With two recent cryptocurrency and blockchain friendly bills passed in the state of Wyoming in January, 2019 (House Bill 62, House Bill 57), it’s no surprise that the ‘Equality State’ is making an aggressive push to solidify its stronghold at the forefront of blockchain in the United States. Cue BeefChain, a “rancher-centric” supply chain project utilizing blockchain technology to bring value to world-renowned Wyoming beef producers.
Specifically, BeefChain has created a model for Wyoming ranchers to realize value in two important ways:
- Traceability & Human Handling: brings RFID tags and other IoT device technology to ranchers to ensure traceability and prove human handling of beef and sheep.
- Rancher to Retail: an end-to-end supply chain solution whereby BeefChain invests in feedlots and processing operations to establish exclusive and long-term relationships with buyers across the world.
By authorizing unique animal identification and livestock origin, BeefChain enables ranchers to receive premium pricing for actual premium beef, and instills consumer confidence in an otherwise opaque and quality-conscious industry.
Let’s take a further look at BeefChain’s background, partnerships, and several issues plaguing today’s beef production and distribution.
BeefChain Origin & Background
With the majority of cattle operations in Wyoming being traditional family-owned ranches, there’s a pressing need for a connecting and equalizing mechanism between independent ranchers and feedlot operators (and meatpacking beef processors). Each fall, a ranch will sell their calves to a feedlot operator, who then fattens them, before ultimately selling them to a meatpacking beef processor.
An Udderly Costly & Unfair Process
Unfortunately, ranchers carry the financial burden of cattle carrying cost, availing everyday ranchers and business to heightened risk (weather, feed costs, labor costs, etc…), and are often unable to cover debt service. One rancher noted that it costs him on average roughly $900 to raise a calf, with the current asking price typically the same amount, and nearly $500 to $700 added in value after it leaves a ranch.
The reality is that ranchers are quoted low prices – leaving beef price premium for the feedlot operators and processors (once it hits retail). Simply put, the average rancher/ranch struggles to generate profit in an otherwise monopolized and costly industry.
On the flip side of the coin, consumers then pay a premium for “grass-fed” beef, but that’s not always the case – often being misled about the origins and quality of their chuck (not just chuck, but all beef).
The Beef Market & Opportunity
During 2017 alone, over 11,400 Wyoming ranches generated $1.1 billion in cattle sales – with the Equal Rights state as a whole boasting roughly 2.1 million cows (90% brood cows, 5% bulls, and 5% dry cows). BeefChain’s website conservatively estimates that two-thirds of all brood cows in the state of Wyoming produce calves, which leads to a potential market opportunity of 600,000 calves. This is all coming from the state with the smallest population in the United States (579,000 people).
Hitting the ground running, BeefChain has already partnered with six multi-generational Wyoming ranches, tagging the world’s first “blockchain calves” – totalling over 500,000 pounds and ready for delivery in fall of 2019. For example, the RFID tagging of calves provides various beef actors and entities (and ultimately, the end-consumer) a transparent look into an animal’s life – all the way up to the point it’s slaughtered. Through an immutable looking glass, multiple layers of a calf’s life cycle may be verified, ensuring integrity in an otherwise highly criticized industry.
Now, thanks to these Wyoming beef pioneers, consumers can rest assured their chowing down on premium, grass-fed beef, while ranchers receive their due share of a cow’s life cycle and product.
BeefChain Partnerships & SheepChain
As noted above, BeefChain has already partnered with six multi-generational Wyoming ranches to bring “blockchain calves” and beef into practice. You can find a list of the partner ranches on the BeefChain website – https://beefchain.com/ranches/. Furthermore, some of BeefChain’s strategic partnerships include:
- TE-Food: a farm-to-table food traceability blockchain ecosystem for emerging markets.
- IBM Food Trust: a blockchain solutions platform for creating visibility and accountability in food supply.
- University of Wyoming: includes Dr. Bret Hess (Director of Wyoming Agricultural Experiment Station) and Kelcey Christiansen (Meat Laboratory Manager).
- Tru-Test: a company specializing in design, manufacturing, and marketing for agricultural sector products and solutions.
You’ve probably been reading this piece and wondering, “The title of this piece also mentions sheep, what’s the deal?” We weren’t trying to pull the wool over your eyes, as BeefChain has entered into a collaborative with the Canadian Sheep Federation, Brookwater Farms, and NorthumberLamb Co-op to put sheep on the blockchain.
The SheepChain Demo
Brookwater Farms, a family owned and operated venture on Prince Edward Island (Canada), provided BeefChain with the sheep for a demo. Brookwater already tags sheep with RFID tags when they’re born, tracking them from birth to death – with the goal of raising their animals in the most comfortable way possible. NorthumberLamb was employed as the perfect processor, and BeefChain (American Certified Brands) provided the software and technology for the operation.
BeefChain then conducted a demo, where sheep were tagged at Brookwater, scanned and loaded onto a trailer (and subsequently transported to NorthumberLamb). From NorthumberLamb, the RFID tags were scanned again, and information was ultimately recorded using American Certified Brands’ API.
SheepChain is just one potential use case of the technology being applied by American Certified Brands to BeefChain. You can find out more about SheepChain by filling out this Google Doc form on the BeefChain website.
In a society where consumers are demanding product from ethically raised and slaughtered animals and high quality product, all without exorbitant mark-up, BeefChain provides a compelling solution to a dry-aged old problem (zing). Additionally, by ensuring ranchers are fairly compensated for their hard work and product, BeefChain is equalizing the playing field for all actors in the beef production industry.
With Wyoming’s push to secure its spot as a blockchain-friendly state and ecosystem, it will be extremely exciting to keep an eye on all the potential developments and moves (Cardano founder, Charles Hoskinson confirmed the company’s move to Wyoming early this year) in 2019 and beyond.
To read up further on Wyoming’s recent recognition of cryptocurrencies as a legitimate currency (and thus, requiring regulation and governance under the Uniform Commercial Code), check out our article here.
Finally, you can find more information about BeefChain and SheepChain, by heading over to the BeefChain website.