A blockchain-enabled trading platform for coffee that will help connect growers with roasters and traders directly, ensuring better realisations, is in the offing. The state-run Coffee Board is facilitating the setting up of the proposed trading platform which will also help address the traceability issue for the buyers.
Sources said discussions are on with the state-run MSTC, the e-commerce company, which is likely to take the lead in developing and operating the platform. “We are looking at launching a pilot in about three months time. This will benefit both the buyers and sellers,” said NN Narendra, Director of Finance, Coffee Board.
Presently the Board is undertaking stakeholder consultations to finalise the trade flow process for the proposed platform, while Acviss Technologies, a Bengaluru-based start-up has developed the blockchain-based traceability solution. “Tracking and traceability is important aspect of the platform and that will be enabled through the block chain,” he said.
Price discovery
Coffee growers, curers, traders and exporters can participate and trade online on the trading platform where the price discovery will happen. Currently, the coffee trade is largely unorganised and is not under the purview of the APMC system. Though prices of Indian coffee mirror the broader trend in the New York and London terminals, the curing houses and traders fix the actual farm gate prices depending upon the locations and quality parameters.
Once the trading platform is operationalised, growers can sell directly from their farm gates or can ship to an empanelled warehouse that will approve the quality parameters and then the trade takes place online, Narendra said. Sellers can give a base price or an expected price for their coffees. After the seller accepts the trade, then a smart contract will be generated, after which the buyer has to transfer the money into the escrow account of the platform within 24 hours and then the seller has to ship or the warehouse has to raise the clearance. The buyer can go and collect the commodity and then the money moves to the sellers account from the escrow account.
Acviss Technologies said in a statement that it has developed a “no internet” blockchain-based traceability application for the Coffee Board. The application is designed to protect coffee production from counterfeiting. Vikas Jain, Founder, of Acviss Technologies said, “It has been a pleasure creating a solution for the Coffee Board, we’ve not only built something innovative but we’ve also tried to make it accessible and helpful for the common man. The app we have created is very simple and does not require Wi-Fi for farmers to scan. It’s a very easy and user-friendly app created first and foremost for the benefit of farmers’‘
Anti-counterfeiting
The blockchain-based traceability application by Acviss is an anti-counterfeiting solution that helps to reorganise the unstructured supply chain, provides transparency in transactions, and protects farmers from fraud and fake GI tag products with the help of quality evaluation. This app also helps farmers to generate stable income and protects them from any collateral damage with the help of automated payments, insurance and financing as there is no middlemen involved. For the end users, this app also helps consumers by providing authenticated certifications ensuring that the bought product is safe for consumption, Acviss said.
In 2019, the Coffee Board had activated a block chain based e-marketplace in collaboration with Eka Plus. However, the initiative did not take off beyond the pilot project for various reasons.