Harry Wright’s new selection of elegantly packaged condiments looks like the type of artisanal fare found at any foodie market or upscale deli. But they have a distinctive ingredient: ground, roasted crickets.
“Once the crickets with the herbs and spices are in, you can’t taste, see or smell them,” Wright said, adding that “there is no longer the Bush Tucker Trial Vibe – a reference to a British reality- Hit TV show where contestants are forced to eat the most unattractive bugs.
Wright hopes his UK-based company Short-Horn Super Seasonings can help change public attitudes toward insect consumption, which proponents see as an inevitable solution to an impending global food crisis.
With fears growing about the environmental impact of the agricultural system, entrepreneurs are rushing to devise new ways to feed the planet’s growing population. Insects are rich in protein and other essential nutrients and can be reared on a large scale with minimal environmental impact.
The pace of early-stage investment so far has lagged behind that in the more glamorous corners of agro-tech, where startups producing plant-based and laboratory-grown meat have attracted both venture capital and public attention.
But enthusiasm for insects is growing. VC funding for the sector has increased since 2018, with $ 210 million in equity investments last year, according to data group Dealroom.
The largest flows went to startups that focused on the feeding of farm animals, fish and pets.
InnovaFeed from France, which breeds black soldier flies, raised $ 140 million in its most recent funding round. It has a strategic partnership with Cargill to supply fish and animal feed, and even processes the dung from the flies into fertilizer.
Ynsect, another French company that grows molitor mealworms and buffalo beetles for use in pet food, fish feed and fertilizers, announced last year it would raise more than $ 350 million in equity and debt.
Insects can replace grain, soybeans, fish and vegetable oils in the pellets fed to animals and fish and provide important proteins and other nutrients. They can be raised using organic agricultural waste and minimal amounts of water.
Rising environmental concerns and ESG investments as well as recent regulatory approvals have opened the door to greater funding.
But in order to become a human source of food in Western markets, insects have to overcome the “ick factor”.
Alex Frederick, agri-food analyst at corporate data provider PitchBook, said negative consumer perceptions in markets that traditionally did not consume insects were a major barrier to adoption and growth.
Gorjan Nikolik, an analyst at Rabobank, said that if the functional and health benefits of insects were clearly demonstrated, they could “play an important role in food.” However, the bank’s most recent report on the sector focused solely on non-human insect consumption. “A lot of our customers said, ‘I wouldn’t eat it,’” he said.
Although pet food is the largest market for insect protein, some manufacturers refuse to use insects. “Most people find insects disgusting and some don’t want their pets to eat them,” says Nikolik.
Rabobank estimates that by 2030, 200,000 tons of insects will be used in fish feed annually, or 0.4 percent of the aquafeed industry, with 150,000 tons used in pet food, which is 0.5 percent of the total pet food sector. It estimates that only about 10,000-20,000 tons of insects are used for human consumption.
However, industry insiders believe insects will play a bigger role than some analysts predict.
“More and more people are thinking about the consequences of their behavior,” said Kees Aarts, founder and managing director of the Dutch insect company Protix. He added that anyone who talked about sustainability 20 years ago would have been viewed as an anti-capitalist, but now “most young people think about it – I’m just blown away by how they look at all sorts of solutions to their footprint to reduce. ”
The negative reaction to insects can be overcome, he believes – “if you deliver tasty products with a smaller footprint, consumers will buy them”.
Some experts say that given the risks that climate change, soil erosion, pests, and disease pose to the global agricultural system, we may have no choice but to eat insects.
“Consumers in the so-called West need to include insects in their diets to ensure that their diet is high in essential amino acids, proteins and essential micronutrients like iron and calcium,” says Asaf Tzachor, a food safety researcher at Cambridge University .
The key might, as with the short horn spices, be moving away from eating whole insects and using them as ingredients and additives.
Tzachor believes that processed insects in products like pasta, porridge, and pancakes could be used to improve their nutritional profile or act as an antioxidant and anti-inflammatory agent. “Black soldier fly pellets contain protein and calcium,” he said. “Mealworm beetle powder contains zinc and essential fatty acids.”
Some executives and investors believe that lower amounts of insect-based human food can be offset by higher value and higher margins.
Eric Archambeau of venture capital firm Astanor, an investor in Ynsect, said insects are nutritious and the ease with which insect proteins are digested meant that they could be used in foods for the elderly and frail who are familiar with mainstream products have to fight. With nutritional supplements, a multibillion dollar industry, he added, “These categories are a niche, but they are a very big niche”.
In addition to food and feed, researchers are also experimenting with other ways of using insects. Some researchers are exploring the use of insects’ antibacterial properties to extend the shelf life of food, while others are exploring their potential role in addressing environmental issues, for example by mounting them on waste such as cardboard and plastic.
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While the development of these technologies into scalable and commercially viable businesses will take time, “it is the potential that excites people,” said Nikolik.
The response to the introduction of short horn earlier in the year suggests that perceptions are changing.
“We’ve already grown 20 percent and have regular customers,” said Wright. “People were very receptive, which was quite a shock.”
Emiko Terazono is the Financial Times commodities correspondent.
Copyright The Financial Times Limited 2021
Reprinted with permission.
