Information Technology Reference
In-Depth Information
11 AgroGrid - Grid Technologies in Agro Food
Business
Ulrich Heindl, Ansger Jacob, Marcus Mueller, Peter Racz, Burkhard Stiller,
Eugen Volk, Martin Waldburger
11.1 General Description of the Business Experiment
Today's global food industry represents a huge market of US$ 3,500 billion pa
(Wijnands et al. 2006). Nevertheless, food supply chains are characterized by fixed
trade relations with long term contracts established between heterogeneous supply
chain companies. In addition, consumer demands have undergone a dramatic change
during the last four decades. Quality, food safety and uniqueness are the leading
factors for buying decisions. Altogether, this causes three main problems companies
in the food sector need to be prepared for. First, new ways to coordinate companies
in to a supply chain must be installed in order to reach an efficient exploitation of
globally distributed capacities. Second, cost-effective mechanisms for collabora-
tion are needed. And third, an integrated tracking and tracing solution is essential to
ensure food quality and safety on a global scale.
AgroGrid is a Business Experiment addressing above mentioned challenges
by providing a Grid-based solution for supply chains in the agricultural industry.
AgroGrid implements a Grid-enabled market place that allows companies oper-
ating in agriculture food markets to offer and source capacities, to negotiate quality
of food to be delivered, to establish contracts, and to create customised dynamic
supply chains (Volk et al. 2009b). Thereby, capacities in AgroGrid include any
products and services offered by a participant, e.g., food products, transport and/
or storage capacities. AgroGrid also provides facilities to monitor the quality and
safety of food products delivered across supply chains.
In this section, the AgroGrid Business Experiment is introduced, in particular,
by providing the essential background information about the relevant market envi-
ronment. Furthermore, the key set of challenges that AgroGrid addresses is outlined,
and all partners involved in this experiment are presented.
11.1.1 Background of the Business Experiment
The global food industry spans farming, processing, transport, export cargo
handling, airlines and shipping, importers, retailers and food-service organisations.
In addition to reviewing current market size, IGD (2009) forecasts that the global
food retail market will grow at an annual rate of 4.8% worth US$ 6,353 billion in
2020. The future picture IGD (2009) draw is that Asia Pacific and Central Asia
will comprise 41% of the global food retail market in 2020, up from 33% in 2003.
Europe will comprise 30% and Nafta 21% in 2020.
