Irresistible Insects #7: Market Insight with Ÿnsect
Exclusive interview with the world's leading insect protein manufacturer.
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Good morning Market Shakers. We’re excited to bring a very special issue this week which features an exclusive interview with Ÿnsect, the world leading manufacturer of insect-based protein for animal and human foods.
Ÿnsect is a company of subtle yet significant transformations. Their name, for example, transforms ‘I’ into ‘Ÿ’ to represent the skeleton of insects themselves that are the essence of their products. Then there’s their extraordinary growth. Since their founding 10 years ago, they have grown to become the world’s leading and best-funded insect protein company (having raised over $425 million in funding). More significant still is the change Ÿnsect is subtly bringing about to our food chain - (re)introducing insects as its basis in order to avert climate change and biodiversity collapse, and address the global food crisis.
Ÿnsect’s vision to reform our food chain is a critical one. 37% of global greenhouse gas emissions currently result from food production, with livestock production accounting for more than half of this. Yet, to feed a projected population of 10 billion people in 2050, we need to increase food output by more than 70% ― a big ask considering we only have 5% more land available to accomplish this feat. If we are to avoid food and ecological crises, sustainability is our only solution.
Governments and organizations over the last decade have shown increasing interest in insects as a sustainable solution to these problems. And Ÿnsect’s high-tech, eco-friendly farming methods and high-quality products have shown that this solution really has legs.
With the market’s appetite for insects 'worming-up’, a future where our plates are filled with insects is not too far off. So we sat down with Antoine Hubert, CEO of Ÿnsect, to talk more about his business and the future of edible insects.
How did Ÿnsect start out and how did you start selling your products?
Their solution was insects. Mealworm, to be precise. Composed of 72% high-quality protein and bursting with nutrients that are essential for human, animal, and plant health, they are a viable, if not a superior alternative to livestock protein. They also require 100 times less land to produce two pounds of protein compared to livestock. Not to mention, they produce considerably less greenhouse gas and require 25% less water. Talk about nutritious, sustainable and eco-friendly.
At first, Ÿnsect began producing proteins for animals. Insect production is reported to have a much lower carbon footprint than conventional soy and fishmeal-based feeds.
Last week we saw a similar strategy applied by Japan’s leading insect-based startup FUTURENAUT, who also found success through collaboration with well-established domestic producers to bring their products to a broader market of consumers.
What are Ÿnsect’s plans to expand into the market for food for humans?
Recently Ÿnsect has also expanded into the market for human foods. In 2021 they acquired Dutch edible insect protein manufacturer, Protifarm, to scale into products for human consumption. Their strategy is to begin with sports nutrition products.
We’ve hinted at the early potential in the sports nutrition market for edible insects already. Many companies in Europe and the US are already using insects as a base for protein products. Isaac Nutrition, who we introduced in our second insect-product post, already uses Ÿnsect’s ‘Adalba Pro’ in their products. The booming market is receptive to high-performance ingredients, and research shows insects have several advantages for sports nutrition. They have even been linked to the superior performance of Thai weightlifters at the Rio Olympics in 2016.
We believe there is unrealized potential in Japan for this application also. Fuji Keizai estimates the market for protein supplements will reach almost 200 billion Japanese Yen (1.7 billion $USD) by 2030. The market has almost tripled in size over the last 10 years.
Moreover, changes to lifestyles brought about by the coronavirus pandemic have created demand amongst Japanese consumers for protein products according to Meiji, whose protein brand, Savas, accounts for over 50% of the market in Japan.
MUJI’s recent release of a cricket-based chocolate bar, which they advertises as a protein bar, may be a sign that the sports nutrition industry in Japan is warming up to insect protein.
You mentioned education is key to motivating consumers to try insect-based products. What else is key to overcoming the so-called ‘ick-factor’ amongst consumers?
How does Ÿnsect’s Vertical Farming model contribute to their success?
Ÿnsect’s existing farms house mealworms in conditions that mimic their natural environment. Larvae are stored vertically, however, in stacks up to 17 meters high. This farming method uses 98% less land and 50% fewer resources than conventional livestock farming.
Once matured, 95% of insects are steamed, sterilized and processed into powders and oils, free from added chemicals. The remaining 5% become adults and reproduce to renew the supply of mealworm larvae. Currently, Ÿnsect is capable of producing over 2300,000 tonnes of insect product per year.
In addition to their farms, Ÿnsect’s entire supply chain is also built to be sustainable.
The availability of farms to provide suitable feed for up-cycling is a key consideration for where Ÿnsect builds future farms.
Does Ÿnsect have plans to expand its business outside of Europe any time soon?
Antoine also tells us that Ÿnsect’s ambitions are not without their challenges. In addition to the availability of local farms to supply feed for the mealworm, regulation is a big consideration.
As we discussed in our second post, regulations surrounding edible insects have not yet been established in most parts of the world. Europe has made the most progress, already approving several insects such as mealworms for use in human and animal foods. For Ÿnsect, being bookworms and carefully studying relevant local laws and policies is essential for expansion into new markets.
Is Asia in your sights?
Antoine emphasised again that further expansion in Asia is not possible without first getting a lay of the regulatory land. This is two-way process, however, and the more countries can do to address and clarify regulations for edible insect products, the easier it will become for innovators in the space to grow.
Japan has taken steps towards this recently. This year, the Asahi Shimbun reported that the Council for Public-Private Partnership in Food Technology, a work group created by the farming ministry in 2020, is working on hashing out regulations for the insect-farming industry.
Prior to this, the Japanese government initiated a task force in 2020 to support food tech in Japan. Edible insects are featured amongst the technologies they seek to promote.
At the end of 2021, JETRO held a contest for international startups interested in collaboration with Japan, and Ÿnsect was selected as a winner. Ÿnsect will receive mentoring from JETRO to support collaboration and open innovation with Japanese companies.
Ÿnsect welcomes more players
Ÿnsect is not the only player in the insect protein space, of course. As more and more startups and companies explore the exciting possibilities and potential of edible insects, we asked Anotine if he has any messages for future competitors.
That’s all, folks!
We hope you enjoyed this fantastic interview with Ÿnsect as much as we did! A big thanks to the team at Ÿnsect for participating and sharing insights with us and our readers.
Join us again next week for our final post on edible insects, which features a special interview focussing on insect-based products sold via different retail channels in Japan.
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