Blockchain Intervention in the Food Industry and its Opportunities for Agriculture Sector
An agriculture supply chain system comprises organizations/cooperatives responsible for
producing and distributing Vegetables/Fruits/Cereals/Pulses or animal-based products.
Supply chains are, in essence, dictated predominantly by two factors – perishability and
transparency. Start-ups are improving supply chain management in all the stages of the
supply by adopting global best practices in storage, packaging, handling, transportation,
value-added service etc. There should be disintermediation and participation of organized
players, i.e. modern supply chain, to benefit farmers and ultimate consumers. Effective
climate strategies must also include meaningful and regular engagement with supply chains
to build capacity, mitigate such risks and improve procurement strategies.
Around 30-40% get wasted at various supply chain levels, which amounts to a loss of INR 2
Lakh Crores/Year in India, according to ResearchGate. Apart from the loss of revenue to the
farmers, it also increases additional costs in the supply chain, which inevitably burdens the
consumers and retailers. Therefore, transparency and traceability play a vital role in the
supply chain. Emerging technology, such as Blockchain and IoT, play an essential role. The
goal should be to make the solution open and affordable.
Transparency and traceability are currently the most important trend driving the change in
the food and agriculture industry. In the 21st century, with many progressions, humankind
developed sensibilities towards what they consume and buy. Hence, consumers want to
know and comprehend what components are in their products, which is why we see so
many innovative products with shorter, pronounceable ingredient lists. Customers wish for
convenience as well as higher-quality items. Previously, it was unusual to read the back of a
product on the shelf before placing it in the cart. More than ever before, consumers are
reading the back of the packaging. Consumers want brands that are transparent about their
products and mirror their personal beliefs. Consumers seek a company's founding story,
sustainability initiatives, social conscience, and corporate transparency because the brands
they eat, drink, and wear have become a reflection of whom they aim to be. Clean labelling
with high ethical standards is more crucial than ever, especially for a rising proportion of
customers with unique dietary needs.
India is the world's third largest cereal producer, after China and the United States. India is
the world's leading milk producer, the second-largest producer of inland fisheries and the
third-greatest fish producer. The fisheries sector also employs around 11 million individuals
wholly or partially involved in fishing and related activities. India ranks first in the world in
cattle and buffalos, second in goats, third in sheep and seventh in the poultry population.
The demand for food in India is driven by the country's large and growing population, which
is projected to exceed 1.4 billion by 2024. India is the world's second most populous country
and is home to about 18% of the global population. With such a large population, there is a
constant demand for food in India. India is one of the world's leading producers of rice,
wheat, sugarcane, and various other crops. However, despite being a major agricultural
producer, India still needs help meeting its population's food needs. India is ranked 107th
out of 121 countries on the Global Hunger Index (GHI) for 2022, which means it has a severe
level of malnutrition. India's high ranking on the GHI is partly because a significant portion of
the population is undernourished and suffers from malnutrition. As mentioned above,
innovation in the food industry is only representative of some sections of society. Most of
the invention is seen at the urban level and vaguely at the rural level. Technologies like
Blockchain can penetrate rural depths with a commendable solution.
A blockchain is an up-and-coming tool for food transparency, safety, and security, as it has
multidimensional benefits for the industry. With secondary tools such as IoT sensors,
blockchain technology can establish a rapidly engaged and transparent food supply chain
that enhances consumer trust and safety. Numerous organizations have explored this
modern technology with various outcomes and improved possibilities. The next stage will be
to make blockchain technology more commercially viable and get broad acceptance from
top food leaders, supply chain players, processors, and the government. All stakeholders in
the sector must collaborate to implement a comprehensive plan for a transparent and
traceable industry.
There is an incredible opportunity to enhance traceability in the agricultural sector by using
blockchain technology. This process commences at the seed level and goes up to the final
stage, right through the entire supply chain. An advanced form of traceability of this nature
can enhance transparency in the industry. Consumers can benefit by knowing about the
quality of seeds, the handling of food products, production processes and whether or not
the produce is genuinely organic.
Blockchain technology has manifold advantages. Since all the data gets recorded on a
distributed ledger system, it becomes tamperproof. The immutability of the data creates
absolute transparency and accountability. Verification becomes easy at every level – for
regulators, quality certification agencies, manufacturers, wholesalers, retailers and
consumers. It's not just about validation. These initiatives can build brand value for organic
food companies. It is a significant shot in the arm of the trust economy, where agricultural
companies can convincingly prove their products' health and nutrition benefits. The good
news is that blockchain technology is already starting to empower the agricultural sector in
India. Many manufacturers are fast moving towards adopting this technology throughout
their processes.
TRST01 (Trust- O- One), an emerging blockchain start-up, developed a multi-chain
blockchain Platform focused on agriculture, climate, and food technology. Its disruptive
innovation, a robust platform, is establishing trust, transparency, and traceability in the
ecosystem. TRST01 Blockchain platform maps the complete value chain from the food and
Agriprenuers. The various use cases developed by TRST01 are the best examples of
blockchain intervention in the food and agriculture industry. Blockchain-enabled traceability
system for Tandur GI Tur Dal is a noteworthy achievement of TRST01. Professor Jayashankar
Telangana State Agriculture University used TRST01's blockchain technology to trace Tandur
-Tur Dal.
India's Public Distribution System (PDS) forms the core of survival for many families. The
manual ration distribution mechanism had flaws that didn't guarantee ration access to
beneficiaries. TRST01 Blockchain traceability solution used by an eastern state in India
gathers verified data from procurement to the distribution chain to allow officials to trace in
details of the procurement process until the recipient. Blockchain Technology to attain the
two critical goals of the public distribution system: food security and Nutrition Safety.
Greentatwa agritech, Hyderabad Samasta Food, Jaipur Rajasthan, and Ovo Eggs Odihsa
adopted the TRST01 Blockchain-enabled traceability solution for their pesticide-free,
Orgianic food Product range.
Blockchain technology also has the potential to contribute to the achievement of
Sustainable Development Goal 2, i.e., "end hunger, achieve food security and improved
nutrition, and promote sustainable agriculture" goal by improving the transparency,
traceability, and sustainability of the food system. Blockchain contributes to SDG 2 by
improving food safety. Blockchain makes it possible to quickly identify and recall any
potentially unsafe products, reducing the risk of foodborne illness. In addition, Blockchain is
used to improve access to financial services for smallholder farmers, which could, in turn,
help to increase their productivity and incomes. This could help to reduce hunger and
malnutrition in developing countries, which are often disproportionately affected by these
issues.
