Opinion: Disruption and Opportunity in Food and Agriculture
The Food and Agriculture Organization (FAO) predicts that nearly 10 billion people will live on this planet by 2050, and recent studies are showing that we will need to produce 70 percent more food to keep up with the population growth.
“Major transformations in business as usual food science, agricultural systems, rural economies, and natural resource management will be needed if we are to meet the multiple challenges before us and realize the full potential of food and agriculture to ensure a secure and healthy future for all people and the entire planet,” states FAO in its publication entitled The Future of Food and Agriculture: Trends and Challenges.
Fortunately, the makings of the next agritech revolution are underway and great initiatives such as Sprout, Agritech New Zealand and are leading the NZ Inc charge. The on-farm innovations driving the revolution include genomics and biotechnology, bio-pesticides and bio-stimulants, self-driving tractors, wireless sensors, nanotechnologies, urban farming with fully closed small glasshouses and LED technology, and the use of big data and artificial intelligence in agriculture, just to give a handful of examples.
However, this will fail to meet the full potential of increased export value for New Zealand from the primary sector unless the next links in the value chain are strengthened and the value-added processing of food component is improved.
FoodHQ is focused on this part of the chain by bringing the smartest food science minds together to enhance and accelerate the ability of New Zealand to be at the forefront of R&D innovation in targeted areas and close the gaps in the ecosystem between new ideas and consumer ready products backed by world class research.
In the Emerging Growth Opportunities in New Zealand Food & Beverage Report 2018, the New Zealand government has outlined the growth opportunities in the country’s food and beverage sector, which generates US$29 billion in exports and represents over half of the country’s merchandise export earnings.
According to the report, New Zealand is making good use of its proximity to Asian markets, good climate, and fertile soils, but opportunities to drive growth with further technological innovation are still plentiful. If the New Zealand food and beverage sector can fill the ecosystem gaps, collaborate and successfully position itself as a global leader in innovation, it will be able to lead global food and agriculture disruptions and make the future of all people on this planet brighter.
In my previous role I was fortunate enough to hang around some experienced entrepreneurs and corporate leaders who regularly told me to “follow the smart money”. I came to interpret this as meaning that venture capitalists and their investment bets offer us a window to the future as they attempt to peer around the corner to see what’s coming next in terms of industry disruption and identifying growth sectors.
Already, venture capitalists from around the world are investing billions of dollars in technological innovations in the agriculture & food sector that have the potential to disrupt every link of the food chain and address the challenge of how we’ll feed the exploding world population in the future.
The number of venture capital investments into agriculture and food skyrocketed in 2013 and the trend doesn’t look to be slowing.
“In New Zealand, where agriculture and food contribute more than US$37 billion to the economy annually, investment opportunities are abundant. “It is a great location for bringing the best of new agritech from around the globe,” says Arama Kukutai, a partner in American venture capital investment company Finistere. “Agritech is seeing a new apogee in investment and New Zealand stands to profit from this megatrend where US$85 billion was invested in venture capital in 2017, and over US$1.5billion in agritech.”
The depth and wealth of experience that FoodHQ represents in R&D in food science clustered in one location has the potential to attract some smart money and solidify our relevance globally in adding value to food production.
Every time I question whether smart money really can be attracted to fund innovative ideas and disruptive technologies in little old Palmerston North, I need only open my office door and right across the hallway is Biolumic who recently announced the close of $5 million in Series A financing led by Finistere Ventures.
The food and agriculture industries are facing significant challenges to meet demand and massive investments are being made to turn these challenges into opportunities to make the entire food chain more efficient. In New Zealand we need to collaborate, accelerate value added processing and collectively put our hand up to signal we want a slice of the global action.
I think it is an incredibly exciting time for the New Zealand food industry as we collectively navigate these national and international changes. FoodHQ CEO Dr. Abby Thompson and I look forward to sharing more of our ideas, partner events and our FoodHQ initiatives with you over the coming months.