Where the money’s going
Chief executive Tom Breen says the funds will be used to get his company’s product to market in New Zealand (where he says final Ministry for Primary Industries regulatory approval is close) and Australia (where he says no approval is required).
He’s hoping it will go on sale next year and be treating “thousands of animals” by year’s end.
Ruminant has commissioned a manufacturing facility capable of producing one million doses per year to back the Australia-New Zealand launch, Breen said.
Brazil, Canada and other markets will follow, he said.
Ruminant’s product is aimed at pasture-grazing or “ruminant” cows, putting the US – where grain feedlots dominate – off the table for now.
Some of the funds will also be used to develop future products and an emissions trading market to incentivise farmers to adopt its product – with some help from new investor Marex.
Methane reduction targets lowered
Breen’s goal is to have 100 million cows popping his company’s pills by 2035 as farmers move to meet methane emissions targets.
In New Zealand, those targets are now less stringent. Earlier this year, the Climate Change Commission pushed for a strengthened methane target.
In the event, on October 12 the Government instead said it would legislate to lower the methane target, from 24%-47% emissions reduction (from 2017 levels) by 2050 to a 14%-24% emissions reduction.
Federated Farmers is pushing for a further reduction.
Ministers Todd McClay (trade), Simon Watts (climate change) and Andrew Hoggard (associate agriculture) said the decision was science-based and was part of a revised pathway that “protects jobs and production and upholds our climate commitments”.
Breen said farmers still needed to reduce methane – and that the Government’s long-term goal of net-zero emissions remained.
Earlier this month, the CEO attended the UN’s Cop30 conference in Brazil. The event took place against the backdrop of something of a backlash against the UN push to lower emissions.
Leaders from the world’s three largest polluters – the US, China and India – did not attend. Key resolutions were voluntary.
But Breen said there are notable examples of private players picking up the slack.
Cop30 saw Brazilian company Marfrig, the world’s second-largest beef producer, pledge to reduce its emissions by 33% by 2035.
It was on a tangent to the UN’s official goal – a 30% reduction from 2020 levels by 2030. But it was a concrete, public pledge.
Not all corporates are on the same page. Breen concedes that in the same week New Zealand lowered its targets, Nestlé withdrew from the Dairy Methane Action Alliance.
But he said: “While some government and industry targets may have changed, climate change has not.”
Farmers need practical tools and investable markets, Breen said.
What does it cost?
Breen would not give an estimate of how much it would cost, per cow, to administer Ruminant’s treatment – which sees a slow-release daily dose of an active ingredient (Tribromomethane) interrupt microbes called methanogens, reducing methane while not impacting the efficiency or health of the animal.
“Farmers’ number one job is to look after their family. That means they invest in things that make them more productive and profitable. We believe farmers need to be putting 10 to 20 bucks in their back pocket every time they treat a cow with a product like ours,” Breen said.
New investor will help with carbon credit business model
Through what mechanism will that $10 to $20 materialise? Breen says in Australia, Ruminant has applied for accreditation with Verra’s VM0041 voluntary carbon credit scheme. He anticipates a similar arrangement in New Zealand.
One of the key investors in Ruminant’s $17m Series A round, Nasdaq-listed Marex, also brings key skills to the party.
The British-based commodities dealer and carbon-trading platform operator recently set up shop in New Zealand, opening an office in Auckland.
As part of its investment, Marex will act as exclusive broker and market maker for Ruminant Biotech’s carbon credits generated by the project.
“This investment positions us to commercialise our world-leading technology with a scaleable business model that rewards on-farm emissions reductions through carbon markets,” Breen said.
“We’re excited to unlock new ways to reward farmers for reducing emissions, while helping industry and Governments meet their climate goals. We’re confident that if we can get this right, adoption will follow.”
Govt grants on both sides of the Tasman
At the October 12 announcement, McClay, Watts and Hoggard said in a statement: “The Government is already investing more than $400m with industry to speed up the development and rollout of methane-cutting tools. The first is expected on farm in 2026, with up to 11 available by 2030.”
Ruminant has received $11m in public research grants from New Zealand Government agencies, plus A$3.5m ($4m) from the Australian Government’s Methane Emissions Reduction in Livestock R&D assistance programme (the University of Sydney is a Ruminant research partner).
The start-up also received a $2.5m equity investment from New Zealand Green Investment Finance (NZGIF) – the Crown “green investment bank” that imploded after its SolarZero bet went south and is currently been wound down. With its NZGIF money banked in May 2023, Breen’s firm is not affected by the NZGIF meltdown.
“They were an important early stage investor and remain on the register today,” Breen said.
The Companies Office lists NZGIF’s stake at 5.8%.
The Series A backers
The US$9.5m ($17m) Series A raise announced this morning was co-led by existing investors Rosrain Investments (backed by Stewart Brothers Bloodstock in Queensland) and Christchurch-based Cultivate Ventures (owned by investment banker Greg Anderson), “with significant investment from global financial services platform Marex, alongside follow-on funding from AgriZeroNZ”.
AgriZeroNZ is a public-private partnership half-owned by the Government, via the Ministry for Primary Industries, and half by agribusinesses and banks including Fonterra, Silver Fern Farms, Ravensdown, Synlait, A2, Rabobank, BNZ and ASB.
Ruminant (founded in 2021) earlier raised $4.5m in a 2022 seed funding round (backed by Sir Stephen Tindall’s K1W1 and others) and $12m in a 2023 pre-Series A.
Total funding from all sources has been $33m. All going well, 2026 will be the year that backers start to see some returns.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
