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  • Blockchain implementation has clear advantages in terms of overall supply-chain management, but it can also have more direct benefits for farmers specifically:
    • Better participation in supply chains
    • Reduced transaction costs
    • Support for farmer co-operatives
    • Support fair labour practices
    • Prompt payment for services and insurance claims
  • Typically, farmers - particularly small-scale farmers - can be inhibited from participating in supply chains due to costs (e.g. marketing costs, transaction costs, negotiation costs etc) caused by a lack of information transparency
  • Implementation of Blockchain in the agri-food supply chain can be beneficial to farmers by:
    • Enabling collaboration between supply chain partners by enhancing trust
    • Improved market knowledge and understanding of buyers’ requirements
    • Reduced transaction costs (e.g. due to disintermediation) can enable farmers to access new markets
    • Increased transparency and more direct contact with consumers can empower farmers in disadvantaged communities to demand fairer wages


  • One way in which Blockchain based solutions can benefit farmers is through the use of smart contracts
  • Blockchain-based, can be integrated with IoT devices
  • Advantages: reduced time-delay, foster trust, immutable
  • Reduce need for intermediaries e.g. lawyers, banks who typically enforce the terms of the contract
  • Discourage buyers from reneging on payment

Note: stand-alone code-only smart contracts are not legally enforceable; smart contracts are most effective as ancillaries to implement the provisions of a traditional text-based, legally-binding contract


  • Example: A farmer growing wheat wants to sell next year’s harvest to a producer who wants to turn it into flour.
  • The farmer and the producer create a smart contract according to which the farmer will be paid upon receipt of the wheat.
  • The following year, the wheat is harvested and delivered to the industrial mill, and the farmer receives his payment automatically via the smart contract upon transfer of asset ownership.


  • Crop insurance is under-utilized globally, in part because the claims process can be complex and/or, in certain countries, corrupt
  • Smart index-based insurance contracts: payout is triggered by a measurable index rather than the loss itself
  • Example: an agricultural smart contract might be triggered by weather data, e.g. if it is hotter than 40 degrees for over a week, farmers with this insurance package will automatically receive a payout
  • Advantages: timely payout, minimal human interaction, symmetrical information between farmer and insurance provider, avoid costly damage assessment



  • Prompt payment, reduced time-delay
  • Reduced costs due to disintermediation
  • Transparency and immutability promotes trust between actors
  • Reduced likelihood of breach of contract
  • Promising use in crop insurance
  • Efficient


  • Smart contracts (in and of themselves) are not legally enforceable
  • Technical expert needed to write smart contract code - a new middleman?
  • Infrastructure and a high level of digital maturity is necessary for implementation
  • Inflexible


  • Although the literature has identified many potential advantages of Blockchain implementation for farmers, lack of digital capacity and initial adoption costs remain persistent problems
  • Low levels of digitalisation, especially in developing countries
  • Could potentially widen the financial and digital divide between large and small stakeholders, farmers in developed and developing countries
  • Importance of farmer training and skill development
  • The negative environmental impact of current agricultural practices necessitates a new sustainability driven approach to agrifood production
  • New technologies - including Blockchain based solutions - can help to make more effective use of limited resources and reduce food waste
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