Solving Headaches in Agriculture with Blockchain

Asia Blockchain Review
October 21, 2019

The agriculture industry has been facing challenges in providing enough food for the world population while enhancing food safety, transparency, control over the supply chain and consumer trust. Blockchain-based traceability can solve these challenges by making all the information transparent to better control the supply chain, encourage responsibility among all stakeholders, and build consumer trust.

Agriculture Industry Confronts Challenges

Agriculture is the spearhead economic sector of the Vietnamese economy, accounting for 14.57% of GDP or US$40 billion in 2018, and is expected to grow to US$51 billion by 2020. The proportion of fruit in Vietnamese agriculture is 9.5%, valued at US$3.8 billion. Every year, Vietnam produces more than 4 million tons of fruit for export and domestic consumption. Asia produces a third of global food supplies, and according to the FAO, the world will need an additional 2.1 billion tons of food by 2050, most of which will be produced in Asia. Asia is also the fastest developing region in terms of economy and population, which places a burden on the agriculture industry of Asia, in general, and Vietnam, in particular, to increase production for food security and ensure the sustainability of development.  

Overview of Vietnam’s agricultural market

However, the increase in demand also brings more opportunities, along with challenges to all stakeholders in the supply chain. With pressure to deliver more food that can be stored for a long time and travel great distances, the value chain is becoming more complex. Agricultural producers have applied technologies to boost yields over the same area of land, which has led to problems of food safety and transparency in the agricultural value chain. Farmers are now familiar with using pesticides and growth stimulants to unnaturally enhance production. These chemicals persist in foods long after harvesting, jeopardizing food safety and consumer trust.

Moreover, the improper transportation and storage of foods and the use of chemical preservatives can further drive down food quality and damage agricultural products. For instance, some agricultural products such as fruit, meat, and frozen fish must be stored at appropriate, near-constant temperatures during the transport and warehousing processes. If temperatures fluctuate beyond certain thresholds, the quality of food will be affected.

Mr. Nguyen Duc Phuong Nam – Managing Director of WOWTRACE spoke at ISTF2019.

Food sanitation is also a challenge for the agriculture supply chain. After harvesting, products will go through processes of sorting and processing, manufacturing, packaging, delivery, storage, and then retail to consumers. Therefore, maintaining product quality and sanitation throughout the supply chain poses a challenge, and it is difficult to get all stakeholders to strictly follow sanitation standards. From the consumer side, stakeholders need to know exactly the origins of their food, the journeys that the products go through, and trustworthy information regarding product testing and certification before selling to the markets. Many EU and American countries require businesses to provide traceability information about importing agricultural products, but the information is only submitted for custom clearance processes.

Lack of transparency hinders the development of the agriculture supply chain. All information about the product journey must be updated continuously to help control the flow of products and maintain quality. The information has to be transparent, trustworthy, and traceable, as this data is valuable for controlling all activities and for analysis to improve supply chain efficiency. Seamless traceability is also worthwhile to consumers. According to the CFG x Futerra Expert Survey, 70% of consumers are most interested in product transparency, while 55% demand more information on social, health, environmental, and safety issues about consumable products. Furthermore, 73% of respondents indicated they will be loyal and buy more products from a brand that is transparent about their products. The study has shown that transparent traceability is a major success factor in the cultivation supply chain.

How Blockchain Can Solve These Challenges

All data stored via blockchain technology can be made transparent because all updated information is immutable, meaning it cannot be changed or deleted. With blockchain, all the transactions are recorded and can be retrieved easily. That encourages all supply chain stakeholders to take full responsibility to ensure that products meet sanitation and quality standards, due to undeniable evidence on the blockchain. Applying blockchain to traceability helps supply chain managers to achieve end-to-end visibility and better control over the supply chain based on the seamless, transparent flow of information. If all trustworthy information is accessible to everyone in the supply chain, everyone can make better decisions promptly when issues arise. Moreover, the information retrieved from blockchain gives decision-makers a trustworthy source of reference to predict potential risks, estimate demand for production management, and provide valuable data for analysis and to improve supply chain operations. Therefore, blockchain increases trust among all parties in the supply chain, prevents fraud, eliminates losses, and ensures product quality.

On the value side, blockchain improves the agriculture value chain by providing transparency and traceability. When all the information is transparently available, supply chain participants can take prompt action should a problem occur, trace the root causes of an issue, or use the information for analysis, to make business forecasts, and to reduce waste, thereby improving the efficiency of the supply chain. For consumers, transparent traceability instills greater confidence when choosing food products for their families, engendering loyalty to brands that provide such transparency.

Blockchain will help ensure the transparency and traceability of information.

Blockchain technology was an exciting topic featured at the International Symposium on Tropical Fruits which took place in Ho Chi Minh City, as the technology promises to change the future of the agriculture industry. WOWTRACE, a startup specializing in providing blockchain-based traceability solutions to businesses, has introduced their successful case study to the event and attracted the attention of guests and other speakers. The difference between WOWTRACE and other traceability solutions is the underpinning technology. Using blockchain to record all transactions, data inputted by all supply chain stakeholders is transparent, immutable, and undeniable. WOWTRACE identifies products at the item level, meaning each item has a unique ID represented by a unique QR code. When an item is transferred through a step in the supply chain, related information is recorded on the blockchain.

Dr. Manoj Nardeosingh (second from the left) – Secretary-General of African-ASIA Rural Development Organization (AARDO) expresses his interest in the application of blockchain traceability technology in Indian agriculture.

Consequently, there is no circumstance in which two items have the same traceability information. This solution prevents fraud, counterfeit products, and makes information trustworthy. Consumers can use their smartphones to scan a QR code affixed to a product to retrieve all the information on the product and its journey.

“WOWTRACE solves the problems of the agriculture supply chain such as food safety, transparency, and trust between supply chain stakeholders and consumers. WOWTRACE has successfully implemented the Blockchain traceability solution on Vietnamese Mango, Chocolate, and Organic vegetables with positive feedback. We are developing our solution to help businesses control their supply chains better with end-to-end visibility, optimized management tool, and comprehensive user experience. We also expand the solution to other industry besides agriculture like pharmaceutical, FMCG, high-value products.” – Mr.Nguyen Duc Phuong Nam, Managing Director of WOWTRACE.

With proven applications of blockchain in traceability from WOWTRACE, blockchain technology promises to transform the agriculture industry shortly. The transparent and immutable characteristics of information recorded on the blockchain are key to solving the problems of product quality and trust in the agriculture supply chain. All supply chain stakeholders, including farmers and producers, distributors, retailers, logistics services providers, consumers, and even governments, will save a lot of time and money thanks to the integrity of data on blockchain.


About WOWTRACE

WOWTRACE is a complete ABCD (AI, Blockchain, Cloud, Data) Traceability Solution that brings sustainable growth and transparency to the supply chain across Asian countries, allowing all stakeholders to achieve end-to-end visibility and control over their operations on the supply chain.

Learn more about WOWTRACE at https://www.wowtrace.io/


About Asia Blockchain Review

Asia Blockchain Review is the largest initiative for media and community building in Asia for blockchain technology. It aims to connect all blockchain enthusiasts on a regional scale and facilitate the technological foundation of blockchain through a range of group discussions, technical workshops, conferences, and consulting programs.

Our goal is to cultivate and encourage a collaborative community for our members to gather, share their experiences and endeavors in the blockchain space, and brainstorm the potential uses of blockchain technology.

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