Often overlooked, yet vital for our sustenance, the agro-industry walks a tight rope in embracing globalization and technological evolution. Herein blockchain enters, filling mission critical voids, balancing international trades, boarding automation safely for better products accompanying steadfast economic growth. The forecasted exponential growth, estimated at 1.4 billion in 2028 of blockchain technology’s agro-industrial value is modest compared to its impact.
Untangling Agro-Industrial Supply Chains, Food Safety & Traceablity
Simply put, supply chains are a series of transactions wherein blockchain is more of a perfect fit rather than just applicable. Specifically, agro-industry goods traverse from producers through logistics companies to bulk handlers before reaching processing plants, distributors and consumers. During transport, substantial losses that amount to roughly one third of agricultural supplies occur.
However, by auditing stocks at checkpoints, distributed ledgers can identify and prevent leaks in agro-industrial supply chains to a large extent. What blockchain solves fully are administrative tasks for producers, previously handled manually for each supplier, broker or logistics company. In turn, producers save money and better timing results in a more dynamic agro-industry overall.
Moreover, traceability, safety and provenance of resources for the agro-industry reflect on the end product’s quality standards and consequentially, pricing. Today’s consumers value sourcing goods from a clean environment using adequate machinery more than ever. As they progressively acknowledge the integrity blockchain instills, producers, retailers and manufacturers are already in the know.
The account of customers rewarding the fruit of honest labor stimulates agro-industry participants to make efforts for embracing blockchain. Hence, the good actors come together as a unit, giving them economic power to implement state-of-the-art technology.
Digitalization and IoT Devices
Emerging technologies such as soil temperature, humidity sensors, digitized irrigation systems or drones are invaluable to the high risk agro-industry. More so, linking data for automated, effective production means faster response times when facing unpredictable weather conditions. Yet, fully digitized internal and external information driven system requires failsafe data storage and transfer mechanisms.
Therefore, blockchain features make it the logical solution for agro-industrial IoT. Integration, because said devices are open targets for cyber-criminals. Instead of introducing a potential liability to production and transport, foolproof distributed ledgers enable and promote innovation.
Concerning quality standards and food safety, blockchain and IoT devices serve a purpose in processing facilities as well. Specifically, machinery and technologies used to deliver a product are just as important to customers as its provenance. Thus, companies vouch they employ proprietary methods in preparing merchandise wherein through permissioned blockchains don’t reveal any trade secrets.
More so, using one blockchain, food processing and packaging plants can self-audit what they place on the market, avoiding recalls. By integrating facility management systems, blockchain optimizes capacity through real-time data on equipment utilization and availability. Very much alike production, monitoring food processing conditions improve operations whereas distributed ledgers grant open testimonials for product excellence.
Improved Oversight of Subsidies
Agro-industrial subsidies account for 700 billion dollars worldwide and the lack of transparency is a glaring issue. Subsequently, some companies receive bloated portions of taxpayer’s money while payments for others come slow or not at all. Herein, blockchain could bring clarity to managing subsidies as well as lowering expenses for reimbursement.
Distributed ledger’s leave no room for exploiting the system, offering fair competition and lift a heavy burden off the budget. Besides lifting the veil of obscurity, automating administrative tasks together with bypassing middlemen, blockchain ensures timely and cost-effective subsidies.
Supporting Sustainable Practices
Regarding sustainability, the scope comprises of use of substances posing a health risk, soil contaminants and irresponsibility towards the environment. Namely, pesticides damage farmland and exposes consumers to health risks, likewise of steroids, while overexploitation of game animals harms ecosystems. Provenance, traceability and end-to end overview of operations powered by blockchain makes environmentally and consumer-friendly practices feasible for the agro-industry.
More so, it serves as a certificate of sorts, wherein companies can boost sales while keeping prices affordable. With respect to edible wildlife, blockchain links suppliers, food plants and retailers, helping to establish sustainability between supply and demand. Whereas resources for strategic food sourcing are expensive for suppliers, mutual value gained across supply chains makes it affordable.
Insurance for the Underserved
In parts of the world where insurance is unaffordable, farmers face going out of business and communities face famine. Just one day ago, thanks to blockchain, Etherisc announced its first payout to farmers in Sri Lanka. Specifically, they joined forces with charity organization Oxfam and insurance provider Aon for reaching out to farmers in underdeveloped countries.
Instead of processing claims manually, the funds saved using blockchain technology enable some farmers to afford insurance in the first place. Expanding coverage to developing countries, blockchain can eliminate uncertainty and late payments by releasing funds based on smart contracts. Using information from independent and global weather reports, the technology upgrades clients’ privacy as well.
Notable mentions of blockchain applications include keeping industry giants from monopolizing markets while aiding smaller farmers through faster global remittance. Community-supported farming, consisting of younger actors should adopt the technology rapidly whereas fair pricing awaits those in underdeveloped areas. Apart from touching financial, ethical and technical dilemmas, blockchain sparks collaboration between both industry leaders and pilots for the poverty-stricken.