COP21 : How public subsidies are the only solution
Like so many people I’m already aware that the consumption of insects (called the entomophagy) could be one of the solutions for the demographic and environmental issues but is there someone who has ever think of the way we can introduce them in the economy, how we can decrease the production costs in order to boost a demand which still doesn’t exist ?
Actually, I worked on a project with my former college at the end of my secondary studies and otherwise with a startup based on Toulouse (France) named Micronutris which produces, as you can deduce, insects. They are selling insects. Ok, that sounds great but if I’m saying to you that you have to pay €12.50 ($14.11) to have the opportunity of tasting 5 grams (0,176 oz) of raw dehydrated insects, that sounds still great ? We have to reflect about how businesses like Micronutris could decrease their production costs.
Everyone would say “Yes, obviously, France has too staff costs”. I think these persons have just half of the answer. We have to think about some basic economic classes we all have learnt. Simply, the economy of scale isn’t reached. But how can we reach it ? I’ll bring two solutions to this problem; the first one would be the easiest while the second one will mobilize our good old John Maynard Keynes.
The first solution, which one will decrease insect prices, is simply by producing at loss. Imagine I’m still based on the example of my startup in southern France. Micronutris, lowering its prices would in theory have an increasing demand of insects. I said IN THEORY because for this case we have to change consumption habits and that’s the difficulty… Therefore this solution seems to be irrelevant because we are not sure about the outlets and this type of development equals, for a business, too long time before reaching profits.
In a context where the environmental footprint of human is the subject of every political debate I could see on TV (and more the COP 21 is approaching more we are speaking about it) we need the intervention of the government right now. Subsidies are the KEYS. We need temporary subsidies. I think that international initiatives shown by the COP21 are really great but first and foremost we need national iniatives. Words are great but acts are better. By choosing to subsidize insects production F.Hollande & Co. could offer in the market the place for the insects production. In fact, the only aim is to compete the others productions which have their own demand.Once prices are the same than insect flour and wheat flour and since the government encourage itself the insect production the demand could only increase. More the demand is important, more the business will product. Then its fixed costs will decrease. Therefore insect production needs public subsidies but for a limited time. We know the government’s implication in order to reduce the human environmental impact so why not financing these subsidies by taxing the most no eco-responsible items, which are, mostly the cheapest on the actual market ?
Could it be the only solution ?