Block chain and the future of agriculture

Block chains can improve the sustainability of supply chain of various scale farmers

Agriculture is one of the most important industries on earth. Without it, it will not be able to meet the food demand of growing population on the earth. However, agriculture is facing a wide range of challenges. This means that if the industry continues to meet consumer needs and provide people’s safety, nutrient food, new transformation innovation is needed.

Agricultural issues include world hunger, climate change, global warming, global supply chain issues, resources and soil depletion, water resources, food waste, food quality control, and the income of small farmers around the world.

Block chain technology may not be a meter of universal, but it can help transfer information and resources into important agricultural stakeholders, and by taking this innovative means may help solve many of them.

Through its novel distributed book technology (DLT), block chain technology can create a safe and accurate data sharing area between governments, farmers and non-profit organizations. It can also provide innovative financial solutions through the DEFI protocol, thereby reducing the cost and risk of small farmers.

In this article, we will review some key issues in the current agricultural ecosystem, while discussing solutions that can be provided by the block chain. Specifically, we will discuss the potential impact of the block chain on the following:

Reduce the world hunger by improving the food distribution mechanism to improve the climate change to improve agriculture through improved information sharing to reduce food waste through improvement of supply chain management to help increase food quality through encrypted currency and block chain to help small farmers will guarantee the small farmers. Un affected zone chains that are affected by climate reasons can help reduce world hunger

At present, the United Nations estimates that more than 690 million people are currently in food supply, including 38 million in the United States. Some people estimate that by 2030, the number of hungry will increase to more than 800 million. The United Nations also estimates that by 2050, the world population will grow to amazing 9.7 billion, solve agricultural issues to create a more fair food distribution mechanism, will become more important in the future.

Although the direct or unique cause of most food shortages is poverty, there is also a reason for the lack of available food supplies, especially in developed countries.

By integrating data from all aspects from the food supply chain, from seeds to harvesting, packaging, sales, transportation and resale, crops and livestock production can be more accurately estimated. This helps balance the supply and demand relationship to ensure that food streams are actually required, not just where farmers and distributors think possible.

Fraud will exacerbate the shortage of food. Agricultural fraud is usually manifested as false, contaminated, low quality or only part of food. At present, the fraudulent behavior of agriculture has reduced food supply and further increases the price cost of this already caught in trouble. By creating a non-variable classification account for each link of the supply chain, the block chain can suppress fraud, data manipulation and poor management, thus reducing food prices for the most vulnerable people.

Block chains have potential positive impact on climate change and global warming

Most scientists agree that global warming is one of the main environment, social and political issues in the 21st century, and an important factor in this warming is human carbon dioxide emissions. Global warming is expected to lead to a variety of serious environmental and economic issues, including flooding, drought, harsh weather events, such as crop shortages and other agricultural issues.

Although global warming is certainly possible to explore agriculture in some areas of the world, especially in the cold weather, it may be disastrous to the overall impact on global agriculture.

According to EPA research, if the temperature of a certain region is raised over the “most suitable temperature” of the crop, crop yield may be seriously affected. However, not only the temperature increase will affect crop yield, but a report of EPA also pointed out that “the reduction in protein and nitrogen content in alfalfa and soybean plants is related to the increase in carbon dioxide, resulting in a decline in their quality.” Report supplement “” The decline in cereals and forage quality reduces the supply capacity of pastures and pastures that grazing livestock. “

In addition, the US Environmental Protection Department pointed out that “in 2010 and 2012, the high temperature in the night has affected the production of the American corn production zone, in 2012, due to the premature buds of warm winter, Michigan cherry losses $ 22 million.” This is just The rise in temperature causes one of many examples of crops.

Block chains may not directly affect crops loss caused by climate change, but it can bring many new methods to incentive mechanisms and personal levels of energy conservation and reduce carbon dioxide emissions. At the personal level, the block chain app has enabled individuals with energy-saving to sell excess energy to others. This will motivate individuals to reduce energy usage, thereby reducing the discharge of global carbon dioxide.

Influence of block chains on ESG

In the organization level, ESG (Environment and Social Governance) is one of the fastest growing points of investors in multinational corporations. This is especially true for energy production and agricultural companies. Billion US dollars flows into funds and companies that are implementing a large number of ESG programs, but these statements are still the most worried and concern. [Volume Chain] Add fine grain tracking … It is possible to provide an extremely important transparency for the initiative of various ESGs around the world.

By using block chain technology, companies can alleviate investors’ concerns about the true impact of enterprises ESG initiatives. Due to the interposition of the block chain database, it can effectively track the supply chain, and can even track carbon emissions by direct connection to the IOT (Internet of Things) hardware devices placed in power plants, manufacturing facilities, or farms.

The Global Energy Company Respol has implemented block chain technology in its supply chain. Respol converts physical assets (such as plastic or natural gas) to digital assets that can be tracked all nodes in the supply chain. This fine tracking is possible to provide important transparency for various ESG initiatives around the world.

The block chain can also facilitate the creation and use of digital ESG bonds. In 2018, the World Bank issued the first $ 83 million block chain bonds, which attracted investors including the Australian Federal Bank of the Australian to issue the bond. These bonds include the need to report intelligent contracts such as carbon emissions, pollution, and overall energy use.

Block chains may reduce food waste by improving data and information sharing

According to the US Department of Agriculture, 30% to 40% of the food in the United States were wasted, although in fact, nearly 40 million Americans experienced food without guarantee. Waste food can lead to rising food prices, and this will only make poverty Americans get food. However, this problem is not limited to the United States, and similar food waste rates have also plagued many developed countries and developing countries.

[Block chain allows] Companies better understand how much food they should produce at a specific period, thereby reducing waste in the entire supply chain.

In addition, all waste of food will drag the economy, estimated $ 218 billion, costly costs in removal, production and transportation of unbeatened foods, which are usually finally filled.

By using block chain technology to create a non-variable classification tracking supply chain, combined with predictive analysis of weather conditions and customer needs, companies can better understand how much food they should produce in a specific season, thereby reducing the entire supply chain. waste.

In addition to the growers itself, innovative block chain applications are trying to reuse unused foods to help hungry people. GoodR has developed an app that helps the restaurant transports unused leftovers to local charities. The company uses block chain databases to accurately tell the restaurant where they waste which foods are wasted when they areted, and how much wasted, which should help them use a more sustainable food practice.

The municipal authorities and the government can also use this type of cooperation and to avoid food waste, track waste, and reduce taxpayers.

The block chain can improve the quality of food by better supply chain management

In addition to food shortages, global hunger, food waste and climate change, food safety is another most pressing problem in farming in the farming. According to the World Health Organization (WHO), it is estimated that 600 million people have been sick after edible food, resulting in approximately 420,000 prevention dead.

After a series of embarrassing food safety scandals, Wal-Mart developed the block chain technology throughout its entire agricultural supply chain. This food and retail industry giants cooperate with IBM, and now is a member of the IBM Food Trust source project, which helps food companies track their products from the initial farm or factory to the entire distribution chain.

In many cases, the products that reach the giants like Wal-Mart have to go through more than 20 to more than 20 to more than 20 supply chain sites before arriving at the consumer, which makes it extremely difficult and time consuming that the source of the contaminated food is found. Lack of data forcing the company to withdraw a large number of products from the shelves, sometimes unnecessary, while still facing the risk of future pollution.

Take Wal-Mart as an example, the company now requires most of its suppliers and distributors to use IBM block chain tracking systems. According to reports, the system is very comprehensive, so that each product sold can be traced back to the farm Рsometimes even producing its fields. Other companies in cooperation with IBM Food Trust include Nestl¨¦, Duero, Croch, Tyson, Drescol and McLean.

The block chain can help the small farmers by encrypted currency, DEFI microfinance and block chain.

Small farmers are an important part of agricultural ecosystems, especially in developing countries. In the smaller community in developing countries, local farmers may be the only food source of the whole town.

However, due to the credit that the big company is easy to obtain, independent farmers are often in trouble. Many local farmers are one of the $ 1.7 billion adults currently without a bank account. According to the World Bank, despite a lot of people with a large number of bank accounts, “one-third of them has a mobile phone that can get financial services.” Farmers can use encrypted currency applications to get small loans to maintain and expand them. Business.

With the increase in encrypted monetary exchanges, wallets and applications, and the development of stable coins, block chain technology can usually replace banks for many small farmers. Farmers do not have to wait for the object to exchange their crops, farmers can easily use Bitcoin or Ether as-astrous wallet to receive their goods funds.

Local farmers can also use block chains and encrypted bank applications to purchase essentials and services such as fertilizers and farm tools to maintain and support their agricultural operations. In addition to paying the supplier’s cost, encryption banks can also be used to pay wages to workers to expand local agricultural operations and increase food supply and may reduce prices.

At the consumer level, individual customers can also use encrypted currency to pay food costs, which provides a powerful alternative to traditional banks in areas where it is difficult to find or unable to provide such services.

In addition to paying or receivables directly or receivables, farmers can use the encrypted monetary platform to maintain and expand their business. A more traditional encrypted loans are available on the DEFI platform like AAVE, while the platform specializes in microfinance has begun to surge.

However, traditional microfinance institutions can also use block chains, as a research on the development bank of the Americas, the study uses block chains to promote toilets, shower and other basic water purification and safety products in Peru. loan. The study found that the block chain was very effective in speeding up the loan application and processes. It promotes KYC (Understanding your customers) protocol, helping to avoid fraud and financial management is very effective.

Block chain recovery can help small farmers should have bad weather conditions

Bad weather is another major problem of modern agriculture because it can reduce crop yields in the absence of almost no warning. For example, in February 2021, the winter storm URI attacked Texas, causing approximately $ 600 million crop loss.

Although the US supply chain can be recovered relatively easily from these losses, similar events in developing countries often lead to food supply crisis and may make farmers bankrupt.

However, sufficient insurance can help farmers are economically affected by these incidents. This can provide farmers to provide funds needed to continue agricultural operations even under bad weather conditions.

A company named Arbol provides weather insurance for global farmers by using block chain smart contracts to lead the district block chain agricultural insurance industry.

Specifically, Arbol provides protection for the rainfall or too small, crop yield, heavy snow, wind speed, wind direction, temperature and humidity. According to the company’s website, users can specify the amount of insurance they want to purchase and use GPS and digital weather data, which will automatically pay claims within two weeks or less.

With the development of the industry, there are many crop insurance solutions to play a role in providing a broader solution for farmers in various sizes.

The block chain presence will be used to provide external data to the block chain.

The block chain is essentially a closed system. This is why they usually require a third party information provider (called predicage) to provide “chain” data for the block chain. In the agriculture industry, this may include weather, climate and rainfall data, as well as data on potential food pollution. Although the predictor is necessary to run normally in block chains, they do have some vulnerabilities, especially in data security, speed, accuracy, and final determinism.