Listed foodtech: a tale of missed chances or second chances?

By Frank Buhagiar on Monday 23 October 2023

Listed foodtech: a tale of missed chances or second chances?
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CommentaryFoodTech Investment

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

July 2007 – what were you doing? Only ask as that was the last time 10-year US Treasury yields stood above the 5% level.  That is until the week ended Friday 20 October 2023. 5% barrier once again broken, albeit by the slimmest of margins – 5.001%.  As Reuters reports: “While the benchmark yield eased back from that level, it posted its largest weekly surge since April 2022, powered by solid economic data.”  “Solid economic data?” Good week for stock markets then?  If only.  Back to Reuters: “Wall Street ended lower…as investors closed the book on a week marked with mixed earnings, warnings of possible further interest rate hikes from the Federal Reserve, and worries of escalation of the Middle East conflict.”  Nasdaq ended off 3.2%.  Why the whistle-stop tour of markets? To provide context for what was a tough week for FFF’s listed foodtech space: 35 share price fallers, eight risers, three non-movers. Foodtech never stood a chance.

Speaking of chances…July 2019 - what were you doing?  Only ask as that was when Beyond Meat’s market cap stood at a whopping US$11.7bn.  Compare that to today’s sub-US$1bn valuation - Beyond’s shares shed another 21% over the course of the week just gone.  July 2019 – was that the vegan burger co.’s best chance of getting its plant-based meat products into the mainstream?  No news out but The Daily Mail did go to print with, “The end of vegan food bubble? Sales of vegan burger maker Beyond Meat fall by a THIRD as consumers turn to CHEAPER real meat during Biden's cost of living crisis”.  Title says it all.

CEO Ethan Brown is staying positive though: 'As we look to the future, we remain steadfast in our belief that plant-based meat, and Beyond Meat specifically, will play an important part of the global response to a climate crisis that appears to be rapidly intensifying, while also delivering health benefits to the individual consumer.' And according to the Mail: “Beyond Meat has slashed prices on its core products to bring them in line with or lower than their animal protein equivalents in an attempt to bring in more customers.” Price parity - might just give Beyond a fighting chance.

Oatly, another vegan foodie mentioned in the above Daily Mail article: “Other brands such as Oatly, Nestlé and Innocent Drinks owned by Coca Cola have pulled some of their vegan products from sale amidst a growing rejection of the often pricier options.”  Oatly, another vegan foodie posting a double-digit share price fall – shares off 15% over the course of the week.  No news out but, as reported in last week’s Food on the Move, FRIDAY 13TH AND LISTED FOODTECH, the oat drink co.’s  Q3 results are due on 9 November.  Market not giving the Q3 numbers much of a chance...

At least Verde Agritech is still in with a chance of winning “the largest incentive prize in history”. That’s the Elon Musk-backed XPRIZE “$100M Carbon Removal” Challenge which seeks ‘innovative solutions to extract and sequester carbon dioxide from the atmosphere, fighting climate change and rebalancing Earth’s carbon cycle.’ As highlighted in Verde AgriTech Advances into phase 2 of Musk-Backed $100M XPRIZE Carbon Removal Challenge, the potash fertiliser co. has put forward an “…ambitious proposal to develop one of the world’s largest carbon capture projects through Enhanced Rock Weathering (‘ERW’) – a natural weathering process that involves the sequestration of carbon dioxide (‘CO2’) from the atmosphere by crushing and spreading reactive rock material on land.”

The announcement points out that “Verde has developed partnerships with British universities, leaders in Soil Science[1], that have proven Verde’s K Forte® and Super Greensand® (‘Products’) have the potential to capture CO2 from the atmosphere through ERW…the carbon dioxide capture properties of the Products are estimated at 120kg per tonne. The Company has combined measured and indicated mineral resources of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O, compliant with the Canadian National Instrument 43-101.[2] Its total 3.32 billion tonnes of resources put Verde in a unique position of potential scalability to sequester up to 0.40 gigatons of CO2.”

And yet, Verde shares off 4%. Investors not giving the company, nor listed foodtech for that matter, much of a chance these days.  Listed foodtech in need of a second chance…