SmartUs Insights predicts that the market for blockchain in agriculture will surpass $430 billion by 2023, representing a 50% CAGR since 2017. Can the technology be the magic wand to cure perennial challenges in the food sector?

The use of data and information is crucial to unlocking new opportunities in agriculture. Many farmers and support systems, including the government, use Information Communication Technology (ICT) solutions for better decision-making in farming.

Many farmers now use technology to access markets and financial support. Governments have also chipped in by providing Global Positioning System (GPS) facilities to help in field mapping and machinery guidance.

However, basic ICT is no longer enough. To make more significant progress, stakeholders in the agriculture sector must leverage cutting-edge technologies to overcome persistent challenges. And Blockchain is one of them.


Although a peer-to-peer ledger system, blockchain technology trump other systems with its unmatched transparency. The high level of transparency renders the middleman redundant and eliminates the need for a central authority.

It’s a configuration that reconstructs how trust is gained. Instead of relying on authorities, trust is placed in the peer-to-peer architecture. The new transactional structure can transform agriculture in endless ways, including;

  • Optimizing the food supply chain

The food chain has become longer and more complex than ever before, creating new challenges such as food traceability, quality, and safety. Food trust and supply chain inefficiencies are other concerns. Getting healthy food to the table now takes ages because of intermediaries and bureaucratic issues in the supply chain.

Blockchain technology addresses several issues across this entire supply chain. By transparently providing individual product information in the blockchain, producers and consumers can build trust without the middleman. It also makes it tricky for the supplier to defraud producers with low-quality products.

Consumers can also trace how the food is processed and shipped, facilitated by Radio Frequency Identification (RFID). RFID tracking is a non-contact automatic identification communication that can’t be compromised because everyone is watching the system at any given time. RFID removes doubts about safety and environment-friendliness.

  • Facilitates agricultural e-commerce

E-commerce is thriving. But, not so much for agriculture because of a couple of reasons. First, e-commerce is mainly driven by trust. Customers are more likely to buy if they trust the product. Unfortunately, necessary information about agricultural goods is hard to confirm and trust.

This concern often leads to the second challenge – cash-on-delivery. While it’s still e-commerce, cash-on-delivery slows everything down. The seller’s money is tied up, meaning they can’t acquire new stock. Besides, it creates a new level of uncertainty. Above all, handling small orders with various items causes high operating costs for e-commerce merchants.

Blockchain solves most of these issues with one element – information security. Private Key encryption in the blockchain setup allows buyers to authenticate items before buying. It’s a decisive step in the e-commerce journey that instantly raises trust levels and gives the customer renewed confidence to order and pay right away.

  • Reduced food wastage 

Studies show that up to one-third of all food produced globally goes to waste. In the US alone, nearly 52% of all fresh fruits and vegetables are thrown away each year.

That’s before accounting for the products discarded in the field before reaching the market. Crops are literally rotting in farms, stores, and consumers’ homes because of inadequate food management solutions.

The worst part is, most agricultural sectors’ efforts are focused on improving productivity and yield. According to a 2019 Forbes report, 95% of agricultural research has focused on raising production over the past 30 years. Only 5% bothered with reducing wastage.

Blockchain won’t necessarily stop oranges from rotting in your fridge. However, the decentralized ledger offers a streamlined view of food production activities, which allows for timely harvesting and better storage. Remember, blockchain is also a lot more accurate in predicting demand, which would reduce food wastage.

  • Enhanced quality control

Most developed countries have elaborate quality control measures to ensure food products meet a particular safety threshold. These measures include;

  • Bacterial contamination testing
  • Measuring nutrient content
  • Inspecting livestock and plant facilities.

Often, internal and external quality control is used.

However, quality control has never been smooth, even in the most developed countries. Tracing products right from the farm to the consumption point takes much effort and resources. Even worse, counterfeiting is a real risk, and middlemen are always lurking.

Blockchain can provide a more streamlined and more effective quality control process. For instance, IBM is developing an IoT system that allows growers to monitor soil quality, irrigation, and pests more precisely. In addition, Blockchain-powered IoT sensors can help to track stored crops to monitor quality.

  • Informed agricultural insurance 

Extreme weather threatens agricultural production, ultimately outing food security at risk. It’s a challenge both crop and livestock farmers face. Recently, agricultural insurance covers have offered some respite.

If your crop fails, the insurance provider may cover some of the losses. Typically, the farmer pays a premium before the cropping cycle begins and receives an insurance payout if they experience a covered loss.

However, the way agricultural insurance is structured leaves a few dangerous gaps. Even in indemnity-based policies, considered some of the most efficient, information on the production process’s riskiness is distributed asymmetrically between the farmer and the insurer.

Farmers are far less informed. This often results in farmers with less exposure to risk buying the insurance covers more than the higher-risk group who need cover even more.

Blockchain encourages the fair distribution of pertinent information, such as weather conditions, to empower the farmer. Tailored blockchain contracts also create a situation where damage claims can be triggered via changes to weather conditions. This way, farmers get more value out of their insurance packages.


Blockchain is set to revolutionize agriculture in many other ways. It even helps producers set better prices to match demand while maintaining profitability.

However, the most important question is how soon we can implement these technologies. Stakeholders must act now to end the issues in the sector. NIX Solutions is always waiting to help.