Blockchain: what uses for the food supply chain?
Published on 28 November 2017
In the food industry, blockchains are well on their way to becoming the technology to set your sights on. Why? Because they facilitate the exchange of data among professionals and could significantly impact the supply chain. How do they work? What are their specific advantages for the food sector? What actors do they engage? Your questions answered.
Blockchain and the food industry: the secret to a successful relationship
Blockchain technology can be used to improve the traceability and quality of products by providing reliable information about their origin and status. Aim: provide food products with increased freshness in order to put consumers’ minds at ease. In order to do so, a blockchain relies on three fundamental principles:
- Transparency: since data transferred is accessible to everyone, blockchains help fight against the opacity of supply chains. Supply chain actors can record each step in the manufacturing process of a food product, from its production to its point of sale. This traceability makes it possible to identify any potential problem— contamination of products, breaks in the cold chain— and to take action almost instantly.
- Speedy and secure transactions: with blockchains, information is transferred in a matter of minutes. Once data has been validated as reliable, it is duplicated on various networks to ensure security.
- User collaboration: the way a blockchain works encourages collaboration among the different links in the food supply chain. Information exchanged is verified by blockchain users and then can be consulted by producers and distributors in the food industry, or even consumers.
An in-depth look at Blockchain technology
Blockchain in the food sector: advantages all around
With the implementation of a blockchain, all actors involved in the food supply chain (producers, suppliers, food processing companies, distributors, retailers, regulation agencies and consumers) can have authorized access to reliable information on the origin and status of food products. And each and every one of these actors has a lot to gain:
- Producers: with a blockchain, any attempt to alter a product can be immediately detected and a notification sent to the producer. This detection then prevents the same incident from happening to the distributor. Transparency can also push some sectors towards more ethical and responsible practices (in industrial fishing, for example).
- Distributors: if the wrong product ends up on grocery store shelves, it can be easily identified and removed. Today it takes a number of days, even weeks, to trace back the supply chain (as we saw in the summer of 2017 with the case of contaminated eggs in Europe). With blockchains, we can immediately pull up data and thus avoid the high costs of removing entire batches when only a few products are contaminated.
- Consumers: the transparency provided by a blockchain heightens consumers’ trust. They have the guarantee that labels are reliable and can adapt their consumption habits based on their individual needs— preference for origin, farming or growing techniques, etc.
Emerging automation trends in the supply chain
A method proven and tested by food industry giants
As of now, it is difficult to access the information contained in a food industry blockchain. For example, it is impossible to identify a precise point at which a product was contaminated, and assessing the losses in merchandise can take weeks.
Although this technology is still in the embryonic stage of its development, food industry giants have carried out tests to verify its viability. Ten major food companies, including Nestlé, Unilever, Walmart, Dole, Driscoll’s, Golden State Foods, Kroger, McCormick and Company, McLane Company and Tyson Foods, have thus integrated a blockchain to work on the traceability of perishable food products and prioritize the areas where technology could be useful.
And the results live up to expectations. Walmart, which carried out a feasibility study for the development of a blockchain for pork in China in 2016, can corroborate: the multinational company announced last June that it took them only a few minutes to retrace the origin of their products instead of several days. The tracked data included information on the products’ origin, their batch number, the factory which they came from, the processing methods as well as the expiration date, temperature during storage and even distribution details.
This process was also taken up by Carrefour, which announced in February 2017 that the company planned to use a blockchain for its logistics procedures, in order to ensure the transparency of its animal-based products.
In the supply chain sector, the development of blockchains is an authentic godsend. In addition to ensuring product traceability and secure data, this technology encourages collaboration between the links of the supply chain. It provides a way to regain consumers’ trust and prevent the food industry from being discredited by new food scandals.