Important Companies Are Using Blockchain To Improve Agriculture Supply Chain
Important Companies Use Blockchain To Streamline Agribusiness’ Supply Chain
There are many diverse industry sectors that are being influenced and improved by the use of the blockchain technology. An important industry which could use the blockchain is the agriculture business. This giant industry suffers from some important endemic issues that could be made better with the blockchain technology.
As agriculture relies on complex relations between the farmers and the retailers, it created a messy supply chain that often can complicate payments and cause issues that hurt its efficiency. As the demand for agricultural trade is more and more international and the whole world is interested in bringing the trade to the current century, blockchain can be an effective solution.
The blockchain technology could Increase Transparency and The Traceability of Produce in the Agribusiness
It is no secret that transparency is one of the most common characteristics of the blockchain technology. According to a survey made by GlobalData’s How Britain Shops, consumers are more and more concerned about the quality of the food that they buy, so transparency can help companies to profit more in the market now more than ever.
As information about the nutrients and healthy food is more mainstream than ever, shoppers would like to be able to track the origins of the produces that they are buying with more accuracy than they have been able to do so far.
While this technology is still in its infancy, there are some reports of big brands like the French retailer Carrefour, which has displayed information about its free-range chickens using the blockchain technology. With more information, now the customers will be able the right choices.
It should also be noted that the consumer faith in food suppliers is decreasing as scams and industry mistakes are common recently all around the world. Because of this, using the blockchain can streamline the tracking process and give an opportunity for the customers to know better what they are actually buying.
The blockchain technology now permits that the clients will use radio frequency identification to receive a wealth of information include breed, sire, sex, vaccination details, hormones, antibiotic treatment and more about an animal growth. The lives of the animals are becoming public knowledge.
Recently, Nestle, Univeler, Dole and Walmart have made a partnership with IBM to develop a new blockchain called Food Trust. The idea is to create a single record for all these partners and competitors to help to maintain safety conditions via the collaboration of the many parties involved in the process.
Scandals like a recent salmonella outbreak from contaminated papaya in Mexico, which had fatalities, are proof that the world is currently needing to upgrade its trust and eliminate chances of contaminated food making new victims.
Governments Are Backing The Blockchain Technology For Agriculture
Some governments around the world, like the government from Australia, have been creating projects to help agriculture and blockchain take the best out of each other. The Sustainable Sugar Project has recently received $2.25 million AUD to use the blockchain to track the origins of supplies in a wide effort to increase sustainability and traceability.
According to the Minister of Agriculture, David Littleproud, this is the type of technology that could assure the sustainability of a model in which better and healthier food is a premium.
In China, the Agricultural Bank of China has decided to loan money to create a blockchain to help the agricultural land of the Guizhou province. Blockchain has also been used for land registry in countries like Gana.
Australian Supply Chain Innovator Is a Great Example
It looks like Australia is really a blockchain center because Square Peg Capital has recently invested $5.5 million USD in the Australian startup Agridigital, which works with agricultural and blockchain. The partner of Square Peg Capital, Tony Holt, has affirmed that the blockchain could be very helpful as the supply chains are very chaotic right now.
The technology could also greatly reduce the time that it takes to pay farmers and the uncertainty of the payment. According to the CEO of the Commonwealth Scientific and Industrial Research Organization (CSIRO), Adrian Turner, the blockchain will improve efficiency, ensure the quality of branded goods and integrate the supply chain better by connecting people without so many third parties.
This could result in a potential reduction in cost, which will make the produce cheaper for the clients and improve the profits of the companies.
Is Blockchain The Solution?
As several blockchain initiatives have been started all over the world, one could say that the blockchain is the definitive solution for the agribusiness industry and the food supply sector, but that would be a very simplistic answer.
After all, the blockchain technology is still very new and it has several issues and perceived weaknesses. CSIRO’s Data61 has reported that the solution is not as flawless as it looks. As the blockchain cannot be tampered with or even changed, the institution believes that there is a risk that “toxic data” is locked out of the system. This also could lead to metadata being compromised.
Even if it is hard to tamper with the blockchain, internet of things devices are easier to manipulate and can be used to record false data. If the input of data breaks down on the chain, this could also have serious issues as the new process would rely more on the technology.
Also, using smart contracts is still not a final solution, as they might consume too much energy and the current blockchain technology that we have still is not scalable enough to be used this way.
So, blockchain is the solution yet. According to Adrian Turner from the CSIRO, blockchain is “here to stay” but it might take quite some time until the technology has been evolved to the point that it needs to actually be the best solution.