As a food manufacturer, if you have not got to grips with the blockchain technology, then it’s time to bring yourself up to date. Blockchain is the underlying enabling technology developed for the cryptocurrency, Bitcoin. But blockchain is way beyond that, as there is a growing buzz around blockchain and its power to transform the way business is done. The blockchain was initially adopted for its financial advantages, but its core attributes mean that it has a remarkable potential to improve food traceability solutions.
The Blockchain technology is a way of sharing and storing information across a network of users in an open virtual space. It allows users to look at all transactions simultaneously and in real time. The World Economic Forum defines blockchain as a “shared, programmable, cryptographically secure and therefore trusted ledger which no single user controls and which can be inspected by anyone.”
In the food supply chain, information is digitally connected to a food product and entered into the blockchain throughout its journey, including farm-origination details, factory information, processing data, storage temperatures, shipping details, and expiration dates. Every member of the network agrees on the information captured in each transaction, which is assigned a digital certificate. This then goes on to become a permanent record that cannot be tampered with or altered.
The major problem with the supply chain is the lack of transparency and traceability. Because of this, consumers are not given adequate information about the history of the food products they are buying. Also, the nature in which the supply chain is run makes it inefficient and highly susceptible to fraud. The Vottun project seeks to improve food traceability that is significantly absent in the supply chain. Vottun brings about a robust blockchain food safety management that boosts speed, trust, efficiency, and most importantly, transparency. Leveraging on the power of the immutable ledger of the blockchain, it will provide trusted-tracking services for products along the supply chain.
The Vottun protocol certificate authentication protocol offers certificates to every layer of the food supply chain. From the farmer to the supplier to the retailer, everyone gets a certificate and these certifying documents are a seal of quality and adherence to statutory standards and regulations. These certificates are tied together by the product QR code or barcode. So, when a consumer picks up a food product off the shelf, the consumer can use his phone to scan the code on the product, and the full production history will be displayed. This blockchain food tracking method ensures transparency for everyone involved in the supply chain and safety for the consumer buying the food product.
The blockchain’s public nature is one of its biggest benefits. Blockchain technology in food industry provides provenance, traceability, and transparency of information. In a food chain blockchain, for example, all transactions for one item can be seen and validated at any point in time. This enables every member of the supply chain to have a better picture of the food’s journey, all in the form of a digital ledger provided in the blockchain.
Blockchain in food industry provides a permanent record of transactions which is thereafter grouped in blocks that cannot be tampered with or altered. Transactions are thereafter, verified and approved by consensus among participants, thereby making fraudulent activities very difficult. Food fraud is less likely to occur, and if it occurs, it would be easier to spot. At the same time, consumers are comforted with the fact that companies cannot tamper with or alter information on a food product, in a bid to hide the true origin and movement of the product through the food chain blockchain.
The food tracking blockchain operates a neutral open platform that excludes third parties from authorizing transactions. Rather, it has a set of rules that all participants, both users and operators of the system, must obey. This system is highly valuable in complex supply chains where trust is low and compliance is very difficult to gauge. The Economist has nicknamed the blockchain, “The Trust Machine”.
Blockchain in food industry operates on a distributed rather than a centralized form and because of this; each participant has access to the same ledger records. Information updated is visible to everyone in the network at the same time. This entitles the whole supply chain to be more responsive to be more responsive to any fraud threats or food safety disasters.
One of the unique aspects of the blockchain is that it could give an edge to every participant within the supply chain: processors, growers, distributors, suppliers, retailers, and regulators. Below are some of them.
Producers – If there are attempts to tamper with a food item as it moves through the supply chain, producers can immediately identify and prevent the potential harm before it gets to the retailer.
Retailers – If a potentially hazardous food product makes it onto the shelves, it can be quickly identified and removed from the shelves. This eliminates the need for costly batch recalls.
Consumers – Customers are reassured with the transparency and openness of the blockchain, that the food they are buying and eating is exactly what the label says it is. Currently, 75% of consumers do not trust the accuracy of food labels.
It can be unrealistic if a retailer could see and validate with 100% certainty where each food item is grown, processed, handled, stored, and inspected. Also track every stage of its journey, from farm to store is impossible. With blockchain traceability, however, this can be actualized 100% as it has the potential.With food chain blockchain, there are no gaps in the history, location, and status of a food product; instead, the whole picture is shown. For instance, if a retailer becomes aware of a potentially deadly issue with rock melon, participants of the blockchain network can easily view the entire history of that rock melon, to find the root of the problem. Where necessary, the affected rock melon from that specific farm or batch is quickly recalled.
The question is, “how quickly can a food product be recalled?” In October 2017, Walmart, IBM, and Tsinghua University signed an agreement to use blockchain technology to explore food supply chain traceability and authenticity. Before using blockchain for the experiment, Walmart had tested how quickly it could trace back the mangoes in one of its stores to their original farm and it took 6 days, 18 hours, and 26 minutes. When blockchain was used, it took 2.2 seconds.
According to PricewaterhouseCoopers, food fraud is worth $52 billion globally each year. An increasing number of Australian producers are being targeted by food counterfeiters in Asia and the Middle East, and it is getting worse. Our reputation for high-quality food is being undermined by foreign operators, who are counterfeiting labels and packaging to sell their own lesser-quality ad potentially unsafe products.
The blockchain in food industry will be of great help, as Alibaba has already set out to prove. In March 2017, Alibaba, the Chinese multinational e-commerce giant, mobilized the help of PricewaterhouseCoopers to run a pilot program with Australian health Supplement Company, Blackmores, and Fonterra in New Zealand, to prevent food fraud using blockchain.
Maggie Zhou, Alibaba ANZ managing director, said that if the pilots are successful, they would form the basis of a global supply chain model for all of the group’s e-commerce markets, thereby protecting the reputation of food merchants and also boosting consumers’ confidence to purchase food online. Christine Holgate, CEO Blackmores, accurately described the situation, when she said that the Alibaba plan will make her company’s supply chain more visible and transparent to consumers in China.
Food processors and manufacturers more often than not, struggle to validate the origin of their ingredients. If the processor wants the consumers to trust in the quality and provenance of any food product, then there should be a detailed information about what is in it and how it was made.
This is not a problem for the blockchain, as it allows the grower and processor to share information with each other privately and securely, while also having the supply chain validate this information. In other words, it gives a Web-of-Trust system that allows the network participants to evaluate and validate assertions made about food, whether on the food’s origin, dietary claims, sustainability, and so on.
This system can only work, however, if the information provided is accurate. If food processors are inputting the correct data, then it comes out correctly; of the source is wrong, it defeats the whole purpose. Currently, data is stored on paper or in centralized databases, which are prone to human error and forgery. One way to solve this problem is sensors. Food processors can use sensors to get accurate and detailed information which is then made available to everyone across the supply chain.
Blockchain technology and the Vottun project, have the combined potential to completely transform the food industry. But it will only work effectively if everyone participates. If food products can be traced from farm to fork, all parties along the supply chain would adopt the technology. But all of these will not happen overnight, but with large companies like Walmart and IBM leading the way, and with the Vottun project gradually coming into the scene, the change the supply chain needs could happen sooner than expected.