Grain Quality Tracking using Blockchain
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This document proposes using a blockchain business network to track grain quality assurance from farm to port in the Brazilian agribusiness sector. Currently, the process is inefficient, expensive and vulnerable due to a lack of consensus on records kept by different participants. A blockchain network could provide consensus, provenance, immutability and finality of records kept by auditors, regulators, banks, and participants. It would integrate smart contracts, transactions and backoffice systems using REST APIs. This could remove manual data entry, create a chain of responsibility between participants, simplify information sharing between trusted parties only, and allow third-party auditing through query and analytics tools. Blockchain networks show potential for improving logistics and food safety worldwide through industry standardization
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Grain Quality Tracking using Blockchain
- 1. 1 Grain Quality Assurance Tracking based on a Blockchain Business Network Percival Lucena, Alecio Binotto, Fernanda Momo, Henry Kim
- 2. Contrato Venda Transport Warehouse Trading Transport Port BlockchainSource Exit Quality Control Entrance Quality Control Bart Contract GEBN Seed Tracking Sales Contract BLOCKCHAIN CERTIFICATE Brazilian Agribusiness: AS-IS Workflow
- 3. 3 Problem… … inefficient, expensive, vulnerable Insurer records Auditor records Regulator records Participant A’s records Bank records Participant B’s records
- 4. 4 … with consensus, provenance, immutability and finality Auditor records Regulator records Bank records Participant B’s records Blockchain Insurer records Participant A’s records Permissioned Blockchains – Business Network
- 6. 6 © 2017 IBM Corporation Permissioned Network Hosting Toronto Deployed London Planned Singapore Sydney Tokyo Dallas Ashburn Frankfurt São Paolo
- 7. 7 Contrato Venda Transport Warehouse Trading Transport Port BlockchainSource Exit Quality Control Entrance Quality Control Bart Contract GEBN Seed Tracking Sales Contract BLOCKCHAIN CERTIFICATE
- 8. Farm to Warehouse - Sample selection 8
- 9. Farm to Warehouse - Lab Analysis 9
- 10. Warehouse – Silo monitoring 10
- 11. Warehouse to Port - Bulk/Container 11
- 12. Port – Lab Analysis 12
- 14. Port – Shipment Boarding 14
- 15. Smart Contracts
- 17. Backoffice Integration – REST API
- 18. Conclusions - Trusted information requires standard practices. IoT helps to remove part of manual data entry - Participants information added to the network helps to create a chain of Responsibility - Permissioned Blockchains and private channels help to simplify information. sharing about non-trusting participants - Auditing processes can be implemented by 3rd party through query and analytics mechanisms - Logistics and Food Safety are straightforward applications of Blockchain Business Networks that can be adopted worldwide. - Creating consortiums and governance requires cross industry standardization
- 19. Thank You - Percival Lucena plucena@br.ibm.com https://arxiv.org/pdf/1803.07877
Editor's Notes
- This is the “BEFORE” picture representing the “status quo” for business networks. Each participant keeps their own ledger(s) which are updated to represent business transactions as they occur. This is EXPENSIVE due to duplication of effort and intermediaries adding margin for services. It is clearly INEFFICIENT, as the business conditions – the contract – is duplicated by every network participant It is also VULNERABLE because if a central system (e.g. Bank) is compromised due to an incidents this affects the whole business network. Incidents can include fraud, cyber attack or a simple mistake.
- The novel Blockchain architecture give participants the ability to share a ledger which is updated every time a transaction occurs through peer to peer replication. Cryptography is used to ensure that network participants see only the parts of the ledger that are relevant to them, and that transactions are secure, authenticated and verifiable. Blockchain also allows the contract for asset transfer to be embedded in the transaction database determining the conditions under which the transaction can occur. Network participants agree how transactions are verified through consensus or similar mechanisms. Government oversight, compliance & audit can be part of the same network. Participants SAME AS BEFORE – this is not a disintermediation play CONSENSUS– means all participants agree that a transaction is valid PROVENANCE– means participants know where the asset came from and how it’s ownership has changed over time IMMUTABILITY– means no participant can tamper with a transaction once it’s agreed. If a transaction was in error then a NEW transaction must be used to reverse the error, with both visible FINALITY– means that there is ONE place to determine the ownership of an asset or completion of a transaction. This is the role of the SHARED LEDGER.