Can blockchain deliver value to farmers

More and more, blockchain is becoming a buzzword. Years ago it was associated with the instability of bitcoin and other cryptocurrencies. Today farmers and agribusinesses are realizing it could be the business tool for the future.

According to experts speaking at an educational session at Commodity Classic in Orlando, Florida, the biggest obstacle for agriculture's entry into the blockchain is leaving the pencil and paper behind.

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"Agriculture is one of the least digitized sectors," Mark Pryor, chairman and CEO of The Seam, told the crowd. "That presents a real challenge. We also have data silos that benefit only one company." But Pryor said that every once in a while a technology comes along that revolutionizes the system. He believes blockchains are that technology.

Simply put, a blockchain is an openly distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.

"A blockchain provides the single version of the truth between multiple competing parties in the supply chain," Pryor said.

A blockchain has multiple characteristics. They are rules-based, distributed in real-time, permissioned and can’t be changed.

“Participants have the ability to interact with each other with full trust that the agreement will execute on time and as agreed upon no matter if you know the person or have ever done business with them, Luis Macias, CEO of Grainchain said. “They could be located in Africa, China, Morocco or anywhere in the globe.”

But before massive adoption can take place, some hurdles have to be overcome. Pryor illustrated that among individuals and companies, the basic terminology of farming could be different. As an example, in the shipping industry one company may call a ship a vessel. Another company may call it a boat or a conveyance and on and on.

"We are starting to see ADM, Bungee, Cargill and Dreyfus form a partnership that investigates standardizing and digitizing global agriculture transactions," Pryor said. "They have recognized they aren't speaking the same language."

For blockchains to work, the terminology has to be defined and agreed upon by all parties involved. Pryor said it is leading to "coopetition" or collaboration between business competitors for mutual and beneficial results.

What does all this mean for individual farming operations? It improves accuracy, transparency, efficiency and trust. Those factors can help farmers navigate and negotiate the narrow margins that exist in farming today, according to the panelists.

"With razor-thin margins, we need to figure out how to enhance our marketing opportunities," Macias said. "How do we market our products the way we deserve and use the empowerment of data to make more money?"

To do that, Marcias started Grainchain, a company built from the blockchain platform utilizing suites of software products designed to increase efficiencies for farmers.

"We are providing the technology to level the playing field for the small-to medium-size farmer to be able to compete at the levels that ADM, Bungee, Cargill and others do," he said.

Macias said Grainchain provides the farmer two distinct advantages: It gives them the ability to market grain so they can negotiate a better price, and it creates a system that allows them to trust others from around the world with their paid contracts. The person buying farmers’ grain will know precisely where it came from, how it was put together and the path it took to get to them.

"We've developed a system that will pay you instantly when you drop your grain off," Macias said.

He told the group that with complete trust in the blockchain, farmers will be more open to accepting contracts outside of their normal trading areas that may offer better premiums.

"Once you get used to that, you can venture out into markets that you never would've have considered before," Macias said. "This technology ensures the funds are there when you drop off your grain, directly to your bank account without the fear of the other party backing out of the contract."

Blockchains are only as good as the information entered, according to experts. Macias said individual entry of data needs to be removed. Systems are already in place to grade and measure grain. That data will be added to the blockchain for each transaction.

"The combination of our systems creates an environment where nearly 99 percent of data is entered by systems and not people," he said.

He told the group that the final piece of their software suite manages the trucks going to farmers’ fields, tracking where they went and what they picked up. This provides an authentic dataset that genuinely shows where it came from. That data is used to pay the truck driver for the route taken and the cost of maintaining the fleet of trucks used to transport the products.

"At the end of the day we have an infrastructure that changes the way we are doing business," he said. "We've got customers right now that are going from the field all the way to the end producers. So when that tortilla chip goes in your mouth, you can authentically know where it came from."

According to Grainchain's website, they have already logged 84,410 transactions with more than 5,264,205,815 pounds of commodities processed.

In the future, blockchains will also have implications in food safety traceability, identity preservation, certification of sustainability practices and more.

Originally published for the Iowa Soybean Association

Mark Jackson talks TED in New York City

By Joseph L. Murphy

Mark Jackson displays his Iowa Soybean Association hat at the Crossroads of the World in Time Square. Jackson is in New York this week to participate in a TED Talk about sustainability and farming.

Mark Jackson displays his Iowa Soybean Association hat at the Crossroads of the World in Time Square. Jackson is in New York this week to participate in a TED Talk about sustainability and farming. (Photo: Joseph L. Murphy)

Mark Jackson displays his Iowa Soybean Association hat at the Crossroads of the World in Time Square. Jackson is in New York this week to participate in a TED Talk about sustainability and farming. (Photo: Joseph L. Murphy)

Mark Jackson traded the black soil of his Mahaska County farm for the concrete streets of New York City this week. The trip that carried him from Iowa to Manhattan was to raise awareness of his livelihood and how farmers strive to be sustainable in a changing food system.

Jackson, a farmer from Rose Hill and a director with the Iowa Soybean Association, was invited to take part in a Technology, Entertainment and Design (TED) Talk this week in the big apple. His speech titled “Hands Across Generations” will focus on his family’s passion for agriculture dating back to the 1800’s on the rolling prairie of southern Iowa.

TED Talks are a series of speeches that are given to a live audience and shared through social media. For many connected to social media TED is a place to listen and learn.

“TED is a community with global reach,” Ronda Carnegie, head of Global Partnerships and Strategic Initiatives at TED, said. “There are over 1,800 Talks on TED.com, which have been viewed nearly 2.5 billion times. What’s more, we have over 11,000 volunteer translators from around the world translating TED Talks into 105 languages.”

TED representatives talk with speakers during a rehearsal for the event. (Photo: Joseph L. Murphy)

TED representatives talk with speakers during a rehearsal for the event. (Photo: Joseph L. Murphy)

 

The talks are recorded and broadcasted on the TED website and then shared through social media platforms like Facebook and Twitter. The result is millions of people around the world can see the conversations that were initially presented to several hundred people.

For Jackson sharing his family’s history and more importantly the work he has done to make his farm sustainable while increasing yields is a chance of a lifetime.

“The importance of having TED as a platform to tell my story is a unique opportunity. Stepping outside of our normal avenues to relate the importance of modern agriculture is critical to defend the sustainability efforts that farmers have achieved,” Jackson said. “The Ted-Unilever collaboration is a first of its kind for the “TED Institute” and being selected to share the Iowa farmer’s story is a major accomplishment within itself as Unilever realizes the value modern agriculture has brought to the sustainability conversation.“

Mark’s work with the Unilever soy sustainability program made his story a natural fit for the TED presentation. Last year Jackson hosted top executives from Unilever on his farm to help them better understand modern agriculture practices and how soybeans move through the supply chain before being used as ingredients in Unilever products like Hellmann’s Mayonnaise.

“This TED event is about bringing the outside in, in the area of sustainability. Across many platforms, with many voices, many nationalities and many topic areas,” Jonathan Atwood, national vice president of sustainable living and corporate communications for Unilever, said.

He went on to say that Jackson brings a voice to the Iowa soybean story that in partnership with Unilever is creating a conversation about sustainability and how the worlds of business and agriculture can come together to make a difference.

“We reached out to Mark and others in the Iowa farming community to say come on a journey with us,” Atwood said. “We are thrilled that Mark is here to say ‘this is who we are, and this is what we stand for’ and that’s exciting.”

Jackson speaks with Gina Barnett during a rehearsal for his TED presentation. (Photo: Joseph L. Murphy)

Jackson speaks with Gina Barnett during a rehearsal for his TED presentation. (Photo: Joseph L. Murphy)

 

This week has been busy or Mark. He attended rehearsals, met with other presenters and learned more about the TED organization. All the preparations are leading up to his moment on the stage and the ability to tell his story of hands across generations.

Originally published for the Iowa Soybean Association. Find more great stories at: www.iasoybeans.com/news