Blockchain uptake on the rise for secure food supply chains

2 Mar 2020

Blockchain technology has been hailed as a way to improve transparency in food supply chains, and it is now being adopted by a growing number of companies.

Blockchain technology refers to a system that creates a permanent digital record of transactions along supply chains. For food ingredients, this means each time they change hands, from the farm or fishery to the end consumer, the transaction becomes a block of information. These are then added together to become a detailed description of the supply chain. Everyone along the chain has access to the complete record, but no one can edit it without every other participant’s authorisation.

Blockchain uptake on the rise for secure food supply chains
Blockchain could improve consumer trust - and save money

Infant food and formula are among the most sensitive products in the food supply network, so it is perhaps unsurprising that suppliers in this sector have shown some of the greatest interest in the technology. Most recently, Danone announced a plan to use blockchain with QR codes to enable its customers to trace every pack of infant formula back along the supply chain. The codes can be scanned before purchase, and then a second code behind a tamper-resistant seal can only be read after purchase, giving another layer of security. The company said it would start with its Nutrilon and Aptamil brands in China before applying it to other brands in Germany, France, New Zealand and Australia later this year.

Infant formula is an important area for the technology, as it has been suspected as the source of several foodborne illness outbreaks in recent years, and has also been the subject of food fraud and adulteration scandals.

In the food industry as a whole, blockchain promises to standardise and centralise information about how ingredients are sourced and handled. It has already been adopted or explored by many of the biggest commodity ingredient suppliers, including Bunge, Archer Daniels Midland, Louis Dreyfus Company and Cargill. Apart from providing greater transparency and traceability, it also has potential financial benefits, as it could help shorten ingredient storage times and reduce the time and money spent on processing traditional documents.

Many ingredient suppliers and food manufacturers have suggested that its greatest potential is in improving the efficiency of food recalls. This is an area that often is not openly discussed until a recall is underway, but more companies are turning to blockchain to hasten the process and help lessen the impact of foodborne illness or undeclared allergens, for instance. Global food conglomerates such as Nestlé, Unilever and Tyson Foods are among the big names already using the technology.

In addition, blockchain could be used to ensure food authenticity, in terms of organic or Fairtrade claims, for example, and to prevent food fraud.

However, the complexity of global food systems continues to be a barrier. Research groups like FoodLogiQ and standards organisations like GS1 have been assessing how to improve the uptake of blockchain in the food sector for years, and suggest that using it for food traceability requires a different approach from technology-oriented systems like banking or insurance. According to research organisation Gartner, about 80% of supply chain-related blockchain initiatives therefore are destined to remain at a pilot stage through to 2022.

At a time when consumers are increasingly sceptical about processed food and its origins, blockchain could prove a useful tool for improving trust in the industry, while also boosting food safety and sustainability. Using the technology as part of a range of traceability initiatives could help manufacturers and suppliers achieve these goals.

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