Why Agriculture Must Adopt Blockchain?
Blockchain technology is increasingly gaining adoption in various industries, including agriculture. The agricultural supply chain is a complex system that involves multiple stakeholders, including farmers, intermediaries, traders, processors, and retailers. The supply chain is prone to various challenges such as fraudulent activities, product mislabeling, inefficient logistics, and lack of transparency, which can lead to significant economic losses.
Adopting blockchain technology can help address these challenges by providing a transparent and secure platform for recording and tracking all the activities in the agricultural supply chain. In this blog post, we’ll look at the benefits of adopting blockchain in agriculture, the steps to build a blockchain platform, and how to adopt blockchain for agri products supply chain.
What is Blockchain and its Market Size
Blockchain is a decentralized, immutable, and secure digital ledger that records transactions and stores data in a transparent and tamper-proof manner. According to a recent report by MarketsandMarkets, the global blockchain market size is projected to grow from $3 billion in 2020 to $39.7 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 67.3%.
Benefits of Adopting Blockchain in Agriculture
Adopting blockchain technology can provide significant benefits such as increased transparency, reduced fraud, and efficient logistics. Blockchain can provide a permanent and immutable record of all transactions, including the origin, quality, and quantity of the products, as well as the certifications and licenses required to sell them.
Steps to Build a Blockchain Platform
Building a blockchain platform for the agricultural supply chain involves several steps, including designing the architecture, selecting the appropriate blockchain protocol, building smart contracts, and integrating the platform with other systems. Open-source blockchain platforms such as Hyperledger Fabric, Ethereum, and Corda can be used to build a blockchain platform for the agricultural supply chain.
Steps to Adopt Blockchain for Agri Products Supply Chain
Adopting blockchain for Agri products supply chain involves several steps such as onboarding stakeholders, digitizing the existing data, setting up smart contracts, and integrating the platform with other systems. It is important to ensure that all the stakeholders are willing to participate in the blockchain platform and that the data is standardized and digitized for easy integration.
Adopting blockchain technology in the agricultural supply chain can provide significant benefits such as increased transparency, reduced fraud, and efficient logistics. Building and adopting a blockchain platform for the agricultural supply chain requires careful planning and coordination among all stakeholders. With the increasing market size of blockchain technology, it is imperative that the agricultural industry adopts blockchain to stay competitive and address the challenges of the supply chain.
It can have various applications in agriculture, such as:
- Tracing of food products: Blockchain can enable consumers to know where their food comes from, how it was produced, and whether it meets quality standards. It can also help farmers get fair prices for their produce and reward them for good farming practices.
- Enhancing agricultural supply chains: Blockchain can improve the efficiency, transparency, and trust among different actors in the agricultural supply chain, such as farmers, processors, distributors, retailers, and consumers. It can also reduce costs, risks, and frauds by enabling smart contracts.
- Modernizing farm management software: Blockchain can help farmers manage their farm inventory, resources, inputs, outputs, and finances more effectively. It can also facilitate data sharing and collaboration among different stakeholders.
- AgTech IoT optimization: Blockchain can enhance the use of Internet of Things (IoT) devices in agriculture by providing a secure platform for data transmission, storage, and analysis. It can also enable smart farming solutions such as precision agriculture.
Blockchain is a technology that can improve the efficiency, transparency, and trust among different actors in the agricultural supply chain, such as farmers, processors, distributors, retailers, and consumers. It can also reduce costs, risks, and frauds by enabling smart contracts12. Some of the benefits of blockchain for agricultural supply chains are:
- Simplifying all stages of the agricultural supply chain: Blockchain can enable faster and easier transactions among different parties by eliminating intermediaries and paperwork. It can also provide a single source of truth for all data related to production, quality, quantity, location, ownership, and movement of agricultural products.
- Tracking a product along its entire path from farmland to store shelf: Blockchain can enable traceability and provenance of agricultural products by recording every step of their journey on a shared ledger that cannot be tampered with. This can help consumers verify the origin and quality of their food and help producers comply with regulations and standards.
- Improving food safety and eliminating counterfeit items: Blockchain can help prevent food contamination and adulteration by providing real-time information on food conditions such as temperature, humidity, freshness, etc. It can also help detect and remove counterfeit or substandard products from the supply chain by verifying their authenticity.
- Reducing financial risks and promoting inclusive trade: Blockchain can enable secure and transparent payments among different parties by using cryptocurrencies or digital tokens that are backed by real assets. It can also facilitate access to credit and insurance for small farmers who may lack formal documentation or collateral.
- Providing farmers and businesses with access to agricultural financial services: Blockchain can enable farmers and businesses to access various financial services such as loans, savings accounts, remittances etc. through decentralized platforms that are powered by smart contracts. These platforms can offer lower fees , faster transactions ,and greater inclusion than traditional financial institutions.
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