On April 30, 2021, Bion Environmental Technologies Inc. (BNET: OTCQB) announced that it has executed a Letter of Intent (LOI) with Lamb Farms, a large dairy operator in upstate New York.
BNET has developed patented technology that provides advanced waste treatment and resource recovery for large-scale livestock production facilities—dairy, beef and hog production—based on a business model that "stacks" new revenues to offset treatment costs.
Bion plans to partner with key industry stakeholders to deliver U.S. Department of Agriculture (USDA)-certified sustainable meat and dairy products to the consumer, with substantially increased profit margins in this premium sector.
Lamb Farms has 7,000 cows at six milking locations. The three-pronged business mantra of this 11th generation farming family is: Wholesome Milk; Comfy Cows; Sustainable Farming.
The project will initially treat the waste from the 2,000-head milking herd at the Lamb Farms' New York location.
Governments, consumers, farmers and investors are all demanding that the livestock industry clean up its act.
"Nine million dairy cows, 90 million beef cattle, 62 million swine and billions of poultry in the U.S. produce more than 100 times more organic waste (and nutrients) than humans," states BNET.
Large-scale livestock production facilities—CAFOs (Concentrated Animal Feeding Operations)—spread manure on the ground, untreated, for its fertilizer value.
That sounds healthy, but it's not.
"Fresh manure sometimes contains pathogens (such as bacteria and viruses) that can cause diseases in humans," states the Agriculture Department of Washington State University.
"Pathogens that live in the intestines of animals can be transmitted from their manure to people," confirms the U.S. Food and Drug Administration.
The problems are not confined to just pathogens and agricultural fields.
Half the nitrogen from the waste "evaporates" then returns to the ground, causing downstream algae blooms and dead zones.
The fecal effluent from CAFOs that is spread on agricultural fields runs off and leaches into aquifers and waterways, further polluting rivers and lakes.
BNET's business model exists at the intersection of the $200 billion animal-protein industry and the $100 billion clean water sector, whose largest unregulated polluter IS the animal-protein industry.
"One billion tons of animal waste is generated in the U.S. every year, and it's largely untreated," stated Dominic Bassani, Bion's CEO. "Governments spend huge amounts of money downstream to cleanup the effects instead of taking care of the problems more efficiently upstream at the farm."
"Americans love their beef and other meats, but raising the animals—particularly cattle—is a significant contributor to the [pollution] problem," reports the L.A. Times.
Consumer and investor groups are driving change in the livestock sector.
"It is not going to happen; it is happening now," states BNET.
For investors, it's a good thing when your company's business model intersects with the mainstream news cycle.
On April 20, 2021, The Wendy's Company took an important step to help tackle the climate crisis and align with investor expectations on greenhouse gas emission reductions from direct operations and supply chains," reported Ceres.org.
Wendy's, one of the world's largest quick service restaurants, committed to pursue a science-based target by the end of 2021. When asked to comment, Bassani said, "Meeting science-based targets will require solutions, like Bion's, that can be quantified and confirmed."
Wendy's environmental initiative didn't come out of the blue.
"Global fast-food companies like Wendy's are well positioned to minimize risk and capture opportunities by significantly reducing greenhouse gas emissions," stated Sister McKillip, a leader in a religious coalition for responsible investment.
"As shareholders, we're particularly encouraged by the company's agreement to tackle not only the emissions from the company and its franchisees but those in its agricultural supply chain—which make up the lion's share—as well," added McKillip.
Through a coalition coordinated by Ceres and the UK-based investor network FAIRR, investors are putting pressure on six of the largest fast-food companies (including Wendy's) to ensure they reduce climate and water risks in their meat and dairy supply chains.
FAIRR is not a gaggle of disenfranchised hippies holding cardboard signs.
The coalition consists of 90 global investors with more than $11 trillion in combined assets.
"Bion has no relationship with Ceres, FAIRR, or Wendy's," stated BNET in an April 23, 2021, note to shareholders, "but we are all on the same path: a clean and sustainable livestock sector."
"We're not going to solve all the livestock environmental impacts in this country," Bion's communications director, Craig Scott, told Streetwise Reports, "But we are going to clean up a segment of the market that is driven by consumer demand for premium sustainable products."
"Our efforts will result in significant benefits for the environment," added Scott, "but just as important, we will improve farm and production economics and provide the consumer with what they've clearly said they want: verified sustainable products."
The Wendy's announcement is another in a list of clear signals that animal product retailers are getting the message: that they can and must reduce the environmental impact of their operations. And those impacts are most acute at the production level.
"Our technology largely eliminates the environmental impacts from very large-scale livestock facilities," confirms Scott, "but again, our business model is not to sell solutions. Our intent is to partner with quality industry stakeholders to produce verified, sustainable and sustainable organic meat, dairy and fertilizer products."
Additionally, Bion's 3G Tech produces organic fertilizer as a co-product of the waste treatment process.
Last year Bion received its first Organic Materials Review Institute (OMRI) listing.
The organic subplot should be of interest to BNET shareholders.
About 12 million square miles of the earth's surface are currently arable (farmable). Due to the encroachment of suburbs, arable land is being lost at the rate of over 38,000 square miles per year.
Land devoted to organic farming is tilting hard in the opposite direction.
"The U.S. organic sector posted a banner year in 2019, with organic sales in the food and non-food markets totaling a record $55.1 billion, up a solid 5% from the previous year." That's double the sales of a decade ago.
At the New York Lamb Farms facility, a demonstration "beef barn" will be constructed on-site that will house and produce a mix of sustainable and sustainable/organic CORN-FED cattle.
At this time, organic beef is limited to grass-fed, which is far different from the juicy and tender product the U.S. beef industry is known for.
The beef installation will allow Bion to demonstrate proof of concept of its beef opportunity, while also pursuing certification of a verified sustainable brand through the USDA's Process Verified Program (PVP).
"The livestock industry—and especially the beef industry—is unsustainable and under constant attack, which is why plant-based meats are trending," added Bassani. "We have a critical part to play in bringing a verified sustainable product to the market that satisfies the growing consumer demand for sustainability."
"We—and what we represent—provide a real response to this trend. You have to clean it up," stated Bassani. "You have to be able to communicate it to the consumer. And you have to be able to pay for it. Bion Environmental Technologies is already positioned where the industry is going."
Bion is currently in discussions with several potential production partners across multiple animal species.
The company has 87 million shares fully diluted (shares/options/warrants/cv notes/cv deferred comp, etc.). Some 45–55% of total shares are owned by management, employees, their extended families and charitable donees.
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Disclosure:
1) Lukas Kane compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. His company has a financial relationship with the following companies referred to in this article: None.
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