Category Archives: Blocrice

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Oxfam Launches Blockchain-Based Rice Supply Chain

Advocates for poverty eradication Oxfam announced yesterday that it has launched its rice supply chain management platform BlocRice on the blockchain.

BlocRice, introduced in April, started out as a pilot program aiming to enhance the negotiation powers of organic rice farmers in Cambodia. The project was the first of its kind in the region, allowing farmers to interact with key players along the rice supply chain.

Country director of Oxfam Solinn Lim stated that “the aim is for BlocRice to gain acknowledgment from all relevant actors in the supply chain”.

With six actors identified in the rice value chain – the organic farmer, the agricultural cooperative, the export company, the import company (Europe), retailers, and consumers – Solinn envisages BlocRice as an ecosystem of farmers with a collective bargaining power. She said, “BlocRice will give farmers collective bargaining power since agricultural cooperatives will be parties to the contracts.”

Smart contracts will be the core technology to be leveraged upon here, which will be used to establish transparency and a coherent working protocol among farmers, exporters, and buyers.

Solinn added that all stakeholders would share a digital contract, sharing information on blockchain throughout the process, from planting to manufacture of rice crackers.

As records from 2017 reveal, Cambodian rice farmers are currently the ninth largest exporters of rice, however, applying blockchain technology could possibly improve the welfare of small-scale farmers, as well as scale up export activities of rice and other agricultural produce in Cambodia.

Song Saran, CEO of Amru Rice, an exporter in the value chain, commented on the BlocRice project: “…if it proves successful, however, it may be expanded to include all the communities currently working with Amru Rice and new products, such as organic cassava, pepper and cashew nuts.”

Further, interest from the Cambodians shows positive reception to the idea of contract farming and a desire for “financial literacy”.

 

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Oxfam to Trial Blockchain to Improve Pricing for Cambodian Rice Farmers

Oxfam International is piloting a blockchain-based farming project that aims to ensure that rice farmers get a fair price for their produce.

With 50 organic rice farmers already on board, the Blockchain for Livelihoods from Organic Cambodian Rice project, also dubbed Blocrice, Oxfam intends to introduce the program across the country.

Blockchain boost

Currently, the technology has found itself being trialed in Cambodia’s northern province of Preah Vihear. According to the Oxfam website, it will “contract farming between farmers’ cooperatives and exporters, rice cracker makers and other buyers. Contracts predefine the primary purchase price, trade volume, transportation method and other conditions.”

The pilot will digitize and register these contracts on the blockchain platform, details such as primary purchase price, trade volume and transportation method are recorded, with cashless payments made to rice farmers through bank accounts for traceability.

Solinn Lim, Country Director of Oxfam in Cambodia, believes that with Blocrice, farmers gain “collective bargaining power”. Lim adds: “The sheer fact of being registered as an actor on the blockchain platform implies that people matter, Blocrice will give them a platform to empower themselves.”

Oxfam estimates that 60% of Cambodia’s workforce is employed in the agriculture industry, explaining that many of the low-income farmers and some laborers do not have the appropriate contracts with their clients. Furthermore, lack of market price knowledge and high-interest loans are putting producers under a great deal of pressure to sell produce and clear debt.

On the up

It’s not a fantastic situation for a key industry within Cambodia. That said, over the past couple of decades, rice exports have been increasing significantly. Since 2013, Cambodian rice exports have risen by 32.5%; this is according to World’s Top Exports (WTEx), who also report Cambodia as the ninth largest exporter of rice in 2017, selling USD 331.1 million worth.

The 50 farmers who are part of the pilot are registering their profiles as well as uploading key data such as expected yields and planting areas. The project is taking place through March 2019 during the rainy season, which is the country’s prime season to harvest and sell rice.

It’s an exciting prospect for the country. Blocrice pilot participant Kann Kunthy, Managing Director of rice exporter AmruRice said, “We expect to bring traceability, transparency, financial literacy and best practices [to] contract farming in Cambodia.”

The project will be targeting the European market which accounts for almost half of Cambodia’s rice exports. Thanks to the EU’s preferential tariff exemption, Cambodian rice exports have benefited greatly.

However, the European Commission has concerns regarding certain human rights issues that occurred in the run-up to a July election, which may cause Cambodia to be removed from the special tariff.

With any luck, the implementation of the blockchain product could ease the worries of the EU and reinvigorate the rice export industry entirely. Furthermore, the project intends to expand into other provinces and exports including cassava, cashew nuts, maize and pepper.

 

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