Blockchain and Indoor Farming as Solution to Help Feed Nine Billion?
The UN has stated that by year 2050, the world’s population will increase by nine billion, which is 20% more than the numbers we have today. Most of the increase will occur in countries that are rapidly developing into urban.
According to the World Health Organization (WHO), an estimate of 70% of the world’s population will turn urban by 2050. Hence, food production must increase by 70% in order to feed a larger and more urban population.
Cereal population will need to rise by 50% annually to be able to support population growth despite the steady decline in yield growth.
Food supply chains are inefficient and suffer from issues on quality control, especially in developing nations. Blockchain-enabled applications will take an important role in addressing this challenge as one of the clearest real-world applications of blockchain technology in adding greater visibility and efficiency in supply chains.
Despite the fact that agriculture is a $5.5 trillion global business with more than one billion people employed, it remains highly inefficient. Smallholder farmers in developing countries still face challenges in getting affordable access to capital.
Such financing difficulties can be solved through blockchain solutions. Farmers usually wait for weeks or even months to receive payment after delivery and this causes them to deal with larger players who possess even greater power in bargain. With this, they fail to receive their fair share despite playing the most important role in the chain. This only translates lower income for farmers.
The world now gradually turns urban and becomes more aware of the carbon footprint in goods transportation over long distances. This paved the way for indoor farming and now slowly plays an increasing role. Blockchain solutions and smart contracts allow careful management of water and energy. Automated data collection and analysis have the potential to improve management on crop inputs such as water and energy, as well as the corresponding automation of indoor farming operations.
To give an example, when a farmer uses indoor hydroponics and a closed-loop system, he/she is able to reduce water usage by up to 90%. Increasingly, global food demands will be met by crops that are grown indoors, in an environment that is more efficient and more controlled compared to outdoors. Through moving indoors, people’s traditional dependence on weather is eradicated. Furthermore, sensor arrays help plants to “communicate” exactly what they need for the whole day.
Through blockchain solutions and Internet of Things (IoT), farmers will save more time and money, and increase yields. In spite of the common belief on farmers being slow to adapt, they have proven to be always eager adopters of technologies that help and deliver genuine value. Data democratization of the food chain will bring increase in efficiencies, reduce waste, and grow transfer remuneration to the stakeholders, providing the greatest value.
Blockchain solutions allow the building of a new model of trust in agricultural supply chains. In the old information technology paradigm, storage of agricultural, environmental, and regulatory data are put in centralized computer servers and is managed by administrators that maintain data integrity, security, and authorization for access.
There is much risk in a centralized data administration – data in crop safety and quality data. Loss of data can be easily encountered either due to failure or absence of backups. Centralized administrators may take actions based on their own agendas, having their own interests in mind, influencing decisions related to access of data and security.
Blockchain technology application to crop data ensures incorruptible information on food and its sources. Blockchain and IoT technology simplify data management throughout the system complexity of farmers, brokers, distributors, processors, retailers, regulators, and lastly, consumers. Information about the food we partake becomes simplified and transparent. It provides a sense of trust on food that consumers partake and confidence to regulatory agencies on data reports.
Blockchain has redefined trust across the agriculture industry with cryptographic security, eliminating any potential pursuits of self-interest in data administrators or other actors. It also enables real-time payments concurrent with delivery and improves visibility to buyers, leveling the playing field for farmers. Farmers receive payment immediately and the increase of competition for their crops raises the prices they receive, while also helping consumers to pay lower prices for food through a more transparent, secure, and environmentally sustainable supply chain.
Reference: ASIA TIMES
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