Beneficial products for the cereal and oilseed industries are the next frontier for Australian biological business, New Edge Microbials.
Research commissioned by the company has found the use of biological products is on a huge growth trajectory.
"What we found five years ago is that market had moved from a US$100 million market in 2000 and is on track to be a US$25 billion market in 2025," New Edge Microbials managing director Ben Barlow said.
"It's growing at a compound growth rate of 15 per cent per annum; we grow 25pc here at NEM every year so that implies this company doubles in size every five years.
"So the tailwinds were big, particularly when you compare that to traditional fertilisers and chemistry, which were only growing at about 3 to 4pc per annum."
NEM already produces biological products for the pulse and horticultural industries from its base in Albury, NSW, and has been in the game for more than two decades.
It supplies inoculant for about 60pc of the pulse hectares planted in Australia each year and also exports product to Brazil, the US and Europe.
Inoculant is a bacteria coating farmers apply to seed before the crop is planted.
As the seed shoots, the bacteria help create an environment to fight off plant pathogens and encourage the plant's roots to uptake nutrients.
"It's like a halo effect around the seed; it's converting available nutrients into nitrogen," Mr Barlow said.
"The plant doesn't take all the nitrogen up, there's residual nitrogen after the crop has been taken off."
When it comes to applied nitrogen, Mr Barlow said between 50 to 70pc of it was lost to the atmosphere and waterways.
Quantities of carbon dioxide are also emitted when it is produced.
As a result, the European Union and Canadian government have mandated sizable reductions in the use of applied nitrogen use by 2030.
"When you look at legumes, to the farmer we are probably $12 a hectare on-farm to apply and we're fixing about $180 worth of nitrogen at the moment per hectare; so it's a no-brainer from an economic point of view," Mr Barlow said.
"But what's not commonly known is that one tonne of urea is between eight and 12 tonnes of CO2 to produce.
"So if you're applying 250 kilograms of urea, that's taking 4t of CO2 emissions to produce."
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Mr Barlow will share more insights on the global biologicals landscape during a workshop at AgriFutures evokeAg 2023 in Adelaide next month.
While the use of biologicals is becoming more mainstream, some stereotypes about the industry remain.
"When we surveyed farmers and you talk biologicals they're sceptical; about 80 per cent are sceptical of biologicals," Mr Barlow said.
"When we send the same interview out, the same set of questions, and we talk the word inoculant instead of biological, they're fine.
"Research on biologicals in cropping over the years was seen as out there because of the reliance on chemistry and fertiliser but it is becoming mainstream."
Mr Barlow said it was important alternative biological products were designed to fit current farming systems and were as easy to use as possible.
He said using biologicals on cereal and oilseed crops could provide Australian farmers with economic and yield gains.
However, he said Australia trailed the US and Canada by about 10 years in this space.
"In 2024 we plant to release our first cereals and oilseeds product that is showing demonstrable yield increases where you are in rainfall deciles below 50pc," Mr Barlow said.
"In 2025 we follow with a nitrogen use efficiency product for cereals and oilseeds and in 2026 we follow with a carbon placement product."
Mr Barlow said NEM has grown from 12 employees to 60 over the past four years and is in the process of doubling its plant capacity.
NEM is also working with researchers at Australian universities and CSIRO and invests between $4m to $5m each year in R&D.
"We have been acquiring early discovery intellectual property that underpins our applied research to commercialise it," Mr Barlow said.
"Those research parties are now part of those programs and we have an agreement with them that on every box of every product that we sell here and abroad forever, they will get a royalty on success.
"That has the capacity to be an enduring research legacy of our company forever."
Mr Barlow said there was no doubt healthy soils were the way of the future.
"I'm not some zealot that says, 'you need to get rid of chemistry and you need to get rid of synthetic fertilisers and replace them with biologicals' because I know what that means, 50pc of the world's population will die," he said.
"We will not be able to produce enough food, we're flat out keeping up with the demand of the world's population today.
"I'm a great believer in the fact that this is about enhancing our farming system; that might allow farmers to apply less nitrogen to get the same financial outcome, therefore it's a better economic outcome and it's building up the soil microbiome and allowing crops to flourish."
