The blockchain is a ledger of accounts and transactions that are written and stored by all participants.
Blockchain in Agriculture supply chain promises a reliable source of truth about the state of farms, inventories, and contracts in agriculture, where the gathering of such information is usually incredibly costly.
The blockchain technology can track the provenance of food and thus helps create trustworthy food supply chains and build trust between producers and consumers.
As a trusted way of storing data, it facilitates the utilization of data-driven technologies to make farming smarter:
- Lack of transparency in agri-food Supply Chain
- The increasing need for Food Safety and Traceability
- Need for efficient Financial Transaction.
Use of Blockchain in Agriculture supply chain
The blockchain represents one among the technologies with the foremost promise to provide more consistency in wide areas of the agricultural industry.
Whether it’s applied to managing warehouses, silos, and supply chains more intelligently, or utilized within the field as a tool to transmit real-time data about crops and livestock, there are few aspects of an agricultural operation that wouldn’t benefit in one form or another from blockchain technology.
Benefits of Blockchain in Agriculture Supply Chain
The blockchain technology allows peer-to-peer transactions to take place transparently and without the necessity for an intermediary like a bank (such as for cryptocurrencies) or a middleman within the agriculture sector.
The potential of Blockchain in Agriculture supply chain Industry is vast.
To possess a far better understanding of every benefit we’d like to segregate them :
- Transparent Supply Chain: In the blockchain, it’s impossible to change the record anonymously. Data and content remain the same. So, Consumers want to know the origin of food and they even can pay additionally to find out all detailed information about the product.
- Fraud Prevention: As information recorded in blockchain cannot be changed and it is visible to everyone, blockchain will allow one side to protect itself from fraudulent actions and cheating.
- Investment’s attraction: Initial Coin Offering is a new way to attract investments and it is a so-called cryptocurrency crowdfunding. It is a good option for small business types at the early stages.
- Smart Contracts Availability: Farmers supply their products and they don’t need to wait for the payment for months, as it was before. Smart contracts are written in the form of code, and when specific terms should be implemented, they are fulfilled automatically.
- Stock Exchange for Farmers: Farmers can trade futures contracts where the price for grain, animals, or vegetables is fixed and it will remain fixed in the future. Thus, a farmer will get it’s indicated cost, and a buyer will be immune from price fluctuations.
- Agriculture Cryptocurrency: Everybody knows Bitcoin cryptocurrency. Today it is one of the most popular cryptocurrencies in the world. But there is another cryptocurrency called PavoCoin that was developed specifically for the agricultural sector. It is used internally for farmers and it shows a big potential.
More about this project you can read below.
Statistics of Agriculture Supply Chain: Why do we need to build the system?
Globally, Food is a US $ 5 trillion industry and Food traceability is US $ 4.5 billion market opportunity.
Asia has the 3rd of the world population and food safety has a major impact on the consumer’s buying.
Example Investment Requirements,
- Inputs – Fertilizers and Hybrid Seeds.
- Infrastructure: Irrigation, Storage, other
- Markets – Trade
Classes of applications which helps in building up of blockchain in Agriculture and Food :
- Agricultural insurance – Agricultural insurance schemes are traditionally a well-recognized tool to manage weather-related risks.
Here, farmers pay an insurance premium before the cropping cycle begins and receive an insurance payout whenever they experience a loss on their farm.
Thus, the insurer bears all the insured risk and farmers are able to manage their financial exposure to weather extremes, i.e., financial losses caused by weather extremes.
- Smart agriculture – Smart agriculture is featured by the utilization of ICT, the internet of things (IoT), and various modern data collection and analysis technologies including unmanned aerial vehicles (UAV), sensors, and machine learning.
A key issue of establishing Blockchain in Agriculture supply chain is developing a comprehensive security system that facilitates the use and management of data.
- Food Supply Chain: From the producers’ perspective, the use of blockchain technology helps establish a trust relationship with consumers and build up the reputation of their products, by transparently providing individual product information in the blockchain.
Enterprises can better achieve the value of their products and thus increase their competitiveness.
This would make it difficult for suppliers of fraud and low-quality products to stay in markets and force all suppliers to improve the quality of products in the whole agricultural and food sectors.
Companies working on Agriculture supply chain:
PLAAS – POWERING AGRICULTURE THROUGH BLOCKCHAIN
About our Client: PLAAS SOLUTION
Plaas is a platform that enables the virtual market for agriculture.
It operates as a verification platform, stores information about farmers, offers supply-chain tracking and validation, and enhances the market via future contracts.
The app will help empower the farmers of Africa to seamlessly trade their animals and crops at market prices, which in turn, will boost their income.
Moreover, the information provided by farmers will help others to enrich their harvest.
Blockchain solutions provided by PLAAS :
- Lack of transparency in food-chain supply
- Credit histories and difficulties in contract enforcement
- Adulteration of agricultural and meat products
- Manipulation of prices by the middleman and big businesses
- Inaccessibly to quality seed and raw materials
- Inconsistency in records
- Limited access of farmers to non-manipulated information
Working :
- TRACING AND TRACKING – The producers and consumers will be able to track and trace the origins of food crops and meats and rely on immutable ledger accounts showing full details of the product they want to buy or sell.
- SMART CONTRACTS – Records will be kept on one of the decentralized smart contract platforms, thereby providing farmers with daily records about products bought and sold.
- DATA – The system will capture information in real-time by the use of Animal Radio Frequency Identification (RFID) and Global Positioning System (GPS) technologies.
- NODE VALIDATORS – Node Validators would inspect and approve the material sold on the platform. Moreover, they would also determine and examine the quality of the crops.
Conclusion
Cryptic Ocean is a blockchain technology company that provides end-to-end blockchain development and blockchain consulting services to multiple business domains.
Our goal is to help companies adopt new technologies and simplify complicated issues that arise during technology evolution.
We also focus on enabling peer-to-peer agricultural transactions and processing while cutting out the middlemen.
Contact us for the best solutions about the use of blockchain technology to solve the toughest challenges faced by the world today.
FAQ’s
How can Blockchain be used in agriculture?
Linking agricultural shipping and monitoring processes using a shared, decentralized blockchain ledger adds value to agricultural products because machinery, crops, and livestock can be traced by the recipient to prove quality and ethicality and therefore assign
greater value.
How does Blockchain affect the supply chain?
The real-time tracking of a product in a supply chain with the help of blockchain reduces the overall cost of moving items in a supply chain. Payments can be processed by customers and suppliers within the supply chain by using cryptocurrencies rather than customers and suppliers rather than relying on EDI.
How do you use Blockchain in the supply chain?
Blockchain helps organizations understand their supply chain and engage consumers with real, verifiable, and immutable data.
Transparency builds trust by capturing key data points, such as certifications and claims, and then provides open access to this data publicly.
What is an agri supply chain?
An agriculture supply chain system comprises organizations/cooperatives that are responsible for the production and distribution of vegetable/Fruits/Cereals/Pulses or animal-based products.
In general, we distinguish two main types:
1.‘Agriculture food supply chains for fresh agricultural products’ (such as fresh vegetables, flowers, fruit).
In general, these chains may comprise growers, auctions, wholesalers, importers and exporters, retailers and specialty shops, and their input and service suppliers.
2.‘Agriculture food supply chains for processed food products’ (such as portioned meals, snacks, juices, desserts, canned food products). In these chains, agricultural products are used as raw materials for producing consumer products with higher added value.
Must read our other blocks on blockchain.