Animal AgTech

Prime Future 49: Climate + agriculture: noise, or mega trend?


Ask 10 people what sustainability means, get 10 different answers.

Ask 10 people what regenerative agriculture looks like in practice; you’re more likely to hear the equivalent of “you’ll know it when you see it” than a clear set of actionable ideas.

The ambiguity in definitions can make producers feel like engaging on climate/sustainability is the equivalent of the Baylor Bears hearing that they did not score enough home runs to win the 2021 NCAA basketball championship. ¯\_(ツ)_/¯

How do you win when it’s unclear what winning looks like?

Additionally, the climate + ag conversation often has a tone problem. Real or perceived, much of it feels condescending to producers…it reeks of coastal elitism and “you’re doing it wrong, silly”. What reaction do you expect to get when you tell a 5th generation rancher that they aren’t using sustainable grazing practices? That rancher predictably says “what is a better definition of sustainability than raising beef for 100+ years on the same land” then follows it up with “no one is more invested in the long term sustainability of this land than we are, the people who derive our livelihoods from the land”. Shot, chaser.

For starters, let’s please welcome nuance to the table. The extreme positions on either end of the sustainability spectrum will not create actionable, consumer-satisfying, carbon-reducing, market-growing solutions. But nuance…that’s how we find the productive middle ground. Nuance acknowledges that one size does not fit all – what works in geographies that get 40+ inches of annual rain fall won’t necessarily work in areas that get <15 inches. Systematic management changes like transitioning from continuous grazing to intensive rotational grazing are complex, as is anything related to managing the biology of plants or animals.

Nuance also matters in the context of beef’s perceived “market position” around climate change. While methane emissions are a target, cattle have the superpower to up-cycle grasses and support soil health, a key factor in carbon sequestration. Russ Conser of Blue Nest Beef explains that he left a career in venture investing at Shell to launch a cattle business when he realized that “effectively grazing cattle is the other half of the carbon cycle” via carbon sequestration. 🤯

The language, tone, and lack of nuance in sustainability speak sometimes makes the whole topic sound like mere noise…so the volume gets turned down. To turn this mega trend into opportunity, we’ve got to break the language logjam in order to unlock the meaningful ways agriculture can show off its uniquely powerful climate chops.

And this issue matters, right now. A significant amount of capital has been invested into cell based meat with much of the enthusiasm centered around the reduced environmental impact compared with animal grown (?) meat.

As a result, the livestock industry has a time sensitive imperative to demonstrate, dial up, and deliver on the wide ranging net climate benefits that livestock alone can deliver.

So here we go. Where is the opportunity for producers to take steps towards delivering what a carbon-conscious market wants?

“One in five of the world’s 2,000 largest publicly listed companies have now committed to a “net-zero” emissions target to help tackle climate change.”

If you believe:

(1) the undeniable trend is towards food companies (retailers & food service) making net/near zero claims about their supply chains, and

(2) the likely trend is towards more coordinated/aligned/virtually integrated beef supply chains (e.g. the venture between 44 Farms & Walmart)

Then, it is not a difficult leap to assume that in the not too distant future there will be an increasing number of coordinated supply chain initiatives that will incentivize – or select – producers to adopt (or continue) and verify certain production practices. Clearly aligned incentives throughout a supply chain to realize greater commercial outcomes for all (<—key word) participants, and measurable carbon outcomes that make meat attractive even to carbon conscious consumers? Interesting…

In the interim, some companies are learning how to work with their supply chains, e.g. Sysco & Cargill’s program to “invest $5 million to support ranchers in the Southern Great Plains with the implementation of sustainable grazing practices” by “targeting 1 million acres to sequester as much as 360,000 tons of carbon annually.” Some of the practices that the grants will support include rotational grazing, improvements to infrastructure, control of invasive vegetation, or a combination of interventions appropriate for the landowner, wildlife, soil type, and climate. Presumably everyone involved will learn a lot through this project from the how’s to the why’$.

Brief aside on Amazon: One of the company’s core tenants is improving customer experience. A few years in, they began to focus on fulfillment errors as a key metric. Less errors in customer orders meant happier customers. But less errors also meant reduced cost to fulfill the order. Improving the metric had good impact on customer experience AND on company profits.

Applying that to our topic: can what’s good for carbon sequestration be good for the land AND for cattle AND for cattle producers? Or must producers who set out to improve carbon related metrics do so at the expense of their business?

Take intensive rotational grazing – a practice that carbon sequestration enthusiasts love to love, and a practice that many cattle producers generally accept as a way to better manage grass and therefore increase carrying capacity. It’s hard to execute because of the labor and hassle factor, but how can technology change that? How can properly aligned incentives recalibrate the cost/benefit equation? What needs to be true in order to increase adoption of this practice that is widely accepted is beneficial on every outcome??

Anyone grazing livestock effectively is closely managing two inventories: cattle AND grass. What’s good for grass tends to be good for cattle, and the producer. Sustainable grazing enthusiasts want to promote biodiversity and healthy vegetation and reduce water consumption….these sound a lot like things cattle producers want too, right? Perhaps this whole thing is as simple, not easy but simple, as looking at new ways to achieve age old objectives, of finding the overlap in operator objectives and carbon objectives….there’s almost always middle ground to be found.

It takes a healthy dose of humility on all sides when it comes to tackling this topic because there’s still *SO* much unknown…including how to measure carbon sequestration in soil, how to quantify its impacts, and how/when/if carbon markets will pan out.

Regardless of the abundant unknowns about how things will evolve, this whole “climate thing” is not a topic where producers can look away and hope it will disappear. This is a mega trend. There will be winners and losers – my hypothesis is that the difference will be those who collaborate and find workable solutions…or don’t. This is a mega trend to engage, to lead by looking for the ‘and’ solutions…the places of overlap between what’s good for climate related metrics AND for cattle AND for successful cattle operators AND for food companies AND consumers. This is a place to ask questions like, what if? What needs to be true? What opportunities will be created in this mega trend?

Consider this framing on the value of engaging:

Producers will produce what the market signals, and the market signals around this mega trend are dialing up.

Where there’s a market there’s a way.

Heads up – I’m now part of the Merck Animal Health Ventures team. This newsletter is not representative of anyone’s views but my own. Sometimes it doesn’t even represents my views 🙂

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If you’ve never felt older than after reading that tweet, you are not alone.

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Prime Future 79: Blockchain…all dressed up but where to go?


Technology only has a fighting chance in agriculture when it definitively improves producer outcomes🤑 and/or consumer outcomes😃. Tech for the sake of tech is a road to nowhere.

Moreover, I get reeally skeptical when seemingly overnight cult-like obsessions form, as has happened in the second half of 2021 in the tech world with DAOs.

Unpopular opinion: DAOs are just blockchains all dressed up & looking for something to do on a Friday night.

What’s a DAO? Decentralized Autonomous Organizations. (Oh that wasn’t self-explanatory? Weird…)

Constitution DAO is probably the most public example, recently formed to purchase a copy of the US Constitution that was going up for auction. The group raised ~$40M which wasn’t quite enough to snag the prize, so the DAO was dissolved.

One definition of a DAO is, “a group organized around a mission that coordinates through a shared set of rules enforced on a blockchain.” Hmmm. Here’s another perspective:

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