Emerging economy supply chain technology provider bext360, has announced two programs with three partners in Africa, Europe and North America to produce the world's first blockchain traceable coffee, and to trace payments made to coffee farmers.
bext360 has partnered with the Great Lakes Coffee, a Uganda-based coffee exporter, and Coda Coffee, a Denver-based coffee roaster, to launch a pilot program using the bextmachine to trace coffee from Uganda to Denver, Colorado in the US.
For the second program, bext360 has partnered with Moyee Coffee, the world's first FairChain coffee brand based in Ethiopia and Amsterdam, to launch a full-scale production and revenue-generating program using its bext-to-brew platform to trace coffee from Ethiopa to Amsterdam, as well as payments made to coffee farmers in Ethiopia.
Coffee, the second largest traded commodity in the world, is a $100bn market worldwide. However, most of the world's coffee is grown by small farmers, many of whom depend on family labour and unreliable income —often less than $2 a day, according to the World Bank. Through these partnerships, bext360 aims to bring more transparency to the coffee supply chain and more equity to these farmers.
Tracing coffee from eastern Uganda to Colorado with the bextmachine
The first pilot program has kicked off by sourcing coffee through Great Lakes Coffee in eastern Uganda, and exporting the product to Coda Coffee in Denver, where the coffee beans will be roasted and sold to consumers. During the pilot, the bextmachine will be deployed in Uganda with Great Lakes Coffee farming partners who will deposit their coffee cherries for analysis at washing stations, where they will also be paid for their harvest. From this collection point, the product will be tracked and analysed all the way to Coda Coffee in Denver, where the coffee will be roasted and available for purchase.
The bextmachine is similar to Coinstar, but it uses machine learning, artificial intelligence and IoT to evaluate coffee cherries and beans and grades cherry and bean quality. The machine employs blockchain technology from Stellar.org to track data about the coffee's origin and quality and allows for digital payments to farmers via a mobile app. The bext360 platform enables all stakeholders – farmers, roasters, and consumers – to access data across the entirety of the supply chain. This data enables complete analysis of the supply chain to identify supply chain efficiencies, as well as allow more compensation to farmers who produce higher quality coffee cherries. For consumers, bext360 provides unprecedented levels of transparency around origin and quality; and allowing, for the first time, a coffee drinker in Denver to have access to this data and verify that the single-origin coffee the cafe sold to her is exactly that.
Tracing coffee from Ethiopia to Amsterdam and payments back to Ethiopian farmers with the bext-to-brew platform
The four-month long revenue generating program with Moyee Coffee will begin on 6 November by sourcing coffee in Ethiopia and providing proof of living-wage payments made to the farmers, all traced and immutable within the blockchain. For this entire coffee harvesting season in Ethiopia, all of Moyee's coffee will be fully blockchain-traceable from the washing station in Ethiopia to its retail and wholesale customers in Europe. The collaboration with bext360 makes Moyee the first European coffee brand to introduce fully blockchain-traceable coffee.
Moyee will be providing confirmation data from the producers and farmers at the different points of collection, which will be inputted into bext360's bext-to-brew platform, which is powered by Stellar.org's blockchain technology. All of this coffee information — from origin, quality, to purchasers to payouts — are recorded on a blockchain in bext-to-brew platform. The ledger is designed to help keep down overhead costs, replacing paper carbon copies and other inefficient record-keeping methods, while making the financials easier to audit. For consumers, bext360 provides unprecedented levels of transparency around origin and quality; and allowing, for the first time, a coffee drinker in Europe to pull up this data and verify exactly where her coffee was sourced.
At the point of collection, the bext360 platform instantaneously creates crypto tokens, which represents the value of the commodity. As the commodity flows through the entire supply chain, new tokens are automatically created to represent the commodity in its developed form. For example, when a coffee cherry enters the supply chain, a token will be created to represent its quality at the first level. As it continues through its lifecycle in the supply chain and becomes green coffee, a new token will be created at each node of the supply chain and will be exchanged with the older token, in order to represent the commodity in its new form.
bext360's tokenisation technology, which is currently patent-pending, can be used to drastically reduce the transaction cost of global commodities. For example, these tokens can be used for inventory valuation, and smart contracts can be created and used against these tokens. Today, the certification process in supply chains is extremely costly. Currently, once a product arrives at each point of the supply chain, an inspector must physically examine the product and ensure that the product is what it says it is. For coffee, every batch needs certification papers to move along the supply chain, from one port to the next. The bext360 platform provides fully transparency and immutability, which can eliminate this costly part of the supply chain.
Guido van Staveren, Moyee Coffee founder, said: "Blockchain is the next big step in our FairChain coffee revolution, which is proving there is an enormous demand for radically more honest and transparent coffee. The bext360 platform changes the game entirely. Its blockchain technology brings unprecedented transparency to our FairChain and its crypto-tokens enable us to pay our farmers immediately and directly. Smart technology used to benefit the men and women who produce our coffee."
Daniel Jones, bext360 founder and CEO, said: "We're beyond excited to be launching our pilot programs with our Moyee Coffee, Coda Coffee and the Great Lakes Coffee. It's exciting on many levels for us – firstly, it's our first production and revenue producing implementation of our platform, which will produce the world's first blockchain traceable coffee supply chain.
"Secondly, this partnership signifies a significant step towards fulfilling our vision of using the most cutting edge technology to bring consumer and farming communities together to improve product quality, community livelihoods, as well as the consumer coffee experience."