Where the money\u2019s going<\/p>\n
Chief executive Tom Breen says the funds will be used to get his company\u2019s product to market in New Zealand (where he says final Ministry for Primary Industries regulatory approval is close) and Australia (where he says no approval is required). <\/p>\n
He\u2019s hoping it will go on sale next year and be treating \u201cthousands of animals\u201d by year\u2019s end.<\/p>\n
Ruminant has commissioned a manufacturing facility capable of producing one million doses per year to back the Australia-New Zealand launch, Breen said.<\/p>\n
Brazil, Canada and other markets will follow, he said.<\/p>\n
Ruminant\u2019s product is aimed at pasture-grazing or \u201cruminant\u201d cows, putting the US \u2013 where grain feedlots dominate \u2013 off the table for now.<\/p>\n
Some of the funds will also be used to develop future products and an emissions trading market to incentivise farmers to adopt its product – with some help from new investor Marex.<\/p>\n
Methane reduction targets lowered<\/p>\n
Breen\u2019s goal is to have 100 million cows popping his company\u2019s pills by 2035 as farmers move to meet methane emissions targets.<\/p>\n
In New Zealand, those targets are now less stringent. Earlier this year, the Climate Change Commission pushed for a strengthened methane target.<\/p>\n
In the event, on October 12 the Government instead said it would legislate to lower the methane target, from 24%-47% emissions reduction (from 2017 levels) by 2050 to a 14%-24% emissions reduction.<\/p>\n
Federated Farmers is pushing for a further reduction.<\/p>\n
Ministers Todd McClay (trade), Simon Watts (climate change) and Andrew Hoggard (associate agriculture) said the decision was science-based and was part of a revised pathway that \u201cprotects jobs and production and upholds our climate commitments\u201d.<\/p>\n
Ruminant Biotech chief executive Tom Breen (left) with Climate Change Minister Simon Watts at Cop30 in Brazil last week.<\/p>\n
Breen said farmers still needed to reduce methane \u2013 and that the Government\u2019s long-term goal of net-zero emissions remained.<\/p>\n
Earlier this month, the CEO attended the UN\u2019s Cop30 conference in Brazil. The event took place against the backdrop of something of a backlash against the UN push to lower emissions.<\/p>\n
Leaders from the world\u2019s three largest polluters \u2013 the US, China and India \u2013 did not attend. Key resolutions were voluntary.<\/p>\n
But Breen said there are notable examples of private players picking up the slack.<\/p>\n
Cop30 saw Brazilian company Marfrig, the world\u2019s second-largest beef producer, pledge to reduce its emissions by 33% by 2035.<\/p>\n
It was on a tangent to the UN\u2019s official goal \u2013 a 30% reduction from 2020 levels by 2030. But it was a concrete, public pledge.<\/p>\n
Not all corporates are on the same page. Breen concedes that in the same week New Zealand lowered its targets, Nestl\u00e9 – one of the largest customers for the NZ dairy industry – withdrew from the Dairy Methane Action Alliance.<\/p>\n
But he said: \u201cWhile some government and industry targets may have changed, climate change has not.\u201d<\/p>\n
Farmers need practical tools and investable markets, Breen said.<\/p>\n
What does it cost?<\/p>\n
Breen would not give an estimate of how much it would cost, per cow, to administer Ruminant\u2019s treatment \u2013 which sees a slow-release daily dose of an active ingredient (Tribromomethane) interrupt microbes called methanogens, reducing methane while not impacting the efficiency or health of the animal.<\/p>\n
Ruminant Bio Tech’s R&D team holding boluses, designed to curb methane emissions in cattle. At rear is the lab team producing a batch of boluses. The start-up is based at Future House in Parnell, Auckland \u2013 a “deep tech incubator” Outset Ventures. Photo \/ RNZ<\/p>\n
\u201cFarmers\u2019 number one job is to look after their family. That means they invest in things that make them more productive and profitable. We believe farmers need to be putting 10 to 20 bucks in their back pocket every time they treat a cow with a product like ours,\u201d Breen said.<\/p>\n
New investor will help with carbon credit business model<\/p>\n
Through what mechanism will that $10 to $20 materialise? Breen says in Australia, Ruminant has applied for accreditation with Verra\u2019s VM0041 voluntary carbon credit scheme. He anticipates a similar arrangement in New Zealand.<\/p>\n
One of the key investors in Ruminant\u2019s $17m Series A round, Nasdaq-listed Marex, also brings key skills to the party.<\/p>\n
The British-based commodities dealer and carbon-trading platform operator recently set up shop in New Zealand, opening an office in Auckland.<\/p>\n
As part of its investment, Marex will act as exclusive broker and market maker for Ruminant Biotech\u2019s carbon credits generated by the project.<\/p>\n
\u201cThis investment positions us to commercialise our world-leading technology with a scaleable business model that rewards on-farm emissions reductions through carbon markets,\u201d Breen said.<\/p>\n
\u201cWe\u2019re excited to unlock new ways to reward farmers for reducing emissions, while helping industry and Governments meet their climate goals. We\u2019re confident that if we can get this right, adoption will follow.\u201d<\/p>\n
Govt grants on both sides of the Tasman<\/p>\n
At the October 12 announcement, McClay, Watts and Hoggard said in a statement: \u201cThe Government is already investing more than $400m with industry to speed up the development and rollout of methane-cutting tools. The first is expected on farm in 2026, with up to 11 available by 2030.\u201d<\/p>\n
Ruminant has received $11m in public research grants from New Zealand Government agencies, plus A$3.5m ($4m) from the Australian Government\u2019s Methane Emissions Reduction in Livestock R&D assistance programme (the University of Sydney is a Ruminant research partner).<\/p>\n
The start-up also received a $2.5m equity investment from New Zealand Green Investment Finance (NZGIF) \u2013 the Crown \u201cgreen investment bank\u201d that imploded after its SolarZero bet went south and is currently been wound down. With its NZGIF money banked in May 2023, Breen\u2019s firm is not affected by the NZGIF meltdown.<\/p>\n
\u201cThey were an important early stage investor and remain on the register today,\u201d Breen said. <\/p>\n
The Companies Office lists NZGIF\u2019s stake at 5.8%.<\/p>\n
The Series A backers<\/p>\n
The US$9.5m ($17m) Series A raise announced this morning was co-led by existing investors Rosrain Investments (backed by Stewart Brothers Bloodstock in Queensland) and Christchurch-based Cultivate Ventures (owned by investment banker Greg Anderson), \u201cwith significant investment from global financial services platform Marex, alongside follow-on funding from AgriZeroNZ\u201d.<\/p>\n
AgriZeroNZ is a public-private partnership half-owned by the Government, via the Ministry for Primary Industries, and half by agribusinesses and banks including Fonterra, Silver Fern Farms, Ravensdown, Synlait, A2, Rabobank, BNZ and ASB.<\/p>\n
Ruminant (founded in 2021) earlier raised $4.5m in a 2022 seed funding round (backed by Sir Stephen Tindall\u2019s K1W1 and others) and $12m in a 2023 pre-Series A.<\/p>\n
Total funding from all sources has been $33m. All going well, 2026 will be the year that backers start to see some returns.<\/p>\n
Chris Keall is an Auckland-based member of the Herald\u2019s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.<\/p>\n","protected":false},"excerpt":{"rendered":"Where the money\u2019s going Chief executive Tom Breen says the funds will be used to get his company\u2019s…\n","protected":false},"author":2,"featured_media":154497,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[102630,50493,1975,51,5299,138,5276,79504,12700,2082,71,302,6080,1132,111,139,69,19952,2081,11596,102631,102629,25338,1037,1361,16541,1533],"class_list":["post-154496","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-132m","tag-17m","tag-at","tag-auckland","tag-biotech","tag-business","tag-cow","tag-cows","tag-emissions","tag-for","tag-from","tag-its","tag-methane","tag-million","tag-new-zealand","tag-newzealand","tag-nz","tag-pill","tag-raised","tag-raises","tag-reduces","tag-ruminant","tag-slash","tag-startup","tag-that","tag-valuation","tag-will"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/154496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=154496"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/154496\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/154497"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=154496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=154496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=154496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}