Can precision fermentation reach cost parity with animals?

21st Bio says precision fermentation is getting close to competing with animal and petrochemical production, but scaling challenges, cost barriers and inefficient strain selection still limit the industry’s potential, according to AgFunderNews.

Speaking at a recent industry event, Henrik Geertz-Hansen highlighted that the sector is moving past hype into a more realistic phase focused on cost parity, scalability and industrial performance.

“We are getting very, very close,” he said, adding: “We’ve generally underestimated as an ecosystem what it takes to bring truly affordable, scalable and desirable bio manufactured products to the market.”

The core issue lies in transitioning from laboratory success to industrial-scale production. While precision fermentation already dominates high-value segments such as enzymes and pharmaceuticals, its expansion into bulk food ingredients remains limited by costs.

However, progress is accelerating. According to Geertz-Hansen, some proteins such as casein, beta-lactoglobulin and ovalbumin could reach below $10–15 per kilo in the coming years, a key threshold to compete with animal-derived proteins.

One of the biggest bottlenecks is the use of non-optimized microbial strains. Many startups rely on strains designed for lab efficiency rather than industrial resilience, which leads to performance drops at scale.

These limitations make the transition from lab to pilot and full-scale production expensive, slow and error-prone. The solution, he argued, is to develop standardized platform strains optimized for industrial environments.

Another critical challenge is the so-called “valley of death” in biomanufacturing, where startups struggle to move from innovation to commercialization. 21st Bio positions itself as a partner that helps companies bridge this gap by preparing technologies for large-scale manufacturing and transferring them to contract manufacturers.

The company promotes a model where startups focus on discovery and applications, while specialized partners handle strain optimization, fermentation and downstream processing. This distributed approach mirrors the evolution of the computing industry, where software and hardware development became separated.

Geertz-Hansen also emphasized that upstream and downstream processes must be developed simultaneously, rather than sequentially. Large biotech firms already follow this integrated approach to reduce inefficiencies and avoid costly redesigns.

Emerging technologies could further accelerate the sector. Artificial intelligence is improving protein design and metabolic engineering, while continuous fermentation offers long-term efficiency gains compared to traditional batch systems.

Still, feedstock costs remain a structural factor. While glucose can support early-stage products, future scalability will require flexible processes that use locally available raw materials, such as sucrose or lactose, enabling regional production systems.

Infrastructure is another constraint. Existing contract manufacturing organizations often lack the standardized equipment and processes needed for diverse fermentation technologies. This fragmentation increases costs and slows adoption.

At the same time, new investments in large-scale facilities—particularly those located near raw material sources—are seen as a positive signal for the industry’s future.

Despite current limitations, Geertz-Hansen remains optimistic about the long-term outlook. He believes the next decade will unlock the full potential of biomanufacturing and the bioeconomy, driven by better technology, smarter capital allocation and stronger partnerships.

The transition toward scalable, affordable bio-based production could reshape industries ranging from food to chemicals, positioning precision fermentation as a key pillar of sustainable manufacturing.