A2 cows are the future

(As with many of my posts, this was first published at http://www.interest.co.nz .   It is also forthcoming in NZ Farmer as one of my regular fortnightly columns there.)

Towards the end of 2015 there was a massive re-assessment of A2 milk on the New Zealand and Australian stock exchanges. The shares of ‘The a2 Milk Company’ (abbreviated hereafter to their NZX code of ATM) closed the year at almost four times their price back in May, and with market capitalisation at $NZ1.35 billion.

For a few heady hours the capital value was close to 1.7 billion – more than Trade Me and almost double The Warehouse. Since then the shares have settled back somewhat, but still showing a three-fold gain from 12 months earlier.

In essence, the drive was fuelled by several major Australian institutional investors building their stakes, and then hundreds of smaller investors climbed on board. This was in response to ongoing good news stories from ATM, based on sky rocketing sales of infant formula in Australia and China, with this news particularly well reported in the Australian media.

Share markets tend to ebb and flow, and I never advise people whether I think the ATM shares are a good or a bad buy. Share market sentiment is unpredictable. But there is no doubt that the dairy world is changing.

Back in September, ATM was reporting that 28% of pregnant Australian women were drinking a2 MilkTM, with this then flowing through to a demand for the a2 PlatinumTM infant formula produced for ATM by Synlait. This was and is despite the ATM products being about twice the price of other brands. Chinese mums were then responding on the basis that if that was what Australian mums were doing, then they would do the same.

Unlike New Zealand, where A2 milk is hard to find and with poor keeping quality, the Australian-produced milk has excellent shelf life and is clearly the top premium brand.

In this article, my aim is not to tell that success story in any more detail. Rather, my aim is to say to New Zealand farmers, it’s time our industry woke up to what is happening. What is wrong with our industry that science, initiated here in New Zealand, is being ignored in this country? And much of this is at the expense of New Zealand’s 11,000 dairy farmers who have missed the boat.

In theory, ATM is still a New Zealand company but increasingly the investors come from Australiaan dbeyond, and that is where all the top ATM executives are. Here in New Zealand, there are about 35 farmers supplying A2 milk to Synlait, for which they receive a paltry premium of 15c per kg milksolids. And Synlait will also be clipping the ticket nicely (and legitimately) for the processing and packaging services they provide. But in the main, the benefits are going elsewhere.

It is ironic that Fonterra owned a 50% share in the first of the A2 patents. This patent, amongst other things, prevented farmers in most parts of the world from selecting for A2 herds – unless either Fonterra or ATM gave a license. How such a patent could ever be issued is another story. It should never have happened, but the ‘herd forming’ component somehow slipped through into the American patent and then was rubber stamped elsewhere across much of the world.

Despite co-owning this key patent (initially with the Child Health Foundation, and subsequently with ATM), Fonterra decided to downplay the A2 issue – something that they must surely be now wondering about. So they ignored the asset they held. It could have given Fonterra a big ‘early mover’ advantage.

In late 2015, the herd-forming patent ran out, and now there is no patent restraint on anyone anywhere in the world setting up A2 herds. And indeed it is starting to happen in a significant way. There will, however, be trademarks, brands and some specific testing methods that are still protected.

All of the international semen supply companies have had their bulls typed for A1 and A2 for several years. Accordingly, If clients asked, these companies could always advise which bulls were A2A2 (i.e., carrying double copies of the gene variant which needed to produce A2 herds). But now some of these companies are actively advertising it.

Several years ago, when travelling in an overseas country, I visited a farming group comprising three families who between them produce a billion litres of milk per year. That is more than all of the total milk products we consume locally in New Zealand. My visit was unrelated to A2, but at the end of the visit I did bring up the topic. A smile came over their faces. I said I would go out to my car and get a copy of my book on A1 versus A2. They said ‘‘No need. We now realise who you are. And in any case we already have several copies of your book”.

They explained to me how they had calculated that, when the patent situation changed, they could, and if necessary in a matter of weeks, be producing more than one million litres of A2 milk per day. At that stage they saw the A2 issue as a potential threat to their business and were planning accordingly. My guess is that they have been quietly getting organised ever since.

In recent weeks, the somewhat renegade ‘Milkweed’ journal, which goes to more than 5000 American farmers on subscription, has told its readers that now is the time to go A2. At least for some of them, it is going to happen.

Unfortunately for New Zealand farmers, it is going to be easier for the big American mega-farmers to shift to A2 milk than is the case for New Zealand farmers. Four key factors are: 1) they have multiple herds and can therefore easily segregate the A2A2 cows; 2) they artificially inseminate their 15-month heifers and this gives them more replacements to work with; 3) sex-selected semen works better in their systems than our seasonal systems; and 4) high replacement rates are economically positive for them, given the price of cull cows relative to the cost of raising replacements.

The one advantage New Zealand farmers have is that they are starting ahead of many countries in relation to their baseline A2 status. In all likelihood, New Zealand is starting ahead of the USA, China and much of Northern Europe – but not southern Europe.
In a logical world, Fonterra would have been acting a long time ago. But Fonterra is locked into historical positions and is unlikely to change in the near future. Fonterra will argue that the science remains unproven.

Well, the science is increasingly proven.

I began studying these issues back in 2003 and quickly realised there was a smoking gun. By the time I wrote my book ‘Devil in the Milk’ in 2007, the human clinical trials were still missing (they are very hard to do) but the underpinning science was growing fast. Of course the mainstream industry did their utmost to discredit me – they saw it as a threat – but in the long term they have only fooled themselves.

In the last 18 months, there have been papers published in Nutrients, the European Journal of Clinical Nutrition, the International Journal of Food Science and Nutrition, Nutrition and Metabolism, and Nutritional Biochemistry. I am linked into some of this research – I am a co-author on three of those papers. There is more to come. Quite simply, the share-market tide may ebb and flow, but the science is becoming a river.

So what can New Zealand farmers do? At the very least, New Zealand farmers should be using A2 semen as a de-risking strategy.

It should be easy to use A2 semen, but for that to occur LIC needs to come to the party and set up an A2 ‘bull of the day’ service for each of the three main breeds (Friesian, Jersey and Kiwi Cross). In the past, LIC has been unwilling to do this, but now is the time for farmer members to put the pressure on.

A second step – and this is so easy to do – would be to prominently display the A1and A2 status of all bulls in the LIC catalogues – both hard copy and online. LIC have all of this information, but they make it hard for farmers to find.

These simple steps will not be enough to bring New Zealand up to speed and get the early mover advantage. It is too late for that. But at least they will help prevent New Zealand farmers getting left further behind in the dust.

The counter argument is likely to be that New Zealand dairy industry will lose potential genetic gain by doing this. Well, together with Lincoln University Master of Agricultural Science student Italo Mencarini, I have studied that as part of broader analyses of converting herds to A2, and we have published that work through the New Zealand Society of Animal Production. (http://www.nzsap.org/system/files/proceedings/ab13036.pdf).

If everyone goes A2, then it is possible that the genetic gain we could otherwise obtain in the next ten years might take us an extra year or so. But that is only if everyone is using A2 bulls, and as a consequence we need to drop well down the ranking list to get sufficient supply. However, farmers do not currently maximise genetic gain. If that last drop of genetic gain is so important, then one of the first strategies farmers should be using would be to artificially inseminate their 15-month heifers, like farmers almost everywhere else do, rather than using bulls. That will more than compensate for any slight reduction in the rate of gain from moving to A2.

So my call to action is for New Zealand dairy farmers to ring their LIC directors and tell them what they want. After all, LIC is indeed a farmer-owned co-operative. It is up to farmer members through their LIC directors to set the policies.

And as a final reminder, don’t forget that ‘The a2 Milk Company’ sells its milk across Australia as the leading branded milk at more than twice the price of Fonterra’s milk.

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About Keith Woodford

Keith Woodford is an independent consultant, based in New Zealand, who works internationally on agri-food systems and rural development projects. He holds honorary positions as Professor of Agri-Food Systems at Lincoln University, New Zealand, and as Senior Research Fellow at the Contemporary China Research Centre at Victoria University, Wellington.
This entry was posted in A1 and A2 milk, Dairy, Synlait. Bookmark the permalink.

34 Responses to A2 cows are the future

  1. Honora Renwick says:

    Such good news.

  2. Helen Fogarty says:

    what I would like to see is the widespread availability of A2 milk in the USA now the only way to get it is to find an individual farmer whose herds are such or to drink goat’s milk which I often do the knowledge is now out there when is this country going to wise up?

  3. Steve Short says:

    You probably already know this Keith but for the information of other Australian, NZ and overseas readers here in Australia most of the other milk suppliers have begun to wage variously overt campaigns of misleading advertising and labelling against the ATM products. For example, the very large (‘since 1900’) Dairy Farmers cooperative chain now prominently ‘informs’ on the front label that all their milk ‘NATURALLY contains A2Protein’ and ‘Permeate Free’. There is the very smallest print size mention on the backside of the bottle or carton that their milk contains A1 Protein as well to avoid being sued or prosecuted for misleading advertising….

  4. jo Baker says:

    Well done Keith keep up the amazing work

  5. Ivan S H Ho says:

    Guess Malaysian consumers will be aware of the benefits of A2 herd in time to come, meanwhile they can stick to their goat’s milk from http://www.happygoats.com.my

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  8. Angus says:

    Hi Keith,

    Why are no decent human trials on A2 milk and how much would they cost? Why would it cost a lot to test for inflammatory response of small bowl lining and blood markers- researchers do these tests all the time. In short, why hasn’t this been done??

    • Keith Woodford says:

      Angus,
      Some of these trials are now underway. The next year should be interesting. Most clinical trials cost at least $500,000 and a good trial is unlikely to give much change on a million dollars.
      Keith

  9. John Martin says:

    Keith,

    An interesting article….it mentions that A2 milk in Australia has better keeping quality than NZ produced milk. Do you know the reasons for that? I would be interested to know and will appreciate your comments.

    Thank you,

    John Martin

    • Honora Renwick says:

      Yes, I’d been keen to know too. I gave up on the A2 Corp’s milk here as I couldn’t drink 2L on my own before it went funny. I have discovered Retroorganic’s product from jersey cows, organic, not homogenised and keeps better so I’ll stick with that.

      • Jo baker says:

        Have you considered that it is a good thing that A2 milk only lasts 5 days? This is the usual time that fresh milk lasts from cow to going “sour” unless it has been treated or has preservative.
        Fresh food only keeps for as long as it should without additives, also if you pour your milk from the plastic bottle into a stainless steel or glass container it lasts one or two days longer, the plastic is no good for the milk.

      • Honora Renwick says:

        Thanks for that, Jo. I’ll try out your suggestion.

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  11. Keith Woodford says:

    I missed this comment stream earlier as I was overseas at the time. Yes, the keeping quality of A2 milk in NZ is a big issue and this has done great damage to the cause here in NZ. Something is astray in either the processing quality assurance, or in the logistics amangement. There is no excuse for these issues!
    Keith Woodford

  12. Ray Sutton says:

    Keith, I see you only mention LIC, guess you are aware of other semen supply company in the NZ market. I do sell for one , this company test all bulls for A2, I have clients who use only A2 sires and only this week 2 more are looking at A2 with one testing his young stock, Q;- how would an A2B sire transmit this gene over an a2a2 cow? My understanding is to treat the B as A1, is this correct. As to my opening comment, do you look at other company`s catalogues or their breeding programmes?
    Regards,
    Ray Sutton.

    • Keith Woodford says:

      Ray,
      I recognise that other companies have all of their bulls typed for A1 and A2. My focus was on LIC because of their ‘bull of the day’ scheme. I saw the lack of an A2 option within ‘bull of the day’as slowing down the necessary conversion of the national herd. And a key aims in that article was to put a little pressure on LIC to get organised and thereby make it easier for farmers.
      The lack of empathy for A2 within LIC does indeed open the door further for companies such as yours, and I had not meant to imply any lack of importance in regard to the role of these companies.
      As for the B allele, there is some evidence, which is still inconclusive, that the B allele may actually be worse than the A1 allele. It breaks at the same point as the A1 to give beta-casomorphin7, and it seems possible (based on limited empirical evidence) that the release of this peptide (during digestion) is even greater than occurs with A1 because of differences in the tertiary structure of the protein. (The A1 mutation preceded the B mutation within the chronological ‘genetic tree’ and hence is a branch off the A1 stem.)
      The B allele is most commonly found in Jersey cattle and can have a prevalence of about 15% in American Jersey, but typically lower in NZ.
      The B allele will be transmitted in 50% of the sperm of an A2B bull, and hence will show up in 50% of the progeny.
      If I was the owner of an absolutely top quality A2B bull which I wanted to breed from because of its quality in regard to other attributes, then I would mate it to a few top A2A2 cows, recognising that only half the male progeny (i.e those that were A2A2) would have potential as commercial sires.
      I would be interested in receiving an electronic copy of your catalogue – my most public email is keith.woodford@lincoln.ac.nz
      One large international company tells me that about 65% of their bulls are now A2A2. I believe, but need to confirm, that selection for milk components rather than volume, and perhaps some other specific traits, is causing their bull team to move towards A2A2 simply because the A2A2 is being ‘carried along’ as a chance correlate.
      Keith

  13. asit Kumar says:

    Hi Keith,
    am new to the A1 and A2 milk
    we have a farm with Indian Cows
    have been reading your articles wherein you suggest that milk which comes from A2 cows has to be raw to get full A2 benefits , if pasteurized it loses all it A2 properties.
    Cows of Indian origin are all supposed to give A2 milk and consuming raw milk is not possible without getting sick
    so my question is that Pasteurized not UHT milk is a safer bet than raw milk even if we lose a bit of A2 properties

    thank you
    asit
    (india)

    • Keith Woodford says:

      Asit, I think you have mis-interpreted my perspective in relation to raw milk. There are indeed very definite risks associated with drinking milk that has not been pasteurised. So people who drink raw milk need to be very sure of the disease-free status of that milk.
      It is indeed true that some vitamins may be lost through pasteurization, but it is the safest path to follow. And for those whose only option is UHT, then that too is a safer pathway than raw milk.
      Keith W

  14. SUBODH KUMAR says:

    Sir, You may already be aware that Indian breeds of cows are the original A2 milk producers. Unaware of the difference between A1 & A2 milk, India had embarked upon a policy of cross breeding with high milk yielding but after your researches known to be A1 milk producing cows. These cross bred cows suffer heat stress and do not perform well in Indian warm climate. Now there is growing awareness about importance of A2 milk from Indian breeds of cows. We have been using good Indian bulls to reconvert the cross bred cows to A2 milk producing Indian breeds again. Do you have any plans to enter Indian Milk business ?

    • Keith Woodford says:

      Subodh
      No, I have no plans to personally get involved in the milk business in India. But I do hope that India converts its milk supply to A2 using Bos indicus breeds and A2 Bos taurus animals as appropriate to the specific environment.
      Keith

  15. blair sawall says:

    hello;
    I’m a dairy farmer fron Wisconsin USA. I’ve been using A2 bulls for a year now. Is their a dulituted factor For the A1 to A2 ratio. Lets say I would become 75% or 85% A2 to A1 would that make a differance in people. I’m guessing not but what are your thoughts? I believe all dairymen should being using A2 bulls. Some day the word will get out to the consumer and they will want A1 free products and we wouldn’t be ready to supply it. I live in a cheese heavy order. I believe I read on your blog that cheese as well as fluid milk the A1 properties act the same. Thank you for pursuing the A1 vs. A2 issues.. I do belive the big coops have to keep this quiet because again thy won’t be able to supply the products Blair Sawall

    • Keith Woodford says:

      Blair,
      Yes, there is a dilution factor.
      In regard to A1 beta-casein, less is better but zero is best.
      In regard to cheese, it has less lactose than milk and so the interactive intolerance effects effects between A1 beta-casein and lactose will be less. But all the other health-risk effects of A1 beta-casein will be the same.
      Keith

  16. Hola señor KEIT WOODFORD
    Soy Daniel Viotti de Uruguay.
    Tenemos una granja lechera en Uruguay y estamos inseminando con semen A2A2 Nuestro rodeo.Estoy convencido de sus bondades.
    Cuando venga al congreso de fucrea me gustaría tener una charla con usted.
    Lo felicito de corazón por ese gran país que es Nueva Zelanda que tuve la suerte de poder conocer en el mes de marzo pasado.Seria un placer si nos puede visitar en nuetro pais.
    Muchas gracias.
    Daniel Viotti.

    • Keith Woodford says:

      Hola Daniel
      I look forward to meeting you in August. My program is organised by Mac (Manuel) Herrera
      Regards
      Keith Woodford

  17. Tony Wallace says:

    Thank you for this great work. Like many others I wish to move to A2 dairy products. Unfortuantely on a low income and with the lack of real industrial style A2 cheese production, the net effect has been to almost eliminate cheese from my diet. It is so sad the NZ dairy industry has not taken this seriously. If the science is “unproven” then you would think a precautionary approach of moving to A2 would be appropriate. However like asbestos I fear that short term financial benefits will over-rule public health. So sad and preventable.

    Tony Wallace

    • Honora Renwick says:

      Not sure of the science but maybe a compromise by buying from known jersey-only herds would be helpful and affordable. I know there is a certain percentage of A1 genetics in jersey herds but not sure of the amount. Due to the poor keeping properties of the A2 milk here in Christchurch, I buy Retroorganic’s milk and cheese as 2L of A2 milk takes me too long to drink.

  18. Ram says:

    The “Jallikattu protest” in Tamilnadu state in India, which began before “Pongal Festival” ie., 14th Jan 2017, has brought limelight on Indian indigenous cows and their A2 type milk. We are grateful to you for your research and your book. Please keep up your good work.

  19. S Kumar says:

    I am from Tamilnadu, India and migrated to the USA in the late 90s. In India I used to drink a lot of milk and I think it was mostly buffalo milk (A2). Sometimes I might have drunk A1 milk too. Not sure. I mostly had stomach issues like severe stomach pain and cramps since childhood and one year after I came into USA, I became seriously sick and got admitted for appendectomy. In USA also I continue to drink milk. But about 8 years after my appendectomy, I started having IBS issues and ended up with SIBO within 6 months. Also had UTI once and that’s when I was given antibiotics and my stomach problems came down. I started taking pro-biotic supplements and they did help a little bit but the effects faded away after a while. My wife figured out that I had some allergy towards milk and doctors told me that I could try Lactaid milk but that also did not help. Hence, I stopped drinking milk altogether and everything came back to normal. Its been 6 years now and occasionally I had issues when I ate some stuff with milk as one of the ingredients. I would get some bad reaction within 10 minutes. Stomach cramps are the most prominent symptoms. Now, I was able to find the A2 milk at a local grocery store and I tried it for two days. and I did not have any bad reactions at all. It seems like I was just allergic to A1 milk. But, my son always drinks A1 milk and he did not have any issues so far. Yesterday he tried A2 milk and he complained within a few minutes that he had some stomach pain and also his bowel movements stopped for two days now. Hence, I am confused that if there is any proper conclusion I could make out of this. I tend to think that some people are suitable only for A1 and some people are suitable for only A2. If you mix up that combination, its becomes a problem. It appears to me that way. But you might know better than that. I am interested to know about your thoughts on this scenario.

    • Keith Woodford says:

      S.Kumar,
      This s the first occasion I have heard of someone who can tolerate A1 milk but not A2. I know of plenty of people who cannot tolerate ‘ordinary milk’ containing a mix of A1 and A2. And I know lots of people who can tolerate A2 but not ordinary milk. What is the brand name on the A2 milk?
      Keith W

      • S Kumar says:

        Hi Keith,
        I bought the a2 milk made by A2 milk company. Its from the “whole food store”. My wife stopped giving the A2 milk to my son and he had his bowel movement after 2 days. But his stool was more solidified than usual. I advised my wife to give him the A2 milk again during the week-end to see if the same symptoms appear again. Will update here after that,
        Thanks!

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