The Entomology Industry is Entering a New Era

I have been updating the Entomology Company Database in this site now for 1,5 years and the list of active companies has been growing a month after a month until this summer. There was a two month break that I didn’t find a single new company and when I finally did find the summer’s first I had the feeling that there must be something happening in the background. I went through the complete list of the companies on 20th of August and this is what I found out:

25 companies had their status changed from active to  not active.

8 companies had their status changed from active to unknown.

Even though 25 up to 33 companies have left the industry it does not mean that the industry would have lost its potential, but it tells of loss of the biggest hype and arrival of realism. The ones with no real potential are moving on.

What is worth noticing is that of the 25 closed down companies only four were farming companies. This change is a step towards healthier structure of the industry. Before this change, and also still today there are very little raw material producers (beginning of the supply chain) compared the end product manufacturers and sellers (end of the supply chain).

Would be really interesting to know the reason for the companies to quit. Are the end product companies quitting mostly because of:

  1. Difficult regulatory environment?
  2. Challenges entering the markets with insect products?
  3. Because of the lack of supply in the raw material side?

Any idea about this? Please leave a comment!

Check out the latest update of the Entomology Company Database here: https://ilkkataponen.com/entomology-company-database/

Advertisements

4 thoughts on “The Entomology Industry is Entering a New Era

  1. EU novel food status kicking in in January 17?
    Mid summer lull?
    Average drop-out rate for fledgling industry at this point in it’s development? Have you checked against lifecycles of comparable/average industries?
    Keep up the good work!

    Like

    • Hello Tony,

      Thanks for the comments and questions!
      – It is my understanding that the novel food status will be altering in January 2018, not 2017.
      – The summer holidays might had an effect on the companies, but that could only be a reason for new companies not popping up, not for the companies closing down.
      – It would be really interesting to see data about other industries, but that could only tell of some level of credible data as it is really hard to think of a comparable industry. What other industry has created so much attention in so short time that involves physical production, especially farming?

      Like

  2. Hi Mr Taponen,

    I’m a South African food science student who is fascinated by entomophagy and intend on entering the industry after graduating. I was wondering if you had more insights into why so many companies quit two years ago? What do you believe are the main challenges in introducing insects as a common food source? Do you believe that a slow introduction of the idea (for example through market stalls and pop-up restaurants) is more reliable than product development where production costs are high and sales are not guaranteed?

    Like

    • Hello Anissa! So many questions, let’s see if I can answer all of them!
      1. It is true that multiple companies have quit the business, but I see no one clear reason. The food business is a business of high initial investments, low margins, and high competition. Additionally, an extra challenge brings nascent technology and market. Also, regulations are not friendly (in most countries. Lastly, when looking at the feed market the one more barrier of entry is the high production output that is needed from the start.
      2. There in question 1. I already listed some of the challenges, but I would like to add that I don’t see the issues relating to cultural acceptance. The problems lie in achieving profitable industrial scale farming that I believe no one has been able to do so far.
      3. Organic growth like your example is a good idea. It is especially a good idea in the case of edible insects as there are more uncertainties around it.

      Let me know if you have further questions! ..And read or listen to my thesis! It is mainly about these topics.

      Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s