Precision Fermentation & The Dairy Disruption

How will Precision Fermentation disrupt the dairy industry?

The industrial livestock model of production has reached its limit in terms of scale, reach and efficiency.

As the most inefficient and economically vulnerable part of our Food & Agriculture system, cow products will be the first to feel the full force of the modern food disruption by emerging technologies like Precision Fermentation.

The whole of the cow milk industry will start to collapse once modern food technologies like Precision Fermentation have replaced the commercially valuable part of milk, namely its proteins, which account for just 3.3% of its content.

A disruption occurs when new products and services create a new market and, in the process, significantly weaken, transform or destroy existing product categories, markets or industries.

Example: The digital camera destroyed the film camera industry. The modern car disrupted the horse and cart. Now, Precision Fermentation will disrupt the industrial livestock model of production.

yeast + casein + water + whey (protein) + sugars + fats = milk

Solid proteins (casein and whey) account for just 3.3% of milk’s overall composition, and can be replaced using Precision Fermentation.
The rest is made up of 87.7% water, 4.9% sugar (mainly lactose), 3.4% fats, and 0.7% vitamins and minerals.

The gene responsible for the production of milk protein in cows is inserted into yeast. This gene then instructs the yeast on how to produce the milk protein in an efficient way. The protein and yeast combination is then placed in a fermentor, where it multiples quickly and produces many milk proteins (identical to the ones that cow’s produce).

These milk proteins are the key building blocks of traditional dairy. These multiplied proteins are then combined with good vitamins, minerals, non-animal fat and sugar (therefore, there is no cholesterol or lactose!) to form every kind of dairy product imaginable!

What will be the impact of this disruption on the dairy industry?

Around 35% of the products in the milk market are consumed as ingredients in many different products, from cakes and desserts to baby formula and sports supplements. These ingredients will be the first to be disrupted.

Product after product that we extract from the cow will be replaced by superior, cheaper, modern alternatives. This will trigger a death spiral of increasing prices and decreasing demand for the industrial cattle farming industry.

Production methods like Precision Fermentation will be up to 100 times more land efficient, 10-25 times more feedstock efficient, 20 times more time efficient, and 10 times more water efficient. They will also produce an order of magnitude less waste.

The dairy industry, which is already balancing on a knife edge, will be all but bankrupt by 2030.

RethinkX Predictions

According to our forecast, as outlined in our Food & Agriculture Report:

the number of cattle will drop by 50% by 2030
revenues directly associated with cattle production will fall from $95bn to $50bn at current prices.
by 2035, cattle production will drop by 75% from current levels, with revenues shrinking to $20bn.
at current prices, revenues of the U.S. beef and dairy industries and their suppliers, which together exceed $400bn today, will decline by at least 50% by 2030, and by nearly 90% by 2035.