Blockchain for agrofood: between dream and deed

By Oost NL

Image: Blockchain voor agrifood: tussen droom en daad - Lan van Wassenaer, Koos van der Meij en Corné Kempenaar

Blockchain is seen as one of the digitisation tools to improve the transparency, efficiency and competitiveness of agrofood and the position of farmers in agrofood chains. Dr Lan van Wassenaer, senior scientist at Wageningen University & Research, was commissioned by the Ministry of Agriculture, Nature and Food Quality to research possible applications and bottlenecks. Maaike Büchner, project manager for food at Oost NL, can use the INTERREG programme Blockstart to remove possible bottlenecks.

Van Wassenaer's research has the revealing title 'Blockchain voor agrifood: tussen droom en daad' (Blockchain for agrofood: between dream and deed) - Van Wassenaer explains: "As in the famous Dutch poem, practical objections and laws stand between dream and deed: opinions on blockchain are divided and there are sometimes other priorities. In addition, due to laws and regulations, not everything is always possible." The image of blockchain also plays a role in this, such as the environmental impact of Bitcoin: "While in fact there are many different types of blockchain, which do not require nearly as much computing power (and therefore energy, ed.) as Bitcoin."

That is a shame, as Van Wassenaer sees it, “For chains in which a lot of information is passed on within the chain, technology offers many possibilities, especially when it comes to transparency, traceability and also efficiency. You can create reliable information flows."

"By not having to fill in information manually anymore, data is less prone to error".

Dr Lan van Wassenaer - senior scientist Wageningen University & Research

"Because you no longer have to enter information manually, it is less error-sensitive. And also by linking different databases, it makes the work more efficient. You can also share the information almost in real time, which means you don't have to wait as long and there is less delay in the chain," Van Wassenaer sums up.

Food safety

Van Wassenaer also sees opportunities for improving transparency and traceability: "Mistakes are always made. With or without intent. With food, but also with waste. Think for example of fraud in the manure chain. If there is an incentive to enter incorrect information, that is unfortunately what happens. "Checks are expensive and time-consuming and are (therefore) done on a random basis. Recording data in a blockchain can be a solution: "It can be discouraging, because you can always find out where and when information has been modified. In addition, if more and more information is recorded in a universal manner, it makes analysis and cross-checking easier.”

Among entrepreneurs and companies, the researcher notices a mix of enthusiasm and reticence. "Some information may not be sensitive now, but it might be in the future. For example, a crop protection product that is permitted now, but may no longer be permitted in a few years' time. The data is fixed. Entrepreneurs experience that as a risk," says Van Wassenaer. "That is why it is important to consider carefully what you want to share."

The INTERREG programme Blockstart, financed by the European Union and the provinces of Gelderland and Overijssel, gives entrepreneurs the opportunity to investigate whether blockchain is a suitable instrument for them. Oost NL is implementing the programme, explains Maaike Büchner: "We are the point of contact for entrepreneurs who are interested, but we also support them in making choices around the training courses and workshops offered," says Büchner. "We make that choice based on the issue that the company wants to answer." This support is also necessary because each Dutch SME that applies (within the Health, Logistics and Agrofood sectors) has a maximum amount of €7,500 to spend on the available trainings.

Applications

In her research, Van Wassenaer also looked at practical examples. In the agrofood sector, blockchain is already being used by various parties. In the Netherlands, Albert Heijn has a blockchain platform and there are hundreds of initiatives worldwide that apply blockchain in agriculture and horticulture. One of the use cases in the research is the project AGF-Chain - which focuses on automating the monitoring of onion cultivation to facilitate the process at export (such as certification).

Finally, Van Wassenaer mentions the BlockFust project, in which the packaging (barrels) of flowers and plants are equipped with a chip. This way, the products can be traced and you can keep track of what happens to them. "Now the barrels sometimes still disappear. That is a cost item. Moreover, it fits in nicely with the concept of circular chains."

Getting other parties on board

The challenge in accepting the technology is that multiple parties within the chain must work together. "The first question in our checklist is always, what information do you need to share. It makes no sense to build your own blockchain for data you do not share," says Van Wassenaer. In addition, sometimes a culture change is needed: "You have to explain the basic principles and the ideology behind it well, so that the benefits are clear."

"Companies can work on a small scale to further develop their own blockchain"

Maaike Büchner - project manager Food East NL

One of the conclusions of the research is that in the application of innovative technology, the government has an important role in promoting initiatives and experiments that contribute to the achievement of social goals. Blockstart is in line with this. As Büchner says: "Companies can work on a small scale (together with the companies supplying the technology) to further develop their own blockchain. We hope that this project will convince companies to take those first steps when it comes to blockchain. After all, it really is a wonderful way to make the chain in which you operate even more transparent or secure."