Introduction
My name is Michelle Williams. I am a student studying logistics in the Post Graduate Diploma Program at the Excelsior Community College in Jamaica. By completing this assignment I will explore block chain technology and to show how it can be used to improve sustainability in agriculture.
A major goal of organizations is to be sustainable. Sustainability speaks to the endurance of systems and processes. The United Nations World Commission on Environment and Development in its 1987 Our Common Future report defines sustainable development as "Development that meets the needs of the present without compromising the ability of the future generations to meet their own needs." So the questions that could be asked are; What is a sustainable organization? How can an organization measure if they are truly sustainable? How can an organization meet their present needs without compromising the ability of the future generations to meet their own needs? John Elkingston gave a possible solution to these questions when he developed the Triple Bottom Line (TBL) framework in the mid-1990s. What then is the triple bottom line? Simply put its an organizations ability to analyze how their business incorporates the social, economic and environmental factors into business decisions.
The global agricultural workforce is estimated at 40% of the total occupations (bitcoin.com 2016) making it one of the leading job providers worldwide. In Jamaica agriculture contributed approximately 7% to the Gross Domestic Product and accounted for 17% of the labour force (indexmundi.com 2016). The fact that the agriculture industry is important to any economy's ability to feed itself coupled with the significance it plays in providing employment for people of a nation, One can see why it is important to make the sector sustainable and find smarter ways to get more out of an already diminishing natural resource which is being affected by climate change. Block Chain Technology is one way that agriculturalists can seek to improve sustainability by making it more efficient to track and record the steps taken in the agriculture process and make the farms "Smart".
What is Blockchain
The blockchain is an incorruptible digital ledge of economic transactions that can be programmed to record not just financial transactions, but virtually everything of value( Don and Alex Tapscott 2016). Blockchain is also known as "distributed ledger" or "shared ledger" technology. Blockchain therefore allows users to transfer value or assets between each other without the need for a trusted intermediary as the exchange is recorded in a ledger that is shared by all users of that blockchain. Users utilize this ledger to provide a transparent view about the assets being recorded. details such as who owns the asset, who manufactured the asset, quality of the asset, origin of the asset among other descriptions.
There are different types of distributed ledger technology. One popular blockchain technology is Ethereum. This was launched around the idea that blockchains can be used for more than just recording information. Smart Contracts are central to Ethereum and allows users to codify significant parts of a workflow process, agreement or task. History was made on December , 2016 when an Australian wheat grower David Whillock delivered 23.46 metric tonnes to Fletcher International Exports in Dubbo, New South of Wales. The transaction was settled through blockchain. Whillock got his payment instantaneously. The deal was "auto-executed" by a smart contract run by commodity management platform AgriDigital. This smart contract performed a series of tasks, including valuing the delivery, verifying the buyer has sufficient funds, and securing the funds in the growers name pending delivery. Once the grower made the physical delivery, the title for the grain was transferred to the buyer as the grower's payment was simultaneously created from the reserved funds.
Block Chain technology uses include tracking good throughout the supply chain by making information available. A supply chain is a sequence of processes involved in the production and distribution of a commodity such as reaped crops from a farm. Access to and the flow of relevant and current information on the processes or inputs of the supply chain are essential for the smooth running and productivity of the chain. Information on the supply chain can provide a farmer or buyer of produce insight. By using blockchain technology this information will be made easily accessible as the entire agriculture supply chain will have access to verified data on each commodity, meaning consumers can trust where their food comes from.
Many agricultural solutions are emerging from blockchain. This includes the concepts like smart farms and SKU Chain which is used for tracking food through the supply chain. Smart farms are a form of sustainable agriculture that aims to enhance our environment quality, integrate technology with natural biological cycle controls and create economic viability within farm operations. SKU chain technology is a blockchain based system in the food industry that relies on its immutable nature to solve the problem of supply chain integrity.(Redman 2016) Monitoring the food supply chain consumers can get a better idea of where the food is coming from, the date it was created, and how it was produced more efficiently, rather depend on the inefficient labeling system which can be easily manipulated as was the case in March 2017 when several Caribbean countries imposed a ban on the importation and sale of corned beef from Brazil following reports of several major meat processors of the south American Country selling rotten beef and poultry. It was alleged that the companies involved in the illegal practice paid hefty bribes to auditors in exchange for fraudulent sanitary licences.(Caribbean360 2017 March 22)
Blockchain allows for greater accountability and improves sustainability in agriculture. The advantages of the use of block chain in agriculture are many. the use of this technology could lead to improved tracking and tracing origin of products, efficient supply chain management, fair pricing and decreased transactions fees (de Meijer 2016) .
- Efficient Supply Chains: It is helpful in the monitoring of the supply chain of food products by providing increased transparency and data integrity
- Product Tracking: It provides information on similar transactions as well as on the current stock price of good, even suppliers in rural areas are able to determine what their harvest is currently worth and sell it to distributors at a price that reflects global market conditions.
- Tracing Origin: Retailers can verify that the product they are receiving is exactly what they paid for. A consumer using block chain will have the confidence about where their food comes from and how it was produced.
- Fair pricing and decreased transaction fees: using blockchain commodity buyers are able to deal with their supplier directly and transfer payment via mobile. This may ensure that farmers receive fair payment for their produce and the retailer pays a fair price as that would save the retailer money in agents.
- Minimizing Human Error: Blockchain can present information to farmers regarding diseased products throughout their supply chain: what types of crop are they and where were they grown and the farmer can use this information to minimize future loses through better crop care and produce sorting.
- Management transparent transactions: Blockchain enables farmers to keep track of their transactions and contractual obligations to buyers, suppliers and other stakeholders in order to maintain accountability.
- Efficient Financing: Blockchain technology enables real time payments on delivery.
- Smart Farm Contracts: Blockchain technology automatically ensure that contracts between farmer and retailer or consumer are complied with, protecting the rights and obligations of contracting parties.
- Data Monitoring: Blockchain technology allows farmers to capture data in real time. example wireless sensors can be integrated into fields to monitor crop growth, harvesting and subsequent yield. This will help them to plan more effectively and maximise their success rate.
- Land titling: Blockchain can aid with keeping record of land ownership. It would reduce the risk of persons claiming to own the land as the correct ownership would have been recorded in the incorruptible ledger.
Blockchain technology will help a farm or a nation to determine how sustainable their agricultural industry is as it accurately records information. Through blockchain technology one can track down to the specific farm or farmer from which a produce was taken. Sustainable agriculture is the production of food, fiber, or other plant or animal products using farming techniques that protect the environment, public health, human communities, and animal welfare. This form of agriculture enables us to produce healthful food without compromising future generations' ability to do the same.
A country such as Jamaica and its farmers working toward sustainability in agriculture, can boast their economy through:
- The provision of more jobs as agriculture will become an attractive job
- Increased exports
- increased inflows of foreign exchange
- improved food security
Working towards sustainability in agriculture will see countries across the world such as Jamaica working towards achieving some of the United Nations Sustainability Goals. The Sustainable Development Goals (SDGs), otherwise known as the Global Goals, are a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity.
These 17 Goals build on the successes of the Millennium Development Goals.Through sustainable agriculture sustainable goals such as no poverty, no hunger, good health and good jobs and economic growth would be addressed.
With blockchain technology more focus can be given to the concept of a circular economy. A circular economy promotes greater resource productivity aiming to reduce waste and avoid pollution by design or intention, and in which material flows are of two types: biological nutrients, designed to reenter the biosphere safely, and technical nutrients, which are designed to circulate at high quality in the production system without entering the biosphere as well as being restorative and regenerative by design. This is contrast to a linear economy which is a 'take, make, dispose' model of production . the circular economy concept is a sustainable development strategy which looks at finding ways to enhance a products life cycle from being cradle to the grave to being cradle to cradle. By retrieving the information captured by blockchain, the waste from agricultural production can be tracked and consideration be given to what the waste can be utilized as.
Conclusion
Blockchain technology can enhance the sustainability of nations like Jamaica's agricultural sector, by capturing the information which can be beneficial to all who access the distributive ledger such as farmers, retailers and consumers. It will avail farmers greater access to information such as global competitive pricing so that they can be better informed as to what to charge for their produce and not charge too much or too little. This is important for a farmer to be profitable and to a nation that is into exports such as Jamaica, they will be aware of the prices so they are competitive and make the best prices for their commodities.
It also supports the compliance to contracts making it hard for a farmer to supply less or inferior quality produce to a retailer and it provides some financial protection for the farmer as block chain technology can be utilized to ensure their payment is remitted to their account before a delivery is made to the customer.
Consumers will also have more confidence and trust in what they are eating especially now when there is more focus being given to healthy eating in particular and healthy lifestyle in general. They will now be armed with information as to where their produce was grown, who the farmer is, right down to the very farm and under what conditions.