| Outside of the commodity sector, here is something interesting… Long time readers will recall Else Infant Nutrition (Ticker: BABY), a company I discovered through my Cantech Investment Conference in Toronto in 2017. They had a patent to disrupt the infant formula space with a nutritious, sustainable, dairy free alternative. From our first round of investment, the company delivered a 2000% return. The same team that supported BABY’s go public process introduced me to another milk alternative company, Hope and Sesame - a sesame based milk replacement. The ticker is MYLK. Initially, I thought the alternative milk business was becoming too mature… but some recent developments have caught my attention. Contrary to popular belief, oat milk, the darling of millennial latte’s, is not a healthy alternative to dairy. Here is why: Glycemic Index (GI) GI is a number that ranks the speed at which sugar is released into the bloodstream. The smaller the number, the less the impact the food has on your blood sugar. Simply put, a GI score of: Believe it or not, apples and donuts have a similar amount of sugar: -
An apple, with a diameter of 3 inches will have roughly 19g of sugar -
A doughnut, with a 3.5 inch diameter, will also have roughly 19g of sugar However, you may notice that you feel very different after eating an apple versus eating a doughnut. Why? Glycemic index. The GI score on that doughnut is 76 (high/bad). The GI score on the apple is roughly 38 (low/good). Less blood sugar spike, less rush, less crash. Additionally, high blood sugar is a root cause of damage to blood vessels, increasing risk of heart disease, stroke, kidney failure and nervous system degeneration. What does this have to do with oat milk? The production of oat milk involves adding enzymes that break down the oat starch into simple sugars, creating a sugar called maltose. If there was a super villain in the sugar world, maltose would be it. Remember that 76 GI score on the doughnut? Maltose scores a 105. If you are a lover of oat milk lattes, I apologize for going down the rabbit hole on this one. But when it comes to nutrition, I am all about the rabbit holes. Second data point, Russia is the world's second largest producer of oats, so I am very curious to see what happens to the supply economics of the core ingredient.
None of this means that Hope and Sesame is a winner, but the dots are starting to connect for me. I recently procured a pallet of Hope and Sesame products for my local coffee shop in Squamish to give it a test run - I’ve asked them for brutally honest feedback. I’ll be sure to share if it is anything material. That’s it for now. Have an epic week. |