Agronomics (LSE:ANIC) is one of those UK shares that I believe investors may in the future regret not buying into today. It’s invested widely into a revolutionary and disruptive industry, the scope of which is huge, and it has some very big names behind it.
Jim Mellon’s (Master Investor) Agronomics is a seed funding investment company, invested in ‘lab-grown’ (cell based) animal and agricultural products: meat, fish, milk, eggs, leather, pet food, and more. Agronomics currently has 16 companies in its portfolio, including BlueNalu, which aims to be the global leader in cell-based fish and has products on the market in Asia. It has been tipped to go public in 2022. Another is Mosa Meat, a Dutch company that produces cell-based beef and has just included Leonardo De Caprio (who now sits on the board) as one of its top investors.
Other prominent investors in this industry include Jeff Bezos, Bill Gates, Richard Branson, and Alphabet, as well as actor Ashton Kutcher.
The prediction
Winston Churchill predicted “we shall escape the absurdity of growing a whole chicken in order to eat a breast or a wing, by growing these parts separately under a suitable medium”.
These groups of companies are working on this becoming true. The products are not synthesised or plant based, they are the real thing: real fish, real chicken, real beef, but rather than reared in a field, they are grown in a lab. No animals are hurt, no seas are fished. The benefits are clear. Though there are still many who would baulk at the idea of this product being dished up to them, it cannot be ignored that if we need technology to help us feed the planet then this is a clear contender.
Barclays estimates the global alternative meats market will be worth £120bn by 2029. Agronomics has invested nearly £200m into a market that currently has less than £2bn invested in total, securing a significant market share. It is very probable that Agronomics will be a multi-billion dollar business in the not too distant future, in my opinion. I believe that from its lowly 22p per share today, it’s very possible that £10 per share can be reached in several years from now.
Barriers
What currently stands in the way of whole-scale adoption are:
- convincing the public that’s a viable alternative;
- scaling up production to sufficient capacity to lower overall costs;
- regulatory approval.
There will inevitably be kickback from large-scale farmers who are, of course, very protective over their industry. But times are changing, demand for animal proteins is increasing, so I think it’s only a matter of time before we see these products on our shelves. There have already been some very interesting collaborations between producers and top international suppliers. This is perhaps a bottom-drawer share, but one I will want to keep taking out and having a look at.