GrainsWest Summer 2018

The Food Issue 2018 41 ITCOIN TOOK THE WORLD BY STORM ABOUT two years ago and has since risen, fallen, crashed, burned, re-risen and may be soaring or bottoming out on the stock market as you read this. When the world’s biggest bubble comes along, it’s hard not to take notice, and Bitcoin news certainly is enthralling. However, what has captured the attention of many is the technology behind Bitcoin: blockchain. Simply put, blockchain is an immutable and unchangeable public ledger, or record, of transactions. All dealings are recorded in the public eye for all to see. It tracks something, usually cryptocurrency, going from A to B to C and so on. However, its application is not strictly limited to digitized dollars. The agribusiness world certainly thinks there is potential for blockchain to reduce administrative burden, increase traceability and provide consumers with confidence and peace of mind at the grocery store like never before. And it’s already happening. Between November and December 2017, worldwide commodity trader Louis Dreyfus Company sent a load of U.S. soybeans to China utilizing blockchain technology. What unfolded was a success. Many players were involved, including three banks and the U.S. Department of Agriculture. The outcome was the same as with regular shipments— soybeans went to China. The main difference was the transaction’s back-end process, which received top marks from Louis Dreyfus’s perspective. “The results of this transaction clearly demonstrated the advantages of blockchain. There were significant efficiency improvements for all parties involved,” said Robert Serpollet, the company’s global head of trade operations. “It cut out much of the unnecessary, non-value-adding work and eliminated duplicate tasks. It cut the time spent on email exchanges, rekeying, sending and signing documents or identifying discrepancies. And, thanks to the platform’s automatic function, the conditions of the smart contract were automatically filled.” Although Louis Dreyfus has only conducted the single trip using blockchain, it doesn’t appear to be a one-off publicity stunt. “The technology has evolved quickly, and this could lead to production later this year,” said Serpollet. “But there is still a lot to be figured out, including the choice of technology, level of adoption, legal framework and other issues. This will not happen overnight.” Louis Dreyfus has a sterling 100 per cent success rate with blockchain to date, and oil and energy industries are also on board with the technology, according to Elaine Kub, author of Mastering the Grain Markets: How Profits Are Really B