The rise of blockchain in Agriculture: Growing data connections

Many of those in the digital rights and tech policy community have a jaded view of blockchain. It is seen as just the latest in a long list of proposed technologies that promise to magically solve complex social and economic ills. It has been interesting for me, therefore, as a person with a digital rights background to now be working within a sector embracing it.

I research the growth of new technologies in Agriculture: Artificial intelligence, automation, robotics, etc. Within Ag, there is a great deal of excitement around blockchain — ostensibly because of the ways in which it can provide better knowledge about food provenance — or the origin of food.

Understanding and identifying food provenance is an important thing. A singular problem of our increasingly consolidated food supply chain is the rise of contamination.[1] A recent Center for Disease Control and Prevention report found that major, multi-state foodborne outbreaks have tripled in the past twenty years, and one in six Americans can expect to sicken due to contagion. This has led vendors to seek out solutions which could make it easier to trace problems back to the source. One of those vendors is Walmart.

In 2016, Walmart partnered with IBM to pilot test utilizing blockchain technology in the supply chain of mangos in North America, and pork in China. They were delighted by the results: For one, they discovered that fruit they believed originated from Mexico actually came from Costa Rica; but perhaps more importantly, they managed to reduce the time it takes to trace a product to origin from 7 days to 2.2 seconds. From Walmart’s point of view, this bore out claims of transparency and efficiency. Walmart has put over 20 products on this blockchain platform (including pharmaceuticals) and will soon require that all their leafy green suppliers adopt it.

That Walmart has decided to adopt blockchain is important because their purchasing power alone ensures that a great number of ancillary suppliers will be required to implement the technology — but that company is far from alone in the agricultural sector. From large-scale commodity traders which are creating entire platforms to enable trades, to uber-small grassroots direct-to-consumer cooperatives, to the development sector — producers and vendors alike see blockchain technology as a way to bring new efficiencies, clarity, and food provenance into the industry.

But as this tech gets adopted, questions remain.

Decentralization vs Centralization

One of the main promises of blockchain technology is that it can distribute the information across platforms, ensuring that the information is not held in any one place. This is said to ensure openness, transparency, and decentralization

But as of right now, this is largely not the case. Most still rely on a centralized, singular private platform provider. In the case of Walmart, their partner is IBM, and all the data for their trades is housed on IBM servers. Many claim that the IBM “Food Trust” is a blockchain in name only; that while its technology is based on an open source blockchain framework, the chain itself is completely closed off within a centralized organization and is unlikely to produce very many nodes. The main concern with these private blockchain consortiums is that they lack incentive and verification processes.

Transparency and Traceability

Speeding up a problem does not improve the quality of input data — it just enshrines problems. Blockchain is very capable of capturing the digital record of a bag of lettuce, but cannot determine if that bag was mislabeled. Blockchain does not protect from fraud. The need for human oversight and regulation remains just as great. Indeed, speeding up the process may in fact increase the rate of contamination, as claims of efficiency is used as an excuse to diminish oversight. A PwC analyst encourages companies to think “like a fraudster” and has gone so far as to say that that blockchain technologies in the food supply arena simply gives the illusion of traceability. Additionally, while the technology is (ostensibly) secure, physical points of access are not. It is not difficult to replace stickers or QR codes on boxes.

Growing Data Connections

Ultimately, it is unlikely that groups like Walmart, Nestle, Carrefour, etc., care about provenance so much as the illusion of it — the ability to off-load responsibility onto the smallest common denominator (in this case, farmers). This is technology which they see as a way to both increase control and decrease costs.

But the institution of blockchain systems is also about the growth of an entirely new commodity: data. Dennison Bertram, who worked at an early-stage supply blockchain company called Bazzta, realized quickly that their product was gaining value not from what was cultivated in the ground, but from the information that was extracted in aggregated information:

With enough data you can create a comprehensive picture of the health of harvests, the effect of fertilizers and farming methods, you can understand rainfall, climate change, and yields. You can look into the past and predict the future, correlate growing conditions, identify and eliminate inefficiencies and standardize quality.

None of this information benefits the farmer. In a neo-colonialist fashion, according to Bertram, instead this information is extracted and remade, only considered valuable once it has been transformed by others.

This end goal of generating data — not growing food — is made clear in the discourse of the companies. The motto for IBM’s Food Trust is “where data becomes the world’s most essential ingredient”. Monsanto (pre-Bayer acquisition), said that it had transitioned from being a seed company to being a data company.

Many of the same companies investing in agriculture chains are also involved in the creation of ledgers in other areas — and the overlap between these institutions is vast. Koch Industries, for example, is involved in blockchain consortiums in commodities (energy, agriculture), transportation, and intellectual property.

Conclusion

Despite the speed with which this technology is being adopted, great barriers remain to the adoption of blockchain in agriculture. There is in general a lack of global standards, many different regulatory environments, and complexities within the chain of custody. And yet, because of the consolidated nature of agriculture and related industries, these issues are quickly diminishing.

There is a tendency in the tech policy/digital rights community to dismiss blockchain, but those discussions usually center around the problems with public ledgers. The technology described here are for the most part private ledgers, a different entity, which are — at least according to Bruce Schneier, not only “nothing new,” but “completely uninteresting”.

I respectfully disagree. Fundamentally, the rollout of this technology will create new financial and technological dependencies between retailers, suppliers, and farmers; it can generate new power dynamics and magnify existing inequities within already imbalanced agricultural systems. It also has the capability to provide new data insights to the companies with access to this aggregated information. Just as Walmart’s adoption of RFID chips forced an entire sector to adapt to that tech, so too will their adoption of blockchain.

What benefits and insights does this data give Walmart (and others incorporating this tech)? How will the incorporation of Artificial Intelligence magnify these capabilities? These are questions the tech policy community should be paying attention to, instead of focusing on the — admittedly, outrageous claims of the companies themselves.

[1] Some claim that the ability to detect contamination is the actual problem, which is facilitated by the increasing use of technology and oversight tools. This is a highly disputed point, however.