planetary limits on Climate Change, in part due to our reliance on animal proteins as we note, the next few years are expected to bring extreme droughts, only exacerbating the fragility of the food supply system.

As with investment portfolios, diversification can reduce risk and bring resiliency. It is a 'yes, and' approach, not an 'either, or' approach in food systems transformation, combining both legacy and novel proteins, that can bring stability. We at VegTech? Invest have always viewed it this way.

Many left the Bloomberg Intelligence Farm, Food & Fuel Summit with an understanding of the societal and industry need for diversified proteins in the current food supply system, and that this need and shift are underway now. Indeed, Bloomberg Intelligence research indicates that Plant-based Innovation including diversified proteins will be approximately $166 billion by around 2035, representing 8%-11% of the market.

This offers an impressive opportunity for food systems transformation investors.

At VegTech? Invest, we consider ourselves and our ETF to be leading the food systems transformation shift in the financial markets. We have been leading this, often as the lone voice on this subject, for over two years.

For more information on food systems transformation and the investment opportunities therein, please visit https://VegTechInvest.com.

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