In her interview with Disruptor Daily, AgriDigital CEO and Co-founder, Emma Weston explains how her company has identified a real lack of transparency and trust between supply chain participants. This is as a result of the incredibly complex nature of modern-day agricultural supply chains, with lots of double-entry, manual handling, asset transfer delays, matching payments with titles, and other operational challenges. All this has led to the combination of #Blockchain technology with a digital commodity management platform (AgriDigital) to create a more efficient and accessible trade, finance, and traceability function. Basically, creating a digital trust within the agricultural supply chains. This cloud-based platform is multi-participant with commodity management where all players across the supply chain – farmers, buyers, storage, operators, consumers – can operate and interact to buy, sell, and finance commodities. It also allows consumers to understand how food has been produced, processed, stored, and transported.
To understand the importance of Blockchain technology within the Agriculture industry, we must first look at the key challenges faced by the supply chains' participants. One major challenge is the absence of real-time payment that creates a counterparty risk for sellers. Sellers can often be left stranded in case of a default of contractual obligations by other parties. The second major challenge is the lack of automation and democratization when it comes to supply chain finance for buyers. To get a loan from a financial institution, a few checks must be performed before the loan is approved or not. These checks can take weeks and sometimes lead to disapproval for the loan. The factors used to determine if a loan is approved or not can be unclear and at times biased.
The third major challenge is about ensuring that all consumers can make informed purchasing decisions by accessing the provenance of their goods.
Blockchain technology can be considered as a valuable key to solving these challenges and transforming global agriculture supply chains, through its ability to create secure digital assets. As digital assets are the representations of real-world assets that can be traded and financed more efficiently, supply chain participants are able to transfer commodities with complete security, accurately attribute value to goods and identify where that value has been contributed along the supply chain. Moreover, digital assets and the data embedded in them, support product integrity and provenance for consumers, providing detailed information on the journey a commodity has made through the supply chain, from the farm to the end product.
Great work is currently being done with Blockchain, around food sustainability, enabling consumers to know whether a particular product has been sourced sustainably or has it been part of an environmentally damaging, illegal, or unethical process. A good example is the World Wildlife Fund (WWF), with the Blockchain Tuna Project, tracking tuna in the Pacific Ocean. In the project, Tuna is caught and tagged with GPS tracking, determining whether it was caught in a legal fishing area. The data is stored on the blockchain, moving through the supply chain as it travels to the end consumer.
The Agriculture Industry has been sustaining the world since the dawn of time. As new technologies arise, we can be assured that we will witness massive growth and development in the way the agriculture supply chain operates.