The spectre of cow’s milk, minus the cow, is a clear danger to the dairy sector.
She echoed similar concerns raised two years’ ago by governmental scientific adviser Sir Peter Gluckman who described synthetically produced milk as an existential threat to the sector.
Appleton said a talk she gave on the threat was simply a means to get the subject out into a domain for discussion. She intends to spend more time interrogating the numbers behind the apocalyptic farming prospects contained in the RethinkX report, also out earlier this month.
The San Francisco company predicted the United States dairy and beef sectors will be virtually wiped out by emerging protein technology in a decade as proteins five times cheaper than existing animal proteins emerge by 2030.
The emerging synthetic protein technology can mimic cow’s milk by synthesising dairy milk proteins made from genetically engineered yeast in a lab. Similarly, synthesised proteins are also being developed to mimic meat cuts though that is expected to take longer to perfect than bulk milk.
And it is the dairy sector Appleton expects will be hit harder and faster by the technology.
NZ’s tendency to export about two-thirds of its dairy production as bulk powders does not bode well if ingredients buyers choose not to be specific on needing the grass-based cow version.
“There will be some customer sectors who may care, possibly ice-cream manufacturers, but by and large most of it just goes in as an ingredient. There will be a place but it’s likely to only be a niche.”
The footprint to produce synthetic milk is lab sized. But Appleton says the outputs are not simply straight milk, rather the fractions of it including the whey proteins and casein proteins used to make cheese.
They can be isolated and produced specifically, using a process that runs on an 8:1 ratio of input sugars to output proteins. That is high and expensive but destined to fall in coming years as the technology matures to more economic levels of 3:1.
“The technology is not perfect. There are unintended consequences of using sugars, such as the damage sugar farms are doing to the Great Barrier Reef. But there is no way cows can compete. Generally, the smaller the animal the greater its protein production efficiency and nothing is smaller than yeast.”
Dairy ingredient processing is highly integrated where one product is a by-product of making another, such as skim milk powder from butter production or whey from cheese making. That makes the sector vulnerable to a disruptive synthetic technology that can produce such specific components.
“This would leave those byproducts with nowhere to go, with severe environmental consequences in dealing with that milk you can’t process and sell.”
She says there is intense debate in the synthetic sector over just how cheap the proteins will become, some claiming $1 a kilogram and others $10/kg.
“But the time line suggests $10 is a kind of natural point it will achieve in our lifetime.”
Appleton said she is acutely aware of the implications of her predictions on rural communities and NZ society.
She sees potential for a growing artisan dairy sector, similar to how wool responded post-synthetics by eventually producing high-value branded products like Icebreaker.
“But that was Merino and did not apply to everyone producing wool.”
For the greater number of farmers still committed to dairying there will be a need to consider more mixed land use where possible, possibly including regenerative agricultural practices now gaining more profile.