April 9, 2018 | By Elizabeth Leake

Guest Commentary - Blockchain and the Future of Agricultural Markets

Photo by Malcolm Carlaw (Summer Wheat beginning to ripen in the Palouse region; used with the photographer’s permission)
 
By Elizabeth Leake, STEM-TREK Nonprofit
Given the many non-financial applications for blockchain that have cropped up ever since cryptocurrencies gave it a controversial reputation, more people have become "blockchain-curious." Experts are increasingly interested in uses that improve value chains in agricultural food systems in low and middle-income countries. Because more people in these areas earn a living from agriculture, blockchain stands to alleviate poverty while improving food security prospects for everyone.
 
According to analysts who work for International Business Machines (IBM), blockchain is “a shared, unalterable ledger for recording the history of transactions. It increases trust, accountability, and transparency across business networks.” By enabling smart contracts between individuals anywhere around the world, there is no need for centralized support or oversight, such as legal, banking, or title companies, brokers, or other steps that add cost and opportunities for fraud. A decentralized ledger can still be tampered with, but with blockchain’s transparency, it is easier to detect if something has been altered. As for efficiency, IBM Global Financing reportedly saved as much as 75 percent of the time required to mediate transaction disputes among 4,000 partners and suppliers using a blockchain distribution management solution.
 
To economists and business managers, 75 percent savings is nontrivial. This explains why the Consumer Goods Blockchain Forum—with representation from such commercial giants as Nestle, Walmart, Proctor and Gamble, and McDonalds—is rapidly employing blockchain.
 
Medical and pharmaceutical industries are also embracing blockchain to secure public health and personal information and to safeguard consumers against counterfeit drugs. There are also blockchain enthusiasts in agricultural and related industries investigating its use in insuring global food security. While most of us have become wise to counterfeit software, telephony, and designer handbags, few realize the same deceptive practices can affect food, feed, seed, and agricultural supplies. A compromised herbicide or pesticide, for example, might not be identified until after a crop fails. It could take years and declining health before some realize they are not receiving promised fortifications.
 
Blockchain effectively tracks the provenance of raw materials and commodities. For example, by capturing GPS coordinates when and where cocoa is harvested, producers can verify that best and sustainable practices are being exercised, preventing irresponsible deforestation. This information can also be used to track how rare earths used in electronics are mined to ensure that forced or child labor are not involved.
 
Mitigating disputes and crime robs time and money from the value chain. Therefore, international policing agencies can use blockchain to combat fraud. While bad actors can still dump junk into the market, with blockchain’s ability to offer immediate traceability, they will be discovered more quickly and issues will be resolved faster. In essence, it would cost more for criminals to cheat a blockchain system than the cheat is worth because associated risks and penalties are much higher.
 
Crossing from the virtual to physical realms will require a “follow the product solution,” and that is what Netherlands-based FOCAFET Foundation is developing. Designed with the goal of becoming 100 times more efficient and 1,000 times more secure than current methods, FOCAFET’s “virtual Internet of entities” employs a bar code that cannot be copied. Unique product attributes, like a seed’s genetic makeup or a product’s exact chemistry, are recorded in blockchain ledgers. These characteristics are then followed through each step of the supply chain, including where and how it was produced, until delivery. Using a mobile device, the end-user scans the bar code and the product’s authenticity and integrity are immediately verified. The mobile app will accommodate a broad range of devices (considering that some people will use older hardware) and is interoperable with about 80 spoken languages. Additionally, it will seek community feedback in an interest of continuous improvement.
 
Food security blockchain enthusiasts are encouraged to join the CGIAR Platform for Big Data in Agriculture’s “Blockchain Coalition,” which is emerging from the Platform’s Socio-Economic Data Community of Practice (SED-CoP) led by Gideon Kruseman (CIMMYT). Since the CGIAR Platform collaborates with stakeholders at 15 research centers and 12 research programs around the world, the Coalition will draw leading specialists who can work together to shape the future of blockchain’s use in agriculture. To join the SED-CoP, visit the platform website and complete the form.
 
The state of global blockchain culture is a theme for STEM-Trek’s July workshop called DIGI-FI@PEARC18. The workshop will take place during the Practice & Experience in Advanced Research Computing (PEARC18) conference in Pittsburgh, Pennsylvania, July 22-25. Watch the STEM-Trek site for updates.
 

About

The Global Food and Agriculture Program aims to inform the development of US policy on global agricultural development and food security by raising awareness and providing resources, information, and policy analysis to the US Administration, Congress, and interested experts and organizations.

The Global Food and Agriculture Program is housed within the Chicago Council on Global Affairs, an independent, nonpartisan organization that provides insight – and influences the public discourse – on critical global issues. The Council on Global Affairs convenes leading global voices and conducts independent research to bring clarity and offer solutions to challenges and opportunities across the globe. The Council is committed to engaging the public and raising global awareness of issues that transcend borders and transform how people, business, and governments engage the world.

Support for the Global Food and Agriculture Program is generously provided by the Bill & Melinda Gates Foundation.

Blogroll

1,000 Days Blog, 1,000 Days

Africa Can End Poverty, World Bank

Agrilinks Blog

Bread Blog, Bread for the World

Can We Feed the World Blog, Agriculture for Impact

Concern Blogs, Concern Worldwide

Institute Insights, Bread for the World Institute

End Poverty in South Asia, World Bank

Global Development Blog, Center for Global Development

The Global Food Banking Network

Harvest 2050, Global Harvest Initiative

The Hunger and Undernutrition Blog, Humanitas Global Development

International Food Policy Research Institute News, IFPRI

International Maize and Wheat Improvement Center Blog, CIMMYT

ONE Blog, ONE Campaign

One Acre Fund Blog, One Acre Fund

Overseas Development Institute Blog, Overseas Development Institute

Oxfam America Blog, Oxfam America

Preventing Postharvest Loss, ADM Institute

Sense & Sustainability Blog, Sense & Sustainability

WFP USA Blog, World Food Program USA

Archive

Interview with Lindiwe Majele Sibanda

Lindiwe Majele Sibanda, chief executive officer and head of mission of the Food, Agriculture and Natural Resources Policy Analysis Network (FANRPAN), highlights the need to invest in women farmers to boost agricultural production and the intersection between scientific research and agricultural development.
 


Photo of the Week

Anonciata Mbakirirehe of Kayenzi, Rwanda, stands amid her newly germinated maize.


Interview with 2013 Next Generation Student Jose Pablo Soto-Arias

Jose Pablo Soto-Arias, a plant pathology student at the University of Wisconsin-Madison, describes his work on food-borne plant pathogens as well as the importance of supporting new agricultural research and young scientists in the field of food security.
 


Interview with Cynthia Rosenzweig

Cynthia E. Rosenzweig, senior research scientist at the NASA Goddard Institute for Space Studies, discusses the important role of research and education to help mitigate impacts of climate change.



Photo of the Week

Beatrice Wasike of Victorious, Kenya, shows off the millet she harvested this season. Beatrice harvested 8 bags of millet from a quarter acre of land.




Photo of the Week

Farmers in Kibachenje, Kenya, look through enrollment materials for the 2014 season.




Photo of the Week

Like most women in the Maasai community in Kenya, Elizabeth Talash Naikoni is up at dawn to milk her cows.


Interview with Ren Wang: Empowering Smallholder Farmers

Ren Wang, assistant director general of the UN Food and Agriculture Organization, explains why we must support smallholder farmers through knowledge, market access, and technology in order to achieve global food security.



Video Notes - Ruth K. Oniang'o on the importance of empowering women farmers

Ruth K. Oniang'o, Founder and Editor-in-chief of the African Journal of Food, Agriculture, Nutrition and Development, as well as the Founder and CEO of Rural Outreach Africa, addresses gender mainstreaming in agriculture and how empowering women farmers can improve nutrition and health.