Over recent decades, producers have consistently dedicated sweat equity to the hard work cattle production demands. Beef industry norms have adapted from the limitations of eyeball tests, scrawled freehand remarks in notebooks and manual spreadsheet entries, to the expansive opportunities of low-stress handling methods that influence performance benefits, genomic testing and much more. Recently, blockchain has arrived, along with a range of views and interpretations on how it will eventually create a new norm.
“In the past, as a group of calves moved through the marketplace from birth to harvest, almost no information moved with them unless the owner passed it to the auctioneer and he happened to share it with the buyers at the sale,” Justin Sexten, head of Network and Industry Partnerships in the Zoetis Precision Animal Health (PAH) division, told WLJ.
“And what happens when those calves are split six different ways? Big and little steers and heifers, colors, impediments real or imagined, etc. Who gets the scraps of data, how watered down is it and how will it help anyone bidding at the sale or down the line?” Sexten asked.
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Ensuring record movements are reciprocated
On a day-to-day basis, Sexten finds industry partnerships for Performance Livestock Analytics (PLA), a technology-grounded company offering the beef industry its first cloud-based platform. It provides producers with powerful analytics to help make better marketing, management, productivity, sustainability and profitability decisions.
PLA is owned by Zoetis and is part of PAH. The software gathers management and genetic data from the cow-calf producer and transfers it to those who touch the product down the line while allowing the producer at the start of the process to still access the data once it has been passed on.
“What we’ve done is set up a mechanism where the information can move to the right, which is the way we normally think about it, from the cow-calf to the stocker, to the feedyard, to the packer and eventually the consumer,” Sexten said. “But what’s really exciting is we also enable movement to the left, where operators at any one of those segments get it back in a way that assists them with future decisions.”
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Sexten explained that their management softwares, including Performance Beef, Performance Ranch and Cattle Krush, combine with PAH’s genetic prediction technologies in the form of genetic testing to create Blockyard, a blockchain-based solution that allows for the sharing of specific data at the individual animal level.
“We think about blockchain as an interstate,” Sexten said. “We can build entry and exit, on and off ramps—those are easy to construct and are unique to the people participating. We’re standardizing the data, permitting it to be exchanged quickly and securely so everyone along the route can use it to build profitability and efficiency.”
Simplifying data gathering
Sexten outlines eight steps during an animal’s life where calves are typically restrained and data is gathered. The stages include birth, 2 months of age, preweaning, weaning, postweaning, at the stocker yard, upon arrival at the feedyard and at reimplantation time. It’s understood not all calves are handled at each point, but he stresses that all collected knowledge is welcome and helpful.
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“We meet each producer where they’re at,” he said. “We begin identifying the calf’s record with electronic ID tags wherever they first catch them and go forward from there. It doesn’t matter what kind of tag or method they want to use. Come one, come all. They can engage as much or as little as they want. Details might include early vaccinations, implant times, weights, dates, etc. It’s all sharable to build efficiency across the board.”
He explains Blockyard contains day-to-day management in an ecosystem model, which combines PLA’s Performance Ranch and Performance Beef softwares with PAH’s genetic testing to build a usable framework.
“The key is it has to work at the cow-calf, stocker (and) feedyard levels before there’s value in transferring the data. No one must keep special records or two sets of books; it happens synergistically in day-to-day management. If records are kept in our programs, they automatically transfer to Blockyard. There’s no extra work. It’s essentially us saying, ‘Here’s how to be a part of it.’”
Sexten said with their digitized program, specific information is connected to the individual, not the group. Whether the original owner saw his calves sell as a group or be split six ways is irrelevant for the stocker or backgrounder. Individual points move with the animal into the new lot for reference and use.
Show me the money
Initially, producers who own the calf and enroll in Blockyard receive the assistance of a genetic test breaking down breed composition, sire identity and the recognition of traits to help them make the most progress toward their genetic goals.
“The premise is they’ll make better decisions at the segment they’re at, including the cow-calf operator, which has been tough to do in the past,” Sexten said. “Anything down the road is upside. I don’t want someone to engage in this because they think it’s potentially going to be more valuable; I want them to engage to make better decisions for their operation.”
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For example, he pinpoints that current interest costs alone for keeping a single replacement heifer are more than $50, making it critical for the right females to be kept. Feed is often limited, the cost of borrowing money is rising and margins are narrow. But even with limited data at their disposal, the information from a single genetic test delivers the ability to make a much more accurate and informed replacement selection.
“On top of that, while keeping the right heifers is important, the real benefit is not keeping more than we should when they’re so valuable,” he said. “Every heifer we shouldn’t keep and subsequently put on the truck with the steers is already a better decision.”
Linking the information to the animal
For the stocker and backgrounder, hearing from their order buyer that half the cattle on an incoming truck were previously weaned is the most frustrating shred of news they could possibly entertain, Sexten said. With the flow of blockchain, the data arrives even before they’re processed.
“That’s always been the problem. We finish working them, and then data catches up. Now we have transfer in real time. Stockers make breakeven decisions before they raise their hand at the auction. They know the genetic potential as they consider their bid, not after livestock have taken up pen space for a week.”
Once cattle are bought, genetic information, while possibly useful, is a sunk cost.
“What we want to know is: Are cattle with reputation genuinely those with high genetic merit, or do they simply have better management behind them? Many times, we assume good management equals good genetics. We’re presenting the mechanism to confirm this.”
Traceability affects the comfort zone
Following the links to the packer and eventually to the consumer in the grocery store aisle, a blockchain like Blockyard provides the option of built-in traceability. As cattle move through the system, the data is available to support traceability if a supplier desires it.
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“It’s not a mandate but an option,” Sexten stressed. “This, of course, assumes everyone along the line is participating in the same way. It’s built-in optionality as it relates to traceability.”
The packer’s confidence in receiving an accurately defined product increases, as the technology supports the blockchain’s interstate framework with entry or exit lanes to create a traceable supply in concert with a packer. Plus, consumers are assured their dollars are purchasing beef that matches their intentions.
Sexten emphasizes the flow is not limited by only left-to-right travel. Movement is multidirectional, enabling producers at any of the previous segments to access it for help with future decisions. When cattle are sold on a grid or negotiated on a carcass merit basis, the previous owner receives the carcass data back.
“It’s standardized and travels all the way back to where it started,” Sexten said. “There’s never been a mechanism in a meaningful way to move the information in this manner. Many other chains say they want to create traceable supplies, but they only travel in one direction, bringing virtually no value to the home ranch. We want to create a framework for those aspects to develop as the market calls for them.”
To the future and beyond
Sexten admits limitations exist, with the largest obstacle being that some producers don’t care to individually identify their cattle. He emphasizes this process isn’t to be confused with an identification mandate, but he’s certain individual management will only increase with time. Group data can flow, but it is only usable when the group stays intact.
“It’s the problem we’re trying to solve. Sorting occurs in many ways. How do we improve system efficiency? By pairing the details with the animals as they move. It can and will be done. It’s just a matter of when this becomes the norm.”
Sexten believes Blockyard and other blockchains will travel similar paths to ones taken by the row crop industry. Tractors, no matter the make and model, communicate with the implement they pull. Fields were the original data points, then acres and eventually sub-acres. He envisions beef blockchains continuing to develop, with nutrition, technology, animal health and marketing companies working together to help capture value at every step of the way.
Essentially, it becomes a catalog wish list, equipping all participants with the right data when the cattle are in the right spot, guiding the best decisions possible.
“The beef industry used to manage herds. Then it managed groups within herds, and it’s slowly getting to the point of managing individual animals,” Sexten said. “Not to say everyone at the different points in the cycle will get there at the same time, but those who don’t plan for this eventuality will be left behind. The communication of specifics is something our customer, the consumer, asks for, and this transfer makes us more efficient across the feedyard, stocker, packer and ranch.”
