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The Current Status of Blockchain in Agriculture

By Guest Writer on October 4, 2017

blockchain in agriculutre

“I am so excited about blockchain! Can you tell me what it is?”

With this, Hugh McDonough opened the panel, “Blockchain for Ag: Demystified and Demarcated”, at ICTforAg 2017 and explained that blockchain is shared record book that records and tracks transactions and possesses three qualities that differentiate it from other digital technologies:

  • It is an immutable record. It cannot be changed, only added to.
  • It cuts out intermediaries. No tellers, clerks, or delays
  • It is very secure. To hack a blockchain, someone would have to hack every device involved in the blockchain, at the same time.

As the session pannelists summarized, blockchain in development can ensure trust and alignment across the value chain. It can reduce middle man costs, and allows relevant stakeholders to do business with each one another securely without even knowing each other. This transformative technology can dramatically disrupt the way we approach development.

A 2016 World Economic Forum financial infrastrucutre report called blockchain technology a “mega-trend” that will shape society in the next decade.

Blockchain in Development

The development community has begun to realize this technology’s potential for addressing problems of identity, ownership, fraud, and corruption. But amidst all this talk, few have been successful in actually implementing a blockchain solution.

Audience questions during the panel session made it clear: Development and agricultural practitioners want to know how they can use a blockchain solution in their own work. To start, there are several blockchain models to choose from, including “public” and “private” versions.

Blockchain for Agriculture Examples

While taking the first step in understanding blockchain may seem daunting, blockchain evangelists like ICTforAg panelists Ish Goel, Mark Tracy and Violanda de Man prove it is worth the effort. All three are innovating with blockchain to create real-world impact.

  • Ish Goel of Somish is using Blockchain-based digital tokenized currency for the Bank of Papua New Guinea. The tokens can be exchanged for fertilizer for small farmers. Because the tokens are on a blockchain, they cannot be misused or imitated, ensuring that the government-allocated funds are creating maximum impact where intended.
  • Mark Tracy at Cargill Risk Management is looking at using blockchain to create immutable land titles to prove ownership and protect farmers from widespread corruption and digitization of paper contracts into smart contracts to improve efficiency and minimize costs. Smart contracts also offer increased transparency; ensuring contracts cannot be altered without the farmer knowing.
  • Violanda De Man at ICS is developing accessible, affordable crop insurance in East Africa. In a world where poor farmers are made to pay high premiums, ICS’s blockchain solution cuts out the middlemen, providing low-premium, affordable crop insurance to rural farmers. She hopes to reach this technology to 10 million farmers in the next five years.

Blockchain Challenges

There are still obstacles to widespread blockchain adoption, in every country, including:

  • A lack of widespread understanding of what blockchain is and how to use it.
  • The difficulty of integrating the technology into existing infrastructures and bureaucracies.

Yet the international development community has been implementing creative solutions for decades, so who better than development practitioners to leverage in-country knowledge to introduce cutting-edge, impact-driven solutions through blockchain?

We are on the edge of a blockchain revolution. Together, we can truly #blockchaingetheworld.

By Mira Ahmad, Business Development Coordinator at Abt Associates.

Filed Under: Agriculture
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3 Comments to “The Current Status of Blockchain in Agriculture”

  1. Al Chen says:

    The second benefit of blockchain (removing intermediaries) may hinder the development of one of the challenges of blockchain: getting widespread understanding of the technology.

    In the international migrant worker recruitment industry (the focus of my project), intermediaries (recruitment agencies) are prevalent. Instead of trying to “cut them out,” we believe in utilizing them as an ambassador of the blockchain. Since workers are physically going to recruitment agencies to register for work abroad, this represents a huge opportunity for agencies to educate and train hundreds of workers about registering their identities on the blockchain. In blockchain speak, these agencies can represent “nodes” in the network.

    • Wayan Vota says:

      Great point about intermediaries! Too often, I see them described in negative terms, when that do actually provide valid services. We may debate the prices they charge, but they are doing work that few others want (or can) do.

      • Al Chen says:

        Thanks Wayan! The prices recruitment agencies charge are indeed debatable, but we still see them as an integral part of the supply chain since they can educate and and disseminate valuable information to migrant workers during the application process.