Article
Can agritech really transform the future of food?
28 February 2023 | 5 minute read
Feeding the world is getting trickier. The sharp rises in the cost of living that followed the Covid-19 crisis have only been exacerbated by the war in Ukraine, known as the breadbasket of Europe. Longer term, the world’s population is predicted to rise to 9.7 billion by 2050 and global warming is transforming traditional patterns of agriculture in ways that are not easy to predict. The sector itself is contributing to the problem, with global emissions from food production expected to rise 60 per cent by 2050.
This leaves governments and landowners in an uncertain position, says Bertie Hoskyns-Abrahall, a partner in Withers’ private client team who focuses on UK farms and estates.
“There is a conflict of land uses at present. Over time we have evolved to maximise food production but there has been a carbon impact and a loss of biodiversity as a consequence of that. Since that’s been realised there has been much more focus on the environment. But the war has focussed everyone on food again.”
A key topic in the UK is whether alternative land uses offer a more attractive option than farming.
A key topic in the UK is whether alternative land uses offer a more attractive option than farming. Renewables and carbon capture are two alternative income streams that will potentially require agricultural land to be taken out of production.
As the carbon market evolves, real estate partner David Holland considers that carbon capture will become a significant feature of the British agricultural sector. "The demand for farmers and landowners to monetise carbon reductions will increase over coming years. At the moment, carbon capture is focused on woodland and peat, but grassland also presents a significant opportunity."The demand for farmers and landowners to monetise carbon reductions will increase over coming years.
However, David adds, long-term management agreements will be needed, and thus far no statutory framework has emerged to regulate the market in carbon credits. This is not helping UK farmers to resolve the dilemma of whether to maximise food production, focus on biodiversity or perhaps devote land to producing renewable energy.
“Some will say that global supply chains are being squeezed, and we’ve got to focus on feeding ourselves,” says Bertie. “But the flipside of that is that if we lose natural habitats that support insects such as bees, we won’t be growing anything.”
Some innovators are trying to solve the problem with more efficient methods such as vertical farming, which involves growing crops in vertically stacked layers. Wageningen University in the Netherlands has helped to give its local area the nickname Food Valley, with eye-catching research projects that include growing bananas without soil to protect them from a deadly fungus, and the SKY HIGH programme, which uses vertical farming techniques to optimise the taste, shelf life and nutritional value of vegetables. Meanwhile AeroFarms, a B Corporation, has begun building the world’s largest vertical farming research facility in the Abu Dhabi desert.
We’re seeing a lot of venture companies investing in agritech projects that extract plant-based protein and use it to create substitutes for meat, milk and even eggs.
Some of Bertie’s landowning clients have been approached about smaller-scale agritech projects in this vein. However, while the sector is attracting investment, costs are high at the moment. Growing protein alternatives may be a more viable proposition – and a timely one, given that demand for meat is rising steadily.
“We’re seeing a lot of venture companies investing in agritech projects that extract plant-based protein and use it to create substitutes for meat, milk and even eggs,” says John Serio, a partner in Withers’ intellectual property team who is based in Boston. “That is much more sustainable than getting protein from animal sources.”
Over in the Cambridge, UK office, corporate partner Susanna Stanfield works with more than one client focused on growing meat itself. “We act for a client that owns the science for stem cells that you can develop to create lab-grown meat, and another client that is a lab licensing its technology to grow a particular type of meat. It’s exciting because it’s an area where agritech meets climate tech,” she says.
Foodtech is another area that the Withers team see as having a lot of potential. John Serio is working with a company that has found a way of processing chocolate to make it more nutritious. “Raw cocoa is actually very good for you because it contains a lot of compounds called flavanols, which you can also find in nuts and blueberries. Our client, one of the world’s largest chocolate manufacturers, has found a way of processing chocolate so that it preserves more of these flavanols.”
The company is allowed to market its chocolate’s health benefits in Europe, where it is based. Now John is helping it to petition the Food and Drug Administration to be allowed to do the same in the US. “We believe they should be allowed to say that it’s healthy for you because it has eight or ten times the flavanol content of a normal piece of chocolate. It provides the consumer with something that’s much more nutritious.”
With clear demand for more and better food, ideas like these are attracting significant investment. According to AgFunder, $52 billion of venture capital went into agritech and foodtech startups in 2021, a year-over-year increase of 85 per cent.
This kind of momentum gives the Withers team optimism that landowners and innovators will find ways to work together to secure the future of food and the environment.
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