In conjunction with artificial intelligence (AI), machine learning, internet of things (IoT) devices, and other innovative digital technologies, blockchain is transforming the agriculture industry.
From the growing and harvesting of crops on farms, to the purchasing of food products in grocery stores, blockchain technology is helping agricultural supply chains increase efficiency, safety, and sustainability. Not only does this help boost revenue for growers and manufacturers, but it also contributes to a cleaner environment and safer food products for consumers.
Digital transformation is necessary to solve many of the issues that farmers and agriculture organizations face today.
Here are some of the main problems in the agriculture industry that blockchain and other digital innovations aim to fix:
A blockchain consists of individual digital records—or “blocks”— which are linked together in a single list—or “chain.” Participants inside the network can access these records, and use the data to gain insight, oversee processes, and make informed decisions. In the agriculture industry, farmers, manufacturers, logistics companies, consumers, and other participants can establish a stronger supply chain by sharing digital records relating to farm management, product tracking, food quality, government regulations, and more.
Here are some of the most important benefits of blockchain in agriculture:
For these reasons, blockchain technology will continue to play an increasingly essential role in food supply chains. And by 2028, the global market for blockchain in agriculture is expected to reach $1.8 billion in revenue.
The underlying technology that supports every blockchain is known as a distributed ledger. Operating in the cloud, this ledger is essentially one big database, synchronized across multiple locations, institutions, and devices—and is accessible by multiple parties. Data can be saved in the blockchain manually, or automatically through various IoT devices, such as drones, satellites, and soil- or plant-based sensors.
The data stored in each block—from food safety certificates to transaction details—are encrypted and immutable, so they cannot be stolen or altered. This makes it possible for farmers, retailers, and other members of agricultural networks to access important information easily on a single, secure platform. This is particularly beneficial for farmers, who can instantly gain valuable insights regarding seed quality, environmental factors, market prices, payments, and more.
As a product moves from one stage to the next in a supply chain, more and more blocks get added to the chain. So by the time a customer picks the item off a shelf and scans the QR code, they can see the product’s entire history.
Here are some unique types of data collected and saved on blockchain at different stages of the food supply chain process:
To get a clearer picture of the role blockchain plays in the agriculture industry today, let’s take a look at a few common use cases:
Through IoT-enabled smart farming, groups of data—like the ones listed above—are collected to help farmers facilitate stronger outputs. But before the information is saved on the blockchain, machine learning algorithms are deployed for data enrichment and cleaning.
In other words, massive amounts of data from multiple sources are automatically tagged and organized on a digital platform, so that farmers can easily adhere to government compliance enforcements, as well as extract valuable insights—such as predictions around crop yields and the current demand for certain products. This helps farmers make better decisions, such as which crops to prioritize, when to plant seeds, when to add more water and pesticides, when to harvest, and how to accurately price their products.
Once the enriched data is saved in the blockchain, it becomes accessible to every participant in the network—saving massive amounts of time, money, and effort for everyone involved.
With a lack of transparency into resource allocation, transactions, and credit history, financial institutions are less likely to issue loans to agriculture organizations. And without access to financial services, farmers are unable to grow their operations, hire new employees, or invest in cutting-edge technologies.
When stakeholders can share information from each stage of the production process through blockchain, they can prove to investors and financial institutions that their organization is not a risk. This also makes life easier for auditors, as they can digitally view every single transaction the organization has made via digital ledgers, rather than having to wait weeks for financial documents to arrive in the mail.
Supply chain tracking is essential for guaranteeing that food products are safe to eat. However, without a centralized data platform, it can be difficult to know exactly where a particular product came from, how it was grown, who inspected it, and so on.
When data is saved at each stage of the process, either manually or automatically through IoT, validating the quality of food products becomes much easier. Upon receiving deliveries from farms, food processing companies can check which types of seeds the farmers used, what the weather conditions were like during production, what the temperature was inside the IoT-enabled vehicles that transported the products, and so on. If everything checks out, the facility will confidently move forward with processing the food.
Moving downstream, wholesalers and retailers go through a similar validation system when processing companies send them shelf-ready products. And as mentioned above, consumers can do their own quality checks with their smartphone by scanning the QR code on a food item’s packaging.
For farmers, adopting blockchain technology can be a daunting task, as it requires sophisticated technical knowledge around IoT, machine learning, data analytics, and more.
That’s where Codal comes in. We’re an award-winning design and development agency that specializes in digitally transforming agriculture businesses—helping them leverage data to increase efficiency, cut costs, reduce waste, and boost profitability. As we’ve done with many clients in the past, we’ll help guide your organization through the implementation of blockchain solutions, and provide ongoing support, so you can focus on running your business.
By combining our technological expertise with your agricultural skills and knowledge, we can help make the world a better place. Interested in learning more about the benefits of blockchain in agriculture? Reach out to Codal today!