Improving Agriculture Techniques Using Blockchain Technology
Posted By : Anirudh Bhardwaj | 22-Jan-2020
Agriculture acts as the backbone of the economic system as it plays a critical role in improving the economy of a country. According to Statistics Times, the Agriculture industry alone represents 6.4 percent of the world’s total economic production. It contributes a whopping sum of $5,084,800 to the world economy every year and provides employment opportunities to millions of people worldwide. The United States Department of Agriculture reveals that the industry provides bread and butter to more than 21.4 million individuals locally. However, there are several complexities in modern-day agricultural techniques, mainly related to the food supply chain.
The supply chain is an essential part of the Agriculture industry which plays a major role in delivering the farm productions to warehouses. That being said, a majority of the food supply chains involve a lot of intermediaries, operating at different levels. However, there is a lack of transparency between the supply chain processes which is mainly responsible for long delays. Implementing blockchain technology in agriculture can significantly improve the supply chain processes and increase production efficiency.
At Oodles, we have discovered innovative ways to streamline agriculture processes with blockchain development services. Over the years, we have received several requests for implementing blockchain in the supply chain processes. We have devised effective techniques of blockchain implementation that will maximize the agricultural growth with increased security, transparency, and traceability.
Let’s explore how blockchain technology can improve processes in agriculture and the food supply chain.
Applications of Blockchain In Agriculture
Below are the four innovative applications of blockchain in agriculture that can significantly impact crop production and improve farming techniques.
Increased Production Efficiency
Catering to the needs of the increasing global population can be a challenging task in the near future. According to Food and Agricultural Organization (FAO), at least 60 percent of the global population rely on agriculture. However, there is a dearth of security and transparency at different levels of communication which directly impacts the production efficiency.
Implementing the next-gen technologies like blockchain and IoT can significantly improve farming techniques by optimizing resources like water, labor, and the use of fertilizers.
Blockchain, at its core, is a distributed ledger technology that creates a tamper-proof record of the stored data. Present-day agricultural processes produce large chunks of data related to production, payroll, finances, and weather conditions. As of today, this data is stored in centralized servers having a single point of failure. The use of blockchain-based Interplanetary File System (IPFS) enables warehouse managers to store the valuable enterprise data in a secure and transparent manner. Upon storage, the data is distributed across every node and is easily retrievable.
Also read Understanding Blockchain as a Service.
Streamlined Food Supply Chain
The supply chain is an essential element of the food and agriculture industry. A majority of food retailers and merchants rely directly on the supply chain for the procurement of food items. Upon harvesting, the crop production is passed on to the warehouses and then the supply chain comes into action. However, slight inconsistencies in supply chain processes directly impact the market value of various food articles and cause uneven delays. According to Food and Agriculture Organizations (FAO), at least one third of the worldwide food production is wasted annually due to inconsistencies in the supply chain. These losses in food production add up to 1.3 billion ton every year.
The advent of blockchain has made it possible to strengthen the food supply chain ecosystem with increased trust, security, and transparency. Blockchain implementation will enable consumers to backtrace the supply chain to obtain useful information about food processing.
Blockchain creates a tamper-proof record of the essential information such as transportation details, factory data, batch numbers, expiration details, and more. All these entities are digitally linked to the food items and are cryptographically protected within the blockchain. In addition, blockchain enables stakeholders and warehouse managers to monitor food quality at every level and accelerates the food processing cycle.
The farmers living in remote areas have to face many environmental challenges. They often fall prey to harsh weather conditions due to obsolete and ineffective weather forecast mechanisms. FAO reveals that the annual financial losses due to natural disasters have reached up to $300 billion.
To overcome these challenges, researchers have proposed the use of Internet of Things (IoT) equipment in conjunction with the next-gen technologies. While several agriculture agencies are using technologies like AI and IoT to improve their farming techniques, they are yet to embrace blockchain.
Implementing blockchain in weather forecasts will enable farmers to deal with the potential weather crisis by taking timely preventive measures. Different weather stations can transmit the essential weather details to a blockchain-based weather monitoring system. Farmers can analyze this data to choose the best possible course of action to save their crops. Another significant benefit is blockchain-based crop insurance. Unlike conventional insurance plans, blockchain provides greater flexibility, transparency and provides a fair settlement mechanism using smart contracts.
You may also be interested in reading Integrating AI with Blockchain.
Effective Finance Management
Blockchain is the most apt example of a financial digital ledger that was primarily used to strengthen a wide range of financial applications. As of today, it seems to be the right solution to overcome the increasing financial disturbances in the agricultural landscape.
By implementing blockchain to handle financial transactions, we can significantly reduce payment delays, unfair payoffs, and theft instances. It also aids in conducting a fair audit of recorded transactions at every stage of operations.
The Future of Blockchain in Agriculture
Blockchain has great potential and is already transforming the financial sector. Nevertheless, the versatile features of this ledger technology and its flexible architecture have made it suitable for an increasing number of business applications. The agriculture industry can achieve several benefits from blockchain implementation that include better quality control, faster food processing, Improved supply chain processes, increased farmer efficiency, and fair payment processing. As the time goes by, we are going to see many other use cases of blockchain in agriculture, thereby making the processes fast and more efficient.
Why Choose Oodles Technologies For Blockchain Development?
We are a seasoned blockchain app development company that builds secure, user-centric enterprise applications using blockchain technology. Our development team analyzes your business requirements and formulates effective strategies to improve operational efficiency through blockchain implementation. We have successfully implemented blockchain in the supply chain processes for improved process efficiency with increased transparency and traceability.