From CoinTelegraph

April 20, 2025 11:00 AM:

The agricultural industry is massive, with the EU importing 154 million tonnes and exporting 134 million tonnes of agricultural products in 2023. The market is projected to grow annually by 3.45%, reaching $5.52 trillion by 2029. However, farmers face challenges with high transaction costs, delayed payments, and outdated banking systems, especially in Africa.

Cross-border payments are crucial for agricultural trade, but traditional banking systems are expensive and slow, charging farmers 3%-6% in fees. Exchange rate losses can range from 3%-10%, impacting small businesses in Africa. Farmers often wait up to 120 days for payment settlements, affecting their liquidity and forcing them to take out high-interest loans.

Stablecoins offer a solution to the financial challenges in agricultural trade. By bypassing banking inefficiencies, farmers and traders can transact instantly with lower costs, saving 3%-6% per payment. Stablecoins also provide stability against volatile local currencies, allowing access to global markets and avoiding exchange rate fluctuations, especially in countries with unstable currencies.

Global agriculture faces fraud and supply chain inefficiencies, with food fraud costing $40 billion annually and trade in fake goods totaling $500 billion. Stablecoins could reduce counterfeit goods movement across supply chains, making the industry more efficient. African agribusinesses like Parrogate in Zimbabwe are already benefiting from blockchain technology to streamline payments and improve cross-border trade efficiency.

While stablecoins offer promise for agricultural trade, regulatory uncertainty and technological barriers remain challenges. Compliance with local regulations, education gaps, and limited access to stablecoin mechanisms in well-established infrastructure areas like Europe are hurdles to overcome. Despite these barriers, the demand for stablecoins in African agriculture is strong, with a willingness in the industry to adopt compliant stablecoin solutions for cross-border liquidity.

The adoption of stablecoins in agriculture may face obstacles, but the benefits are clear. Instant transactions, lower fees, and enhanced financial access offer a promising future for farmers and traders. Stablecoins have the potential to revolutionize the industry, providing greater financial inclusion and transforming the field as an essential evolution in the digital age.

Read more at Cointelegraph: Farmers are switching to stablecoins