
// Blockchain
How to Use Blockchain in Agriculture: 10 Use Cases
// Blockchain
Agriculture is the largest branch of the world economy, the annual turnover of which in the United States alone exceeds $ 1 trillion (1% of the country's GDP).
Moreover, this sector is one of the most inefficient. A huge number of counterfeit and spoiled products, an outdated accounting system, too long and inefficient supply chains, an excessive level of bureaucracy and a lack of transparency are only a small part of agribusiness problems.
And it seems that the only technology that can solve at least some of these problems is the blockchain. We analyzed 150 blockchain startups and identified 10 key areas of application of the new technology: the problem, its solution and the companies that deal with it.
Problem. Studies show that about of fruits and vegetables in developed countries are thrown away due to improper storage and transportation conditions, with 34% of these products becoming unsuitable before leaving the farm. This is mainly due to the fact that neither the farmer, nor the freight carrier, nor the supplier can control the indicators of humidity, temperature, CO2, etc.
Blockchain solution. To track the storage and transportation of agricultural products, you can use special sensors that collect the necessary information and record it in real time in a decentralized distribution book based on the blockchain. So stakeholders (farmers, distributors, consumers) will be able to understand at what stage the product has spoiled, and prevent it in the future.
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For example, the delivery of refrigerated goods to the United States from Africa requires stamps and permits from about 40 people and organizations that interact with each other in more than 300 cases. The total costs of processing documents with such logistics are estimated at between 15 and 50% of the cost of physical transport. At the same time, in such a complex structure, errors and inaccuracies inevitably appear, which lead to cargo idle time and long-term litigation.
Blockchain solution. According to research by the World Economic Forum, the use of new technologies to reduce bureaucratic barriers in logistics and supply chains will increase global trade by 15%, global GDP by 5%. At the same time, according to experts, the blockchain is the only technology that can remove these barriers.
For the agricultural industry, improving supply chains means:
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Much of this growth will result from a combination of three factors:
Blockchain solution. As farmers integrate RFID tags into their business (collect environmental and location data), drones, and artificial intelligence, they will begin to realize that they need an operating environment that will effectively manage all of this and ensure the security of the system and the data collected.
The only contender for such an operating environment is the blockchain. Only this database architecture can provide openness and at the same time security of information storage. Openness is needed because the new FMS will have to provide unobstructed access to data for all parties, and security - because you need to be sure that the information is genuine and protected from falsification.
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The problem is that implementing IoT requires:
Blockchain solution. Blockchain is a decentralized storage of information that can reliably and safely save IoT data. Already developed specialized platforms, sharpened by working with the "Internet of Things" and they have shown themselves well in other industries: scalability, safety and reliability of the technology have been confirmed.
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Blockchain solution. In terms of more honest pricing, new technology can help in several areas:
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Thus, taxpayers financed the cultivation of nuts. Not wheat, not corn, not healthy spinach, but nuts. And the money spent on it is unlikely to pay off in the form of dividends. This is the support of the small farmer. Although in some countries things are even worse. There, 90% of the subsidies go to one or three companies owned by relatives or friends of officials.
Blockchain solution. This is unlikely, but with the blockchain there is hope that at least something in the agricultural subsidies may change for the better. The public may require the creation of a blockchain platform where subsidies will automatically be distributed between those who really need them.
Transparency and open source will allow taxpayers to control the process. In addition, the blockchain and smart contracts, reducing document flow, the number of intermediaries, unnecessary operations, etc., can help simplify these payments in terms of costs.
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Blockchain solution. The new technology will make the lending market global, so that farmers, for example, from Africa will be able to take out loans in European structures on acceptable terms. In addition, the blockchain will allow you to create crowdfunding models where ordinary people can finance businesses from other countries. Now it is difficult, risky and associated with unnecessarily complex bureaucratic procedures. Tokenization will relieve crowdfunding of these problems.
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Blockchain solution. As in the case of lending, the blockchain is able to localize the insurance industry, so that farmers, for example, in Latin America will be able to insure on more favorable terms with European companies.
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This is due to:
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Blockchain solution. Those who are concerned with the methods of growing crops, livestock or fish will be able, thanks to the blockchain, to track down the “history”, for example, of corn from the shelf in the store to the seeds from which it originated. Or salmon “history” from the freezer to the farm on which it was grown. In this case, you can track everything - from the chemical composition of fertilizers to DNA.
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