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Ike Sharpless Winslow Management Company Tuesday, Sept. 22, 2009

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1 Ike Sharpless Winslow Management Company Tuesday, Sept. 22, 2009
Crop Biotech, Aquaculture, and Animal Agriculture: Identifying Trends, Concerns, and Best Practices Ike Sharpless Winslow Management Company Tuesday, Sept. 22, 2009

2 Overarching Trends Labeling concerns: COOL, GMs, Animal Welfare, Fair Trade, Certified Organic, etc, etc, etc… Corporate or government leadership: shifting perspectives? Inter- and intra-connectedness of agricultural crises None of these issues can be discussed without understanding the role of the global food business and the agricultural supply chain Ex: of pt. 3 – BSE-resistant cows and feeding cows cow bonemeal

3 Labeling Underlies a fundamental division in US-EU practices: consumer right-to-know vs. agency stamp of approval Labeling is often the preferred mechanism of control for industry groups, but it does not address a core problem: that environmental concern expressed in polls and elsewhere often does not translate into behavior in terms of “willingness to pay” (WTP) Reasons for 1 are many and complicated: see, for example, Robert Kagan’s Of Paradise and Power for one plausible explanation Image from :

4 The Rise of CSR in the Food Business
Why does this matter? 10 companies produce 40% of all the food we buy (and 40 companies produce 85%) 20-30% of product value comes from the farm – the rest is food industry-value added General trend towards corporate-environmental alliances IKEA and Rainforest Alliance/WWF/FSC Marriott and Conservation International Myriad examples exist: water, labor, health, animal welfare, … Data from Fletcher school class notes for “The Global Food Business”

5 Agricultural Biotechnology: Evaluating the two competing narratives
Data on US GM: from USDA’s National Agricultural Statistics Service (NASS) for 2004 and BIO spokesperson Bomer-Lauritsen for 2008 (reliable?) Data on Global GM: from the International Service for the Acquisition of Agri-biotech Applications (ISAAA) Fifteen years in: the first transgenic crops were planted in 1996 (1st to be developed was Calgene’s Flavr Savr tomato, developed in 1989) Key lesson: barring allergenicity and the risk of antibiotic resistance, GM foods are probably safe and healthy for human consumption; the real risk is how their use fosters the uncritical acceptance of conventional agriculture generally and large-scale monocropping in particular

6 The Good Things (Biotech as Technofix)
Decreased total pesticide usage Especially valuable in developing countries, where lax or nonexistent regulation encourages pesticide companies to export their products that are banned in the US/EU Higher yields in easy to understand monocropped systems can (arguably) produce more food on less land Only 10% of the world’s land surface is arable, and much of it is already overfarmed and on eroded soil Has the potential to help with diseases and nutrition deficiencies that are systemic in much of the developing world “Phytoremediation”, whereby plants detoxify pollutants in the soil or absorb and accumulate polluting substances out of the soil May enable the development of more efficient grains for animal feed Genomic mapping leads to further food safety opportunities

7 The Bad Things (Biotech as Frankenfood)
Agricultural biodiversity plummeting (hence the Svalbard Global Seed Vault…) From 40,000 rice strains in India to 250 Small farmers become entirely dependent upon corporate seeds (terminator technology) Non-GMO seed producers suffer from crop contamination Consumers lose right to choose (under US system, at least) Works hand-in-hand with monocropping, stymieing polycultures “ecological theory predicts that as long as transgenic crops follow closely the pesticide paradigm prevalent in modern agriculture, such biotechnological products will do nothing but reinforce the pesticide treadmill in agroecosystems” Rice stat from class notes, “Corporate Management of Environmental Species” Quote from “The Ecological Impacts of Agricultural Biotechnology”, by Miguel Altieri. Available at

8 The StarLink Debacle, circa 2000
StarLink corn approved for animal feed only (the largest US market for corn) due to potential human allergenicity, but found its way into a Taco Bell taco shells Raised serious questions about segregation, traceability (required 660-foot buffer zone), and allergenicity Subsequent FAO/WHO standards (2001) acknowledged the near impossibility of zero allergenicity risk due to the inability to prove a negative Source: HBS case study N , “Aventis CropScience and StarLink Corn”, Ray A. Goldberg, November 5, 2001.

9 Functional (and Pharma-) Foods
A functional food is technically any food with health-promoting claims or abilities (Marketing) example: yogurt In the GM context: Golden Rice (rice with higher carotenoid levels) Crops enriched with Vitamin E, folate, high protein content in the form of Lysine Hypoallergenic soy and rice exist, and wheat is being developed “Pharma” foods are being developed that may help prevent or cure diseases such as cholera and diarrhea

10 What are the drawbacks A potential contributor to increased pest resistance and the development of ‘superbugs’ Opposed on GM grounds Viewing food solely as the sum of their micronutrients robs them of their ‘whole food’ value (=Pollan’s critique of nutritionists) Evidence of nutrient uptake is unclear Corn/lime Mayan nixtamalization example Positive example from Dartmouth researchers re. higher-calcium carrots Carrot ex: from Proceedings of the National Academy of Sciences, DOI: /pnas

11 Pharm Animals In February 2009, the FDA ruled “safe” a herd of goats containing ATryn, an intravenous anti-clotting drug extracted from their milk for a fraction of the pharmaceutical’s production price. These goats are the first such GM animal to be approved in the US. ATryn is the brand name of ‘anticoagulant antithrombin’ as manufactured by Massachusetts-based GTC Biotheraputics Although groups like the Humane Society of the United States (HSUS) oppose GM animals on principle because of their mechanistic nature, there have been no animal-welfare related harms associated with ATryn to date HSUS position statement:

12 “Hardier” Crops CEO of Performance Plants Incorporated said in 2008 that drought resistant oilseed rape and maize will be on the market “in four years” “Snorkel rice” takes the ‘snorkel’ genes in flood-tolerant rice and introduces them to higher-yield rice Crops able to grow with less water or in conditions of high salinity have been “in the pipeline” for the last decade, with little tangible gain (such as Water Efficient Maize for Africa (WEMA) Hugh Grant, Monsanto’s CEO, acknowledged when talking to an HBS class of mine that it was probably a PR mistake on the company’s part to focus solely on proprietary crops (Bt/RoundUp) at the expense of ‘humanitarian’ technologies Source for PPI: Source for Snorkel Rice: Source for second image:

13 Innovations in Crop Agriculture
New (non-soy) sources of protein synthesis Algae Grain crops In vitro meat Leaf protein extraction Mycofungi lupins The marketability of non-transgenic but biotech ‘borderline’ methods to GM-skeptical audiences (best example: hybrid corn in the 1920s) Seed coating marker-assisted breeding Genomic selection Other innovations: Controlled release fertilizers Source for fertilizers:

14 Algae Like in vitro meat, Algae is hampered by the “yuck” factor While distinct from algal biofuel, food algae could be a potential co-product of fuel algae The biggest recent player in the fuel algae game is Exxon Mobile, who partnered with Synthetic Genomics Inc. in July 2009 to invest $600 million in Algal fuels Up with cellulosic ethanol as an in process technology rather than an existing one – seems to me like it needs much more attention. Algae has the added advantage of being able to capture fertilizer runoff, thus potentially preventing oceanic eutrophication Has the added advantage of possibly creating food as a co-product of fuel, most likely for animal feed in the form of pellets Exxon source: (some good links on the topic, in addition to the book in the photo above)

15 Seed Coating LandecAg’s intellicoat (above)
“... is an agricultural technology company that specializes in temperature-activated seed coatings.” PlantTech’s agristrike (below) “PlantTech is the largest Australian field crop, canola and pasture Seed Company, with an unsurpassed product range of leading proprietary cereal, oilseed, pasture, pulse and forage varieties, plus access to a comprehensive range of public varieties.” Other developments of note: Plant Health Care Inc.’s Myconate and Harpins technology (see ppt in notes) Lesson: neither of these companies appear at all green, but the technology does have various potential green applications. “It can greatly reduce insect pest, protect the environment, save the seeds (about 1/3 seeds), increase the output of crops (increase by 10-40%) and promote the development of seeds project. “ Excellent source for seed coating: LandecAg quote from the company website: Benefits quote from: (hmm…) PlantTech quote from the company website: Source for first Image: Source for 2nd image: Myconate/Harpins ppt:

16 Genomic Selection Using genomic selection for marker-assisted breeding, crop and animal breeders can select desirable alleles without actual gene splicing "some of the most potent objection to transgenics actually has to do with the increase in market power that went along with some of the input companies. Genomic selection and marker-assisted breeding have exactly the same kind of economic power implications, if no more so, as transgenics. People who are upset about transgenics but think marker-assisted breeding is okay are just incredibly naive." Paul Thompson (U. of Michigan), in a phone interview This is the best short current piece I found on this issue: Key source: Source for image and text:

17 Aquaculture and Fisheries
Barring an (unlikely) sudden drop in demand for fish—the opposite is happing, especially in the developing world—farmed production will and must increase and should correspond to a decrease in wild production in order to stave of total oceanic collapse. -Key Lesson: the barriers to international cooperation on sustainable fisheries, and the high substitutability of consumer preferences for fish products, indicates that the most short-term progress can be made in improving fish farming practices, especially in China (with many caveats…).

18 Global Fisheries Crisis
On current course, collapse of all major fisheries by (Science, Nov. 8) Tragedy of the commons / collective action problem (the regulators want to support their fishermen—they don’t get elected by cutting back) The problem of bycatch Growing appetites Shark Finning example Cite: Nov. 8 Science study Source for image:

19 Capture Fisheries Divisible by fishing area, gear and the main target species North Sea herring purse seine fishery Gulf of Mexico shrimp trawl fishery southern ocean Patagonian toothfish longline fishery. Some gear and species are inherently more unsustainable than others Bottom trawling Very long-lived species Info direct from:

20 Bycatch and Bottom Trawling
Wild-caught shrimp catches up to 10 pounds of discarded sea life for every pound of shrimp All major fisheries catch large amounts of bycatch, whether trawl, purse seine, or longline. The problem is especially bad in illegal, unreported and unregulated (IUU) fisheries in developing countries Bottom Trawling The image to the right is of the “Gulf of Mexico, captured by the Landsat satellite in late 1999, [which] shows the sediment trails left behind by individual ships (the bright spots) - a testament to the utter devastation the practice exerts on vast seafloor ecosystems.” Top photo source: -Florida shrimp bycatch, 1969

21 A case study in collapse
The North Atlantic Cod fishery has collapsed precipitously The solution (would have been): honest assessment “maximum sustainable yield” with proper enforcement

22 The Insidious Role of Branding
Thanks to clever marketing, previously unpalatable fishes are becoming desirable delicacies which are fished (often illegally) using ecologically devastating bottom trawling methods. Which sounds better: Orange roughy, or slimefish? Chilean Sea Bass, or Patagonian toothfish?

23 The Need for Intergovernmental Oversight
Fish tend not to care about 15-mile territorial waters or 200 mile Exclusive Economic Zones (EEZs) as established by the 1982 UN Convention on the Law of the Sea (UNCLOS). This makes transboundary intergovernmental oversight a must 64% of the world’s ocean is international waters; of that, 3/4ths is unmanaged “In 1995 there were more than 1.2 million decked fishing vessels in the world, up from just fewer than 600,000 in 1970.” much of this growth is government subsidized, which results in excess capacity and thus low margins for industry fishermen, who then have incentives to fish more. Quote from Marine Stewardship Council case study (see MSC slide for citation) Second image from:

24 Marine Stewardship Council
Founded in 1996 as Unilever/WWF collaboration Founding mission: “…to work for sustainable marine fisheries by promoting responsible, environmentally appropriate, socially beneficial and economically viable fisheries practices, while maintaining the biodiversity, productivity, and ecological processes of the marine environment.” (Relative) success stories ‘Dolphin-safe” tuna “Give Swordfish a Break” Campaign pledge Wild Alaskan salmon fisheries certification Unlike the issue-specific and tangible cases of dolphins and swordfish, however, the MSC eco-label covers fish ranging from frozen cod in Britain to Alaskan Salmon to a range of other regulated marine capture fisheries as of October 2008, there are nearly 2,000 seafood products with the MSC’s seal of approval Source: Marine Stewardship Council case study, Stanford Graduate School of Business, Case number M-297, June Prepared by Susan Masserang and Jonathan Tinter under the supervision of Prof. Sonia Grier. Source for ‘2000 products’:

25 The Keys to Sustainable Wild Caught
As the MSC and other cases indicate, the problem isn’t that people don’t know how to work towards sustainable fisheries. Barring a lack of scientific knowledge about the sea (‘out of sight, out of mind…’), they do. The problem, rather is a lack of political will and legal authority combined with a collective action problem relating to an exhaustible public good That said, these are the things that work: restrictions on gear like nets so that smaller, younger fish can escape limits on the total allowable catch (although maximum sustainable yield can be very hard to determine – Alaskan Pollock and NMFS ex.) closing some areas to fishing certifying fisheries as sustainable offering shares of the total allowable catch to each person who fishes in a specified area. Work with existing national and international legal jurisdictions to maximize utility Source for recommendations:

26 Growth of Aquaculture Image source: Key lesson: for better or for worse, aquaculture is the only way to prevent oceanic collapse barring a decline in demand for seafood (which doesn’t look likely). The logical conclusion is to make sure fish farming is done as well as possible.

27 Why ‘especially in China’?
Image Source:

28 Why Tilapia? Large size, rapid growth, omnivorous diet, high stocking density tolerance, no planktonic phase GIFT Tilapia “GIFT, or Genetically Improved Farmed Tilapia, grows 60 per cent faster and has a 50 per cent higher survival rate to adulthood than the original fish. Sometimes also known as the Super Tilapia, the fish was developed through vigorous selection-breeding programs -- the first time a tropical food fish has been improved using such methods. The fish used to breed GIFT was the Nile tilapia (Oreochromis niloticus).” (yes, Wikipedia…sorry) Quote from:

29 HQ Sustainable Maritime Industries
Exports tilapia to US, Korea, Japan, and Mexico from its facilities in Hainan, China Mission statement To bring quality to every aspect of HQ's vertically integrated aquatic products business. To lead China in penetrating world seafood markets. Increase profitability through the introduction of zero-toxin products while respecting the environment and communities in which it works. Best Aquaculture Practices Certified (potentially problematic – see next slide – but is currently the only major standards-setting organization for aquaculture See for complete list of awards and certifications

30 Best Aquaculture Practices
Implemented by the Aquaculture Certification Council (ACC) of the Global Aquaculture Alliance (GAA) The ACC is a “process” certification currently certifies shrimp hatcheries, shrimp, tilapia and channel catfish farms and seafood processing plants to include shrimp, channel catfish and tilapia. Although ostensibly independent, the GAA is effectively an industry consortium. According to Food and Water Watch, “Their process combines annual site inspections and effluent sampling, but allows for certain use of antibiotics and chemicals. Although GAA’s standards are more measurable than most others, they have received criticism from several organizations, including the Mangrove Action Project and Environmental Justice Foundation, for flawed standards that fail to adequately protect mangrove ecosystems.” Food and Water Watch link:

31 Examples of conflicting preferences: organic fish and ‘sustainable’ tuna
Whereas fish feed is usually 50% fishmeal (which can be made from unsold fish and fish offal, or small whole fish) and 50% grain, organic salmon must use fishmeal from sustainable fisheries intended for human consumption. Clean Seas Tuna, Ltd. is trying to breed southern bluefin tuna, which is being massively overfished to satisfy demand for fatty tuna in sushi. They are also developing wheat pellets to feed their marine-caged tuna. This is a ‘stopgap’ measure in the sense that it is responding to market demand rather than trying to reshape demand. New Scientist, 13 September 2008, “Dinner’s Dirty Secret”, Bijal Trivedi. Tuna story from Bloomberg:

32 Marine or Freshwater Aquaculture?
Harder to regulate generally than freshwater aquaculture More likely to cause disease transference to wild species However, some species can only be farmed in marine systems Freshwater aquaculture is generally better than marine aquaculture, as most of the fish raised are herbivorous (carp, tilapia) Source for diagram:

33 Organic Shrimp Shrimp is the most popular seafood in the US
Shrimp farming destroys up to 30% of the world’s coastal coastal mangrove forests It requires 2 lbs of fishmeal and squid to yield one lb of shrimp EcoCamaronera Bahia—the world’s first certified organic shrimp farm—practices mangrove-friendly methods in Ecuador, as does Biocentinela. Like all shrimpers in Ecuador, both are at heavy risk for white spot disease OceanBoy farms is an inland marine shrimp farm in Florida that has ACC organic shrimp certification and USDA organic seafood certification (the first to get it). They have a very high ration of shrimp per foot, but they pump in extra oxygen and clean the water frequently. There is a higher risk for disease if poorly managed, but is otherwise a fruitful model Source for EcoCamaronera: More on OceanBoy:

34 The Role of GM Fish: AquAdvantage Salmon
AquAdvantage® salmon, developed by Aqua Bounty Farms “Aqua Bounty is developing advanced-hybrid salmon, trout, and tilapia designed to grow faster than traditional fish. AquAdvantage® Salmon (AAS) reach market size twice as fast as traditional salmon. This advancement provides a compelling economic benefit to farmers (reduced growing cycle) as well as enhancing the economic viability of inland operations, thereby diminishing the need for ocean pens. AAS are also reproductively sterile, which eliminates the threat of interbreeding amongst themselves or with native populations, a major recent concern” The company has spent more than a decade chasing regulatory approval from the FDA, but FDA officials have reportedly said it is coming “soon”, especially in light of the recent “pharmed” goats ruling. Source for 1st graph: See the Aqua Bounty FAQ for their take on some of these issues: FDA official quote source:

35 Solutions (Aquaculture)
Greater independence for certification bodies The largest certification body to date, the Global Aquaculture Alliance’s Best Aquaculture Practices, is probably too caught up with fishing interests to provide a neutral assessment of environmental and other impacts Supporting feed inputs other than wild-caught fishmeal “Ento-protein” progress by Neptune Industries using insects rather than fish to provide feed protein—the company itself, however, may be a poor investment Algae pellets Traditional Chinese aquaculture (4,000 years old) Rears herbivorous and carnivorous species in the same pond using plants to serve as food (eliminates fishmeal and is ecosystem-based approach: “integrated multi-trophic aquaculture”). This model can also use ducks/chickens in an integrated system where their poop makes algae for the fish to eat (so that you only have to feed the chickens and you get two crops) – but not done on a large scale Source: New Scientist, 13 September 2008, “Dinner’s Dirty Secret”, Bijal Trivedi. Source for ento-protein:

36 Solutions (Consumer) Support:
farmed herbivorous species consumption: tilapia, bream, carp and catfish with BAP certification or (better yet) Monterey Bay Aquarium Seafood Watch approval Ex) the 2009 Northeast Seafood watch endorses US farmed tilapia as ‘best choices’, South American farmed tilapia as ‘good alternatives’, and Asian farmed tilapia as ‘to avoid small marine capture species consumption: sardines, anchovies, mackerel, herring, etc. Reputable certified wild carnivorous fish

37 Impediments Tight profit margins are not easily amenable to large scale modification of practices, creating disincentives to change towards more sustainable programs (or, as one of my professors said, “the numbers tend to cut down your options” The sustainable fish are often not the much-touted Omega 3-rich fish (they are, however, lower down the food chain and are thus lower in PCB and Mercury contamination levels). The nature of global fisheries oversight is a classic case of market failure, with overfishing causing some sectors to go through a Hubbert curve not unlike that of peak oil. In many cases, the demand for seafood is voracious and indiscriminate, particularly in the Chinese delicacy market Graph source:

38 Animal Agriculture Types of Concerns Environmental Labor Practices
Human Health Animal Welfare CAFO image from: -point out pig’s ears…

39 A Ridiculously Short History of Conventional Agriculture
The Haber-Bosch Nitrogen fixing process quintuples the available ammonia supply for crops in 1909 Dramatically changes the global Nitrogen cycle, which is only beginning to be properly understood To make a long story short: leftover munitions and biological agents (i.e., nitrogen and phosphorous) after WWII become fertilizer and pest/herbicides, which along with govt. crop subsidies make CAFOs economically viable Earl Butz appointed Secretary of Agriculture by Nixon: “get big or get out” Vertical integration, economies of scale, and globally provisioned supply chains (following market liberalization)

40 The Livestock Revolution
A structural change, termed the “livestock revolution”, is taking place around the world but with particular intensity in East Asia Multinational supermarket and fast food chain expansion creates demand for streamlined intensive meat production The availability of cheap course grain on international markets has increased the global CAFO focus on monogastric animals like chicken and hogs At current rates, Global meat/milk demand to double within 50 years 80% of current growth in industrial systems Developing countries overtook developed countries in meat production in 1996

41 Niman Ranch: a case study in the problematic economics of ‘happy meat’
The original provider of humane meat to Chipotle Market Grill Bill Niman was forced to sell his share in Natural Food Holdings LLC, and he now boycotts Niman Ranch for their transport to slaughter and microbial use policies The net effect: until a consumer market exists that is willing to capture the various extra costs of humane meat, it won’t be profitable in the US

42 Solutions As with crop biotech, the ‘solutions’ fall into two categories: those that address Berry’s original concern (fundamental solutions), and those that work within the confines of ‘conventional’ agriculture (stopgap solutions). Both should be applauded, especially if fundamental change appears unlikely, but in the long term technofixes are unlikely to solve many of the food industry’s systemic environmental problems. Solutions can be further subdivided into governmental (and intergovernmental) solutions, producer solutions, and consumer solutions Image source:

43 Stopgap solutions Animal ag solution: Carbon solution:
Define CAFOs as point sources under the CWA (in process – see law blog link) Carbon solution: Changing animals’ feed or developing transgenic animals that ‘fart/burp less or better’ ex: adding 2% fish oil to cows’ feed may reduce methane emissions by 20% Aquaculture solution: Breeding tuna Eutrophication solution Controlled-release fertilizers Biotech solution: Drought-resistant GM crops Link on CAFOs/CWA: Source for last image: Source for fish oil and cow farts:

44 Fundamental Solutions
Changing our diets Understanding how the second law of thermodynamics should impact our food choices Changing farm policy at national levels In the US, ending commodity support for corn and soy and prioritizing sustainable fruit and vegetable growth Internationally, greater collaboration and focus on population, understanding the oceans, and IP reform (this list could go on and on) Link for Pollan’s recent piece:

45 Recap of Key Lessons Biotech Fisheries/Aquaculture Animal Ag
GM foods are probably here to stay, but global agriculture still requires a paradigm shift to become truly sustainable Fisheries/Aquaculture Aquaculture needs an independent ecolabeling and certification organization like that of the MSC to supplement the industry-influenced GAA A much greater emphasis on restaurant dining is required, given the high proportion of seafood eaten in restaurants Animal Ag Beyond all of the environmental and human health concerns, much higher levels of consumer information are required to prevent market failure

46 Companies and Practices to Watch
GTC Biotherapeutics Performance Plants Incorporated New Harvest Plant Health Care Inc. In Vitro Meat Consortium HQ Sustainable Maritime Industries OceanBoy Farms Biocentinela Clean Seas Tuna, Ltd. Neptune Industries (Aqua Biologics) Aqua Bounty Farms Niman Ranch / CMG Practices Crop Agriculture Controlled Release Fertilizer Drought-resistant crops Feed In vitro meat Algae Insect-based fish food Link for Neptune’s 1st customers in 2008:

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