Blockchain technology enables sharing and storing of data in a virtual space amongst a network of users. Transactions are done in real time and no one person has a monopoly of the information. The food industry is very sensitive. Many people get diseases out of badly prepared foods. There is also a lot of wastage along the supply chain; from the farmer to the food preparation center. Blockchain technology helps to build smart contracts amongst the participants in the blockchain. It brings about efficiency, reduces wastage, and eliminates fraud. This article explores some of the key benefits those in the food industry stand to gain by embracing blockchain technology:
Blockchain technology brings out transparency along the food supply chain. It helps all those concerned to better respond to food safety disasters. When it comes to food safety, every second counts. Retailers can easily trace the source of the problem easily if all the suppliers are on the blockchain. Contamination in case of a disease can easily be done. The food supply chain is very fragmented with very many players who are distributed across the globe. Blockchain technology can put all the intermediaries and producers in one place.
Transparency and preventing fraud
Data is bound to human error. The data after being verified by third parties is often stored in a central place. But, this information can at times be inaccurate and is subject to manipulation. With blockchain, you have a ledger that can be verified by everyone in the blockchain. This eliminates errors and cases of fraud. In case someone supplies erroneous information, they can easily be traced. Labor contracts can easily be negotiated and entered into the blockchain. This eliminates cases of child labor common in developing countries. It is often difficult for multinationals to vet the labor force in foreign nations.
Better management of data leads to scientists being able to mitigate food shortages and handle biological threats effectively. In some countries, you will discover that fish populations have seen a gradual decline. With better record keeping stakeholders can keep a tap on the populations, mitigate any declines, and improve quality.
Faster and quicker payments
Farmers face delayed payments when it comes to food production along the supply chain. With blockchain technology, farmers get instant payments for produce supplied. The prices are also very close to the prevailing market rates. This will boost efficiency as the farmer can reinvest the money received in producing more products. Blockchain will also eliminate inflated prices across the food chain supply. When intermediaries are eliminated transaction costs are reduced and the market moves towards efficiency. Small-scale farmers can also enter the grind, which enhances diversity as more products are brought into the market.
There is a lot of opportunities that blockchain technology offers to the food industry. Better management of data will reduce food wastage and efficient payment systems to farmers will open up new markets for farm production. Transparency in data management will reduce fraud and the sharing of data will enhance biodiversity in several sectors.