Speaker 1: A casual glance at economic news might make you think
Speaker 1: the world is going to the dogs. But what if
Speaker 1: it was going to the bugs and the maggots. Economic
Speaker 1: forces like climate change and population growth have a new
Speaker 1: generation of farmers scouring the globe for fresh sources of protein.
Speaker 1: The edible insect market may exceed one billion dollars in
Speaker 1: five years, and along the way diffuse a potential food crisis.
Speaker 1: Welcome to Benchmark. I'm Daniel Moss, columnist at Bloomberg Opinion
Speaker 1: in New York, and Dame Scott landman and economics editor
Speaker 1: with Bloomberg News in Washington. Two guests today come at
Speaker 1: the boom in gastronomy from different places. First will be
Speaker 1: joined by Olympia Yaga, who at North Carolina for Canberra,
Speaker 1: where she's CEO of go Tera. Go Tera builds mobile
Speaker 1: insect farming systems. In June. I ate some worms and
Speaker 1: crocodile at an event with Olympia. The worms were fine,
Speaker 1: croc was a bit dodgy. Our second guest is Agnesca
Speaker 1: to Susa, who covers commodities and agriculture for Bloomberg News
Speaker 1: in London with two colleagues. She recently wrote an article
Speaker 1: called Bugs Are Coming Soon to your dinner table. First,
Speaker 1: let's go to our intrepid Australian insect farmer, Olympia. Why
Speaker 1: don't we start by describing your role in this emerging
Speaker 1: constellation of the insect gastronomy. Sure, so, I'm the founder
Speaker 1: and CEO of a company called go Tera that manages
Speaker 1: food waste using insects in robotic modular systems. And I'm
Speaker 1: also the chairwoman of the Insect Protein Association of Australia,
Speaker 1: which is the national representative body for insect farmers and
Speaker 1: insect retailers in Australia and Olympia. When you talk about
Speaker 1: insect farming insect protein, what kind of insects are we
Speaker 1: actually talking about? That both the ones that you do
Speaker 1: and other people in your association have been working with. Yes, So,
Speaker 1: for insects for food, the big three are meal worms,
Speaker 1: and there's a couple of different types of meal worm, cricket,
Speaker 1: and in that group you could probably put your locusts
Speaker 1: in your grasshopper, and then cockroach or beetle. And then
Speaker 1: there's some other novel ones where people grow sort of
Speaker 1: spiders or scarabs and things like that. But those three
Speaker 1: the most conventional that people farm in commercial quantities, both
Speaker 1: in Australia and around the world. So the cockroaches that
Speaker 1: I've seen walking around various apartments, that I've let those
Speaker 1: become food? Is that what you're talking about? How does
Speaker 1: that happen? You are a cockroach farmer without realizing it. Yeah,
Speaker 1: they Yes, those are the cockroaches that we're talking about.
Speaker 1: They are actually really clean. And this is sort of
Speaker 1: an interesting segue into the culture of insects and how
Speaker 1: we perceive what insects are. So they're always being considered
Speaker 1: dirty things, but cockroaches as as an animal are actually
Speaker 1: quite clean, and they have a very distinct flavor that
Speaker 1: is appealing, and they're mostly turned into a meal which
Speaker 1: people use as a flower substitute. Okay, So just so
Speaker 1: we're clear on this, are we at the point where
Speaker 1: we will soon be able to walk into Whole Foods
Speaker 1: or Woolworths or Tesco or Carrap and say, hey, where's
Speaker 1: the aisle that has the cockroach flour? How far off
Speaker 1: is that? I don't think we're that far away at all.
Speaker 1: The challenge for any new industry, but in this case,
Speaker 1: this industry is the commercial capacity to produce commodity for
Speaker 1: fm CG. So what is fm CG. So fm CG
Speaker 1: is fast moving consumer goods. So those are chips, cakes, muffins,
Speaker 1: you know, the things that we buy as snacks and things,
Speaker 1: and so those you've got to farm enough insects for
Speaker 1: your products to become mainstream. And so the industry is
Speaker 1: merging and we're getting more farmers and more farmers are
Speaker 1: getting to commercial capacity, and so that's a barrier to
Speaker 1: becoming mainstream. If you can't make enough product to even
Speaker 1: get shelf space in the more conventional stores, you're not
Speaker 1: going to be able to move there. I think we're
Speaker 1: probably less than two years away from cricket products being
Speaker 1: found in aisles of our sort of your more traded
Speaker 1: Joe whole food type places. Isn't what you make now?
Speaker 1: Is that more for for livestock use as it is
Speaker 1: it going to animal feed and that sort of thing. Yes,
Speaker 1: So intec farming does lend itself to being used for
Speaker 1: for livestock feed. And there are people go Terror is
Speaker 1: one of them that farms insects for livestock feed. But
Speaker 1: the opportunities is equally spit so there's just as much
Speaker 1: opportunity to raise insects for livestock feed based on wage
Speaker 1: substrates that make you that are available, that should be used,
Speaker 1: that should be utilized as a resource um as there
Speaker 1: is for insects to be farmed for human can assumption.
Speaker 1: I think you have hit on a point that's accurate,
Speaker 1: and it is a challenge of the industry. Is that
Speaker 1: for centuries, insects are bad is a deeply ingrained understanding
Speaker 1: in pretty much most of most cultures, and that is
Speaker 1: a barrier to consumption or adoption. Is that cultural conversation
Speaker 1: and how do we bring these products to market when
Speaker 1: we've been told for our whole lives that having an
Speaker 1: insect in your food is really bad. But I don't
Speaker 1: think that that's as unsurmountable a challenge as as actually
Speaker 1: the farming side, to be perfectly frank, I think the
Speaker 1: farming getting people to commercial capacity in an industry that's
Speaker 1: as new as it is, is actually the greater challenge. Now,
Speaker 1: at an event at the Australian National University, you were
Speaker 1: a panist, I was there. We dined, among other things,
Speaker 1: on crocodile loin, on seaweed. That's before we got to
Speaker 1: the worms which were an optional extra to talk about
Speaker 1: the croc not typically something urban nights would eat. What's
Speaker 1: the appeal there and is it broadly part of the
Speaker 1: same movement that gets us bug astronomy? Yeah, I think
Speaker 1: you know, Australians have been eating crocodile what since the nineties,
Speaker 1: but it's never really taken I don't know if it's
Speaker 1: ever really made it into mainstream. You can find it
Speaker 1: in your regular grocery stores, but it's not like there's
Speaker 1: not lots of it. There's just sort of a little
Speaker 1: bit off to the side. But yeah, I think the
Speaker 1: challenge with food is we don't know how to cook it.
Speaker 1: Our parents teach us how to cook or our peers
Speaker 1: and and so that our understanding of what to cook
Speaker 1: and what we bring into our homes when we leave
Speaker 1: home is generally what we've been taught. And so culturally,
Speaker 1: you know, Greek and so I was raised on Greek
Speaker 1: type foods and that's what I teach my children how
Speaker 1: to make. And so when confronted by crocodile, don't know
Speaker 1: what to do with it, it showed actually to be
Speaker 1: frank I found not that you were responsible for preparing
Speaker 1: that meal, but but you know, you've brought me to
Speaker 1: my next point, which is, you know, the meal worms
Speaker 1: that were an optional extra. I indulged in them, and
Speaker 1: I found them pretty unoffensive. It wasn't the world's strongest taste,
Speaker 1: but they were okay. I found at that meal the
Speaker 1: crocodile to be pretty ordinary, fairly tasteless, quite rubbery and texture. Now,
Speaker 1: after leaving lunch, walking back to the main conference session,
Speaker 1: I did feel a certain spring in my step. Were
Speaker 1: those worms doing something for me that I was not
Speaker 1: aware of as I ate them? Obviously, I think you
Speaker 1: would probably luck just glad to be moving, most likely
Speaker 1: because that was quite a dense meal. The meal webs
Speaker 1: are sixty A protein, and so maybe you ingested extra
Speaker 1: protein you felt better for it. But I don't know
Speaker 1: if I should take full responsibility for your demeanor after lunch.
Speaker 1: The crocodile. I think it was a true example of
Speaker 1: the challenges of new things. It wasn't cooks particularly well.
Speaker 1: That's not normally how crocodile tastes um. But you know,
Speaker 1: if you aren't used to dealing with that meat, it's
Speaker 1: quite hard to manage it. And it's the same you know,
Speaker 1: if I gave meal worms to somebody who'd never eat
Speaker 1: them to it before, how would they know how to
Speaker 1: cook it? So I think that's where you're using the
Speaker 1: product in fastness. Moving consumer goods is easier because it's
Speaker 1: already conveyed in a product that you can consume. We
Speaker 1: can put it into chips and bars and things, and
Speaker 1: that makes sense to us. We already eat those things. Um,
Speaker 1: and it sort of is a good entry as far
Speaker 1: as you're looking at market demographics, because you're generally paleo
Speaker 1: eaters or vegan eaters or slow food eaters. Those people
Speaker 1: who have already committed to specific types of eating are
Speaker 1: more readily engaged in adopting new products that fit their ethos,
Speaker 1: not necessarily their palates or what they like to eat.
Speaker 1: So so one more question from me, Olympia, if I
Speaker 1: heard you correctly earlier, you said that you're not necessarily
Speaker 1: worried about demand in your line of business. It's more
Speaker 1: the supply, getting the capacity for farming to meet what
Speaker 1: you think is going to be strong demand. What is
Speaker 1: business like in your company and in your industry? Is it?
Speaker 1: Is it growing at a very rapid rate? Can you
Speaker 1: can you give us any numbers? Sure? So the industry
Speaker 1: globally is expected to both in food, so insects for
Speaker 1: food production and in sex for feed production. Both expect
Speaker 1: to have a hundred percent growth over the next two
Speaker 1: years to both reach a billion dollar industry, and so
Speaker 1: that's pretty speedy given how long the industry has been around.
Speaker 1: And those things are about the fact that we've got
Speaker 1: farms in Canada and Europe and the US who are
Speaker 1: currently at commercial commodity capacity and can produce those commercial
Speaker 1: commodity quantities, and so we're now seeing these products get
Speaker 1: to market for people to consume, and that's lifting the
Speaker 1: entire industry as it goes Olympia. What role are robots
Speaker 1: playing in your business? Yeah, so we have designed a
Speaker 1: robotic modular system for farming insects. The nature of Australian
Speaker 1: and agriculture and how the demographic of our land mass,
Speaker 1: how we are spread out with with cities quite far
Speaker 1: distances from each other, and we have these regional hubs
Speaker 1: that are almost isolated, so you'll drives and suddenly there's
Speaker 1: fifty people living in the middle of nowhere. When you
Speaker 1: consider using insects to eat waste or waste streams, that
Speaker 1: means you it's a better option to move b where
Speaker 1: the waste is than it is to be trying to
Speaker 1: truck waste to you, so you can raise insects. So
Speaker 1: I created a robotic system to farm insects on site
Speaker 1: where waste is created. It can form either black soldier
Speaker 1: fly or meal worm, and we will be commercializing that
Speaker 1: product in the next d eighteen months and getting it
Speaker 1: out into trials. But what that will mean for us
Speaker 1: and our goal of where these end up being is
Speaker 1: that we can put them under shopping malls where large
Speaker 1: volumes of waste, certain food waste, of being thrown away,
Speaker 1: and they can consume that waste on site using insects
Speaker 1: without the need for human interaction or human intervention, which
Speaker 1: is generally where you find challenges with employment and certainly
Speaker 1: manually raising insects on food waste is not economically viable
Speaker 1: in an industrialized world country. So robots managing food waste
Speaker 1: under shopping malls. So this is an instance where robots
Speaker 1: are assisting you with your disruption of the food industry. Yes,
Speaker 1: so we're disrupting waste management, which is an industry that
Speaker 1: hasn't been disrupted in its existence. So even though we
Speaker 1: have different ways of managing waste. Bioreactors and all those
Speaker 1: different new methods, we still pick up waste from one
Speaker 1: location and drag it or truck it to another and
Speaker 1: manage it in an an alternate location to where it
Speaker 1: was created. Um. We believe that those mechanisms of managing
Speaker 1: waste are becoming more and more prohibitive, mostly around the
Speaker 1: cost of petrol and trucking, but also around the need
Speaker 1: to keep regional communities vibrant and industry based in regional areas.
Speaker 1: And so for us, it's about decentralizing waste management and
Speaker 1: keeping it close to its region rather than dragging it
Speaker 1: across country for management. We think that's a more viable
Speaker 1: way to move into a future. Well, Olympia, thanks for
Speaker 1: joining us and good luck to you. Thank you so
Speaker 1: much for having me. It has been fun. So that's
Speaker 1: our on the ground or in the ground perspective. Now
Speaker 1: let's go Agnesca do SUSA in London. Aggie, thanks for
Speaker 1: joining us. When you researched and reported bugs are coming
Speaker 1: soon to your dinner table? What really struck you? So?
Speaker 1: While researching from my article, what I didn't expect to
Speaker 1: find is how many people there were committed to insect farming,
Speaker 1: particularly here in Europe. I thought this was very Asian
Speaker 1: oriented industry. You know, there are at least twenty thousand
Speaker 1: farms in Thailand. Insects are a popular food in that region.
Speaker 1: So I thought that if if we were to consume
Speaker 1: insects here in Europe, that would still be imported from Asia.
Speaker 1: And what I discovered was that actually people here are
Speaker 1: more and more committed to rearing insects locally. What I
Speaker 1: found surprising was to to meet people who who had
Speaker 1: other jobs in the past, other careers, uh, city dwellers
Speaker 1: or who would hear about this possibility and that would
Speaker 1: just completely make make a career change and switch to
Speaker 1: insects insect farming. And at the same time it was
Speaker 1: it was interesting to find people as well who would
Speaker 1: such as the Sconing family who are traditional farmers and
Speaker 1: learned about this possibility that they could actually do it
Speaker 1: in Finland and and we're willing to take that opportunity.
Speaker 1: What about the financial incentives for the farmers to get
Speaker 1: into this field or the city folk that you you discussed.
Speaker 1: Is it becoming a lucrative business or is it is
Speaker 1: it already there? It's a slow journey. I think you are.
Speaker 1: You're seeing people who are committed because they believe in it,
Speaker 1: but they do acknowledge that right now, it's not going
Speaker 1: to be a lucrative business straightaway. It's a very young industry,
Speaker 1: particularly here in Europe or in the West in general.
Speaker 1: So so you know, because it's quite small, you do
Speaker 1: not have the economy of scale. The production costs are
Speaker 1: going to be much higher than what you obtain in Asia.
Speaker 1: So so, just to give you example, you know, the
Speaker 1: price of crickets or cricket flower in Europe and North
Speaker 1: America can be as much as five times the price
Speaker 1: of the same product farmed in Asia, in Thailand specifically,
Speaker 1: So so you have to wait. You have to see
Speaker 1: more investment in technology. You need to see the economy
Speaker 1: scale achieved in order to actually bring the production costs
Speaker 1: down and be able to sell the product at the
Speaker 1: appropriate price. So so so that takes time. But I
Speaker 1: think you know, as as the demand picks up, you know,
Speaker 1: many of these people hope that they will be able
Speaker 1: to achieve good profits at the end of it. So
Speaker 1: let's talk more broadly about this. This is not just
Speaker 1: farmers shifting from livestock to bugs because say they're having
Speaker 1: a midlife crisis. What are the economic forces that are
Speaker 1: making this a real business proposition. One attractive thing about
Speaker 1: insects farming is how few resources they use, So you know,
Speaker 1: insect faring doesn't require as much land that then they're
Speaker 1: so tiny you can just keep them in you know,
Speaker 1: you know, a very compact place. You know, they do
Speaker 1: not require huge water resources. You know, in terms of that,
Speaker 1: I think that really helps. Then in terms of the feed,
Speaker 1: you know, you need to be feeding them in order
Speaker 1: to to rear them. And if you look had the
Speaker 1: feed conversion ratio, you know the amount of feed you
Speaker 1: need to get in order to produce one kilogram of
Speaker 1: let's say cricket that is five times smaller than what
Speaker 1: you require for beef. What role does climate change and
Speaker 1: population growth play A big one, because more and more
Speaker 1: consumers are aware of the impact traditional livestock traditional meat
Speaker 1: sector has on the environment. Where aware that rearing cattle
Speaker 1: contributes to climate change. It is a major source of
Speaker 1: greenhouse gas emissions. So more and more consumers are trying
Speaker 1: to adjust their diets. They're more aware environmentally conscious, and
Speaker 1: they want to through their dietary choices they want to
Speaker 1: bring about the change. So insects are a good proposition
Speaker 1: because you know they are not emitting as huge quantities
Speaker 1: of greenhouse gas guys this as pigs or cows. So
Speaker 1: so definitely, this is something that many people are watching
Speaker 1: when when they reach out for protein. And and another
Speaker 1: thing is we are more and more aware that you know,
Speaker 1: the population will continue to increase. We're expecting to reach
Speaker 1: the population of nine billion by twenty fifty, and we
Speaker 1: are aware that we're going to have to increase our
Speaker 1: food supplies by at least fifty by that time. And
Speaker 1: because our global resources are limited, we are um and
Speaker 1: and scientists and organizations and and food companies are trying
Speaker 1: to find the answers, how are we going to do it?
Speaker 1: How are we going to find those alternative proteins? And
Speaker 1: you do have certain options. For example, you have meat alternatives.
Speaker 1: So you hear about love grown meat or plant based
Speaker 1: products that resemble meat, that smell like meat or taste
Speaker 1: like meat. But we but but we know, you know,
Speaker 1: we are still far from this um mass production of
Speaker 1: such products, and we know they cost a lot, so
Speaker 1: so so you know, it makes you think you know,
Speaker 1: perhaps insects could be that that alternative, given that they're
Speaker 1: actually very high in protein. Aggie. In your article, you
Speaker 1: write about a couple of restaurants in Finland that are
Speaker 1: serving crickets on their menu, and you also discuss how
Speaker 1: ground up crickets, for example, can be made into I
Speaker 1: guess the kind of powder that could be added to
Speaker 1: foods like sausages, cookies, muffins, tofu and even ice cream.
Speaker 1: Is this actually happening already in some of the foods
Speaker 1: in our grocery store or you know, when when is
Speaker 1: this supposed to start really hitting the mainstream. So some
Speaker 1: cricket flower or insect flower is it's a very fast
Speaker 1: growing segment of the market. Its ground up crickets. They
Speaker 1: don't taste of much and and they don't look like insects,
Speaker 1: so it helps consumers to overcome this echy the factor.
Speaker 1: You know, it's much easier to consume an insect for
Speaker 1: many people if if the product doesn't look like an insect,
Speaker 1: particularly here in the West. So you're seeing more and
Speaker 1: more products that use that contain the flower, and the
Speaker 1: most common one these days that you actually already see
Speaker 1: in supermarkets. Um, maybe more the the niche supermarkets, or
Speaker 1: the the organic or the vegan focused was or the
Speaker 1: you know the health that the health stores. You do
Speaker 1: see energy bars, so you know, so this is aimed
Speaker 1: at people who work out and you know, people who
Speaker 1: just meet a snack. Have you tried any any of
Speaker 1: these products? Yeah? I did. I did. Actually, they don't
Speaker 1: taste of insects. It didn't strike me as um as
Speaker 1: anything different because insect flower accounts for ten percent of
Speaker 1: the products, so if you actually look at the ingredients,
Speaker 1: it's not the majority of what you get in the bar.
Speaker 1: And then you know, I tried licorice that was a
Speaker 1: finished product. I tried crackers, so you know, once it's
Speaker 1: ground up, you know, you just you can just consume
Speaker 1: it like as if it was any any other product.
Speaker 1: So I think the appeal here is more nutrition driven
Speaker 1: rather than taste driven. Aggie, thanks for joining us. Well,
Speaker 1: thank you. My Pleasure Benchmark will be back next week.
Speaker 1: Until then, you can find us on the Bloomberg term,
Speaker 1: Bloomberg dot com, or Bloomberg app, as well as podcast
Speaker 1: destinations such as Apple Podcasts, Spotify or wherever you listen.
Speaker 1: We'd love it if you took the time to rate
Speaker 1: and review the show so more listeners can find us,
Speaker 1: and you can find us on Twitter follow me at
Speaker 1: scott Landman Dan. You're at Moss on the School ecode
Speaker 1: our guest Olympia Yargur is at go Tera Underscore CEO,
Speaker 1: and Aggie Ta Susa is at Aggie Ta SUSA. Benchmark
Speaker 1: is produced by tofor Foreheads. The head of Bloomberg Podcasts
Speaker 1: is Francesco Levie. Thanks for listening, See you next time.