Commodity Monday #15: Blockchain Tractored.
What tractors have to do with blockchain? IBM researchers believe that when combined with AI and IoT, blockchain can enable banks to lend to farmers and tractor owners based on utilisation of and data collected by tractors. Read about this and more in our latest issue of Commodity Monday.
Researchers at IBM lab in Kenya are working with Hello Tractor to pilot the agriculture digital wallet, a blockchain-enabled and AI-based decision support platform that enables capturing, tracking, and instant sharing of data, while creating end-to-end trust and transparency for all the parties involved across the agribusiness value chain.
More specifically, the pilot will address a broad cross-section of the agriculture industry:
- Farmers: Machine learning will help farmers predict crop yields. The data, combined with advanced analytics and blockchain, can be mined to develop a credit score for loans by predicting the value of a harvest.
- Tractor Fleet Owners: able to view and manage fleet utilization and predictive maintenance as well as forecast future tractor utilizations based on history, real-time weather data and remote sensing satellite data.
- Banks and Financial Institutions: view and track utilization of tractors while also evaluating forecasted utilization to make credit decisions for tractor owners based on verified and trusted data on the blockchain.
The blockchain will provide a tamper-proof definition of demand-side and supply-side workflows from tractor request to fulfillment, payment for services, and distribution of proceeds, logging of all workflow-related approvals including booking, invoicing, etc.).
The project was announced at recent TechCrunch Battlefield in Lagos, Nigeria. The pilot is slated from H1 2019.
A lack of rain in the Northeast corn producing provinces has left fields parched, which has prevented farmers from sowing seed. The critical planting window for South African corn closes roughly around the end of December, but the ideal crop planting window in some states has already passed.
The market has responded accordingly, white and yellow corn prices have spiked by over 100 rand in the past few weeks on the Johannesburg Stock Exchange and a weakening rand has compounded the issue.
Problems with South Africa’s corn crop come as the country’s agricultural sector struggles. The Agribusiness Confidence Index dropped to a nine-year low in the final quarter of 2018, with participants citing infrastructure concerns and recent contentious land and property-rights legislation.
Although South Africa isn’t expected to suffer immediate effects from a weak corn harvest — bumper crops over the past two years have bolstered carryover corn stocks — rising corn prices put neighboring countries like Zimbabwe and Botswana at risk for food supply shortages.
India is the second-largest producer of wheat in the world, but it still has a hard time keeping up with growing domestic demand for the staple food crop.
For the current crop year, which will be harvested in April and May, wheat production is forecast at 99.7 million tonnes, slightly ahead of last year’s 98.5 million tonnes. But with India’s wheat consumption for 2018/19 expected to reach 93 million tonnes, plus another 5 million tonnes needed for the livestock industry, there is a possibility that supplies will once again be tight.
Wheat production is very important to India’s agricultural industry, economy, and the well-being of the country’s consumers. Historically a net exporter of the grain, India now struggles to produce enough wheat to keep up with growing demand. As the country shifted to being a net wheat importer in 2016, government procurement, minimum price support, and investments in the wheat industry were ramped up to address the industry’s concerns about future output. Wheat production also faces threats from climate change, as the crop is more sensitive to environmental stressors than others. The future of India’s wheat production will depend on how the industry responds to a changing environment and rising consumer demand.
Swisscom Blockchain, the blockchain advisory and development arm of Swiss telecom giant Swisscom, and essDOCS, an enabler of paperless trade, announced a strategic partnership to jointly provide blockchain solutions such as traceability, cross-platform connectivity and solution-data distribution. The joint solutions will first focus on transition technology, bridging data ‘gaps’, paper-based processes and technological silos with the end goal of secure, automated digital trade.
Founded in 2005, essDocs already offers a range of non-blockchain solutions to digitise trade finance and logistics documents, including the bill of lading. Swisscom Blockchain and essDOCS have commenced testing of their first collaborative product, which will officially launch in 2019.