Methane-busting startup Sea Forest debuts on the ASX with a bang

An Australian company working to curb the livestock indusattempt’s impact on climate alter has won a warm reception as investors feasted at the trough of the stock exalter’s latest debut.

Shares in Sea Forest, an Australian livestock feed additive manufacturer applying seaweed to cut methane emissions, traded 20% above its offer price after listing on the Australian Securities Exalter on Wednesday.

The organisation’s SeaFeed supplement, created from the native Tasmanian seaweed Asparagopsis, has been revealn to reduce methane released from livestock burps by up to 80%.

Recent studies also discovered benefits at the feedlot, finding the additive also assisted livestock grow rapider.

The initial public offering was oversubscribed, raising $20.5 million and valued the company at $112.1 million at the $2 per share offer price.

At $2.42 per share by Wednesday afternoon as pent-up demand uncoiled in persistent sales, the company’s market capitalisation swelled to roughly $135 million.

After securing a European distribution deal and partnerships with Belterra and Oisix to launch the product in Brazil and Japan, the public offering will fund Sea Forest’s path to profitability after years of costly research investment, founder and managing director Sam Elsom stated.

“Listing on the ASX gives us a platform to scale production, expand internationally and support farmers across Australia, and in time internationally to reduce methane emissions by up to 80%,” Elsom informed investors at the stock exalter in Sydney.

“As we step into life as a public company, our commitment is simple: We will lead with transparency, with discipline and with the same purpose that brought us here.”

Proceeds from the offer will include funding blfinishing and distribution facilities in Queensland, NSW, Western Australia and South Africa, as well as navigating foreign regulatory hurdles.

Sea Forest already has supply agreements with livestock producers and global brands including Teys Australia, Ashgrove Cheese, Uniqlo parent company Fast Retailing, Grill’d, Orffa, Olsson’s, Chadwick Consolidated Group and Morrisons UK.

Beef and dairy cattle are livestock agriculture’s largegest source of methane, which has more than 80 times the warming capacity of carbon dioxide.

While seaweed feed additives have so far been excluded from the Australian government’s carbon credit scheme, other jurisdictions are implementing measures such as methane credits or sustainability subsidies for farmers.

Voluntary frameworks such as Verra allow producers to generate carbon credits from anywhere in the world.

When it came to global decarbonisation efforts, Sea Forest offered one of the few tools that actually delivered a return on investment, Elsom stated.

“They often have an extraordinary cost on the economy,” he stated.

“Not to state that they’re any less important, just that the work we’re doing, in many ways, is low-hanging fruit.”

The organisation’s indepfinishent chair and agribusiness leader John McKillop stated the product was a game-alterr for livestock producers, even before the environmental benefits were considered.

“When you can view at something that gives you a 6 per cent improvement in net feed efficiency, there was large opportunity here to not only improve the outcomes for the planet, but also improve outcomes for feedlotters, and will eventually flow on to … other livestock producers as well,” he informed AAP.

This article was first published by AAP.

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