Understanding How IBM And Others Use Blockchain Technology To Track Global Food Supply Chain
In August 2017, IBM announced a collaboration with 10 food producers and retailers — Dole, Driscoll’s, Golden State Foods, Kroger, McCormick and Company, McLane Company, Nestlé, Tyson Foods, Unilever and Walmart – to highlight the “most urgent areas” in the global food supply chain. This initiative will help retailers pinpoint sources of contamination through the application of blockchain technology.
IBM’s Food Trust system is a cloud-based solution based on the IBM blockchain. The system stores the data of about 1 million food items, which is then shared across the IBM blockchain platform and the Linux Foundation’s Hyperledger Fabric. IBM Food Trust uses the blockchain to connect participants through a transparent, permanent and shared record of food origin details, processing data, shipping details and more.
Currently, there are more than 350,000 food data transactions to date on the IBM Food Trust platform, allowing consumers to compose an entire meal from the products that run through the blockchain network. These items represent dozens of individual food items, from vegetables, meats, to spices, fruits and more, and now fresh water fish fillets. IBM notes that the use of blockchain technology can reduce the cost of the average product recall by up to 80%.
Food fraud costs the global food industry between $10-$15 billion annually and we have seen instances in the past where non-organic products were passed off as organic, while various meats were indeed not what consumers thought they were. There is a massive opportunity to combat this industry problem with technology such as blockchain, Ramesh Gopinath, VP of Blockchain Solutions at IBM, told me. Through IBM Food Trust, we are bringing trust and transparency to the industry by capturing primary source data on the blockchain. Participants on the network have insights into each item being tracked from the farm, to the factory, to the shipper and to the retail store.
S-Group, a Finnish retail cooperative, just announced it has joined the IBM Food Trust ecosystem to efficiently and securely trace fish fillets back to their origins. S-Group is implementing its “Pike-Perch Radar” service to track fish fillets sold in its stores all the back to the actual lakes in which they were caught.
Consumers can see this information by scanning a QR-code that is on the packaging of their fish fillets. This information will even show how the fish was caught. This is especially notable as fish serves as an important retail commodity in Finland and its handling is subject to considerable regulation. Using blockchain technology to trace fish back to its origins is an ideal use case for the IBM Food Trust platform.
Blockchain Technology: Food For Thoughts For Startups
Following IBM’s lead, startups are also applying blockchain technology to trace food back to its origins.
“We are focused on bringing Italian passion to the food industry. In order to do so, we are using blockchain technology to let consumers know that they are eating actual Italian food, made and grown in Italy,” Walfredo della Gherardesca, Co-Founder of GenuineWay, told me.
Gherardesca has spent years working on ways to innovate Italy’s food industry, which plays a strategic role in Italy’s economic system. Gherardesca’s latest project, Genuine Way, is one of Italy’s first blockchain-based tracing and certification ecosystems for artisanal food products. The platform has already secured strategic partnerships with two of Italy’s main digital resellers of high-end food products – LorenzoVinci.it and Foodscovery. The platform builds upon an ecosystem of 500 selected local suppliers, certifying the origin of artisanal food products by tracing the food supply chain across the Ethereum blockchain.
According to Gherardesca, the company has created a business-to-business marketplace that interacts between an ecosystem of Italian food suppliers and distributors through Ethereum smart contracts. These contracts are designed to allow any party in the food industry to certify the quality and origin of their products. Once a food item is certified across the Ethereum blockchain, the origin is guaranteed through an identification system using a QR-code.
“For example, when a consumer purchases a cheese product from an e-commerce merchant on the Genuine Way ecosystem, it will arrive with a QR-code on it. Every QR-code is unique and represents that product, allowing consumers to know everything about that product, from the day it was manufactured to how long it took to arrive during the delivery process,” Gherardesca explained.
Tracing Vegan Food Back To Its Roots
And VeganNation is solving the issues around trust, transparency and validity for the vegan community, which consists of 300 million people worldwide. The Tel Aviv based startup aims to connect vegan users across the globe with a vegan-friendly decentralized platform that uses blockchain technology and a utility token – “Vegan Coin” (VCN) – to assist vegans in living a plant-based and environmentally conscious lifestyle.
The main benefits that blockchain technology can bring to the world are transparency, trust and validity. These are also things that the vegan community has been struggling with for years, Rena Thomas, Chief Development Officer of VeganNation, told me. Blockchain technology brings trust and transparency to a community that’s been dealing with questions like, ‘How do we get products that we know are ethical?’ That is something that hasn’t been available yet.
Ultimately, the VeganNation ecosystem aims to connect the vegan community with suppliers and other individuals to ensure that their daily challenges are easily solved. From being able to purchase ethically viable products, to having access to vegan recipes, restaurants and communities around the world, VeganNation uses blockchain technology and cryptocurrency to unite a population that lacks transparency. This is especially apparent in relation to tracing food back to its origin.
“Our whole supply chain will be built on the blockchain, allowing our vegan users to trace products back to where they were made. And because the blockchain is fully transparent, users will also see the impact that those goods had on the environment during production,” Thomas explained.
Using the blockchain to trace back the lifecycle of products will help solve one of the main problems facing the vegan community today, which is ensuring that goods are 100% cruelty-free and fair. While living a full vegan lifestyle is already challenging, it has been nearly impossible to trace the real origin and supply chain of products such as food, clothes and other commodities.
Moreover, the Vegan Coin (VCN) will provide a designated digital token used for all transactions within the VeganNation ecosystem. VCN will be launched at $0.50 a token, and afterwards it will be up to the community of users and free market to decide the value. Users within the VeganNation ecosystem can do whatever they see fit with VCN tokens, yet it is encouraged to use tokens to support vegan businesses and to build a real global economy.
Blockchain technology has the potential to disrupt institutions, economics and social structures, said Liron Langer, Chief Investment Officer of Nielsen Innovate. For networks to be built and be truly valuable, people need a stronger incentive to come together and use the Blockchain. The vegan community and the food industry in general can enjoy a transparent supply chain and food tracing marketplace without fees from middlemen and much more.