Potential Benefits of Blockchain Technology for E-Commerce Agriculture Businesses

The global population is increasing day by day, increasing the demand for food. This has created a lot of issues for the agriculture sector as it is witnessing massive barriers in supplying food.

Some common obstacles the agriculture sector face are climate change, desertification, pests, floods, and disease outbreaks. To overcome these barriers and provide a suitable solution for the agriculture sector, blockchain technology can be a great option.

So, this article can help learn and understand in-depth blockchain technology and its benefits for the e-commerce agriculture industries.

Introduction of Blockchain Technology

Blockchain technology refers to an electronic system that allows in keeping well organized and maintained records of the money transaction between two parties in real-time.

When a person does any transaction using the blockchain system, the exchange’s accurate date, time, nature, and exact pricing is automatically recorded.

Once other parties confirm the accuracy of the recorded information, it gets permanently recorded and can also be accessible by other people available in the system.

Therefore, the agriculture sector is quickly adopting blockchain technology because it provides precise details about products.

As per the reports of BIS Research, the value of global blockchain in the agriculture and food market was $139.6 million in 2020, which is projected to reach $1.48 billion by 2026, with a CAGR of 51.0%.

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Due to blockchain, the agriculture sector is witnessing several benefits, such as enhanced informational transparency between parties. Also, blockchain technology will help provide excellent solutions for modernizing agricultural e-commerce platforms with their advanced systems.

Blockchain Technology for E-Commerce Agriculture Industries

The crucial factors any customer looks at while ordering anything online are trust with the E-commerce platform, payment methods, convenience, and the option for tracking the order.

The customers’ requirements for ingredients have become much more specific when it comes to the food sector, which is a big issue for agricultural businesses.

Agriculture sectors need to be quick in processing and delivering food items so that food doesn’t get spoiled. Food spoiling is a severe concern for companies as they can lose their consumers’ trust if this happens with their company’s products.

Benefits of Blockchain Technology in the E-Commerce Sector

• Security

The private key, encryption, and multi-factor authentication are effective tools that can help in keeping the E-commerce data safe from unauthorized access.

The information gathered from the agriculture farm and recorded using blockchain technology remains well stored in the blockchain system.

So, this technology can be a great way to let customers and producers get the required information about the agriculture products they purchase.

• Supply chain management

Information about farmers, product’s origin, logistics company, warehouse, transportation conditions, and storage temperatures can also be easily added to the blockchain system. Further, these data are cross verified by the blockchain system and remain unchangeable there.

Such accurate data makes it even more accessible for E-commerce businesses to achieve effective supply chain management.

• Payment methods

Blockchain can be a great way of reducing transaction costs. With the introduction of this technology, the chances of using cryptocurrency in dealings with farming products have become higher.

• Customer trust

The blockchain system verifies every small detail with other parties before storing them permanently in their system.

Since the information gets well verified and available publicly, users can better access the required data. This can help increase the trust level of consumers with farmers and their products.

Blockchain E-Commerce Platforms

There are several live instances of the online E-commerce platform using the technology of the blockchain system. Alibaba Group and Bayer Crop Science are examples of such online E-commerce platforms.

Alibaba Group and Bayer Crop Science

Ant Financial is a subsidiary of Alibaba Group, a multinational E-commerce company. This subsidiary is owned by Alipay (one of China’s most prominent digital payment platforms). In 2020, this subsidiary signed a deal with Bayer Crop Science, a pharmaceutical company.

The companies launched a blockchain project in China for the welfare of farmers. With the help of this technology, farmers can generate better profits by supplying and selling quality products directly on Alibaba’s e-commerce platforms. ‘

Conclusion

Blockchain technology has tremendous potential to positively impact the agriculture business. It can help increase the trust level between the two parties, communicate information related to agricultural products, and reduce agricultural trade costs.

Moreover, blockchain technology can help transform traditional conventional agriculture business to digital agriculture business in the future.