Blockchain is a distributed ledger technology that enables all members to register transactions in a decentralized database that uses state-of-the-art cryptography so that all the data and information that goes into it cannot be obtained without the original password or key.
Blockchain is set to disrupt many industries ranging from banking and finance, healthcare, retail, real estate, among many others. It can also revolutionize the agriculture sector.
With increasing consumer consciousness towards food security, the application of blockchain technology can play a key role in addressing several challenges related to the agri-sector.
In fact, as per a new report released by France-based technology company ReportLinker, the use of blockchain technology in agriculture and food supply chain market all over the world will reach nearly $430 million in the next five years. The report titled ‘Blockchain: Agriculture Market Forecast until 2023’ projects the agriculture sector reaching USD429.7 million in 2023 from the present worth of USD60.8 million.
Let’s take a look at how blockchain technology can transform the agriculture sector:
It can help consumers to know the source of their food
Fraud and adulteration in food is costing the worldwide food industry about USD30 billion to USD40 billion per year and food-related illness and food allergies are predominant then they were a few decades back. This is the reason that consumers want to know where their food is coming from and are demanding information related to food more than ever before. With the surge in this trend, food growers and suppliers have no choice other than using blockchain to ensure traceability, quality, and accountability of the food.
It can simplify the food supply chain
Blockchain technology can simplify the food supply chain as the data management across a complex network that includes farmers, middlemen, wholesalers, distributors, processors, retailers, consumers, and regulators get simplified. Blockchain can also eliminate information asymmetry thereby minimizing inefficiency and ensuring higher returns to the farmers. Enhanced data sharing can also assist in assuaging the food waste crisis worth USD1 trillion. Blockchain can enable farmers and other stakeholders in the supply chain to access all information throughout the chain, thereby making the chain more efficient and democratic resulting in higher remuneration paid to the farmers and lesser wastage of food.
It can help in determining the genuineness and quality of inputs used by farmers
Blockchain can help consumers determine if the inputs used by farmers are genuine and are of good quality. More often than not, farmers are tricked into buying counterfeit products from local retailers and they don’t know whether the inputs they are purchasing are genuine or not. Retailers sell counterfeit products to farmers to raise their profit margins. Sometimes even retailers don’t know if the products supplied to them are genuine. In such cases, farmers and retailers can just scan the blockchain barcode provided on each product through their smartphone and can determine the genuineness of the products they are purchasing.
It helps farmers to determine if the land they are leasing or buying is litigation free
Land title registering for lease, sale, or purchase is a very lengthy process and it is susceptible to fraud. With the use of blockchain, however, land registration can become far more accessible and efficient because the data recorded in available to the public and gives complete transparency to all the transactions.
It helps farmers in getting subsidies
Blockchain can help in the allocation and delivery of subsidies to the farmers as well as make the entire process of doling out subsidies very transparent. Although the process of establishing the network can be quite complex because several stakeholders are required to come together, it is doable.
It can help in opening new markets
Blockchain can create accountability and trust among market players and help farmers in unlocking new markets. Blockchain can enable farmers to do business without the need of someone to mediate with customers in the middle. Moreover, the technology will include deprived market participants to have a say in the food sector.