Not all beef is bad

Not all beef is bad (

  • At any time there are c. 70-80m beef cattle alive in the US, with about 60-65m on grazing land and 10-15m in fattening/finishing feedlots. On top of this there are c. 20m cattle in dairy herds.
  • Animal feedlots have been identified as creating a number of environmental issues including the use of antibiotics, animal welfare and by-products such as manure production & the agricultural land required to grow the corn etc to feed the cattle
  • The apparently simple solution is to switch to pasture based cattle raising !
  • However, according to a study how many cows do we need, such a shift would require c. 30% more cattle and could only produce c. 27% of the US’s current beef supply.

Analysis and Comments

  • Much of the coverage of the food sustainability debate focuses on the wider environmental impacts of meat farming (so all protein, be it beef, lamb, pork,chicken or fish etc)
  • The popularity with investors of stocks like Beyond Meat (up over 100% since its IPO) seems to be driven by the view that a material part of the protein market will eventually be “created” from plant based alternatives. WEF report on alternative proteins
  • This argument is bolstered by the shift we are seeing, especially among younger consumers, to a “flexitarian based diet” ie a greater proportion of consumption being vegetarian, but with occasional meat added.
  • But be cautious, you should be careful about closing down the breadth of the analysis. From an investors perspective, as the world gets “better off” (however you define that) consumers want more protein, mostly animal based.
  • This suggests to me that for quite a long time, we will require a mix of traditional animal and plant based protein.
  • So rather than the “plant based good, animal based bad” simplification, I would prefer to focus on how Agtech can allow us to produce more protein more efficiently & more sustainably

Beyond Meat Share Price

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