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The technology behind cryptocurrencies such as Ethereum and Bitcoin, the blockchain, has shown its potential in the financial industry. The technology has taken the world by storm and is slowly making its way into other industries, such as healthcare, insurance, and food industry to name a few.
Today, we will be taking a look at one of the largest sectors in the world, responsible for feeding billions of people every day, the agriculture industry. Agriculture faces a lot of challenges, which the industry can overcome with the integration of blockchain technology. To help you understand the true potential of blockchain technology in the agriculture industry, here are five advantages:
Better and faster options for payment
One of the biggest challenges faced by the farmers who form the foundation of the agriculture industry is the fact that they don’t get their share. As they are the most important segment of this industry, it is vital that they get their payments on time, which allows them to continue growing food and meet the ever-increasing demands of the world.
Even though farmers with smartphones can use mobile banking services like micro-financing, they still have to pay high fees for every transaction. However, with the introduction of blockchain technology, it removes the need for third parties in such transactions. As a result of this, farmers can make transaction fees at almost no or negligible costs every time. Farmers don’t have wait for several weeks to months, to receive payment for their produce. Also, as the risk of providing financing options to the farmers reduces, banks can come up with better solutions to help them.
Easier recognition of authentic products
Another problem that blockchain can tackle easily is recognition of authentic products. These days, retailers are selling products which are substandard or fake as it allows them to increase the profit margin at a fraction of their expenditure. There are also situations when the retailers don’t know if they are purchasing authentic products. Due to this reason, a large number of companies who sell authentic agricultural products are losing out huge sums of money every year. At the same time, it impacts their brand image as the fake products don’t have the same quality.
Blockchain will overcome this problem, as it becomes easier for the companies to keep their products. Similarly, retailers and farmers can check if the products they purchase are authentic, by verifying them with the help of the blockchain.
Enhancement in logistics
In the agriculture industry, logistics is extremely important as it involves transportation of goods and products with a small shelf life. Even the smallest delays in transportation will cost businesses thousands of dollars as the products can expire. Similarly, there are situations when the supply doesn’t meet the demands of the consumers.
Blockchain will help in creating a better supply chain as businesses can keep track of the vehicles transporting the products. Also, if there is an increase in demand, the businesses can communicate the same with the producers, to ramp up the supply.
Improvement in food safety
As it isn’t easy to keep track of tons of produce regularly with conventional systems, there are times when they get contaminated by dangerous microorganisms, such as E.coli. If E.coli spreads to the end of the food chain, which is the consumers, it will start spreading diseases.
Blockchain can improve food safety as they can monitor food quality and transport schedules. For example, if a particular third party didn’t use safe methods of transportation or they took a longer time than usual, the retailer only has to check those products. In the same way, if there is a contamination, they only have to recall a small portion of their products.
Proper identification of food source
With food adulteration becoming the headlines off late, consumers are more suspicious of the products they purchase from retailers. The agriculture industry loses billions of dollars every year because of food adulteration. There is an increase in food allergies, due to which consumers want to know the exact source of every agricultural product. Also, they want organic produce, but the companies don’t have an efficient or accurate method of identifying the sources of food.
Blockchain technology will help in the identification of food source, as the entire network becomes transparent. With this technology, it becomes easier for consumers to keep track of all types of information. For example, the consumers will know if the farmers used natural methods or chemicals to grow their food. They can even know the different types of chemicals used by the farmers.
Blockchain technology is the future of the agriculture industry, as it benefits everyone involved, right from the farmers to the retailers. It possesses the potential to solve a large number of problems!
Brought to you by BlockchainSingapore.