When we think about greenhouse gas emissions, automobiles, airplanes, and power plants usually figure more prominently than livestock. The methane produced by cow belching, however, is one of the biggest sources of agricultural greenhouse gas emissions. Fortunately, there are some innovations on the horizon that are promising to help reduce the damage of these gassy cows. This week on Sea Change Radio, we speak to David Messina, the Managing Director of Rumin8, an Australian-based startup that is hoping to transform the cattle industry. The company’s main product is a lab-grown feed additive that is designed to significantly reduce methane emissions in ruminants like cattle and sheep. We discuss the problem that Rumin8 is trying to solve, talk about the company’s business strategy and hurdles it faces, and take a look at the competitive landscape in the growing feed additive space.
00:02 Narrator – This is Sea Change Radio, covering the shift to sustainability. I’m Alex Wise.
00:19 David Messina (DM) – But I think it’ll become standardized. You know, if we achieve and the industry achieves what we want, then it’ll become just a standard. It’ll be a negative for products that aren’t being produced in a climate friendly way within 5 to 10 years.
00:35 Narrator – When we think about greenhouse gas emissions, automobiles, airplanes, and power plants usually figure more prominently than livestock. The methane produced by cow belching, however, is one of the biggest sources of agricultural greenhouse gas emissions. Fortunately, there are some innovations on the horizon that are promising to help reduce the damage of these gassy cows. This week on Sea Change Radio, we speak to David Messina, the Managing Director of Rumin8, an Australian-based startup that is hoping to transform the cattle industry. The company’s main product is a lab-grown feed additive that is designed to significantly reduce methane emissions in ruminants like cattle and sheep. We discuss the problem that Rumin8 is trying to solve, talk about the company’s business strategy and hurdles it faces, and take a look at the competitive landscape in the growing feed additive space.
01:46 Alex Wise (AW) – I’m joined now on Sea Change Radio by David Messina. He is the managing director of Rumin8. David, welcome to Sea Change Radio.
01:54 David Messina (DM) – Thank you very much. It’s a pleasure to be here.
01:57 Alex Wise (AW) – So explain for our listeners the problem Rumin8 is trying to solve what is your technology and how are you trying to change the world.
02:06 David Messina (DM) – We’re going after one of the biggest problems in climate at the moment, and that is methane emissions from cattle. It accounts just for that one single issue from 1.2 billion cows, about 4% of total greenhouse gas emissions. We have products that reduce those emissions by a fairly complex process that happens in the stomach or in the rumen of the animal, and we’re seeing some really exciting results.
02:35 AW – So we’ve heard a lot about seaweed being the kind of this new silver bullet that can reduce methane emissions through a cow’s burps being reduced by this additive, but I’ve also read that growing this amount of seaweed might not be scalable, so ruminate is trying to solve that problem by doing it chemically is.
02:56 DM – Correct, yes, it is the exact same bio active that is found in the seaweed. We actually take that product, we manufacture it and we stabilize it in our laboratory and then we produce a product in a in a pharmaceutical manufacturing process. So instead of having to grow the organic product. All the seaweed we’re actually able to manufacture and stabilize our product, which means like any factory, you can scale it up very quickly and the faster you can scale it and the easier it is to scale, the cheaper the product is.
03:32 AW – And I realize you’re in in testing, but what kind of percentage are we talking about as an additive in terms of a cow’s daily intake? Is this going to be just a little bit of a sprinkling in there or is there a significant portion of their diet in terms of what you’ve seen so far in tests, David?
03:50 DM – It is more like a sprinkling. It’s a very small amount that’s added to as a feed supplement in what the animal eats every day, and we actually have several products available to us. So we have a powdered product which we’re very excited. Out and is our probably our lead product at the moment. We have an oil-based product so that can go around feed or in feed. We have a product that we are very excited, excited about that we can deliver in water to the animals. So when it’s drinking, so that looks very exciting. And our 4th stream is actually a slow release tablet that goes into the room and can last, you know, 6 plus month. So that’s something that may only need to be applied once or twice a year. So these four product streams that we’re working on, we’re confident one of those will fit into most systems that we’re looking at around the world.
04:52 AW – I don’t know how it would work in other markets, but I imagine with the FDA in the US, I guess one of the drawbacks of creating a laboratory product as opposed to just if you wanted to just add seaweed that you get from the ocean is you have to jump through some more regulatory hurdles. Is that correct?
05:12 DM – Yes, of course. And look, that is the case in in every country, unfortunately the unique situation in the US is the product is is treated as a veterinary product and as a result of that it has to go through the FDA, which is five years plus quite an extensive process. In almost every other jurisdiction in the world, it’s treated as a feed additive. So the timing is about half to get that product to market. So we do see an A really unfortunate situation in in your backyard where it’s got this great technology coming through and other companies have good technology coming through as well in this methane reduction space in ruminants. And we all have to go through quite an extensive FDA process, which is not required in, in, in other any other country around the world. So it’s the obviously we have new products coming through all the time in any industry. Ag is probably a little slower than most and the volume is probably a little lower. And what we have here is a classic situation where the, the regulators and the regulation is actually not fit. The purpose for these new products coming through, so we do have a bit of work to do in the United States to try and customize and change that some of those regulations so we can get these products into the market still through a very rigorous process, of course that that other countries including Europe have a very well-established pathway to market for feed additives, including ones that reduce methane production in rooms. We’re just not quite seeing unfortunately the US at that same stage.
07:09 AW – Yet so when you talk about the regulatory hurdles, does that include the importation of meat? I know in Japan they import a lot of Australian beef or the US imports a lot of New Zealand lamb products. Are these products also going to be under scrutiny for the additives that those countries are putting into their food systems, or is this unique to cattle owner’s jurisdiction in that country? Does it translate into the importation of the food as well, I guess, is the question?
07:43 DM – Look, inevitably, whatever product you are feeding livestock that that then get exported into a whole range of different countries, including those ones you talked about, there is a whole process for the seller in this particular case or the exporter to demonstrate. That through the life of the animal, obviously it’s been treated well. There hasn’t been any adverse products fed to the animal or given to the animal at any stage during its life cycle. So our product and others will go through that same process and same level of scrutiny as they all should.
08:24 AW – So let’s talk about the methane reduction levels from your product. What are you seeing thus far in your tests?
08:32 DM – In in vitro test, so these are the ones that we do in the laboratory. You know we’re seeing 95%. Plus, in animal tests, we’re seeing, you know, up to certainly that level. But realistically in the field it is going to be lower when you get into a a larger scale and more animals and a less controlled environment. But you know it is still going to be material we you know we’ve seen results in the field up to 85%. We’re not expecting to see that on a day in, day out basis when we get into large scale which is the next stage for us, you know, in early next year, we expected to be doing large scale farm trials across ranches and farms in Australia, New Zealand, Brazil is probably next. We’ve got trials starting in the EU next year. We’ve got trials in the US already, albeit the again, the timing in the US will be slightly slower for those reasons I described earlier on, but yeah, no material reductions the bio-active is very effective and because we are actually manufacturing this product, we know exactly how much goes into every gram of product and how much then goes into every animal, so it’s very precise dosing and that means our results. Are a bit more consistent than what you may see from a an organic product and we’re also able, as I mentioned, to deliver it in many different formats, oil or a solid or a slow release product or a or a water soluble product so that manufacturing process gives us a lot of advantages and then more consistent results, but they still vary, so you mentioned 10 to 90%, I think the lower quality feed the that the animal is eating in the simple terms produces more methane. It’s working harder. You know the stomach is working much harder to break the product down and that produces more methane, very high quality feed. The cows produce less, so the range is we see everywhere, perhaps not quite that broad with our product because we’re a little bit more consistent but there is an enormous range even between animals.
11:07 (Music Break)
11:41 AW – This is Alex Wise on Sea Change Radio and I’m speaking to David Messina, he is the Managing director of Rumin8. That’s RUMIN and then the number 8. So David, let’s take a step back at the outset of our conversation, you mentioned how big a problem methane emissions are in cattle. And ruminants around the globe. Can you give our listeners a better idea of how big an issue it is and how it is linked to climate change crisis?
12:08 DM – Domesticated cattle and sheep and goats all remnants, you know, have been part of our lives for thousands of years and in different cultures form a very important part of society and in fact part of the family, and a very important part of producing food. And you know, by ploughing or a whole range of other things. So over thousands of years, we have continued to domesticate what were wild animals at one point in time. What wasn’t terribly taking into consideration as we were breeding these animals is how much methane they produced, and because it just simply wasn’t measured and it wasn’t obvious until quite recently. Interestingly, the early work that was done two or three decades ago was focused on taking this 10 to 12% loss energy in methane burps, essentially, and try and turn that into highly more production in the animals and. And so there was quite a bit of research done for completely different reasons. 20 or 30 years ago, recognizing that this methane was being produced and it as a loss, you know, to the animal essentially, so there’s some really good early work done with a focus on trying to turn that into productivity rather than being necessarily too focused on the climate at the time, if we Fast forward to where we are today or the last 10 years, massive focus on climate, obviously a recognition that this lost energy and lost methane from remnants. Not only is a lost productivity, but critically, you know, it has a negative impact on climate. And so the focus is and the research has gone back frankly to where it was left off 20 or 30 years ago. But the focus now is not only about trying to improve productivity because we are seeing productivity gains, which is exciting in itself, but more importantly. When we have our focus on climate now, so if you can imagine a an A cow produces roughly about as many emissions as a as an average sized car then then then you start to get an understanding of over a billion cows in the world is equivalent to over a bee in cars, so it really is important that that we find these solutions and we have, you know, us and there will be other companies coming up with solutions as well where we can materially reduce greenhouse gas emissions and I think the real opportunity that is often lost is methane is much in a in a short period of time in 10 or 20 years. It is much more potent to the environment than carbon. So if we target methane production. From and we’re targeting cattle, obviously, but there are many other industries that produce methane and it’s exactly the same story. If we can reduce methane emissions. And globally by 60 or 70% over the next 10 years, it actually buys us 20 or 30 years just because of the multiplication effect of methane itself. So we have a real opportunity to get in front of methane, it in the short term, it’ll buy us time for all those other solutions to be coming through the system in their various forms and all that technology, because reducing methane in cattle, you take our product and literally within hours it’s producing less methane. It’s like an off switch though the impact is immediate and there’s not many other solutions for any other climate related products in in agriculture, but, but even across the board that have that immediate impact on and then you have this multiplication effect, of course where it’s 20,30,40, 50 times more powerful than CO2 that we can take out of the system.
16:32 AW – Let’s talk about the vast undertaking of of trying to distribute this product across you mentioned Brazil, Australia and New Zealand, but I’m I was surprised to see that by far the largest cattle owning country in the world is India. I imagine a much more, a more fragmented industry. And there’s probably a wide range of incomes and socioeconomic levels vary quite widely, I imagine, in that country. So how does Rumin8 and its competitors crack a market like India? And how do you hope to be the Johnny Appleseed, so to speak, of feed additives for cattle across the planet?
17:16 DM – Well, I can only talk about what the strategies that we’re looking at. We’ve been very fortunate that about six months ago the Breakthrough Energy Group invested in Rumin8 alongside Prelude Ventures.
17:30 AW – And for our listeners, the Breakthrough Energy Group is Bill Gates’s venture group, correct?
17:35 DM – Thank you. Yes, it is and the mandates of both those tier one climate funds is to reduce. So our we’re looking at trying to get product to market as in an affordable and scalable way as fast as possible. That is the mandate. So what we’re looking to do is actually partner with existing infrastructure and existing people and existing companies rather than they build a massive animal health company, which will take three or four times longer than this partnership approach that we’re taking. So we’re not looking to duplicate infrastructure and that includes the US, Brazil, India, Europe, we’re looking to work with tier one existing partners in each of those regions, so we can get product to market as fast as possible with people that farmers trust. The logistics has been resolved many, many years ago, production capacity, all those things. Already exists so when you, when you look through that lens, then our target for 2030 is 100 million cattle. It’s our mission and around the world to be treated with ruminate product and we’re very focused on making sure that happens. I guess to answer the second part of your question, when you look at regions like India and Africa, the cow is a very important part of the culture. They’re not necessarily domesticated for consumption they play many other. In fact, in some cases the opposite. So we need to find solutions for those regions. Massive, massive cattle numbers, less ability to pay. So we think there’s opportunities to actually provide another revenue stream. Into those families because carbon credits become available for these products and if we’re smart, we can get the products into these regions and potentially generate another carbon, another revenue stream through carbon credits.
20:00 AW – And that would be through those local governments or would that be through an international carbon credit creditation body?
20:09 DM – No, that all of these processes need to be registered at an international level. That’s generally where the buyer is in a simple terms, so an internationally accredited system for each of our products is a critical path to the value proposition to all farmers that that use our product.
20:35 (Music Break)
21:33 AW – This is Alex Wise on Sea Change Radio and I’m speaking to David Messina. He is the managing director of Rumin8. Give us an idea of how farmers are accepting or rejecting the concept. How aware of the methane emissions issue are they, if you can generalize, obviously, and what’s the financial incentive for them? Can we make this attractive for them in the short term?
22:04 DM – Absolutely. And you know, one of the one of the challenges we have right now is we have the value of carbon credits, you know, ranging from $30 per ton to, you know $90.00 per ton in the UK for example, and approximately $90 but so massive range in in the value of carbon credit. So the value proposition in Europe for example is very different, it’s very positive. Right away, if, if we look at the US, which is closer to $30 rather than $90.00 a pound, then the value proposition is different. The equation looks very different now. I think over time we’ll see those markets starting to equalize and get closer together. In the interim, however, you know it’s the other areas that we talk about when we talk about value is certainly productivity gains is looking really interesting. Obviously If the animal can grow faster or to grow on less feed because the efficiency, the conversion efficiency of the feed has gone up as a result of not losing methane as much methane, then that’s very positive. We’ve got marketing market premiums. That are being paid already both at a meat level and also at A at a dairy level, you know. For milk, lots of examples almost in every country. In fact, the the milk industry seems to be further ahead of this than the beef industry, where they’re paying a few cents more per liter anywhere where the market is closer to the producer, like milk is obviously very direct. Then the market signals happen much faster than maybe a beef producer, which may go to two or three different processing before it ends up on the on the shelf.
24:01 AW – Yes, speaking of marketing, do you think there’s a chance for a premium to be built up for a consumer sort of like a grass fed beef that this is methane-reduced beef, etc.?
24:14 DM – Look, I I think in certain markets, developed markets, developed countries, yes, where there’s a willingness to pay for those products and we saw that with you know some of the alternatives to meat as well. You know absolutely where you’ve got people who have an ability to pay but not everywhere like that. So we can’t rely on that to as a pull through necessarily in a long term basis, but in the short term, yes, those countries that have more disposable income and can make those choices, we’re seeing some premiums on the shelf and people are certainly paying for those. But I think it’ll become standardized if we achieve and the industry achieves what we want. Then it’ll become just a standard. It’ll be a negative for products that aren’t being produced in a climate friendly way within 5 to 10 years.
25:05 AW – So without tooting the horn of your competitors, David, maybe you could give us at least a lay of the land, the competitive landscape. What excites you beyond just your own product? You mentioned that your goal in 10 years or in seven years is to get 100 million animals to use your product? That that’s just still 10% at best of global cattle numbers. If you can give listeners an idea of some of the other products out there that are in the works.
25:40 DM – Yes, of course. So there’s a product that a couple of years have head of us by a company called DSM. It’s another product that’s produced in a manufacturing process 3 NOP, so that looks that looks very good as well. Precise dosing et cetera not quite as good on the efficacy side with 30 to 40% reductions but still exciting and obviously in the market in some countries already not in the US unfortunately because it’s two or three years behind, as I mentioned earlier on, that also needs FDA approval.
26:17 AW – That also needs FDA approval? That’s similar to the Broma-form additive that Rumin8 makes – you need to go through a process. It’s not just adding like a vegetable or something to an animal’s feed?
26:27 DM – No, and even on the organic product side, which is the seaweed in almost all countries, that has to get registered because they’re agnostic to the delivery mechanism in most countries, it’s the compound that’s obviously doing the heavy lifting that that you’re actually registering not the carrier, if you like. So not a powdered product like ours or not, the seaweed product, like the the seaweed guys are doing or and in the case of. Of the DSM product the same it’s, you know, it’s the compound itself that that rightly so needs to be reviewed and scrutinized and go through a process.
27:08 DM – And look, there’s a number of other organic products coming through the system as well.
27:13 AW – Are they all kind of based on seaweed as the silver bullet or no?
27:17 DM – No, there’s some essential oils and garlic and various other extracts from certain things in, in mixtures, they are the efficacy is lower and inevitably it’s the cost is a bit higher but we need a whole range of alternatives and I’m absolutely no doubt that there’s.
27:38 DM – There’s a bunch more compounds behind us. As well, in fact, we need them. So hopefully over the next few years, we’ll be starting to see those come through as well.
27:48 AW – He’s the managing director of Rumin8, David Messina. David, thanks so much for being my guest on Sea Change Radio.
27:58 DM – Thanks very much. It’s been my pleasure. And I look forward to speaking to you again shortly.
28:17 Narrator – You’ve been listening to Sea Change Radio. Our intro music is by Sanford Lewis, and our outro music is by Alex Wise. Additional music by Les Paul, The Wiggles and Foo Fighters. To read a transcript of this show, go to SeaChangeRadio.com stream or download the show or subscribe to our podcast on our site or visit our archives to hear from Doris Kearns Goodwin, Gavin Newsom, Stewart Brand and many others. And tune in to Sea Change Radio next week as we continue making connections for sustainability. For Sea Change Radio, I’m Alex Wise.