What Blockchain Gives to Agriculture

The article below is a compilation of those benefits various researchers noted on application of distributed ledger technologies in agriculture.

Transparent transactions

It is essential for smallholdings and agricultural concerns to be able to keep track of their transactions and contractual obligations with buyers, suppliers and other stakeholders in order to maintain accountability. This minimises fraud, maximises transparency, and ensures that each link in the supply chain is satisfied. The connection between commodity buyers (such as Starbucks and Coca Cola) and farmers can now be monitored more closely, and distribution channels streamlined yet further.

Smart contracts

Firms operating within the agricultural sector often have extensive contractual obligations to a multitude of stakeholders, and here can have a beneficial impact on contracting, particularly in areas such as hedging contract and pre-sales of harvests.

Data monitoring

One of the most obvious uses for blockchain is in data monitoring. Now, farmers have an opportunity to capture data in real-time that will help them plan their spaces more effectively and maximise the success rate of their harvests. For instance, wireless sensors can be integrated into fields to monitor crop growth, harvesting, and subsequent yield, with all of the data recorded onto the blockchain. Over time, this information will become an invaluable resource to the farmer.

Minimizing human error

There are a multitude of ways in which blockchain can take tasks away from the workforce and automate them in order to minimise errors. It is often an individual mistake that causes physical and financial losses in the agricultural sector, and so adopting technological innovations can minimise the amount of resource that is wasted or misused. Also, blockchain can present information to farmers regarding tainted products throughout their supply chain: what types of crop are they; where were they grown? By drilling down into this data set, the farmer can then minimise future losses.

Tracing origins of products

By establishing a blockchain-driven ecosystem for the registration, payment, and transport of crops or other agricultural produce, buyers can also verify that the product they are receiving is exactly what they paid for. With every step of the transaction process recorded on the blockchain, if a supplier claims that its coffee beans are ethically sourced from Colombia, for example, this can easily be confirmed by tracing the journey from farmer to coffee shop, alleviating concerns about misrepresentation.

Reducing multinationals’ influence

Blockchain can also be utilised to solve a number of existing problems in community-supported agriculture, including governance, distribution, and equity shares. Blockchain-supported systems such as FarmShare enable shares in harvested crops to be electronically distributed to members, creating self-sufficient local economies. This in turn generates greater involvement within the community, and ensures there are incentives for local agriculture to be run more effectively.

Balance out unfair pricing

With crop prices fluctuating wildly based on demand, weather, and global production levels, blockchain can provide an easy solution for both buyers and suppliers seeking to negotiate a fair price for their product. By providing both parties with access to information on similar transactions, as well as on the current stock price of goods, even suppliers in rural areas are able to determine what their harvest is currently worth and sell it to distributors at a price that reflects global market conditions.

Food Safety

This seems to be the area where the most work has already been done because there clear vested interest from both producer and consumer. IBM along with companies like Walmart have started leading the charge in this capacity. Bringing transparency to the supply chain will allow us to identify and remove bad actors and poor processes. This ensures ideal conditions from farm to market, and we can pinpoint source quickly in the event of a food safety outbreak. This could save time, money, and lives.


The benefit to buying local food is always described as “you know exactly where your food comes from and who grew it. You know it’s fresh”. What if we could make this happen at scale? Meaning, no matter where you bought your food, you knew not only where it came from, but when it was harvested and processed, and even who produced it. Companies like Ripe.io are working to solve this very problem. This could also go far to prevent food fraud, false labeling, and redundant middlemen.

Transaction Costs

The key challenges in the agricultural supply chain are its fragmentation and dependency on personally knowing a counter-party before you could trust them to do business. Companies like AgriDigital are making headway in creating more transparent and efficient supply chains through the use of blockchain technology. They are applying the technology directly to the grain trade and also plan to expand into other agricultural commodities, such as cotton.

Opening New Markets

AgriLedger aims to open new markets to farmers in the developing world using blockchain. The premise here is that if we can create trust and accountability among market players, there is reduced need to evaluate each person individually on their trustworthiness and ability to execute. This means that market players that couldn’t establish trust before for any reason (they didn’t live close to each other, they didn’t have a protocol for if things fell apart, the time to develop a new relationship didn’t justify the value, etc.) now could do business without someone needing to broker trust (and take a margin) in the middle. This also means that disadvantaged market participants can have a sort of “seat at the table” through this technology.


Anyone who has worked in the agricultural supply chain knows the challenges that come with logistics. Dealing with products that often have a very short shelf life in uncertain conditions in high quantities with a lot of dollars on the line. Also, often the supply can be uncertain (it’s not like a factory producing widgets). Companies such as UPS are joining the Blockchain in Transport Alliance to play a central role in the smart logistics network of the future, built on blockchain technology. As we see this materialize in other industries, agriculture will no doubt be next.

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