Blockchain has the power to change agriculture for the better, and the number of use cases for the technology is increasing by the day.
Here is how blockchain technology is currently revolutionising the agriculture sector.
What is blockchain?
Blockchain is a form of distributed ledger technology (DLT). Functionally, it is not dissimilar from a Microsoft Excel spreadsheet. People add information where necessary so it can be shared with others who can view the information.
One essential aspect of blockchain is that the ledger is immutable, meaning it cannot be altered to show false information. This is achieved because a blockchain is distributed and hosted across a number of computers.
Since it is distributed, it is also decentralised. This ensures that no singular authority retains full control over the network. This is one of the reasons why blockchain is useful for storing information.
Without a central authority, there is no singular location for the blockchain to be hacked. This helps maintain the integrity of the blockchain.
Improving the supply chain
Blockchain technology can be used to trace information. One application of this is to trace products through a supply chain.
The supply chain is a pivotal part of the agriculture process, since a number of resources need to be sourced from various locations.
By employing blockchain technology, companies and businesses can watch over the entire supply chain to guarantee the entire process is ethical and legal.
Businesses can then show details of the supply chain to their customers to prove it is fully compliant with laws and regulations.
In doing so, this helps build trust with the consumer, which in turn can help grow the business.
Peer-to-peer agriculture
Another useful application for blockchain in agriculture is that it can help facilitate peer-to-peer trades.
Blockchain is used as the underlying technology in cryptocurrency, which enables investors and traders to send and receive cryptocurrency without the need for a middleman. This could be extrapolated to agriculture as well.
For instance, if one agriculture business had spare poultry but was lacking the resources to feed the poultry, but another business had the reverse situation, the two businesses could agree to do a trade with each other and conduct the transaction over blockchain.
Lower costs
Agriculture businesses rely on having products/items shipped to them or sourced from another location. However, since a lot of places demand a fee for doing so, low-income agriculture businesses suffer.
However, as the middleman is eliminated with blockchain technology, there would be no service charge or commission fees for trades or purchases made over the blockchain. This in turn can help businesses with cost cutting, allowing them to put extra capital directly into their agriculture business.
With blockchain being entirely transparent, businesses can also check to ensure they are getting real-time prices for their produce.
Improved stock-taking
With blockchain, the stock-taking process can be streamlined to become more efficient.
A lot of the time, taking stock is largely a manual process which leaves room for error. By incorporating blockchain, this margin for error will be reduced.
Once the entire stock has been catalogued on a blockchain, any future sales and purchases conducted on the blockchain will update the stock in real time.
Blockchain in agriculture
Blockchain is a technology designed to enhance experience and work flow, and it could assist the agriculture industry by streamlining processes and improving efficiency.
Hopefully this introduction to blockchain in agriculture has helped you understand the applications of blockchain technology. It certainly isn’t limited to cryptocurrency as many would believe.
Interested in reading more about blockchain disrupting industries? Discover how blockchain could help drive a sustainable future.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.