[This post was first published in the Fairfax NZ Sunday Star Times on 7 September 2014]
I have previously written about the health reasons why New Zealand should convert its herds away from A1 beta-casein. However within the industry, the issue remains controversial. Fonterra’s response in recent weeks has been that the co-operative produces a great product which consumers love and there are no plans in relation to A2.
The technology of eliminating A1 beta-casein is simple but it does take time. The first step is to only use semen from bulls that carry double copies of the A2 gene variant.
If farmers did nothing else but use A2 semen, then the A1 beta-casein milk component would halve with each cow generation. In practice, there would be almost no effect for three years due to biological lags, but thereafter the level of A1 beta-casein in the milk would halve every five years. I call this approach the ‘passive approach’ to breeding out A1 beta-casein.
Farmers can increase the rate of conversion by a range of active decisions. The most powerful is to genetically test each calf at birth and select replacements accordingly. Many farmers already genetically test their calves for other reasons, so adding the available test for A1 beta-casein is easy.
A second strategy is to genetically test the cows. This can have some effect through more effective culling, but is less powerful than testing the calves.
There are other strategies that can greatly speed up the process, but these have more management implications. For example, many farmers in New Zealand do not select replacements from first-calving cows, because these are typically mated naturally while on dairy support land away from the main farm. Farmers in other countries find this New Zealand system very surprising, because these are the calves that have the highest genetic merit. Selecting from these first-calving cows would also give immediate scope on most farms to ensure that no replacement stock carried the A1 gene variant.
The other way to greatly speed up the conversion is to use sex-selected semen. This would allow almost all existing A2 cows to produce female A2 progeny. This system works very well in intensive year-round mating systems used overseas, but needs further refinement for New Zealand’s seasonal mating systems.
So the question has to be asked: if it is so simple to make fast progress, why is it not already happening?
The answer is two-fold. First, some farmers have been quietly converting away from A1 beta-casein for ten years and more. The semen marketing companies all know the A1/A2 status of their bulls, and frozen A2 semen is readily available. However, LIC, as the major semen provider, does need to set up a service for non-frozen A2 semen.
The second reason is industry politics. Back in 1998, the New Zealand Dairy Group (NZDG), which was New Zealand’s biggest co-operative at that time, nearly made a decision to shift to A2. However, the pre-Fonterra New Zealand Dairy Board, which had responsibility for marketing all New Zealand dairy products, was concerned about the risk to the ‘existing category’. The question was put: how do you expect the Dairy Board to still sell A1-containing products during the 10 year conversion period once it becomes known publicly that we are breeding away from A1? At that time the evidence against A1 beta-casein was much weaker than it is now, so a decision was made to sit tight and hope the problem would fade away.
The concern about damage to the ‘existing category’ remains a key constraint influencing industry decisions. It is also an issue many politicians would prefer not to face up to. The alternative perspective is that it is better to manage risks pro-actively.
Despite the lost years, the New Zealand industry does still have opportunities relative to others. Our level of A1 beta-casein is lower than in the USA and much of northern Europe. Also, most countries are currently constrained by patents held by The a2 Milk Company which are perceived as controlling the right to select herds free of A1 beta-casein.
These patents, which are not effective in New Zealand, run out in most other countries starting in 2016. So we have less than two years to build our lead. Thereafter, other countries, and particularly the USA with its mega-sized herds and the use of sex-selected semen, can quickly catch up, and race ahead with differentiated A1- free premium products. Oh dear!
From a purely business perspective, the other key issue is the role of the NZX-listed a2 Milk Company. To date, they have used their patents to good effect outside New Zealand to keep others at bay. They have made spectacular progress in Australia, but have yet to transfer this success onto the world stage. In part this is because the global mainstream industry, with its enormous resources but cut-out from the action by the current patents, has understandingly chosen to make life as difficult as possible for The a2 Milk Company.
Disclosure of interest:
Keith Woodford receives royalties on his book on A1 and A2 beta casein and has previously acted as an independent adviser to The a2 Milk Company and other agri-food companies. He holds no shares in any milk company.