Blockchain technology driving social and economic responsibility in agriculture: In any country, the agriculture sector is of the most important industries. It has an annual turnover of around $1 trillion, which is about 1 percent of the total GDP in the United States. However, a lot of factors contribute to the inefficient and costlier supply chains of agricultural businesses. Other than the lack of transparency and the existing outdated accounting system, there are several issues like an overpopulation of products and the lack of control over the logistics process. In the meanwhile, the only technology that can deal with these issues is Blockchain.
Blockchain technology drives social and economic responsibilities in agriculture. Let’s have a look at some of the factors that blockchain potentially assists in.
Fairer Payments for Farmers
Weather and farmers are most of the time up against each other. While farmers try to grow various types of crops, they often face unpredictable weather conditions. Either excessive rains or droughts affect the growth of plants. Since this information is usually available only to farmers and food producers, it leads to higher prices and fuzzy supply chain transactions.
In such a scenario, blockchain technology allows farmers and other stakeholders to get an in-depth understanding of the prices of food products using real-time data. With this, they can take informed decisions considering their operations and pay the farmers fairly. Additionally, they can get crop insurance claims through smart contracts.
Helping hand in a weather crisis
During the harvest season, farmers often face the havoc of unpredictable weather conditions. These conditions often affect farm produce. In the United States, several crops don’t tolerate excessive spring rains besides the lack of oxygen levels in the soil turns out to be a challenge for the plants to perform their usual functions.
The lack of transparency in the food chain often leads to a rise in prices. Since the consumers are unaware of the crops being affected by the weather conditions, they don’t get to know what caused the hike in prices.
Using blockchain technology, the farmers and other stakeholders can go through the prices of food products and can make informed decisions related to their crop insurance claims.
Agricultural Cryptocurrency
In the agriculture industry, there are several issues that appear very often and these include transaction fees, issues related to inflation, and long delays in approvals across the food chain among others. Here, the Blockchain comes with a solution as it is the technology behind the cryptocurrencies.
Notably, the founders of Blockchain have developed PavoCoin for the agricultural industry. People in the agricultural industry may use this currency to make payments across the system. It is also a secure and convenient method to make any payment and it helps boost interactions with customers.
Transparency
The agricultural industry has often faced several issues related to food safety. With the help of blockchain technology, customers have now been permitted to access the required information about the food they are buying. The information is absolutely secure and accessible to everybody.
Food producers need to place QR code labels on the packaging materials in an order to allow the consumers to go through the animal’s living conditions and other details. For example, if a QR code label is on a beef package, the consumer can check about the animal and if it lived in a secure environment.
Prevention of Counterfeiting of Raw Materials
While farmers need high-quality seeds and grains to deliver healthy produce. However, a lot of small and large farms are unable to buy quality products due to the lack of funds.
In the meanwhile, blockchain technology allows both big and small farmers to benefit from the system, allowing them to go through the quality of their suppliers’ seeds. It also assists them in making informed decisions related to purchasing. This information is not only used by customers but also benefits the farmers.
Using blockchain technology, the extension gives farmers transparency and allows them to keep a check on their products in real time. It also allows its users to locate their food sources in an order to make sure that the products they purchase are of high quality.
Quality Control of Product
In several developing countries, fruits and vegetables are often thrown away because of improper transportation and lack of storage. Since there is a lack of control over various issues like temperature, humidity, and CO2 indicators, suppliers, farmers, and freight carriers, there should be the necessary tools and resources to keep a check on these situations.
Here, blockchain technology allows tracking of the transportation and storage of agricultural products. The users are given access to real-time data related to the condition of the product, using a decentralized distributed ledger. Thus, the stakeholders are able to monitor the quality of the products and, as a result, prevent them.
Improving Food Production
Blockchain and the Internet of Things (IoT) can together make farming even more efficient. Farmers can benefit from new opportunities in the field using both technologies together. They can enhance the efficiency of their operations.
Also, the farmers can not only improve their management but also can save money by identifying their actions and understanding the patterns for the future.
Enhancing Environmental Sustainability
Using natural resources and modern technologies, Smart Agriculture reduces the environmental impact and enhances the efficiency of production. Blockchain technology makes it easier to implement sustainable practices.
Enhancing E-Commerce Agriculture Business
Producers can use blockchain technology to maintain the safety and security of their data. It allows small businesses to access the online marketplace for their products and it is more feasible. This allows them to focus on their core business reducing the need to follow long steps and also enables them to have seamless transactions.
Fair Produce Pricing
There are various factors that affect the prices of agricultural products. These include the weather conditions, the supply, and the demand for raw materials. This leads to a reduction in farmers’ income while, on the other hand, the retailers and intermediaries take the most profits.
Conclusion
Blockchain technology improves the transparency of the agricultural market. It reduces the number of intermediaries and increases farmers’ profits. It helps them to enter into contracts with retailers on their own favorable terms. Besides, the blockchain helps the market to be more social. It allows the authorities to pressurize those making excessive profits.
Food producers can strategize using eco-organizations which are said to be effective. Not only this, but also farmers can establish an international trade union with the help of blockchain technology.
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