Blockchain: brewing a better coffee?
Low prices paid to coffee farmers and rampant speculation in the market have jeopardized the future of the coffee industry in recent years.
The iFinca platform is aiming to streamlines trade, and provide coffee companies with full traceability to the farm gate.
Alexander Barrett, CEO of iFinca said (emphasis added):
If we’re going to make sure farmers get what they need to produce coffee sustainably, we need to figure out how to better distribute value. With iFinca handling the heavy work of sharing verified information, we’re able to create efficiencies across the supply chain that ensure that farmers are better compensated and receive a living income.
The iFinca platform says it utilizes a network of verified transactions, and each actor in a supply chain has equal access to information. On this, Néstor Osorio, former Executive Director of the International Coffee Organization and former Ambassador to the UK and the United Nations said:
The issue of transparency and being able to trace coffee to its origin is very important. It means being able to understand the way it was cultivated, how it moves around the world. As a platform, iFinca is the answer to how we innovate, to how we answer that question bringing producers and consumers closer together.
The iFinca platform has grown since its launch in October 2019 to include 38 exporters, 14 importers, 26 roasters and 19 cafes, and 9,430 individual farmers and 13 cooperatives across Colombia, Mexico, Guatemala, El Salvador, Honduras, Nicaragua, Haiti and the Dominican Republic.
The sharing of all information in the network is potentially of concern, given that farming data is valued highly between competitors and can be used to plan pricing and harvesting. Other supply chain deployments have taken a stricter approach to agricultural privacy for the farmers in order to show the value of their system against the trade off of sharing data.
Despite this concern, in the initial trading period, iFinca say they demonstrated a verifiable increase in price per pound for smallholder farmers, which has been put down to consumers valuing very specific details about their coffee and presumably paying more for that information.
Mr Ed Wethli, owner of Crazy Mocha, a roaster/retailer with more than 25 locations in and around the Pittsburgh area said:
The insight into our relationships through iFinca allow us to have a direct connection with the farms we source from. This means better coffee for our customers and better income for the farmers we source from.
No word yet on how the contracting under this supply chain is being managed and automated, but we are confident there are lawyers still employed to ensure that these are in place.