Have Your Steak and Eat It - Beef w/o Greenhouse Emissions
There always seems to be a trade off when it comes to the environment. If you want to protect it then it’s going to take a toll on industry because let's admit it's a whole lot cheaper to pollute than protect. Here is a challenge to the readers. Can you think of just one example where helping protect the environment puts more green in your wallet? Nothing right? That long held paradigm changes today because you can literally have your steak and eat it with a new cattle feed technology that can reduce the carbon footprint and save the cattle and dairy industry a lot of money, by lowering the feed costs.
In today's market, producing beef has huge environmental implications on greenhouse gas emissions because the digestive process is so inefficient. To make matters worse the current process of fattening up cows is also inefficient. These inefficiencies are multiplied many times over because no one is addressing the root cause of it all. It all starts with the feed and the old saying applies garbage in garbage out.
Cows that are fed quality grasses rich in nutrients instead of grains thrive and they tend to be healthier and don’t need antibiotics. Cows are responsible for 40% of the global methane emissions. Methane is worse than carbon dioxide because it’s more effective at trapping heat.
The problem with this approach for the grass fed beef cattle and dairy cows is that the grass is not there year round, lots of grass is not suitable or healthy for cattle to eat, and grass fed cattle take longer to get to market and don’t weigh as much. It takes 14 - 22 months to get grain fed cattle to market while it takes 20 - 26 months for grass fed cattle. There was a study that looked at the carbon footprint and found out that grain fed cattle that go to market quicker have a smaller carbon footprint than grass fed cattle. The conclusion was that factoring in diet and time to market the heavier weights of grain fed cattle translated into an estimated 18.5 - 67.5% lower carbon footprint than grass fed cattle. This is a classic example where the environmentally conscious thing to do is not only more costly to industry but also more costly to the environment.
So the numbers don't work on grass fed cows so environmentalists were looking at lab grown beef. A preprint study came out that looked at cultured meat production and calculated that the global warming potential of lab grown beef was 25 times greater than average beef production. Truth is that this was dead on arrival because who really wants a steak that's basically a glorified hot dog.
The only reasonable alternative was the plant-based meat market which is supposed to mimic the taste, texture, and appearance of meat using plant based ingredients. The reason this market gained a foothold is because consumers were interested in healthier alternatives that were environmentally sustainable, and wanted to support the better treatment of animals. The meat market exceeds $100 billion annually while the plant-based market is running at $8.1 billion in annual sales. Beyond Meat (BYND) is one of the leaders, but its market cap is only $385 million. Impossible Foods is private with a valuation of $4.0 billion. Rounding out the top three is Kellogg Company (K). This market is here to stay and it's helping to reduce greenhouse gasses but it's like putting a bandaid on a laceration. But several problems it does not address are the dairy milk cows, milk, cheese and ice-cream markets, and where’s the BEEF?
Leave it to the researchers at UC Davis to find a solution. They conducted a study that showed that cattle that ate seaweed reduced their greenhouse gas emissions by 82%. This was a thorough study where they even put muzzles on the cows mouth to measure the methane in their breath. They also had a control group. The scientists found out that a specific type of seaweed inhibits an enzyme in the cow’s digestive system that contributes to methane production. There was a slight decrease in the animals weight but it was not statistically significant. So while they solved the problem and lowered greenhouse gas, they created a new challenge because the type of seaweed they used was not prolific enough in the wild to warrant a commercial operation let alone an entire industry. Research University trials are not the same as real world field trials, and economics analysis.
A study in Australia also found animals given the seaweed supplement “ate less food and weighed 15kg less by the time they were sent for slaughter”, which is useless for a cattle feedlot where the entire purpose of the feedlot is to increase the cattle weight as much as possible, and as fast as possible.
The scientists isolated the reason why cows produce different amounts of methane based on diet. The cows' stomachs resort to fermentation when they encounter fibrous grass. The poorer the diet the harder the cows stomach needs to work and that creates more methane. If cows get easy to digest feed like the seaweed they wont need to tap into the fermentation cycle that creates the methane. That's the theory. When analyzing the animal production numbers in the UC Davis study it shows that while they lowered the methane emissions there was a nominal impact on the weight of the cows in the sense that they were slightly smaller than the control group. In all likelihood this can be traced back to the seaweed neutralizing the enzyme that contributes to methane product but also contributes to lower nutrient absorption.
When it comes to the environment there always seems to be a tradeoff. If you feed them grass and think you're being environmentally conscious it actually makes matters worse. Culturing beef in a lab costs way too much and there's no guarantee people are going to want to eat it if it was made. Seaweed got close to helping out the environment but it's not sustainable on a large scale. A sustainable solution that can increase beef production and limit the impact on greenhouse gasses would be the “Holy Grail” for the beef industry.
The solution lies in the feed. The feed has to be nutritious and easily broken down and digested and absorbed by the cattle otherwise it will trigger the cattle's digestive system that leads to fermentation and ultimately methane production. An emerging company in Louisiana has come up with the ultimate solution. They take a sugar cane waste fiber called ‘Bagasse’, that is readily available in massive quantities and quickly process it using a proprietary process turning it into a super healthy, nutritious cattle and dairy cow feed that the cattle will eat, love to eat so much that they run to it and they gain weight, a lot of healthy weight, and Momma cows produce more dairy milk and healthier offspring. If unprocessed bagasse is fed to the cattle they will not eat it. The supply of unused bagasse worldwide is massive and there is evidence that the waste Bagasse is a huge greenhouse gas methane and CO2 source. That source is eliminated by converting it to SGP+™ cattle feed.
There are piles upon piles of processed sugar cane fiber laying in mountainous heaps near the sugar processing mills in Louisiana, and the piles grow year by year. The sugar producers actually have to pay to get rid of it because there is no use for it and burning it presents other environmental issues that the US EPA is targeting. The waste bagasse piles look like mountains, and they are a fire hazard because the methane and heat the piles generate do spontaneously catch on fire, just like hay.
A small company called Impact Fusion International (OTCMKTS: IFUS) figured out how to fix the cattle feed problem. They took an agricultural waste product known as Bagasse which is a known source of methane and converted it into a non-methane releasing, nutritious and healthy cattle feed supplement that can replace up to 80% of the cattle's rations. The new feed is called Supreme Gold Plus (SGP+™) and can be compacted without the threat of combustion. If hay has even a little water content, it's capable of catching on fire so it needs constant monitoring. In a small pilot study they found that the SGP+ reduced cattle feed costs by 85% and the cattle ate 60% less feed when SGP+ was part of the mix.
Raising cattle is a formula of caloric inputs measured in feed costs that result in an output measured in pounds of beef over a period of time. In this case study, the cattle ate less and got bigger twice as fast and didn’t belch or have ammonia smelling cow patties. The SGP+ doubled the daily weight gain while feeding them 60% less feed and helped them get to market faster. This has been documented in several customer field trials.
The cattle can be fed up to 80% SGP+™, and unlike grass that is subject to flooding, droughts, poor soil and fires, there are no supply constraints associated with SGP+™, because International Fusion’s SGP+™ is available year round. Dairy farmers are also taking a close look at using the feed to energize growth in US Dairy herds. The driving force behind this move are the huge feed cost savings that are exponential in nature considering dairy cows will produce milk for at least 5 years instead of being slaughtered in 2 years. Dairy farmers understand what's good for beef is even better for dairy.
When cattle are on an SGP+ diet, the meat is higher in quality and the cattle reach slaughter weight much quicker which translates into better profits. One of the things the slaughter houses noticed is that all the cattle that were fed SGP+ had healthy livers. Typically a slaughterhouse throws away 75% of the livers because they are so diseased it's not even fit for dog food. For dairy producers the milk is also better quality and there is more of it. That too translates into more profit for the dairy farmer.
Impact Fusion appears to have impressed some environmental agencies. Recently the US EPA, USDA, approved billions of dollars in funding to reduce methane emissions from cows. At the state level, the State of Louisiana Unanimously approved grant funding, and instructed the two Louisiana State Universities, SUARC, including LSU, to study ways to solve the bagasse waste problems. Their study also had a mandate to solve the air pollution and water pollution issues, in ways that help the state's Agriculture industries feed the world while protecting the state's agriculture industries. Impact Fusion International is working with them and the only one with viable solutions and technology.
If the cattle or dairy industries adopt this feed the company Impact Fusion International is in a good position to grow. Their existing production plant can currently make about $380 million annually of SGP+™ feed at Max capacity, based on $200/metric ton of SGP+™ at a 90% gross profit margin. It can replace hay, which is often in very short supply, and seasonal, costing as much as $400/bail during droughts. That plant capacity can be doubled by investing about 1 day's gross profits, into adding a second line. More lines can be built and added as needed. The company’s process, and additives are protected as trade secrets, just like the Coca Cola formula has been for over a century. Unlike patents, trade secrets never expire.
Impact Fusion International has a joint venture with a group in India. Their partner is Agriglow BioTech, which owns 11 sugar mills that can supply the bagasse needed to convert their waste fiber into SGP+2.0™. Their bagasse waste is expected to feed the 500,000 dairy cows they have in production. Dairy cows eat twice as much feed per day compared to feedlot beef cattle. Agriglow Biotech has a batch of SGP+2.0 arriving in India by the end of September. Their plan is to run a feed trial with the India breed of dairy cows, to test the quantity and quality of the Butter fat. This group also has ties to 300 million head of cattle in India, that are greenhouse gas emission sources, while their hay and bagasse could be considered fire hazards. This means that there are over 460 sugar mills, with waste Bagasse in India that Agriglow-Biotech can access, and expand into.
This venture alone is expected to save about $150 million annually based on feeding the cows SGP+ 2.0. The details of the JV aren’t public, but it's reasonable to assume along the lines that the savings are also in line with their profits. Any expansion of this agreement to other sugarcane producers or dairies would make the joint venture a global feed supplier with billions in sales. In light of the rice shortage in India and Vietnam, animal fodder that the cows currently eat is in short supply. This is the ideal moment for dairy farmers to make the change to SGP+ 2.0 because their hand has been forced.
Now the stage is set where we can have our steak and eat it too.
Any readers neutral on the environment will be pleased to know from an investment standpoint there is a surefire way to profit off of this technology which is capable of reducing greenhouse emissions globally while keeping our bellies filled. Impact Fusion International (OTCMKTS: IFUS) is a publicly held company that has zero convertible debt or toxic debt, and insiders / founders represent the major shareholders and own common shares. The gross profit on the feed is 90% and it’s good for the environment. For those that think we have to compromise on the environment in order to have a nice steak - two words - BULL SH##!