Blockchain Technology Revolutionizing the Food Supply Industry




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Blockchain and food supply industry

When most people come across the term ‘Blockchain’, digital currencies such as Bitcoin come to mind. But applications powered by Blockchain go far beyond the decentralization of the financial industry. For instance, blockchain technology can be used to improve the food industry by increasing efficiency in the supply chain of growers, wholesalers, and retailers. Blockchain may be the solution to some of the most pressing food supply issues.

Manufacturers, wholesalers, and retailers are forced to respond to consumer pressure about supply chain and the transparency of sourcing. On the other hand the application of blockchain technology is expanding rapidly. And, it could be the solution that the food industry needs. A good number of retailers, logistic firms, and growers are working with tech companies in finding various ways to incorporate blockchain technology in the supply chain.

Case in point is the IBM Food Trust blockchain network. This is a blockchain technology developed by IBM to improve traceability of certain food products in the supply chain. It has already been adopted by leading wholesalers and retailers. They include Walmart, Tyson Foods, Kroeger, and Carrefour (Europe’s largest retailer). So, how exactly will blockchain technology revolutionize the food supply industry? Here are some of the ways in which this ground-breaking technology will improve the food supply chain.

Curtailing Food Fraud

Food fraud is becoming increasingly common as the global food supply struggles to keep up with the growing population. Rather than quality and safety, losses can happen when food fraud finds its way into the food supply chain. Food fraud can take many forms from the use of substandard ingredients to counterfeit brands in your grocery store shelves. Blockchain technology can be used to reduce cases of food fraud in the food supply chain.

Cases of counterfeiting and food tampering are quite common in China. IBM, in partnership with Walmart, is building a project that will help trace and provide food information from the farm to the table. This is an effort towards quality regulation via blockchain technology. An open, distributed ledger gives consumers a valuable insight into their food source by making supply chains open to the public. Blockchain utilizes smart contracts, which can be used to increase accountability among involved parties.

Blockchain technology ensures high-quality products by creating more value and honesty. In turn, it eliminates adulterated or counterfeit goods in the supply chain. Data collected from the blockchain processes can be used to improve the methods of production. This will in turn help in eliminating the need for cheaper, substandard options. Food fraud is one of the most pressing issues in the food industry. Blockchain technology can help establish a new level of trust among growers, wholesalers, and consumers. This will ultimately help eliminate food fraud in the supply chain.

Improving Sustainability in the Food Industry

Sustainability is one of the biggest issues in the food industry. The increasing number of consumers amidst growing environmental concerns is a major stumbling block when it comes to sustaining our food production practices. A number of blockchain based projects are coming up with innovative solutions to this problem. In India, a company known as Farm2Kitchen has developed a blockchain network comprising of small and marginal farmers across the country.

In a country where smaller farmers bear the responsibility for most of the food supply, the Farm2Kitchen platform is of great importance. It gives small and marginal farmers access to data they can use to improve crop planning and heighten their involvement in the supply chain. Access to data is crucial as crop production is dependent on climate change, pollution, and erratic weather patterns. Farm2K blockchain platform also helps curb issues such as lack of raw materials, education, and quality raw materials. This leads to more sustainable food production.

In Europe, a Swiss-based company Ambrosus is working in conjunction with the United Nations to provide a Peer-to-Peer marketplace. It is a platform where consumers can verify their food source. The platform will use various sensor systems and blockchain verification to help consumers make informed choices based on the quality of food products. The World Wildlife Fund for Nature and a blockchain company called Viant have developed a new certification system to help fish consumers. It helps consumers to verify that fish comes from a sustainable source in an effort to curb overfishing and other environmental issues.

Increasing Transparency in the Food Supply Chain

Data from the World Health Organization shows that 1 in 10 people fall ill from foodborne illnesses every day. Millions of lives are lost due to foodborne illnesses every year which makes these kinds of diseases a major global health concern.  In 2015, 55 people fell ill after an E. coli outbreak at a Chipotle Mexican Grill. The restaurant got its reputation plummeted and the restaurant chain is still suffering from the effects of the outbreak four years down the line.

Such incidences are a common occurrence in restaurants all over the world. Considering the lack of transparency — as well as the complexity — of supply chains that these establishments get their ingredients from, this trend is not surprising. The lack of traceability in food supply chains leaves the products susceptible to contamination.

How Blockchain Technology Can Help

The blockchain technology can be used to establish an open environment where growers, consumers, and all parties in between can share information on food products.

By introducing transparency in the complicated food supply chain, blockchain technology can help resolve issues to do with contamination. It can also help in the regulation of the food products and prevent outbreaks of foodborne diseases. Improved transparency means access to information for all parties. This, in turn, ensures accountability in every step of the process. Hazardous or contaminated foods can be identified, tracked down to the source, and quickly removed from the supply chain. As a result, businesses can avoid product recalls and unnecessary public scares.

Many of the problems in the food industry arise from the complexity and the lack of transparency of the supply chain. Blockchain technology improves transparency, increases trust, and facilitates better sharing of information between parties in the food supply chain. For instance, retailers would know a lot more about their suppliers. This way, they will be able to detect foul play and other problems via the use of blockchain. With companies such as Microsoft, IBM, and Walmart leading the charge, it’s only a matter of time before blockchain technology takes over global food supply chains.