ORMEX Sustainable Imprint Exchange

Our team is tackling the problem of 746 million of people from 34 lowest-income countries, heavily dependent on agricultural exports. They have no incentive to diversify and produce sustainably as only conventional commodities are exchanged on Financial Markets.

We believe introducing sustainable commodities trading can help farmers increase their income and better resist to the economic shocks. With ORMEX, and through its digital platform, the exchanges receive a secure and immutable proof of sustainable commodities origin, verified by Quality Labels. Additionally, our phone App prototype is currently tested in Kenya with 24 farmers. 

Ormex long-term goal is to increase the global sustainable agriculture from 4,5% to 20% in 5 years. Our financing model is based on Licensing and Transaction Fees from the Financial Exchanges. We plan to scale by partnering with quality labels and connect Ormex platform with 3 leading exchanges (91% of market share) in US, Europe, and China. 

We are tackling 2 problems: 1. The sustainability commodities are not traded on Listed agricultural commodity exchanges. 2. The environmental impact of conventional agriculture, responsible for ¼ of global warming. (WRI, 2019)

According to the UNCTAD (2019), commodity price fluctuations directly affect the incidence of poverty in 34 low-income countries, at least at 60% dependent on bulk agricultural commodities exports. They have no incentive to diversify and produce sustainably as only conventional commodities are exchanged on Financial Markets.

Agricultural commodity dependence is particularly concentrated in 85 % of least developed and most vulnerable countries (LDCs): 47% in Sub-Saharan Africa, 41% in Latin-America and 13% in Asia and concerns in total 746 million people.

The economy of these countries depends heavily on the international pricing. Contrary to metals and energy, agricultural conventional commodities pricing decreased by 9% on average since 2008. (UNCTADStat)

Unpredictable price fluctuations with a negative pricing significantly reduces national revenue, costs millions of jobs and render farmers’ crops nearly worthless in one fell swoop. (UN,2019)

Commodity prices are fixed on financial markets. Listed trading is exclusively reserved to the conventional agriculture, living no alternative towards sustainable agriculture increase and diversification.  

Introducing sustainable commodities on Listed commodity exchanges could value social and environmental benefits and reduce climate-change and pandemic risks. The members of the World Federation of Exchanges recognize their role in promoting this transition. (WFE, 2019) 

However, with 80 international quality labels, there is a lack of common impact measurements. We are aggregating sustainability factors between quality labels, and sellers’ and buyers’ standards to result in building new sustainable products on the exchanges.

ORMEX is a shared, secured, and trustable digital tool and platform for the agricultural community, to trace their social and environmental impact for each new sale. ORMEX connects producers to the market, from farmers to the financial exchanges and validate their quality with their preferred Quality Labels.This will push more actors to take in account sustainability factors. 

It is powered by a bundle of digital solutions: a web-app for the farmers use; a blockchain platform for all other actors and AI/ML analytics to provide patterns on the benefits of sustainable commodities and hedge their risks. Connecting our solution to 3 leading agro exchanges will cover 91% of the agro commodities trading market.

With the new product differentiation comes its price differentiation from conventional commodities.

ORMEX is focusing on the countries who export agricultural commodities and hedge the risk of their production of Financial Exchanges.

As a first target, we focus on agricultural commodity dependence coutries:746 million people from 34 least developed and most vulnerable countries (LDCs): 47% in Sub-Saharan Africa, 41% in Latin-America and 13% in Asia. When prices go down, employment, exports and government revenue suffer.

There is 2,9 mln farmers that practice today organic agriculture. (FIBL, IFOAM, 2019) They represent only 0,5% of the family farmers globally. Thus, there is a real need to scale these practices if we want to feed 2 bln more people by 2050 without destroying our planet. 

ORMEX will reward small farmers participation on our Web App with a virtual currency that will partially pay for their certification, as otherwise obtaining a quality certification is too costly for the small farmers. 

Finally, adding sustainable commodities to the exchange helps farmers to have a direct access to the organic trade channels.

Overall, producing low-impact and more nourishing food enhance better living of family producers and their communities. It also reduces food insecurity in their countries.

With US$100 billion, sustainable agriculture represents only 4,5% of the total agricultural production. (FIBL, IFOAM, 2019) To achieve the SDGs by 2030, we need the implication of Exchanges trading agricultural commodities to channel their investments towards sustainable agriculture.

ORMEX is building a network of agricultural supply chain and financial communities using Blockchain technology and Artificial intelligence for the sustainable commodities trading. We value social and environmental benefits produced by small-farmers at the Exchanges level.

By helping commodity dependence countries diversify their economies with sustainable agriculture we help reduce poverty and fostering equality to protecting the planet and preserving peace.

• Our solution is unique in the conjunction of sustainable factors that we measure and the fact to bring them at the exchange level. For the first time a Blockchain will be used to trace the sustainability (social and environmental) factors with a holistic approach in one place. No need to choose one quality standard.

• AI /ML neural networks will help us to determine meaningful patterns of the social and environmental benefits or trade-offs of sustainable agricultural trading and its direct impact on the lives of real farmers and their community.

• ORMEX helps Sustainable Agriculture be part of the financial mainstream, which is Listed Commodities Trading, with US$46 trillion nominal value for the agricultural segment. With other financial asset classes, as Equities and Social and Green Bonds, the financial institutions invested US$0,5 trillion, from 7 trillion required by the Paris Agreement. To reach the SDGs on a timely manner, we need to involve Commodity Exchanges.

• Finally, ORMEX is creating an inclusive community of diversified actors, from Farmers to the Exchanges – who need one another to resiliently co-exist and to co-develop.

• Applying blockchain protocols in Capital Markets, is already used by Komgo and Vakt. They are not specialized on sustainable factors traceability or sustainable agriculture and do not have any connectivity with the farmers.

1) ORMEX App is dedicated to the Farmers. At each sale of their production, a Farmer enters the information about their crops as well as social and environmental impacts generated during the season.

Once the transaction is validated by one of the selected Quality labels, the Farmer is remunerated in virtual money, Security Tokens, that he can use to partially finance his quality certification.

2) ORMEX is a blockchain application of exchanged sustainable imprints embedded within the smart contracts:

1. collected from small producers via Ormex App

2. confirmed by Sustainable Quality Labels and Wholesalers

3. aggregated and integrated to the Commodity contracts at Exchange level 

4. “matching” the Transformers, Distributors and their customer’s demands of transparency, social equality and land preservaiton.

Blockchain helps us to bootstrap an entire network of agricultural community in a decentralized way. It reduces the cost of verifying the sustainable attributes of a transaction. We can also propagate it holistically compared to the costly manual approaches of the Quality Labels.

Ormex is using a Blockchain protocol, and its prototype is built on Ethereum platform. As of today, our Blockchain prototype is public. 

3) We apply Artificial Intelligence to reduce, classify and predict the collected data in the context of FUTure contracts. Some of the methods used are: Cluster analysis, Kriging and Random forests. 

Machine Learning helps us to determine meaningful patterns on the social and environmental benefits of sustainable commodities. We count to use satellite data to examine the quality of soils, presence of trees on the ground and climate conditions.

With ORMEX, and through its digital platform, the exchanges receive a secure and immutable proof of sustainable commodities origin, verified by Quality Labels and shared within agricultural community.

Additionally we have  created a phone App, that connects Farmers data to the blockchain and thus solve the last mile issue. Our prototype is currently tested in 3 different regions of Kenya with 24 farmers.

The App link is provided.

On Financial markets trading agricultural commodities contracts, there is no differentiation between a sustainably produced and a conventional agricultural product.  International markets are driven by conventional lowest prices that does not consider the conditions of production and consequences they have on the consumers’ health as global warming. Since 2019, supply chain actors urge Exchanges to introduce sustainable agricultural products. (WFE, 2019) With more than 80 international Quality Labels and Standards, it is very hard to qualify a sustainable agriculture product.(WFE, 2019) ORMEX provides a service to the Exchanges, by collecting social and environmental measures of the certified sustainable commodities from Farmers on a digital platform and aggregate at a commodity level. The immediate output of this, is the possibility for the exchange to introduce at least 4 main sustainable agricultural commodities (rice, corn, coffee, and cacao) currently traded on the exchanges. The commodities exports of these products directly feed 70% of total population of 34 agricultural commodity dependent countries.(UN, 2019) The outcome of this activity is an exponential increase of investments towards sustainable agriculture. Another long-term goal is the possibility to extend in time economic shocks due to the law nutritious food pandemics.

248 million farmers from 34 lowest income are heavily dependent from agricultural exports (UNCTADStat, 2019) Their revenue is extremely low and varies at the rate of price fluctuation on the exchanges. Only 3% of the final consumer price is going to the farmer (OECD, 2019). Farmers have no access to the market prices and obtaining a quality label certification it too costly for them. ORMEX provide a Web-App for the Farmers that shows them the daily market prices for their crops. The immediate output is better negotiation power and income increase for these farmers. In return they provide Ormex social and environmental data required in the App for each crop production. According to the sustainable impact generated by their daily activity, they receive virtual Tokens, which can be spent on paying partially for their Quality Certification in Mid-Long Term. The outcomes are that the farmer will start producing sustainable food and be less

Our solution is currently tested in 3 regions of Kenya with 24 farmers and Togo. 

In year 1 we plan to touch 2800 farmers by partnering with a quality Label in 10 lowest-income countires. 

In 5 years we plan to make our App vocal and in local dialects to attend more participants. Our blockchian platform accepts multiple labels. We wish to attend 3M farmers in 17 other lowerest-income countries with at least 3 other quality lables.

Ormex long-term goal is to increase the global sustainable agriculture from 4,5% to 20% in 5 years. Our financing model is based on Licensing and Transaction Fees from the Financial Exchanges. We plan to scale by partnering with quality labels and connect Ormex platform with 3 leading exchanges (91% of market share) in US, Europe, and China. 

1. Year 1:

   1. First 6 months: R&D to make a successful Pilot with the representatives of the value chain (2-3 small farmers, 1 Country wholesaler, 1 Import Wholesaler, a Sustainable Label and a Buyer.)

   2. Next 6 months: work on the POC integration between the Blockchain and the selected combined commodities (rice, coffee, corn) on Financial Exchange and KPI settings of outcomes.

2. Year 2: 

Go-live on the 1st exchange. AI development of Neural-networks and sustainability patterns analysis: on sustainable as on conventional agro-commodities. 

1. Year 3: 

Go-live on the 2nd and 3rd Exchanges, covering 91% of the total commodities market: CME (US) 24%, ICE FUT Europe (UK) 60% and Zhengzhou Commodities Exchange (China) 7%.

1. Year 4 and 5: adapt and integrate sustainability factors into the hedge-risk model of CME Group (the most widely used risk model for the majority of the exchanges).

We need an official buy-in from at least one Financial Exchange. 

Find the 1st supply chain adopters (EFTA, FairTrade, Ecocert, Unilever and Nestle) who already trading sustainability agriculture, but not on listed commodities.

Financial investments for the first 2 years of R&D.

Technical barriers of a blockchain solution, as the number of transactions processed and the use of energy in case of using a public consensus, PoW.

Goulnara has already started the discussions with  her contacts at CME. She is currently in discussion with Fair Trade for the prototype validation.

According to the World Federation of Exchanges, Nestle and Unilever are pro-active on adding sustainable commodities on the financial exchanges. They are pushed by their consumers on providing traceable goods and respecting the environmental and social criteria of their production.

For the financial investments we hope that our participation in this competition will generate interest from the investors and future partners at different levels: Exchanges, Tier 1 Financial institutions - members of commodity exchanges, private funds investors in sustainable development, governments willing to propagate and follow sustainable agricultural measures at the national level, Central European Bank, Buyers of agricultural commodities. We are currently developing a strategy to finance our next Pilot phase with the 1st set of clients.

Goulnara Aguiar, Founder and CEO, full-time

She has a master’s degree in “IT Architecture applied to the Financial Markets” at Ecole Centrale Electronique (France), Blockchain Certification from MIT, and an MBA from INSEAD.

Goulnara is a former Global Lead for Capital Markets software solutions, at renowned software providers as Finastra and Calypso Technology. 

Alex P, CTO, Blockchain expert, part-time, specialized in Blockchain connectivity the European Exchange. Alex studied at a prestigious IT school EFREI in France.

Hortense Serret, is an advisor in quantification of Sustainability measures. Part-time. She is a Doctor in Ecology, from the National Museum of Natural Sciences. 

We have a diversified and complimentary team.

As a former Global Solution Lead, Goulnara worked and negotiated new solutions with Tier 1 Investment Banks Board Members as their teams.

Goulnara is an expert of hedging-risk models of Financial Exchanges. During her career in R&D she has been able to replicate the most difficult model of CME Group within only 9 months and then expanded it to the next 16 Exchanges during the next 9 months, covering all three commodity segments: agriculture, energy and metals.

Goulnara and Alex worked together on different projects at Calypso Technology for a decade.

Alex is currently Head of Development of the Blockchain and its integration with a European Exchange. Hortense is a researcher and did her Doctorate on Ecological Economics. Her knowledge of sustainability factors in extremely valuable

Informal discussions have started with FairTrade Commerce Equitable Label and CME. 

Deloitte representatives from Blockchain and Compliance departments shown their interest in supporting the project within future official partnerships.

Our Business Model is based on a Web-App, Blockchain connectivity service and AI analytics service for the market participants, Exchanges, and Governments. 

Our model is based on yearly Licensing Fees from Financial Exchanges and the clients of sustainable commodities. 

A Transaction Fee of 0,5% per transaction for the Blockchain clients. This amount will decrease basing on the number of transactions realized. For 100k Transactions - US$750K Global Profit, for 1M TRs - US$ 5MGP, for 10M - US$35M.

Additional License will be for the AI analysis.

A special consulting license will be offered to the Governments and Financial Institutions.

In financial markets, we are targeting 3 Exchanges/Clearing Houses representing 91% of all agricultural commodities exchanges: ICE FUT Europe, UK (60%), Chicago Merchant Exchange US (24%) and Zhengzhou Commodities Exchange, China (7%). To be able to trade sustainable commodities, they need a holistic, trustable, and secured traceability solution. This is what Ormex will provide them as a service. 

Supply Chain community is interested in sustainable trading through exchanges and will be able to share more this generated value with their consumers in demand of transparency. (WFE,2019)

The app will be distributed to the farmers via Quality Labels network, prioritizing the agriculture commodity dependent 34 countries. To touch more farmers, we are planning to deliver the Web-App for free and make it vocal with local languages (H1/Y1 R&D) for all illiterate farmers.  

The Farmers will get two benefits: Tokens on their App Account and actualized Market prices for better negotiation power. 

ORMEX shares the same goal with MIT Solve: apply a Tech solution at the service of sustainable agriculture development. Joining our forces can make both parties attend our mutual goals and involve new actors, as Financial Exchanges to achieve SDGs goals of Paris Agreement by 2030. 

Goulnara have studied “Blockchain and its applications” with MIT (on-line) in august last year, 2019. This is one of the best technical trainings she has got. It was just a natural choice to apply to this competition. She could not have dreamed of a better place to promote her project and create partnerships.

We participate in this competition with 3 objectives: 

1) Benefit from MIT.Solve network and exposure at the international level, to get the agricultural community and financial exchanges on-board. 

2) Fund the first 1-2 years of R&D. this will help propel Ormex to the next level, higher new team members and start the Pilot work.

3) Get the technology advice from MIT Members on the Blockchain blockers, latest top-notch AI algorithms and architectural designs, that will help us to make our solution more efficient and less costly. 

Definitely MIT faculty: Christian Catalini, Blockchain Directors, AI specialists, economists as Roberto Rigobon and Silvio Micali. We need their advice on the best model to apply: private vs public vs Algoland for the less energy consumption. We will seek their advice to scale a blockchain solution at a higher speed that 15 transactions per second of Ethereum within the next 2 years. Conscious of tremendous energy that can be consumed by the public Blockchain platforms, we are asking MIT advice on the best consensus mechanism to apply for our social blockchain and also potential combination with an AI solution to reduce this energy consumption. 

Abu Dhabi Crown Prince Court, as sustainable commodities can be introduced in islamic banking. 

The Bill & Melinda Gates Foundation - to help us scale the App benefits and its usage in lowest income countries for the farmers. 

Elevate Prize Foundation - to help us financially, in order to develop our Blockchain platform, to introduce sustainable commodities trading on Listed Exchanges. 

Microsoft - to help us develop AI algorithms with some data provided from satellites on the quality of soils, agroforestry and biodiversity. 

United Nations Environment Programme - to help us associate the realized impact of our project with the SDGs of Paris Agreement by 2030.

Technical University of Denmark - to help us to automate the measures of our App and make it adopted at a large scale by the Farmers.

• In 34 lowest income countries where we operate women-Farmers represent 56-62%. With our phone App, women Farmers receive Actual Market Prices to better negotiate their crops prices. They provide us their data concerning their crops as well as social and environmental factors of their production. In return, their receive Tokens on their virtual account. These tokens can be used to help them finance their quality certificate, generally very costly and better negotiate their crops. Overall increase their income and resistence to the economic shocks.

One of the missions of ORMEX is to analyze the applied Sustainability factors, find the most valuable and un-correlated ones, mix them with climate and soil conditions, and create patterns of long-term productivity. We help customers make forecasting on their future crops production as well as providing access to the real-time market data. 

Real time adjustment in the KPIs participations of each player in a sustainable agriculture and food system for the next generations is a mush have as our time of achieving sustainable goal by 2030 is very limited.

The AI for Humanity Prize will help us hire an AI specialist, and create a full time job.

As a second development path, we also wish to provide these indicators to the consumers while they will buy sustainable food from the participants of our platform. 

Machine Learning will help providing a model of risk hedging, which will include long team benefits of social and environmental factors generated by the farmers.

Our team is tackling the problem of 746 million of people from 34 most vulnerable countries, heavily dependent on negative price fluctuations for their conventional agriculture exports. Financial Markets trade today only conventional agricultural commodities. Thus, there is no incentive for the Farmers of these countries to diversify their production and produce sustainably.

We believe that introducing sustainable commodities on Listed commodity exchanges could value social and environmental benefits and help farmers increase their income to better resist to the more frequent economic shocks.

ORMEX is a shared, secured, and trustable digital platform for the agricultural community, to trace their social and environmental impact. Powered by a blockchain ORMEX connects producers to the market, from farmers to the financial exchanges and validate their quality with their preferred Quality Labels on a constant manner.

Additionally we have  created a phone App, that helps connecting Farmers data to the blockchain and thus solve the last mile issue. Our prototype is currently tested in 3 different regions of Kenya with 24 farmers. Malaika is one of them. Through Ormex App, she enters her crops sale information as well as social and environmental factors of its production.  In return, she receives Actualized Market Data to better negotiate the price of her agricultural commodites. In her virtual accounts she receives Tokens that she can spend on paying a sustainable quality certification  in Future.

Ormex long-term goal  is to increase the sustainable Agriculture production from current 4,5% to 20%  in 5 years. Our financing model is based on Licensing and Transation Fees for the Financial Exchanges and their clients. We plan to scale in 2 ways. First, by partnering with quality labels workingin 17 other lower-income countries. Second, connect Ormex sustainable imprints platform with the 3 leading exchanges in US, Europe and China that cover 91% of total agricultural commodities trading. We ask your  support  to help ORMEX to achieve this goal. Thank you!