How Blockchain could save the world from food shortage
Monetary crisis, Quantitative Easings, Financial crisis coming, low-interest rates and low returns from the stock markets… But the price of food keeps increasing. Looking for a safe investment? The next place to put your assets is definitely Agricultural land. However, the sector suffers from a lack of liquidities and technical innovation implementation. What is the issue and how Blockchain Technology will soon boost this sector?
In a few years, the increase of food intake per inhabitant and the growing number of people on the planet will cause high political instability and revolts that we already see happening in Africa and South American countries. It is just a matter of time before people in the world will start starving, not only in underdeveloped countries… Paradoxically, most of the arable land in the world is not exploited. We gather production on a few parcels that we destroy with chemicals in order to boost their production while others are left in fallow. Presently, the main cause of the shortage is not climate change or any other factors. We have enough arable lands and therefore enough food to feed everyone on this planet. The real cause is the lack of land registration. Enhancing property rights transparency and visibility for every owner will trigger a new era where investments will flock to the agricultural land and new farm developments. This will result in more production but also better food quality.
We all know that blockchain is the latest digital innovation that is on the path to revolutionizing many business sectors, if not most of them… According to many studies, Agriculture and Land Registry are the primary sectors where blockchain technology application is the most promising and vital for the transition towards more sustainable and healthier food production. In fact, the food industry is facing many challenges such as population growth and scarcity of arable lands, climate change, infertile soils, food loss, agriculture productivity inequalities and food-borne illnesses as figured in The Future of Agriculture and Food brochure by Handelsblatt Research Institute. Thus, consumers demands for more information and transparency on soils and food production is growing at a face pace.
In addition, the land registry system is not complying with today’s needs, it is out-dated in most countries worldwide so it systematically affects delays in transactions and ownership verification, and can occasionally lead to land misappropriation.
The use of blockchain ease and fasten the processing time for land transactions and property transfers, allowing anyone to freely access the property without high administrative boundaries.
Moreover, the ownership information on the blockchain ensure the rightful property owner and eradicate conflicts, disputes and corruption in the land administration system. In fact, land real estate is consistently ranked among the most corrupt sector in the world as detailed in the Doing Business 2018 report (Registering Property chapter).
The problem is that Agricultural production needs stability. While changing owners often because of corrupted landowners, all the information about the land is lost with all the data gathering work. Year after another, agricultural landowners need to track their production to make the best choice in order to attain the highest possible efficiency. By tracking land on the Blockchain on a map, we can make it possible to store this information forever.
Globally, the opacity of land administration systems is responsible for the lack of a legally registered title for more than 70% of the landowners worldwide who are in threat of being expropriated. That is causing a lack of foreign investments in most of the regions of the World.
In order to bypass this issue, improve efficiency and transparency, and help restore public trust in government’s national agencies, countries like Ghana, Georgia, and Honduras are now moving towards implementing blockchain-based land registries as stated in the Digital Transformation: Blockchain and Land titled review, from 2019 OECD Paris Conference.
Blockchain application is feasible for land governance by creating a unitary system of all information related to land real estate and connecting it to the global economy. According to the FAO publication, E-agriculture in action: Blockchain for agriculture, the challenge for a more efficient and transparent food chain supply is huge taking into account that 40% of the global population revenues drive from the food supply, nevertheless over 50% of their crop value is lost between harvest and sale.
Small-scale farmers will have to produce more than 60% of the food needed to feed a population of more than 9 billion by 2050, reports from the same publication, which is focused on how the life-changing impact of information and communication technologies (ICT’s) such as blockchain technology, IoT, big data analytics and information systems, and artificial intelligence, just to name a few, aims to promote and support sustainable agriculture and rural development.
In a report made by Stanford Business, called Blockchain for Social Impact 2019 (Agriculture and Land Rights chapter), the organizations having integrated blockchain in the agriculture and land rights sector are using this technology mainly for supply chain management and for records verification. More and more projects and organizations are using blockchain and agriculture 4.0 technologies to establish a ubiquitous trust among key stakeholders into the supply chain to enhance transparency in the food production and distribution as demonstrated in The Rise of Blockchain Technology in Agriculture and Food Supply Chains research.
The next step will be to go deeper into the root of the problem: solving the visibility issue by making information on land quality and ownership available to all. This can only be done by creating a tool that is easy to use for everyone. And the solution was found by the Fieldcoin Team to create an interactive map that is linked with the Blockchain and displaying ERC721 tokens for each parcel. This way, we will know exactly who owns which land but also we can trace what we consume and from where the food we eat comes from. The interactive map is linked with the Ethereum blockchain, accessible to anyone and containing immutable information needed on land properties.