Historically, wholesale coffee prices have been volatile, fluctuating widely over time. In the past two years, coffee prices have dropped from a high of $1.55 per pound to a low of 87 cents. Currently, coffee is selling for 99 cents per pound.

The volatility in coffee has been hard on small-to-medium sized coffee farms in countries where there are few banking options and where growers often get paid prices that don’t reflect the market, according to Luis Macias, CEO of blockchain-based supply chain service GrainChain. The company is based in McAllen, Texas.

“When coffee farmers don’t have access to formal financial systems and formal contracts for purchase, they are the ones pushed down in the industry,” Macias said. “One of the larger focuses in the overall industry…is to find solutions to not only have more financial inclusion but enhance the ability for coffee producers to have a marketplace.”

GrainChain this week announced that its blockchain network is being piloted by roughly 10% of Honduras coffee growers, or about 12,000 farmers, with an eye on going into full production around April 2020.

The relationship between coffee and blockchain has been brewing for some time.

In March, Starbucks announced a “digital transparency plan” that would let it verify their coffee beans as 100% ethically and sustainably sourced, but it didn’t reveal what technology would enable the insights.

Copyright © 2019 IDG Communications, Inc.