An innovative platform can facilitate prompt payment to suppliers and farmers, and the immediate availability of tradable commodities to buyers. It attacks fraud and corruption through certification and accountability, and it streamlines procedures for all participants in the commodities market. Thanks to the blockchain architecture, the GrainChain platform creates a digital yet secure record of commodity data and transactions.
GrainChain was created in 2013 as an integrated cloud-based commodity storage and management solutions company working primarily in North America and Central America. GrainChain’s vision is to create a software ecosystem that empowers farmers in the global grain industry who wouldn’t normally have the budget to invest in certain technologies.
GrainChain wants to level the playing field and reduce the number of intermediaries needed to complete a transaction. GrainChain does this by providing a transaction platform for the sale and purchase of grain and other commodities.
Overall, GrainChain helps farmers engage with more buyers and increases trust and transparency throughout the value chain so that all actors can access information on the quality of the seed. In many instances it helps farmers increase profitability. For GrainChain, this starts in the fields of South Texas, where more than 1,000 farmers use its platform to generate smart contracts for the sale and purchase of grain. The farmers are paid instantly, and buyers receive immediate title to the commodity.
GrainChain runs its platform with the help of blockchain technology. It works with two systems: a logistics system called HarvX and a grain governance system called SiloSys that tracks and maintains movement of a seed from the producer to the farm, including data on the origin of the seed, authentication of the seed, and seed storage.
GrainChain’s blockchain solution is designed to collaborate with existing software systems that use its API. Therefore, GrainChain’s platform records all of this collected data in an immutable record that is perpetually linked to the commodity and the participants.
When a farmer has a certain quantity of grain to sell, the farmer creates a smart contract sales agreement with all the sales terms defined — including logistics, storage, pest control, quality of the grain, and location — on GrainChain’s platform. The buyer can then evaluate the information on the smart contract and add variables to it. By accepting this smart contract, the buyer is effectively accepting the terms that the farmer included.
GrainChain’s platform then calculates the net value for the contract and digitally escrows the buyer’s funds. Once the grain is delivered to the agreed-upon settlement location, it is verified by the system, and the buyer’s funds are automatically put into the farmer’s GrainChain wallet and converted to the local currency, which cuts out international banking and transfer fees.