Blockchain market in agriculture growing rapidly
The overall blockchain in agriculture and food supply chain market is projected to grow exponentially stronger at a Compound Annual Growth Rate (CAGR) of 47.8% to reach USD 429.7 million by 2023 from an estimated value of USD 60.8 million in 2018.
The market is projected to grow, owing to an increase in the demand for supply chain transparency, according to market research company MarketsandMarkets.
According to the 2016 Label Insight Food Revolution Study, 94% of the respondents in the study 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.
Demand for blockchain technology growing
Due to many food fraud cases around the world, which includes the horsemeat scandal in Europe in 2013 and pork scandal in China in 2011, the consumers are demanding 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 & food supply chain is growing.
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“Blockchain technology helps the agriculture & food organizations to record, monitor, and get the 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,” states the MarketsandMarkets report.
Blockchain pilot projects
Many organizations such as Walmart (US) and Nestlé (Switzerland) have started pilot projects with the blockchain technology solutions provided by IBM (US) to ensure food safety and rapid food recalls in case of any contamination. Apart from IBM, there are other big players such as Microsoft (US) and SAP-SE (Germany) and small players such as AgriDigital (Australia), Provenance (UK), and OriginTrail (Slovenia) that provide platforms and solutions for complete traceability of food products across the supply chain.
The key players in blockchain market include IBM, Microsoft, SAP-SE, Ambrosus (Switzerland), Arc-net (UK), OriginTrail, Ripe.io (US), VeChain (China), Provenance (UK), ChainVine (UK), AgriDigital, and AgriChain (Australia).
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Blockchain technology requires companies to form a consortium and work in collaboration; however, forming a consortium requires in-depth planning, commitment, and investment. “The distributed ledger-based blockchain technology is rapidly evolving; however, a single blockchain technology cannot revolutionize the whole industry technologically,” says the MarketsandMarkets report.
Hence, many companies who want to deploy the blockchain technology in their business solutions are coming together to form consortiums to set standards, execute transactions, and enable development of new infrastructures.
There are already many consortia that have been formed in this space, but most of them are in the financial sector. Some of the consortiums and associations that are working toward scaling up and propagating blockchain technology are R3 consortium (US), Hyperledger (US), Global Blockchain Business Council (Switzerland), World Blockchain Association (Switzerland), and Blockchain Collaborative Consortium (BCC).
Blockchain technology
Regardless of the level of economic development, humans across the globe are constantly involved in the transfer of value. This transfer of value is enabling people to trade goods and service and accumulate productive capital and savings for their well-being. Distributed ledger technologies (DLTs) was introduced to lower the uncertainty during the exchange of value. DLTs provide higher efficiency, transparency, and traceability to the exchange of value and information in the agriculture and food sectors. A blockchain is a digitally created real-time ledger of a specific set of data, which is transparent to all stakeholders and is secure from any data manipulation. The data on a blockchain is stored in the form of blocks. In the agriculture & food supply chain, a blockchain traces the provenance of the food product, tracks the real-time data for the produce, and conducts transactions pertaining to the agriculture & food industry. These benefits include easy and cheap 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.
Also read: “Irrefutable traceability data?”
