Australia | Aug 07 2006
By Chris Shaw
Films such as "Supersize Me" as well as numerous advertising campaigns have pointed out the dangers of both obesity and an excess of fat in diets, but Stirling Products (STI) has taken this a step further and looked at it from the animal’s point of view.
The company is developing a growth promoter agent known as R-salbutamol and announced today it has received approval to conduct an initial study into the effectiveness of the agent in cattle.
The company has already conducted research into the effectiveness of the product, designed to increase the efficiency of feed by producing a higher level of lean meat and less fat, and received good results in both poultry and swine and expects results from it testing of lambs in the next few weeks.
In June the company signed a distribution agreement for R-salbutamol with Afgri of South Africa, the company agreeing to fund the products trial and registration process costs in that country, suggesting the potential of the product is beginning to be realised.
The significance of the product can be seen in the potential market, as the company estimates Australian exports of meat exceed 900,000 tonnes annually and are worth more than $5 billion per year. In addition, the market for growth agents is a significant one, estimated at more than US$300m annually in the US alone.
This potentially puts the company within reach of achieving significant sales, as if the product is shown to work better than existing products it may mean less use of the steroids and other antibiotics currently added to feed. It’s a competitive market though, as Scripps Research Institute in the US last week announced it had developed a product that reduced obesity in rats. This suggests Stirling is likely to face a number of challenges in developing a profitable market share if its product does pass further testing.
There is also potential for the biggest market of all, that of human obesity. With this in mind Stirling is already working to develop a product suitable for pets, so it seems only a matter of time before it or a competitor releases a product designed for the human population.
The news has done little for the Stirling share price, as at 2.20pm the stock was trading at a year’s low, down 1.2c to 7c on turnover worth only about $5,000. This compares to a high over the past 12 months of 33c.