Regardless of the level of economic development, consumers worldwide are constantly involved in the transfer of value. This transfer of value enables people to trade goods and service and accumulate productive capital and savings.
That’s why the overall blockchain in agriculture and food supply chain market is projected to grow exponentially stronger at a CAGR of 47.8% to reach $429.7 million by 2023 from an estimated value of $60.8 million in 2018, according to research conducted by MarketsandMarkets, Northbrook, Ill.
Blockchain is a digitally created real-time ledger of a specific set of data transparent to all stakeholders and secure from data manipulation. The data on a blockchain is stored in the form of blocks. In the agriculture and food supply chain, blockchain traces the provenance of the food product, tracks the real-time data and conducts transactions pertaining to the agriculture and food industry. These benefits include easy and inexpensive food batch recalls in case of emergencies, availability of the complete history of the product status, increased customer trust and loyalty, fairer payments, approved vendors and proper compliance management.
According to the “2016 Label Insight Food Revolution Study,” produced by Label Insight, St. Louis, Mo., 94% of the respondents reported that it is important for them to buy from manufacturers who are transparent with consumers. Another major driver of the blockchain market is the growing number of food fraud cases.
High consumer preference for blockchain technology in product traceability, tracking and visibility
Many of today’s consumers want to know where their food comes from. Due to an increase in demand for knowing the provenance of food from the consumer’s end, the demand for blockchain technology in agriculture and food supply chain continues to grow.
Blockchain technology helps the agriculture and food organizations to record, monitor and receive real-time information of the food product in the supply chain. This recorded information cannot be altered by any of the stakeholders, which makes this technology the safest for all transactions.
In September 2018, Walmart, Bentonville, Ark., deployed blockchain technology solutions on full-scale basis for the supply chain operations of spinach and lettuce head. Walmart also collaborated with IBM, North Castle, N.Y., and Tsinghua University, China, to improve the way food is tracked, transported and sold to consumers across China.
And, FoodLogiQ, Durham, N.C., partnered with AgBiome Innovations, Research Triangle Park, N.C.; Subway/Independent Purchasing Cooperative, Miami, Fla.; Testo North America, West Chester, Pa.; and Tyson Foods, Springdale, Ark., to launch a blockchain pilot designed to raise transparency within their supply chains.
Future opportunities through various consortiums and collaborations can amplify the application of blockchain
Blockchain technology requires companies to form a consortium and work in collaboration, however, forming a consortium requires in-depth planning, commitment and investment. While the distributed ledger-based blockchain technology is rapidly evolving, a single blockchain technology cannot revolutionize the whole industry technologically. Hence, many companies who want to deploy blockchain technology are forming consortiums to set standards, execute transactions and develop new infrastructures. For example, The Blockchain in Trucking Alliance (BiTA) was created to design blockchain standards and education for the freight transportation industry.
INS, a new global project by the founders of Instamart, Moscow, announced an initiative to build a decentralized grocery shopping ecosystem based on blockchain technology.
An interdisciplinary team from Massachusetts Institute of Technology (MIT), Cambridge, Mass.; The Wharton School of the University of Pennsylvania, Philadelphia, Pa.; and Boston College, Chestnut Hill, Mass., created b_verify, a new blockchain-based system that has the potential to disrupt the global supply chain.