• Transaction is the result of a partnership between CNH Industrial Bank and Agrotoken
• Farmer was able to use his own grain as part payment for a New Holland T8 Tractor
Transforming grain into a kind of 'digital currency' to buy machinery and implements is already a reality in Brazilian agribusiness. Wagner Cruvinel, from Silvânia (Goiás State), is updating his machinery fleet and partly paid for his New Holland T8 tractor with his grain. He’s transformed it into bankable digital assets and it is the first time that this business model has been implemented in Brazil.
The transaction was possible thanks to the partnership between Banco CNH Industrial, CNH Industrial's financial services arm in Latin America, and Agrotoken, a pioneering company in the field of tokenizing agricultural commodities. The deal was closed on the New Holland stand during the Rural Coopavel Show, in Cascavel (Paraná State).
Acquiring agricultural machinery and implements in this way, and during the show, led to advantageous negotiating conditions. “With the grains transformed into digital assets, it was possible to trade with the resource that I already have available in my company's ecosystem,” emphasizes Cruvinel.
This ‘first’ represents the starting point in the trading of this type of digital asset in the agricultural machinery business. "This is a big step for New Holland and for Brazilian agriculture. We live in a world in constant transformation and the rural community is no exception. The digital economy is already part of our lives, and this is an example of the potential for evolution and development we have in our business," said Eduardo Kerbauy, Vice President New Holland Agriculture in Latin America.
"We promote digitalization because it gives us flexibility, the ability to innovate with simplicity and agility, always focusing on our customers," said Heberson De Goes, President of Banco CNH Industrial, Latin America. “And we are very pleased with the possibility of expanding our agricultural business in Brazil as well as in Argentina,” adds Goes.
How trading in “digital grain” works
Agrotoken has an efficient, safe and reliable ecosystem that transforms agri- commodities into bankable digital assets. In practice, the company transforms grain into a ‘digital good’, to be kept or exchanged for other items, services or other requirements. With the physical grain digitized on the Agrotoken platform – which occurs via a secure transaction using technology - the grain is converted into 'agrotokens' as credit for the producer to use in commercial and financial operations, which are always directly supported by the grain – with its value linked to the price of soy, corn and wheat.
Linked to the origin of the issue of the physical asset, agrotokens are backed by real assets, unlike NFTs. This means that they have identical value throughout the country, regardless of where and by whom they were issued, according to the price indexed on indices such as Esalq, CEPEA/B3, Argus and Platt, a parity that makes it a stable coinm aka a currency with low volatility.
Newly arrived in Brazil, Agrotoken's market strategy is to tokenize more than one million tons of grains by the end of the year. “The agricultural market is now, and is increasingly, digitized. Today, Agrotoken offers another tool to democratize agribusiness, making transactions with soy and corn a reality”, concludes Anderson Nacaxe, Director of Agrotoken in Brazil.