"Aotearoa’s future in food" presented by FFA Chair Alex Worker
Tēnā koutou, 您早上好, hola gente buen dia. My name is Alex Worker, Chair of Future Food Aotearoa and it's a pleasure to be in Rotorua together to explore our shared future in food.
In opening the second day of NZIFST 2022, it's worth recapping on yesterday's connected themes. In the morning we heard from legacy beef, methane and Fonterra, then seafoods, then cell-based developments, then NZTE value chain learnings and finally knowing our 'why' and inviting collaboration thanks to Jodie Kuntzsch.
I'm aware how hard it is to truly collaborate if we haven’t clarity and alignment of our shared vision. There’s actually no point collaborating until we are clearer and aligned under a unifying vision (our why for food & fibres).
Before delving into this, I want to give context on my roles and background so you can understand where I'm coming from:
- Chair of FFA – a founder and industry collective supercharging Aotearoa’s foodtech ecosystem. We bounce around with a number of interesting founders you may know and have worked with – Ārepa, Pure Food Co, Chia Sisters, Boring Oat Milk, NewFish, LILO, Almighty, Two Islands, Manukora, Spring Sheep Dairy, and a few other great high growth SMEs. We are almost into our second year, totally unfunded with partnership with Te Hono to date, building an academy and pipeline strategy for turbocharging high growth SMEs in food and fibres. We see this as new, needed collective revenue for our country.
- Country Manager for Impossible Foods, across NZ and soon South Pacific. Impossible Foods is a US-headquartered food technology company with a global mission to make delicious meats from plants. Since launching last November we are in over 400 supermarkets and foodservice partner locations across Aotearoa NZ. Growth and reception has been great in New Zealand, more than what we were expecting even. Previously, I had spent 10 years with Fonterra around APAC.
- I am a Director and Growth Partner in Kiwi startups NewFish and LILO. NewFish is a pre seed venture creating novel seafoods and now actively investing in developing a microalgae food and nutrition industry in New Zealand. LILO is a fruit wastage desserts company creating supernatural snacks and exploring new generation nutraceutical formats. They are both led by Kiwi founders and in early stage funding rounds.
- I also sit on steering committees with Te Hono and MPI’s ITP for our F&B sector – I see my role as a mid-generation bridge enabling actionable, future-focused transformation plans.
- Lastly, I am husband to a Chinese Panamanian wife, and father to a couple of young multi-identity now Kiwi kids. Aotearoa is a special place, I am grateful to be here and excited about the next thirty years. It’s a supernormal opportunity for us if we can get it together, collectively under bold vision and embracing diversity as a trust hub in the South Pacific - bridging the East and West.
If to talk about modern and future food, we need to get clearer about where we are today.
We do 50bn NZD today of revenue (mainly exports) for our food and fibres. MPI expects us to get to 85bn over coming years. A lot of this is dairy, kiwifruit, hort, beef, wool, forestry and a bit of seafood. A lot of this goes to China and wider Asia today, despite the recent calls for diversification. Today. we are being pushed into a 'Go West' strategy given geopolitics without clear demand signals. This is dangerous for our food and fibre exports.
Not a lot of our current exports are value-add still, hardly any of it is ‘foodtech’ – a relatively new concept for Aotearoa. Agtech has kinda been socialized...foodtech and the connected commercialization pathways, not so much.
There’s currently an assumption that we can do a bit less of what we do, get more margin for it selling to some rich western folk, and be in a pretty good situation to hit 85 bn revenue according to MPI. A lot of our key markets buying our foods – Singapore, China, US,Thailand etc - are heavily investing in foodtech to build domestic supply and self-reliance mechanisms. Rising prices, protectionism, China-US worsening rhetoric, breaking supply chains all challenge Aotearoa’s existing value chains to market.
New in-market value chain models are needed, I see as much as 20bn of this 50bn today under threat if we don’t change, let alone try and make up another 35 bn to hit 85 bn. If we price in environmental impact to a lot of our legacy exports, our products become a lot more expensive, naturally. This hasn’t happened yet.
At Te Hono last year there was an intergenerational meeting that allows for the ‘and’ between existing industries and modern/future food industries. I summarize this crudely as older blokes from primary industries and their attempt to move into regenerative; and a nearly nonexistent
new lane for modern and future foods and everybody still scratching heads how NZ can build this up quickly.
In the 3 horizons of food technology and according to GFI’s view of the world – plant-based, fermentation, and cellular – I believe NZ is underequipped in all of these today. In many of these lanes I think we are running 5-10 years late, and at least 2 years behind Aussies now thanks to their Federal, State and CSIRO impetus. Burning fires around Sydney help enable mindset and resource allocation shifts; abundance of water in Aotearoa creates a false cushion and
sense of comfort. Island behavior around Covid hasn’t helped. Many of our farming boards are rich enough for multi generations – corporate farming interests are very different to family farming interests.
My view for Aotearoa is that we must get clearer and co-create a vision for NZ’s modern food future that we can all buy into. This isn’t from MPI, or Govt, but rather from us – industry, entrepreneurs, scientists and importantly… and missing here today as they have their own meeting in Auckland … farmers. The wider industry ecosystem has to lead this, from NZ for Aotearoa and validated quickly by our channels and partners. Will our current and future customers willingly pay for this upgrade? Where are they today, what do they need in 10 years? What are their beliefs?
I believe Aotearoa is going through rapid systems change as we meet here – we now have a class society, and in the backgrounds our primary industries and value chains are creaking. I see us in free fall today yet I’m optimistic about tomorrow. We need to create the opportunities together. Strong commodity prices and threats of war keep our legacy industries strong …ish, although a cough from China will change this picture immediately.
Looking at our pipeline - there is a lot we need to build together, quick smart:
>> Across plant-based horizons – we have a few companies (S/O Leaft Foods in the room) but today there should be another 30. We need to build and foster this in the next 3-5 years. This needs to be industry and ecosystem led, govt enabled.
>> Across fermentation horizons – we have a couple of companies (S/O Daisy Lab in the room) and some have already gone offshore, but we should already have 10 more. We need to build and foster this in the next 3 years. This needs to be industry led, govt enabled.
>> Across cell-based horizons – we hardly have any today and should have 5 already. We need to build and foster this in the next 3 years. This one should be govt led, industry enabled. GE and GMO etc need to be flushed through. It was cool to hear of cell-based seafood yesterday, how can we supercharge this further through our CRIs?
There is a lot of work we (as a group) can get on with. That’s already another 45 companies we need to create tomorrow. We need to get hustling, as if our livelihoods depend on it. Science and food technology underpins all of these opportunities and companies we need to build, and then we need a few crazy founders who want to talk lots of hot air and fundraise, and connect these (in the case of plant based, fermentation ingredients and arable land plays) with a few progressive farmers and blue triangles – on land and at sea.
The issue here is how do we connect the ecosystem so we don’t leave too many behind, and at the same time disrupt the ecosystem to make sure we keep up with Singapore, Denmark, the Dutch, the Israelis, the Americans, the Koreans, the Chinese etc. They are all our friends, and foodtech competitors and potential partners.
A few points from me:
o A lot of our primary producers are going to look at regenerative ag – the issue is that this requires a very different mindset shift. From Chemistry to Biology. Less is more; circular thinking rather than linear etc. Systems thinking through a holistic lens requires unlocking a new mindset – the Ross’ at Lake Hawea Station started this on Country Calendar last week, classical music included.
o A lot of our modern food companies need to be supercharged, with many at 0 going to 1, let alone from 1-5. We've validated that our pipeline is weak today. FFA and ecosystem friends and enablers can drive this type of academy, but it isn’t cheap and has to be strategic with a focus on quality and right to wins and right to plays. It shouldn’t be Govt led, rather supported. It needs to dodge NZ rhetoric, focusing on ‘outside in’ value creation.
o We can’t do all this with our talent in Aotearoa today, we need to continue to attract and complement with bright minds that buy into our energized vision for NZ. Visas and smart immigration policy are fundamental.
All this is how and what…the fundamental question still remains… what’s our collective why for food & fibres? Thanks Jodie for framing this yesterday. I’ll try playfully to attempt to sum this up. To me this is key, if we nail our collective why as a frontier nation, we then build a clearer strategy and get on with how and what and executing. Te Puna Whakaaronui and Fit For a Better World have already done a lot of this heavy lifting.
My vision is that Aoteaora New Zealand can be the world’s eco valley. We can feed Asia Pacific sustainably and neutrally. This is our why for food and fibres - from products and markets to health, nutrition and wellness solutions. We must protect our lands, people, animals – our whakapapa - as guardians. Kaitiakitanga. The Te Ao Maori frameworks work wonderfully - they are perfectly aligned with many Eastern value frameworks. We must guard Mother Earth’s natural innocence and invite in Father Sky – Rangi and Papa tell this story. People will come to NZ to disconnect, learn, nourish themselves and reconnect. We must invite smarts and foster collective resources as a hub to enable a ‘value at volume’ strategy for 10+ new companies hitting 1-3bn revenue ARR. Technology is an enabler, lets invest accordingly. And this cannot cost the earth, in both regen and modern foods lanes. This is imperative.
If this is a vision we can get behind collectively, we then have to make some hard decisions. What verticals to prioritize, what not to. My view:
- Do regen beef, sheep and dairy, but do it better. Nutritionals, medical, infant, hydroslysates, oils, aged care, end of life etc. Brand the shit out of it. Fortisip equivalents can be NZ branded and made here as finished goods, not via Danone or Abbott. Be comfortable cutting up to a 1/3 or higher of volume from commodity dairy and beef over the next 10 yrs. This is staining our future narrative, sorry Fonterra. Fonterra’s success isn’t neccesarily NZ’s success. Small and medium is also beautiful, if we better control value chain to our target consumers in zip codes instead of markets. These industries can be more ethical, and we need to prove this. Big sometimes can be allowed to fail and evolve again. Failure is ok, we should share and learn from it widely.
Co-ops can also transition, like Kerry.
- Why isn’t our blue economy further prioritizedand protected, after all, we account for 96% ocean and water and only 4% land. I borrow this from Volker and Cawthron Institute. There's a lot to do here - as seafood is healthfood. And we should do it best.
- Therapeutics and holistic ingredients – Wild Thyme and other so-called weeds have global value. These are recognized by the East more so than the West. We should nurture this, some already are.
- Wool, and its value-add revenue streams (proteins etc) is a goodie. ZQRX and Allbirds and Keraplast Manufacturing show the way.
- Macro algae is important, thank you AgriSea and ANZSA initiatives, and key that as the industry builds we do not get caught up in previous primary production model challenges for linear scale and incrementalist pricing. I loved Clare from AgriSea's points yesterday coming back to family values. Open acquaculture vs naturally sourced wild-caught differentiation, price and needs distinguish accordingly. Learn from the mussels commoditization.
- Micro algae in my humble opinion is a key Aotearoa play (Newfish et al). Proteins and non dairy alternatives if there’s sufficient proven IP capture from NZ. There can be real scale here.
- Rubisco and green proteins from mulch and grass are really interesting in my opinion- use our water and sunlight and soil. Khosla’s validation is really important – well done Leaft Foods and a global Series A benchmark in NZ.
- Fruit (health and wellness) extracts and nutraceuticals a total no brainer for NZ – thank you UV hole and ozone layer. Champion and hold Zespri and T&G etc accountable for value-add upstream processing. Invest behind PFR networks. Partner with startups like Ārepa and LILO.
- Invite midstream and upstream opportunities for Perfect Days, Impossible Foods etc into NZ to reposition for APAC re-exports – there’s a lot of IP and talent capture by doing this. We can
learn from Israel and Singapore here. Even the Aussies are beating us to the clip in last couple of years too.
- Support breakthroughs in fermentation and cell-based, validate non-NZ scale up pathways connected to govt, channel and capital ASAP. The Singapore working partnerships are a good example here as long as we can control our IP. Socialise the GMO and GE conversations quickly in our public and allow for targeted scale-up pathways from Aotearoa. Has to be Govt approved and consumer endorsed, importantly, politicians need to get behind this.
- Invest in collective pools for targeted scale-up activities from NZ and some targeted in-market scale up manufacturing plants in key demand nodes e.g. China, Korea, US. We needn’t rely on Fonterra, they can enable the supply chain but a new NZTE model can too. Change MPI to Ministry
for Food Nutrition. Business and value chains have changed, we need to front foot
the new models in Govt.
- Feed both US and China and some others fairly – don’t let politics dictate our nutrition and wellness responsibilities, in NZ with our people (feed ourselves first and better, after
all, food is medicine) and then to our non NZ customers (feed them second and better and with powerful, differentiated stories and stickier solutions). License IP as appropriate, eyes open and play friendly hard ball aligned to Aotearoa interests. Don’t sell any more strategic land assets offshore – Miraka that follows me is a cool example of how to partner smartly e.g. Mengniu and Vinamilk.
Above all else though, there's no point going through the above without us collectively getting clearer on our vision – and keeping it industry led and govt seconded. Run with sprints and marathon speed, chase aspiration and avoid incrementalism. We need a newly-paced hustle culture.
If we are the eco valley for Asia Pacific, let’s start acting like it. Bhutan almost has this leadership position, but I believe this is rightfully ourselves for our food and fibres…if we can get it together. What do we say no to and why. What do we accelerate and why. Its in our control, in your control, you have a voice, for ourselves, our whakapapa, and for our children and our grandchildren and our great great great grandchildren.
Kia ora. Questions, and more importantly, debate?