Blockchain in Agriculture

The blockchain technology allows peer-to-peer transactions to take place transparently and without the need for an intermediary like a bank (such as for cryptocurrencies) or a middleman in the agriculture sector. By eliminating the need for a central authority, the technology changes the way that trust is granted – instead of trusting an authority, trust is placed in cryptography and peer-to-peer architecture. It thus helps restore the trust between producers and consumers, which can reduce the transaction costs in the agri-food market.

The blockchain technology offers a reliable approach of tracing transactions between anonymous participants. Fraud and malfunctions can thus be detected quickly. Moreover, problems can be reported in real-time by incorporating smart contracts. This helps address the challenge of tracking products in the wide-reaching supply chain due to the complexity of the agri-food system. The technology thus provides solutions to issues of food quality and safety, which are highly concerned by consumers, government, etc.

The blockchain technology provides transparency among all involved parties and facilitates the collection of reliable data. Blockchain can record every step in a product’s value chain, ranging a product’s creation to its death. The reliable data of the farming process are highly valuable for developing data-driven facilities and insurance solutions for making farming smarter and less vulnerable.

What is blockchain



A blockchain is a ledger in which agents take turns recording information on the process of generating, transacting and consuming a product or service. The ledger is collectively managed by all participating parties typically through a peer-to-peer network. A new record must be verified by the network before adding it to the blockchain. Any alteration to the recorded data should follow consensus decision-making protocol, meaning the majority of the parties involved should agree. In addition, an alteration to one record will lead to the alteration of all its subsequent records. It is, therefore, almost impossible to change in data recorded in a blockchain in practice. Blockchain is viewed as “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way”. Blockchain is a transformative ICT that have the potential to revolutionized how data is used for agriculture.

Why blockchain

The world we live in today continues to face enormous challenges with providing enough food for its ever-growing population. To be specific, these challenges are mainly the effects of:

  • Climate change
  • Floods
  • Drought
  • Desertification
  • Loss of biodiversity
  • Pests
  • And disease
Innovations in our agricultural processes are needed to overcome some of these challenges and make agriculture attractive to and profitable for the smallholder farmers involved in feeding the world.
The Sustainable Development Goals (SDGs) provide a vision for global development and ICTs can facilitate the much-needed acceleration of development to achieve many of these goals. The growth of ICT in the last decade has provided many opportunities to overcome some of the challenges faced in agriculture.
Recent developments such as the increase in the use of mobile-broadband access devices, the Internet of Things (IoT), drones, smart networks, capacity for big data analytics, and artificial intelligence have provided agriculture stakeholders with some key tools and technologies to improve production and marketing processes, for example, in agriculture and allied fields.
If you have the opportunity to visit a farm by chance you will discover that farmers have complicated ecosystems with seasonal financing structures, needing careful timing and a lot of moving parts.
After the food leaves the farm for the market, it becomes a part of the vast supply chain involving a lot of intermediaries. Imagine the journey that our food takes after it leaves the farm, passing through many hands and processes as it gets to the dinner table.

All these questions above require answers.

Blockchain for Agriculture is one of the most compelling use cases of blockchain that makes the process of growing and supplying food simpler.
Staying on top of the newest developments in agricultural processes is as complex as it is essential for improving the entire sector. Given the rapid development of this technology, it has become a necessity to stay informed of the most recent developments in the field to stay ahead of your competition.
benefits

Benefits of blockchain



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 use of data-driven technologies to make farming smarter. In addition, jointly used with smart contracts, it allows timely payments between stakeholders that can be triggered by data changes appearing in the blockchain.

The use of data and information becomes increasingly crucial for the agriculture sector to improve productivity and sustainability. Information and Communication Technology (ICT) substantially increases the effectiveness and efficiency of collecting, storing, analyzing and using data in agriculture. It allows agricultural practitioners and farming communities to easily obtain update-to-date information and thus make better decisions in their daily farming. For example, daily market prices on the Farmhut website help farmers in Choosing the right price for a product and gain maximum profit 

Applications

Blockchain technology is being used to allow retailers and consumers to track the provenance of meat and other food products from their origins to stores and restaurants.

The major applications of blockchain technology in food and agriculture include product traceability, tracking and visibility, payment and settlement, smart contract, governance, risk, and compliance management.


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