Blockchain in Agriculture

Agricultural blockchain solutions can address many important industry challenges such as food tracking, food quality and safety, monitoring, and weather forecasting. It helps improve the efficiency, transparency and accountability of the agricultural value chain and enhance trust between network participants. Blockchain makes it possible to store data that various actors and stakeholders generate throughout the entire process of producing an agricultural product from seed to sale. It ensures that the data and information are transparent to the involved actors and stakeholders and all recorded data are immutable.

The transparency of blockchain evokes stakeholder contribution to developing the African agricultural value chain. Over time, the database created using blockchain can be used to inform decision-making on where to best apply resources across the value chain. Data captured during the farming process allows for data-driven facilities and insurance solutions to be developed to make farming smarter and less vulnerable. Blockchain helps producers establish a trust relationship with consumers and build up the reputation of their products by transparently providing individual product information. This encourages healthy competition amongst producers and improves the quality of products in the agricultural and food sectors. For consumers’ blockchain enables access to true and reliable information about how food is produced and transacted. It helps address consumers’ concern about the safety, quality, and environmental friendliness of food.

Blockchain reduces the need for farmers to break their contractual agreements by side-selling to another buyer often at a lower price to meet current liquidity needs. This practice is caused by long delays in payments due to logistical challenges, liquidity constraints and heavy friction in transactions. Smart contracts enable payment process automation, which will allow for the disbursement of payment upon the receipt of goods. This provides real-time payment and increases the working capital of farmers and all value chain actors.