SET-listed Thai Union Group is considering using alternative insect-based proteins to replace fish meal as part of a push to encourage growth in the foodtech industry in Thailand, says chief executive Thiraphong Chansiri.
Written by: William Hicks / The Bangkok Post
“I expect to use some of these products soon in our operations,” Mr Thiraphong said. “We can use alternative proteins to replace fish meal, but cost is the key and that is something these startups have to take care of.”
Thai Union has committed US$30 million (949 million baht) to a fund to invest in alternative proteins and other foodtech innovations. The company has also invested in an Israel-based startup, Flying Spark, that makes protein products out of fruit fly larvae.
The use of fish meal, or processed feeder fish used to feed farm-raised salmon and tilapia, has been called out by environmental groups for being unsustainable and drastically heightening the environmental impact of farm-raised fish. Finding a replacement for this product would greatly improve the health of the world’s fisheries, but insect-based alternative protein is far from a cost-effective replacement and could alter the taste of the fish.
In the past decade, Thai Union has invested heavily in sustainability and last year ranked No.1 among the food industry on the Dow Jones Sustainability Index. Yet the seafood industry still faces existential threats from climate change and overfishing.
He said the company has 2-3 more startup investments in the pipeline and will focus on Series A and seed funding rounds to make investments under $5 million.
“We are still committed to seafood, but we have to admit that consumer behaviour is changing and millennial behaviour is changing,” said Mr Thiraphong. “People are interested in alternative proteins, which includes plant-based and insect proteins.”
Last week, the Thai Union-backed foodtech incubator Space-F had its demo day, where startups participating in the programme pitched their businesses to a room full of potential investors. Three of the seven startups present were from Thailand, while the remainder came from Singapore, the US and Germany.
Many of the startups at the event were focused on alternative proteins such as Thai Ento Food, which creates a protein powder out of house crickets and black soldier fly larvae, and Orgafeed, which makes insect-based dog treats, both based in Thailand.
“Many innovative projects in Thailand are focused on fintech, but foodtech is more complicated and difficult, maybe because of the education required, making it hard to find deep foodtech startups in Thailand,” he said. “When we started we knew we could not just focus on Thailand, but I was pleasantly surprised we could attract startups from outside the country and have found many that want to establish themselves here.”
Mr Thiraphong said Thailand has a strong food sector that can attract innovative startups looking for strategic investors from large Thai corporations, despite the country’s relative lack of venture capital.
“Food is the core of Thailand and this is an agricultural-based economy,” he said. “If you can improve this sector, you can improve a lot of problems including inequality; you can improve the wages of farmers.”
Despite the interest in alternatives, he said Thai Union will still focus on its core business of seafood.
“We need to explore new opportunities, while remaining focused on our core which is seafood,” said Mr Thiraphong.
“We need to defend and communicate that we have the best seafood that is clean and natural.”