Blockchain is out of beta testing and has reached Agriculture.
A recent soybean shipment from the US to China has become “the first full agricultural commodity transaction using a Blockchain platform,” –Business Insider
If you want to stay relevant in the future you need to stay on top of the technologies that will shape it. While still in its early phase, Blockchain is a topic that you should understand some of the basics and how it’s being incorporated into agriculture.
Note: This is a basic overview for those in agriculture, I am not a Blockchain builder or expert.
“Blockchain can do to value transfer what the internet did to information sharing.” – Fobes
Block Chain aims to provide transparency and widescale trust via unalterable record keeping. This will transform supply chains of industries like precious metals to food and agriculture. It has the power to change the way we manage leasing and payment collection, supply chain management, and quality assurance securing the provenance of goods and commodities.
The dream for agriculture is that the use of this technology will help commodity producers move up the value chain.
The world is moving from analog to digital and from digital to decentralized.
In the simplest terms Blockchain is a distributed/decentralized ledger that maintains transaction records on many computers simultaneously. Because of this mathematical relationship, the information in a particular block cannot be altered without changing all subsequent blocks in the chain and creating a discrepancy that other record-keepers in the network would immediately notice. In this way, blockchain technology produces a dependable ledger without requiring record-keepers to know or trust one another, which eliminates the dangers that come with data being kept in a central location by a single owner.
Most businesses keep a log of transactions within their business. You buy a product, enter it into your inventory. You sell it, you mark it off. Now imagine that when you buy a product you get a copy of all the transactions that product has ever had going back to the ingredients used to make it. When you sell that product, the ledger follows with the product. This is saved to the cloud on a decentralized computer system. Because everyone has a copy of this ledger, it makes it extremely difficult to forge a product. This process enables clarity across the supply chain and ensures quality standards are met along the way.
Blockchain company Abrosus is working on meeting these supply chain and quality standard needs.
“The state of technology today allows a bold rethinking of how the global food supply chains and markets could operate. A system of interconnected quality assurance sensors can reliably record the entire history of food, from farm to fork. Blockchain can protect the integrity and verifiability of sensor data. And smart contracts can enable automatic governance of food supply chains and manage commercial relationships between actors along those supply chains”. – Abrosus
Thier technology combines Blockchain with hardware devices (sensors and readers, cameras, container locks) to provide a platform to automate the input of data into a system and create a trusted basis of data input to meet the needs of manufacturers, consumers and government regulations.
US agriculture is a global marketplace and much of our product is exported. With our customers stretched all over the world, we need to be aware of the laws of those countries. One example is a law published in 2013 by The European Commission for the Good Distribution Practice of medicinal products for human use (GDP 2013/C 343/01). Chapter nine of this regulation requires proof that shipped medicines have not been exposed to conditions, particularly temperatures, that may compromise their quality. These regulations are now enforceable across Europe. Blockchain logs the data from monitoring systems in the pharmaceutical industry ensuring requirements for frozen vaccine storage are met such as:
- Temperature [-25°C to -10°C],
- Humidity [2 to 3%],
- No direct sunlight or fluorescent light.
This ensures the viability of medicines and reduces the risk of loss of life.
Is this really needed for food? Between 1993 and 2006, the consumption of non-pasteurized cheeses caused 121 outbreaks, leading to 3,000 people falling sick, 140 hospitalizations, and more than 50 deaths. Since these outbreaks, the Swiss Federal Regulation has changed. For food products, Blockchain companies like Ambrosus can go further and define the various levels of quality for a particular product like this illustrative list of requirements for a batch of milk:
- Temperature [4°C to 7°C]
- Fat [3.18% to 3.22%
- Lactose [2% to 4%].
While food safety is of utmost importance, a close second is quality. As consumer demands evolve, the term ‘quality’ has broadened to include ethical and environmental aspects. Consumers today have expanded the term quality of a food product to also include using eco-friendly procedures, good employee working conditions, and the welfare of the animals involved in the manufacturing process.
Blockchain technology gives agriculture the opportunity to provide supply chain efficiency, cost reduction, proof of positive environmental impact, improved customer service, quality assurance and regulatory compliance. These improvements are what our customers are demanding and will help ensure future profitability for farmers.