In my search to find good companies whose focus is on helping civilization adapt to and mitigate the effects of climate change, a few months ago, I got very interested in the application of genetic engineering to agriculture.
The world population is inexorably rising – from around 7 billion today to nearly 10 billion by 2050 – air temperatures are rising, and soil moisture levels are falling. Harnessing scientific advances to feed the burgeoning world population in the face of a harsher climactic reality is an attractive promise.
There has been some notable successes in this area – namely Golden Rice, which biosynthesizes beta carotene to provide better nutrition to poor populations in Asia, and GMO Cassava, which provides much-needed iron and zinc to malnourished Africans.
However, several vital modifications – namely engineering of photosynthetic pathways to allow food crops to be more drought resistant and the engineering of bacteria to “fix” atmospheric nitrogen to decrease synthetic fertilizer usage – seemed years away.
I was particularly disappointed to find that the company furthest down the road to genetically modifying bacteria to fix nitrogen was, according to the CEO, probably five to seven years away from being able to commercialize a product.
Imagine my surprise, when I received a mail from the Canadian subsidiary of an English company – Azotic Technologies – informing me that, not only had they had found a natural way to provide nitrogen fixing bacteria to plants, they had done so decades ago, in 1988. The company, whose scientists are based in Nottingham England’s high-tech BioCity area, was founded in 2012 to commercialize the discovery.
Azotic’s product, Envita – which conducted large-scale North American field trials in 2018 and went on sale in the North American market this year – is the product of those many decades of research spearheaded by an indefatigable octogenarian scientist – Dr. Edward Cocking, a Fellow of the Royal Society and Emeritus Professor at the University of Nottingham.
Professor Cocking and his colleagues discovered a naturally occurring, food-grade bacteria known as Gluconacetobacter diazotrophicus, or “G.d.” for short, that forms natural colonies in sugar cane fields. A strain of this bacteria moves into the plant through the roots and is taken up by the plant into the foliage; once the bacteria has colonized the plant, it begins fixing atmospheric nitrogen and providing essential macronutrients to the plant.
These nitrogen-fixing organisms act as symbionts to common food crops that normally require heavy usage of synthetic fertilizer like maize (corn). Speaking with the CEO of Azotic’s North American subsidiary Mr. Nolan Berg, it was clear that his company’s discovery was an innovation with tremendous commercial and environmental potential.
A farmer’s greatest input costs are seed, fertilizer, and chemicals to control pests. Berg says that the nitrogen fixing G.d. used in Envita can allow farmers to cut fertilizer use by around 30%.
What’s more, synthetic nitrogen fertilizer can be washed away in heavy rains, contaminating human water supplies, flowing into rivers, and eventually creating huge oceanic dead spots. In other words, farmers end up paying for fertilizer that gets washed out to sea rather than nourishing their crops.
Azotic’s Envita moves into the plant quickly, crossing the plants’ cell barriers, and becoming integrated into the host organism very quickly. As such, farmers know that the money that they are spending for Envita’s “in-furrow” (i.e., sprayed onto the seed when it is planted) treatment is going to nurture their plants rather than to kill fish in the Gulf of Mexico.
Berg says that his company is continuing to do research on this wonderful discovery, and hopes to be able to develop a form of Envita that will be able to be sprayed onto plants after germination — a foliar application. A foliar form of Azotic’s product would allow farmers without expensive in-furrow application equipment to use the product as well.
From a legal standpoint, unlike GMOs, which face regulatory scrutiny to a greater or lesser extent on either side of the Atlantic, the biological agent in Envita is naturally occurring and endemic in many regions of the world. As such, Berg says that regulatory burdens for the transport and use of Envita is very low.
Berg also says that the bacteria does not form spores, so cannot survive a winter. As such, there is also no risk that the bacteria will somehow mutate over time and bring about unintended consequences. For the mercenaries out there like me who are interested in the economics of this product, the fact that the biologics in Envita cannot over-winter also means that Azotic can continue to sell its product to famers year after year.
By the end of my conversation with Berg, I began to think that there was really a chance to be able to meet the challenges of feeding an expanding population without destroying the planet in the process. I told him that I wanted to learn more and possibly get involved in his company’s next funding round.
Dr. Cocking and Mr. Berg know that the world needs agricultural technologies that operate on a new paradigm. I know the only way to build and maintain intergenerational wealth in this century is by investing in companies operating on a new paradigm. Intelligent investors take note.