Shaun Newman Podcast - #351 - Sylvain Charlebois

Episode Date: December 2, 2022

Professor, Director, Agri-Food Analytics Lab and Former Dean of the Faculty of Management at Dalhousie University. He has written four books and his research has been featured in newspapers that include New York Times, Wall Street Journal and the National Post. We discuss lab grown meat. Let me know what you think Text me 587-217-8500

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Happy Friday. Hope everybody's week is rolling along. We got an interesting one on tap. Well, it's been an interesting week. Who am I kidding? It's been all over the map as we, you know, kind of a bit of an adventure for the week. But a fun one nonetheless.

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lubricants, methanol, and chemicals delivering your farm commercial oil field locations. For more information, visit them at Hancockpatroleum.ca.ca. He's a professor, director of Agar Food Analytics Lab, a former dean of the Faculty of Management at Dalhousie University. He has written four books, and his research has been featured in newspapers that include New York Times, Wall Street Journal, and the National Post. I'm talking about Sylvain Charlebo. So buckle up. Here we go. This is Sylvain Chalbois, and you're listening to the Shepardot. Sean Newman podcast.

Welcome to the Sean Newman podcast today. I'm joined by Sylvann, Charleboe. So I hope I said it right because I feel like I had it right the first time and then I'm not sure about the second time. Either way, Sylvand, it's nice to have you on the show. It's part of your charm, Sean.

It's all about authenticity. Yeah, absolutely. Well, you know, it's funny. On this side, one of the things I do not want to screw up his names, right? I got your name for a long time. I sit and I go listen to other people say it. And then you listen to six people say it and they all say it differently. And you're like, okay, which way is it?

Either way. That's part of the fun of being on this side is all the different names that come across one's desk. So, Van, the way we start the show is I love when the guest gets to tell a little about themselves and obviously whatever you think is a high point or whatever you would like the audience to know. And from there, we'll jump off and talk about a few different things. Yeah, absolutely. So first of all, I am a professor in food distribution and policy, but I'm also director of the agrafood analytics lab. And the lab was created in partnership with three faculties, management, health, and computer science. And what we do is look at analytics.

We actually look at data constantly. And we try to understand exactly what's going on, what our, trends from farm to store and restaurants. We look at issues. We try to provide some recommendations to policymakers, to regulators, to auditor generals. We work with the Bank of Canada, the CFIA at Canada, seven provinces. So we've been busy over the last little while, and we also work with some private sector, companies looking at some specific issues, mostly about trades, international trades and

food security mainly. So yeah, so it's been it's been an interesting, I'd say three, four years. There's, there was COVID and, and of course, now the food inflation storm we're in is getting us to answer some tough questions about why are food prices more high? What's going on with shortages? What's going on with a bunch of issues that are mainly supply chain related? And because it's such an obscure part of our food economy, few people understand. And so they just want to understand. So that's what they call us.

Well, I'm curious. As a guy who stares at data all day, what is the data saying then? What trends are you seeing when it comes to? food security or is there other things you're looking at? Well, I think we're just going through a sequence of different major disrupting macroeconomic factors, really. And that's kind of what's unique with our period right now compared to a few years ago. So we've had, obviously, climate change is a constant.

Not being a constant, it is a constant. It's impacting our food prices. all the time every single year. So that was always there. But of course, the pandemic really made things more complicated from a supply chain perspective. And public health measures were important to keep people safe, but obviously it has also impacted the efficiency of supply chains as well.

And the one analogy I used often to explain to people who don't understand supply chains is getting them to picture. themselves in their own car with a hot pizza. If you go 100 kilometers with your pizza, you'll burn some fuel. It will cost you some money. Your pizza will be a little bit colder, but you'll get the destination. But if I ask you to cover that spread again, but stop every 10K, idle for 30 seconds, you'll end up covering 100 kilometers, but it will cost you more fuel. In fuel, it will cost you more money. And the pizza won't be. be as fresh. That's kind of what has happened the last two and a half years. So you have to account

for the food waste, the extra costs, and all of that has caught up to us in 2022, really. And so when you ask me where we're at right now, I'd say that we're probably in a seventh inning of a baseball game. If you were to look at the inflation cycle, we're in right now, we're probably at the seven-inning stretch. We're still not out of the woods, but we still have a ways to go, given what we're looking at in terms of macroeconomic factors. So the supply chain, the other issue, of course, is the currency. Interest rates are going up. It's the race to the top right now. The Fed is really defending its currency, the American dollar, the American mighty dollar. And that,

could actually impact our inflation situation up north right here in Canada because, especially in winter months, we do import a lot of food from the U.S. There is a lot there. I'm going to start. I'm curious about this one. You said climate change is impacting food prices. What did you mean by that exactly? Case on point.

Have you tried to buy lettuce of late? Well, the lovely thing is, is I have a lovely wife who does a lovely wife who does a all the shopping. So I actually don't know. You look like a lettuce guy, you know? But leafy greens have been difficult to get in Canada because of what's going on in California. California is drying up.

And typically in October and November, we do get a lot of leafy greens from California. But in August, September, in October, there was this drought, which really weakened plants there. virus just destroyed 75% of all crops there. Farmers didn't have anything to sell, including to Canada. And so that's a perfect case of, and if you do find leafy greens at your grocery store, you'll probably end up paying 10 bucks for three heads of Romaine, for example, which is probably double of what he used to.

I got what you're saying. Climate catastrophe somewhere around the world, drought, fire, famine, blah, blah, blah. We don't, like, groceries won't tell you, we'll put a price eye on climate change, but I can see how climate change is impacting all of us every single day, depending of the vertical you look at. So I just gave you an example of leafy greens, but I can look at cereals and pasta right now. And like there are other verticals impacted by climate change as well.

Well, as we get more tight-knit with the entire world, with the global supply chain, And what you're pointing out is, you know, if something happens on the other side of the world or wherever, I mean, just to the south of us for that matter, it's impacting not only them, but everywhere else because our supply chains are so interconnected. I think that's what COVID really pointed out. And it continues to point out, right? Like this continues to go along how interconnected the world truly got. And now as little things start to happen, they actually have really big consequences, you know, across the across the world or across, you know, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the. border or the pond or wherever, wherever they're shipping to. Because not only do we import, but we also export a ton. And if things like that happen here, they do have consequences elsewhere. Exactly. So I think COVID really is made Canadians more aware of the food world, the planet. If something happens in Brazil or, well, Ukraine, it impacts us eventually.

And people didn't realize, well, yeah, Ukraine actually produces 15% of all the wheat in the world. So who care? But we do produce weed in Canada. Who cares? Well, it's a global economy. And so prices are negotiated internationally. So if a bushel of wheat is nine bucks U.S. in Ukraine, it's going to be nine bucks U.S. here, too. That's how it works.

Well, you know, I only got you for a brief time. And I want to make sure we bring up lab grown meat. That's what I reached out to you. It saw some posts on it. That's right. Yeah. And I, I, you're intrigued, don't you? Well, listen, I grew up on a farm.

We still have the farm. I grew up in the West, you know, cattle country, et cetera, et cetera, et cetera. Lab grown meat is about as foreign an idea as I can come up with. And so when I seen you talk about it, I'm like, well, this should be in. interesting. So I don't know. I assume there's some there's a lot of upside that people are staring at. That's probably why they're pushing it so hard. What is the upside? What is the downside? I don't know. And what are you seeing hearing? There's probably one thing you learn while you are on the farm, Sean, is that if you follow the money, you'll get to some sort of truth. And I do that

all the time. Money never lies, really. And so when you have VCs investing $25 billion in cellar agriculture, something's up. Something's up. So when you look at a company like upside foods in San Francisco, which has gotten some funding from Richard Branson, Bill Gates, but also Tyson Foods in Cargill, those are major, meat players investing in lab-grown meat. Something's going on here. And so they just got the approval from the FDA, which was a huge hurdle. So it's just a question of time before we see these products commercialize. So upside foods just basically received FDA's approval to commercialize lab-grown chicken. So basically, you should.

should we should call it cultivated chicken, but cultivated chicken essentially is the same product as you would find traditionally from a farm. Instead of feeding animals, you're feeding cells. That's the only difference, but you're reproducing the same cell. So when I hear people say it's fake meat, It's not fake meat. It's actually the same thing. But the process, the production process is cellular. It's a bit different. You're basically putting all your cells in a cultivator to reproduce cells.

And you use amino acids and different ingredients to feed cells as if you were doing it in a barn feeding chickens. That's basically the difference. And when you think about what's going on with the avian flu right now, When you think about the ethical treatment of animals, when you think of the cost to feed animals these days, right now, I would venture to say it's cheaper to produce cultivated chicken than it is to produce traditional chicken. And that's a really strong business case right there. Yeah, follow the money. I don't think true words could be said. It's funny though, you know, I come from a land of still family farms, you know, I think of, I just think a, like, when I listen to you talk about growing cells, all that comes to my mind is a brave new world. Like I'm just like, I think it's Eldis Huxley, if memory serves me correct, where they basically breed the human population in a, in a lab, right? It just, it seems, I don't know the word right now.

I'm trying to spit it out, but I can't find it. It seems foreign and very, very, yeah, no, I can understand. It seems abstract. And I come from a place where, you know, well, I just think of my brother. He's got chickens and they're a free range chicken. There's just out running around, right? And my parents had the same and neighbors have the same. And our cattle are out running around, right?

Like sheep, et cetera, all over the place. So when we talk about humane, I'm just like, I don't know. Like I have a hard time. you know, you get these, uh, where I'm from, these, they're animal lovers. They, they truly, uh, treat their animals just as well as anything. And it just seems, oh, absolutely. Yeah. Um, the thing about what, what worries me, Sean is, uh, is, is how we sell this stuff.

So the science is there. And frankly, the business case is pretty strong. But it doesn't mean that, that, that it's going to be commercialized. There are a couple of hurdles. The regulatory hurdle is pretty huge, especially in Canada. We have quotas in Canada. We have billions and billions of quotas. I suspect that poultry farmers have a say in this, and they should have a say in this.

Same for chickens. Same for eggs. But the other issue, of course, in Canada is this whole issue of labeling. I get it. I mean, people will want their chicken to come from a barn, from a farm, and then slaughtered traditionally, and even I would prefer that. But how is this going to be labeled? So in the past few years, we've seen genetically modified salmon in Canada not being labeled in Canada.

And the reason why it's not labeled, it's simply this. So the salmon industry didn't want genetically modified salmon to distort the image of salmon in general. So they're just blending it in. But the other issue, of course, are about social economics. Genically modified salmon is cheaper to make. It's half price. That's why they develop the technology in the first place. Why the hell would you develop a genetically modified salmon?

It's because it's cheaper to produce. You can actually end up with a salmon in 18 months versus three years. Imagine the savings with feed and everything else. It's dependous. But if you offer a deal to the consumer, salmon at half price or 30% off or something, you're diluting the value of the category, which is why they don't want it labeled,

which is, I think, the wrong way to think about it. Same goes with cellular meat or lab grown meat. I think it's important to label the thing so you can actually give consumers a true transparent choice. If people want traditional, so be it. If they want to try the lab grown stuff, that's up to them. But it should be label. And my concern, I can tell you right now, Sean, health Canada won't force the companies to label the technology,

which would be the wrong thing to do. So if I'm understanding that correctly, when you talk about labeling, you're saying you go down the chicken aisle and it's all just chicken. They don't actually put on it that it was lab grown. That that would be that that would be my prediction. Yes. Yeah, yeah, it hasn't happened.

But that's your fear is that they just throw it in beside other chicken and say. If you go to the fish counter or if you buy a product with salmon in it, you're never going to know if it's genetically modified or not. It's not labeled. And you've eaten genetically modified salmon already. If you eat salmon, you've eaten genetically modified salmon. already without knowing it. And why did they do that?

Well, because they don't want to compromise the value of traditional salmon. So salmon is sold on average about $12 a kilo in Canada. If you actually sell, if you actually sell genetically modified salmon at $12 a kilo and traditional salmon, both products, genetically modified traditional at $12 a kilo, which one do you think Canadians will pick? traditional, of course. But if you sell directly modified salmon, say half price

and traditional at 12 bucks a kilo, people will likely pick the cheaper one. Yeah, but that's, but, but right there, that's, that's, that's like artificially messing with the market. Like that's, that's, that's not good.

Because then then that creates like as a consumer, I want the choice of whether I can afford or not and knowing what I'm getting. And I think that's what, you know, isn't that why we have so much transparency or more and more transparency coming on how foods are raised and how foods are this and everything else? So that the consumer knows. Well, the challenge, Sean, is that I think that the investment that we've seen in the food

industry were made to benefit companies, not necessarily consumers. I mean, for, I'm at Dow. We're surrounded by ocean here. We want our blue economy to have a larger part in people's plates. And you're not going to do it if you actually continue to sell salmon $12 a pop. It's not going to happen. It's too expensive. So how do you actually make it more affordable?

Well, if you actually invest millions of dollars in creating this genetically modified salmon, which is costing half the price to make, why aren't you allowing consumers to benefit from that technology? Look at GMOs. I mean, you know, when you were in the prairies, in the prairies, you're surrounded by biotechnologies. They've done wonders for agriculture. And eventually, I actually truly believe that consumers have actually benefited from biotechnologies out in the field because of the abundance, because of increased yields and everything we've seen in the last 20 years. but in livestock we're not I don't think we're actually doing it right honestly I don't think we are doing it right

and what do you mean by that when you say we're not doing it right what do you mean well I don't think it's it's transparent you're not allowing the market to recognize the value in the technology like even with genetically modified crops I've always advocated in favor of transparency and labeling if you actually you know if you use genetically modified maze, for example, you should actually label it at retail so consumers know. And that's why there's been some backlash around companies like Monsanto, because it came as a surprise. You've never allowed the consumer to befriend something they don't understand. Eventually, they will understand that,

well, biotechnology aren't that bad for you. They're actually good for you, you know. But a lot of advocates are using that lack of transparency to advocate against evolution. That's the big problem we have. And agriculture has done wonders. I think the next step is cellular agriculture. And I actually do believe that Tyson and GBS and even Tyson are reading the scenario correctly. They know that that's. where we're going slowly, not entirely, but I think there's going to be a space for

cellular agriculture eventually. Just before I get you out of here, one of the things that, you know, I don't know about lab grown meat, I started watching videos on it because I'm just, you know, a lovely thing about YouTube is you can go watch a ton of information. One of the things that came up over and over and over again is FBS, fetal bovine serum. Is that the case in growing lab grown meat across the board is you need fetal serum? I want to allow the cells to grow? Well, you don't have to.

It's part of the recipe, if you will. You still need a live animal and extract cells through a biopsy. That's why vegans aren't interested in the diet at all. but you can there are different there are over 130 different startups in the United States looking at cellular agriculture and they all they all have different approaches so FBS is part of some recipes but not always in Canada we have 13 companies developing new products including salmon chicken and beef and and when you say they it doesn't need FBS so they're like in order to make this meat grow you

know, once again, fish, chicken, whatever, it doesn't matter. Part of the recipe, though, has to be from a live animal. So as it just sells, like, boom, take a needle, bang, and a petri dish, and away we go. That's right, exactly. Yeah. And then you put that into a culture. I'm not a food scientist, but once you actually are able to generate this multiplier process, you basically put cells into a cultivator to multiply.

cells. And yet, think of, think of, think of agriculture as being adaptable to demand. Let's go back to chicken, for example, you know. How many chicken wings do we throw away every year? How many legs? What's demand for legs versus breast? You can design whatever you want. You can actually design a breast, okay, a chicken breast for people who are anemic. So you basically can add more iron to your chicken breast. Like, it's limitless. You can do a lot of different things with food and sell your agriculture. It's amazing.

And you can reduce waste and eventually you can actually stabilize costs. And like I said, going back to the Aven flu situation right now that we're facing, that's a big problem. We've actually, we have to call over almost 4 million birds so far in this country as a result of the Aven flu. And that biosecurity is a huge risk. A lot of poultry farmers aren't sleeping right now. They haven't been sleeping for months as a result of the Avan flu.

But we have this technology that could actually allow us to think differently about food. Well, I tell you what, sir, the next time you come on, I'm making sure you block off some time because you have my brain firing in all cylinders, but I told you I wouldn't hold you here all morning. And the listeners laughing at me because it's only been a quick, you know, 20-some minutes. but the next time, Sylvann, I would love to sit and pull some more out of your brain because it's a subject that I think a lot of people are paying attention to or don't understand or, you know, like I can think of a thousand things and I know I'm going to stir some.

If you're over 45, you're saying yuck. If you're under 45, you're saying I want to try this as soon as possible. That's what we're seeing in our data. And if you live in the West and are under 45, you still might be going, I just don't care. Probably. Probably. Yeah. Well, thank you, sir, for giving me some time this morning. And, uh, and, well, and I look forward to the next time of trying to pull some more out of you. Because I think, uh, you know, you've, you've rattled about 12 things off my brain this morning where I'm like, huh, that's, you know, like, I would love to sit and, and pull more out of it. But either way, I'll let you get on with your morning and appreciate you giving me some time.

All right. You take care, Sean.