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Blockchain Use Case: Food and Beverages

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“The more complicated your supply chain is, the more opportunity you have to introduce problems.” MELINDA WILKINS, MICHIGAN STATE UNIVERSITY

Of all industrial supply chains, the food and beverages one is particularly tangled and complex. Many items on the value chain are hard to track, and the journey of the food we produce in our farms ends up rather stormy.

Mitigating suck risks comes at a cost. And you just might have guessed right: technology might have the answer. Or let’s say part of it. Because some problems like preventing crops fraud, or products counterfeiting needs a lot more than QR Code scanners and software.

There is a lot at stake because a serious problem in the food value chain can escalate to an environmental, or public health issue. We are all still traumatized by Odwalla Juice’s E Coli outbreak and will be happy to not see it anytime soon.

Traceability and control is possible without the blockchain. There are for example services where you can look up the origin of fish at www.thisfish.info or with fTRACE. However, three major benefits with the Blockchain are:

  • The data cannot be manipulated;

  • The supply chain can secure traceability and control without all participants disclosing all their customers and suppliers to a central party. The level of privacy to enforce can be decided by the participants in the system and;

  • The blockchain creates trust in low cost IT solutions. You can use email, Word, mobile phones etc. and still be sure data is accurate. This allows for example rural farmers and independent truck drivers to integrate with the system.


Blockchain and the Food Chain

Those familiar with blockchain technology have heard of Bitcoin and cryptocurrencies. Compare Blockchain use cases for the food & beverages industry with areas like finance (or “fintech” to be more accurate), there are quite some differences. Food is a physical product and the connection between the “real” world of consumption and the “digital” world of computers is not that subtle.

Furthermore, to be able to feed 8 billion people, the world has managed to make most food products cheap and easily available. There is a risk that tracking every grain; every package and every gallon of juice might render the products expensive.

Hence, let’s say the food and beverages industry would embrace Blockchain integration through simple hardware and cheap software. We still need to make a system with low transaction costs too.


Areas of Application

In this article, we will focus on three areas of applications. We will try to dig deep into the areas that have been identified as the most promising, picking one use case from the major steps in the food supply chain: from the production facility, all the way to the last mile delivery.

At the Production Facility

It’s hard to verify the labor set up, the environmental conditions and the quality control processes in a given food production site like a Tuna factory, a fishing boat or a soybean field. This is where Blockchain could come into play. By making it virtually impossible to falsify or misrepresent conditions in such sites, a more rigorous production process will ultimately lead to better products. A digital representation of the conditions such as a photo or a digital file can be stored at the production facility, or in a mobile app. Furthermore, production facility relevant data from the surrounding sensors can be logged to a separate blockchain as well providing tangible proof for standardizing or control purposes.

This is how it works: such data comes in the form of a digital fingerprint called a hash, and published in a Blockchain. Content, time and location cannot be manipulated since it is recorded in the Blockchain.

By making random inspections, an inspector can then verify that the data corresponds to the actual conditions at the facility, the workforce, and that the outcome/production corresponds to the one reported to the Blockchain.

Bulk & Mass Produced Food

It’s simply not feasible to individually track individual grains, beans or bulk commodities that are bought on a spot market such as coffee, tea, oils, sugar, cacao etc. However, with the advent of Blockchain technology, it is possible to accurately track the total volumes bought and sold for each participant in the supply chain.

It’s by comparing the total volumes throughout the supply chain and logging them in distributed ledges that we can detect any fraud attempt, for example, by detecting unusual changes in volumes that are not consistent with transactions occurring. This is paramount in guaranteeing the quality and authenticity of organic products, a market that is expected to soar for the next decades.

Efficient Tracking of Food Items

One of the most exciting use cases of Blockchain technology is the tracking of packaged food with an immutable accuracy and a wealth of logged location information, all in the form of a downloadable database, with no signatures, nor papers needed.

This simply needs a unique identifier such as a barcode, QR code, or an RfID transmitter. Compared with existing technologies, the blockchain can easily regulate who gets access to the information and the identities behind each product, every step of the way.

Hence, a produced packaged product from any production facility can be tracked from the production site all the way to the supermarket roof, using say a unique barcode. Simply scanning it, and having the right access authorizations provides a complete history of the journey of the product, from the batch number and production time, to the several storing points that led to the store.



Tags:Food & beverages, Blockchain


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