For farmers in all corners of the globe, we are beginning to see what a working blockchain system may look like, how farmers will interact with such systems and what this new technology will mean for farm businesses.

Blockchain is a digital platform that stores and verifies transactions between users. Rather than focussing on one part of the supply chain - such as growers, or grain handlers or consumers - blockchain focuses on the interaction between supply chain participants. This digitised approach to managing supply chains facilitates the transfer of physical commodities, finance and associated data and, in doing so, offers four main benefits - transparency, proof of origin, alleviation of counterparty risk and increased supply chain efficiency.

A major barrier for successful deployment of blockchain is its reliance on the development of other technologies. The development and integration of these other technologies - such as sensors and connectivity networks - will enable farmers and other participants to collect, share and add data to the blockchain. Additionally, software platforms will act as an interface for blockchain technology - farmers will not actually interact with blockchain technology itself.

The pointy end of this conversation for growers is around the implications that blockchain participation may hold for the farm business. The market in which growers are involved - and with who - will determine when, and how, growers should participate in a blockchain. For example, what data will we need to supply and does that compromise our competitive advantage? Similarly, should growers move first or wait until they are required to engage in a blockchain to facilitate sales?

While not part of fully-engaged blockchains, there are examples emerging which illustrate that farmers will have a much closer data-sharing relationship in the future. In July this year, Bayer announced intentions to move to a yield-based pricing model, while locally CBH has offered members 50c/tonne to supply data on crop variety and intended delivery point at a paddock level.

For farmers to enter into data-sharing agreements with their supply chains, it must be mutually beneficial for all parties. For growers, benefits may be in the form of increased margins, access to premium markets, reduced market risk or the value derived from a timely secure payment. Furthermore, new "data sharing partnerships" will impact strategic business decisions, such as the type of skill sets and the digital infrastructure needed on the farm.