The new ‘wind’ power: Cow backpacks and other solutions to agricultural methane emissions
Why a low-key New Zealand dairy company could do more to solve climate change than Tesla
New Zealand isn’t a country that comes up very often in charts of top CO2 emitting countries, but one company—Fonterra—deserves special attention. Fonterra is New Zealand’s largest company and employer, but to put its scale in a global perspective, consider that Fonterra accounts for 35% of global dairy exports, whereas Saudi Aramco, by way of comparison, accounts for 12% of global oil exports. Because cows produce both methane (a greenhouse gas 25 times more potent than CO2) and nitrous oxide (a GHG 300 times more potent than CO2), your average 1,300lb cow produces the equivalent of four tons of CO2 each year. This explains why cows (dairy and otherwise) accounts for 18% of all anthropogenic GHG emissions, a figure more than GHGs produced from driving cars (sorry Elon). Given both the scale of Fonterra and the scale of the challenge posed by animal-sourced GHGs, few other companies have as much potential to combat climate change through supply chain sustainability and innovation.
Company context today
Fonterra is a dairy co-operative owned by its suppliers, who are dairy farmers. Its business model is to run the supply chain and manufacturing plants than transform raw milk into dairy commodities (like whole milk powder, butter and cheese), and then either sell these commodities to CPG food companies, or further process them into branded consumer goods sold through supermarkets. In total, Fonterra has over 10,000 farmers, sells over 4 million metric tons of dairy products and ~$13bn USD of sales.
So far, the main impact of climate change on Fonterra has been political rather than regulatory or economic. New Zealand launched an Emissions Trading Scheme in 2008, but exempted its agriculture sector due to fears of losing market share to international competitors not subject to this type of increase in input costs. That said, Fonterra has been extensively criticized by Greenpeace and the New Zealand media for contributing nearly 20% to the country’s total greenhouse gas emissions. In response, the company has audited the sustainability practices of its entire supply chain and committed to a 20% reduction in its carbon footprint by 2020. Specific initiatives launched so far include:
- Reducing the number of cows needed to supply a given amount of milk (i.e., increasing productivity) through selecting breeding, reducing replacement rates, increasing fertility rates and increasing feed quality
- Reducing GHG emissions per cow through increasing use of nitrification inhibitors to slow the release of nitrous oxide and decreasing use of urea-based fertilizers
- Reducing GHG emissions in manufacturing and supply chain operations, through more efficient energy use
Future impact of climate change
As global temperatures continue to increase, Fonterra is likely to be affected by both the physical and regulatory impact of climate change. Increased atmospheric CO2 levels will favor increased pasture production but warmer temperatures reduce the quality of nutrition in grass, so the net impact on their milk supply is unclear. There are additional risks of proliferation of subtropical insects and hostile weeds, like kikiyu grass, which has already begun to spread in dairy farms in New Zealand’s North Island due to warmer temperatures. Furthermore, increased variability in severe droughts and floods globally increases the difficulty to accurately forecast global supply and demand of dairy commodities. Practically this means sales teams have less visibility into their markets’ demand for exports (which is largely determined by in-market domestic supply). Manufacturing teams similarly have less visibility into the optimal mix of products that need to be made to fulfil sales orders months in advance. So, although droughts and floods in China or Africa are thousands of miles away from New Zealand, they increase the probability of excess inventory or supply shortages, and therefore decrease profitability for Fonterra.
Potential solutions and opportunities
As the world’s largest global multibillion dollar enterprise based on cows, Fonterra is in a unique position to lead innovation in reducing methane and nitrous oxide emissions not just for dairy cows but for livestock more generally. Incremental solutions include further on-size optimization of feed quality, fertilizer use, irrigation levels and pasture species. Far more exciting, though, are solutions that have transformative potential to eliminate livestock GHG emissions altogether. Some of these include:
- Changing the microbiome of cows to remove the bacteria that produce methane, called methanogens. Potential solutions under development now include: vaccinating the cow to produce anti-methanogen antibodies, dosing cows with synthetic enzymes to break down methane, or genetically engineering alternative microbiomes
- Mechanically capturing the methane and harnessing it for later use as fuel (like the cow backpack in the photo above)
If any one of these solutions reduced or eliminated GHG emissions from cows, and if Fonterra developed the intellectual property, they would acquire immense potential to commercialize the technology to all other players in the livestock industry. (791 words).
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Student comments on The new ‘wind’ power: Cow backpacks and other solutions to agricultural methane emissions
While methane backpacks provide an amusing solution to a fascinating problems, it seems as though the best long-term option would be altering the source of the problem (i.e., the cow) rather than rerouting the dangerous chemical. Having to constantly dose thousands of cattle with a live enzyme to break down methane would be logically difficult, time-consuming and expensive to carry out. Selective breeding to find a breed with minimal methane output would be minimally invasive, but time consuming and potentially limited in effectiveness. Antibiotics might be of concern if they were passed through the milk to humans, and would certainly have to undergo regulatory testing and approval. Ideally, scientists would be able to develop and implant a gene that enabled the cows to break down the methane themselves. If done correctly, this gene could potentially be altered and adapted for other livestock that emit unwanted substances. While this solution would take a great deal of time and R&D investment, it seems the most effective and efficient long-term option.
This is a fascinating problem and business opportunity for Fonterra. I am intrigued by the option of altering the cow’s microbiome and wonder if this could be maintained with the right mix of feed (prebiotic and probiotic components) to make this easier to implement. As they experiment with different solutions, it will be interesting to see how innovation happens at the farm-level. In response to Alexandra’s idea about altering the gene of the cow, I’m no expert but wonder if the interaction between genes and the microbiome might be useful here. I’m very curious about the science behind turning genes on and off and what impact the cow’s diet and environment might have on their gene expression.
I found this super interesting to read in particular because I spent the last year looking at agricultural supply chains in Ethiopia, with dairy/beef being critical areas the Government is keen to expand. Ethiopia has Africa’s largest livestock population and the world’s 6th largest, with significant potential to expand production and export of beef and milk. Fronterra announced a major investment in milk powder production in Ethiopia in August 2015.
The ability for Fronterra to test, validate the efficacy of, and potentially innovate to reduce cost of innovations such as the ‘cow backpack’ could have immense benefits in markets such as Ethiopia, too, creating significant impact for GHG emissions globally. Capturing methane and converting it to usable energy is a high-potential solution in that it not only reduces the output emissions but could also reduce the input demand for fossil fuels in livestock operations.
The other aspect of this supply chain that may be worth considering is the consumer power (and potentially, responsibility) on the downstream end to demand less red meat. If consumers make a demonstrable switch toward lower-impact meats such as chicken, pork, or even sheep and lamb, this would both decrease the volume of production on the supply side increase the imperative for producers such as Fronterra to implement more energy-efficient production.
Nick, fascinating read. I agree that the gene mutation and/or medicines to alter the methane output could be tough to implement. Although the public cares about climate change, they also care about wholesome and non-genetically modified foods.
Could cows be trained to excrete waste in facilities that can capture the methane? Cats and dogs can be trained to use the bathroom in particular locations. I would if cows could be trained in the same way to enter designated facilities. I know it sounds funny, but I actually wonder if it’s possible. Plus, the farms could capture and then sell the methane gas, adding a revenue stream.
Interesting read! I remember watching a documentary on Netflix a while back called “Cowspiracy” that talked about the relative input-intensity of producing beef. As you can guess by the name, it was a bit heavy-handed :).
But both that and your post have left me wondering as a consumer how to choose my proteins. What is the carbon footprint and resource intensity, per gram, of different protein sources? And how much do the methods–such as changing microbiomes, backpacks, etc affect the math on that? Do cows become more viable relative to, say, goats when you use these new technologies? I feel like I’ve spent quite a bit of time scouring the web in the past and haven’t really found a satisfactory source, but in the future I wonder if that kind of data won’t become as important to consumers as the nutrition facts on the back label of their foods.
Nick, amazing article. Glad to know that some measures are being taken with regards to this matter. I tried to find an article I read a couple of months ago but was unlucky this time. Its main conclusion was that livestock methane emissions were, to some extent, hidden from world discussions on climate change despite the fact it is one of the main contributors (if not the biggest). The reasons behind this were the existence of significant lobbying and also the fact that a lot of livestock is in developing countries, which could be wrongly perceived by public opinion. Did you come across something similar during your research?