I couldn’t help but agree with the author.
Why scour the Earth for shiny objects when science now offers an alternative, diamonds grown in labs. These gems weren’t synthetic substitutes. They were optically, chemically and physically identical to their Earth-mined counterparts.
Though I was a long way from facing the choice between lab grown and mined diamond I’d decided that when the time came I’d be proposing to my future wife with a broker’s receipt for shares or perhaps a digger. Both seemed of much more use than a shiny rock.
Fast forward a (fair) few years and diamonds are back on my mind. No, I am not getting ready to propose. Rather, I have been in the plant-based science heart of the world, Wageningen, contributing to a report examining innovations in the alternative protein area.
The hot topic in this space is protein fermentation or lab grown proteins – not simulations or substitutes like oat milk or cashew nut cheese but rather dairy proteins that are optically, chemically and physically identical to cow-produced ones.
Personally, I’m not nervous about plant-based dairy/protein products.
I’m excited.
I don’t believe they pose an existential threat to the New Zealand dairy industry but are an emerging product category NZ can enter and succeed in.
The NZ dairy industry knows protein so well and its considerable science capability could be wielded against the many challenges of producing plant-based protein dairy products such as taste, texture and functionality.
I am sure very soon we will see NZ dairy companies producing a plant-based or hybrid milk brand that will perform well, provided they can move past some of their shareholders’ ideological opposition.
Yes, many of their owners’ core business is producing milk from cows but they also own sophisticated, integrated food and beverage companies so why not exploit this strong trend?
Protein recombination, on the other hand, makes me nervous because of its ability to significantly disrupt significant segments of NZ’s traditional primary sector.
There are some strong predictions being made about technology timelines including a recent report by RethinkX that predicts the evolution of massive tower vats producing recombinant proteins.
And there are large amounts of venture capital flowing into companies like Perfect Day, a United States based animal-free dairy protein company. The theory espoused by radical proponents of this technology is that with money and science it will result in the inevitable demise of the NZ dairy industry.
I have now spent hours reading articles on microbial production of protein, mainly based on sugar or soya meal as an input, and I’ve concluded I don’t know enough either about industrial production or microbiology to make a sensible guess as to whether this technology is economically feasible.
The history of the lab-grown diamond gives a good indication of how this protein story could pan out. Identical to mined diamonds, the lab-grown ones are also cheaper and claim to be more ethical and sustainable.
Despite various drivers for creating lab-grown diamonds the first companies formed (in 2007) were driven by a desire to reduce the impact on society (conflict diamonds) and a reduction in the environmental footprint left by diamond mining.
Immediately. of course, that was followed by several rebuttals from the diamond mining industry citing research showing mined diamonds transformed Botswana from one of the poorest countries in the world to a middle-income country with revenues from mining representing almost a third of its GDP. They also showed the energy inputs into the lab process greatly reduced their environmentally friendly claims.
Then came the legal challenges around naming rights. The mined diamond industry believed that lab grown diamonds were in breach of the law by claiming to be real, genuine or natural and demanded they be called synthetic diamonds.
A warning letter to Diamond Foundry, just last year, notes the company has at times advertised its stones as above-ground real without the qualification of laboratory-made. It’s easy to see how a consumer might miss the implication.
Asked whether the Jewellers Vigilance Committee thinks lab-grown diamonds are, in fact, real diamonds, president Tiffany Stevens demurred.
“It’s a nuanced reality that we’re in,” she said. “They are a type of diamond.”
In a sense, that’s what all of this is: a marketing war over what’s real.
Consumers continue to struggle with accepting lab-grown diamonds as real.
By competing on cost lab-grown diamond manufacturers have secured a strong presence in industrial use for cutting, grinding, drilling and polishing procedures. Here, hardness and heat conductivity characteristics are the qualities being bought. Size, clarity, colour and other measures of quality relevant to gemstones are not as important.
The past five years have seen dramatic improvements in the technology for lab-grown diamond production and an increase in the size, clarity and colour of lab-grown diamonds. This has reinforced a position for lab-grown diamonds in the mainstream jewellery market.
However, market prices have fallen and the world’s largest diamond company, De Beer’s, which coined the tagline diamonds are forever, has entered the lab-grown market with its own brand called Lightbox, significantly under-pricing the market. They have combined this with a real is rare campaign and are confident they will drive value through both their lab-grown and mined diamond products.
My prediction is lab-grown dairy proteins will initially break into the lower end of the ingredients market (whey, casein etc) but will struggle to overcome consumer perceptions, industry lobbyists and regulatory conditions to take any sizable chunk of the consumer dairy product market.
What does this all mean for the NZ dairy industry?
My guess is consumers will face the same conflicting and contradictory noise in the market from the challengers and the incumbents, which will cause a majority to continue to pick real and natural over lab-grown. The dairy industry might even use the real is rare campaign – dairy is forever doesn’t quite have the right ring to it.
Ultimately, I believe two actions are required.
NZ must double down on its sustainability aspirations and NZ dairy companies must continue to develop strong brands, consumer products and high-value ingredients.
Simultaneously, NZ must invest in its science and research capacity around cellular agriculture and protein fermentation to generate intellectual property and give companies the research and development grunt to challenge the best in the world in this space.
I am optimistic for the NZ dairy industry though, in the back of my mind, I can hear the words of famous futurist Roy Arama. “We tend to overestimate the impact of a new technology in the short run but we underestimate it in the long run.”
The only sensible course is to be wary of the initial hype and just as wary of the scepticism in the long term..
