Blockchain – you’ve probably heard of it, or heard it mentioned in a sentence with Bitcoin – but what exactly is it and how does it apply to food traceability?
Simply put, blockchain is a shared technological network that essentially acts as a record-keeper – it keeps a record of data blocks and organises them in chronological order in a ‘chain’. There are multiple computers or stakeholders present on this network, each with a copy of the record (or ‘ledger’) – so this shared technological system/blockchain is accessible from a range of different access points, otherwise known as ‘nodes’ (from Deloitte article here). This means that unlike many other forms of data record-keeping, blockchain technology is decentralized, with “many identical copies of a blockchain database…held on multiple computers spread out across a network” (from Forbes article here). Each block of data that is entered into the system by one of the nodes becomes a new link in a chain of data that has been recorded overtime. IBM outlines how blockchain works in the steps below (from IBM article here):
1. As each transaction occurs, it is recorded as a “block” of data
2. Each block is connected to the ones before and after it
3. Transactions are blocked together in an irreversible chain: a blockchain
The IBM Food Trust defines blockchain as “a digital ledger system stored across a variety of networks” (link to IBM reference here).
Additionally, the existence of this network means that each time new data is uploaded, the nodes must separately “verify and confirm the legitimacy of new data before a new block can be added” (from Forbes article here).
One of the key features of a blockchain is that it is immutable (IBM reference here), meaning that once data is recorded, it can’t be changed. Agrawal et. al refer to this as “an append-only system” – if someone wanted to make changes to the data, they would have to create a separate block, which is recorded after the initial block (pg. 4, reference here). Consequently, this “creates a technology-based trust” because of the “traceability of assets and information” (pg. 4, reference here). ABC Science summarise it as “a way of taking electronic information and making it unchangeable so people can’t tamper with it” (ABC Science Elevator Pitch)
So, whilst blockchain is often discussed in association with Bitcoin, it is really “the underlying technology that enables Bitcoin” (IBM reference here) and allows it to function. This facilitates its use in a rapidly expanding range of areas, particularly in the effort to improve food traceability.
Why food traceability is important - and how blockchain can help
Recently, the benefits of blockchain technology in relation to food traceability and food supply chain issues has been explored, with the idea that “blockchain technology creates a linear, open traceability on food products – one which cannot be altered” (from Food Engineering article here).
Food traceability has been a consistent issue for food businesses and manufacturers overtime, with end-to-end traceability seen as important now more than ever in an increasingly interconnected world. In order to mitigate issues with food security and traceability, a range of start ups and businesses have begun to develop and offer services which enable food business clients to leverage blockchain technology to solve these issues and improve their overall transparency and efficiency. As Food Standards Australia New Zealand outlines, “traceability allows food businesses to target the product(s) affected by a food safety problem, minimising disruption to trade and any potential public health risks. It is important for all food businesses (including retailers and importers) to be able to trace products.” (article here).
McKinsey outline that blockchain technology has the potential to add value to the supply chain world in particular, by “replacing slow, manual processes” and “strengthening traceability” which is needed due to “increasing regulatory and consumer demand for provenance information”. It also “adds value by mitigating the high costs of quality problems, such as recalls”. (McKinsey article here)
Case Studies
A range of start ups and businesses have begun to offer these services, enabling their clients to make use of blockchain technology for a variety of purposes.
Ripe.io are a San Francisco and New York-based start up who have built a platform for “every actor in the food supply chain” including food producers, food distributors and restaurants and food retailers. This platform creates the ability for clients to track real time data regarding their food supply chain – this allows them to offer “quality food and transparency” and “consumer satisfaction and faith that they are receiving the freshest, best product possible” (from their website here).
Another key example is The IBM Food Trust, established as a means of offering blockchain technology to food businesses. It is currently “the only network of its kind to connect participants across the food supply through a permissioned, permanent and shared record of food system data” (IBM website here). Walmart has collaborated with IBM Food Trust to improve food traceability, an example of this including their requirement for suppliers of leafy green vegetables to contribute to their blockchain (from Tech Crunch article here).
Nestlé have also piloted blockchain technology via tech company OpenSC to “trace milk from farms and producers in New Zealand to Nestlé factories and warehouses in the Middle East” (Nestlé website here). They have also used the IBM Food Trust to allow consumers to trace coffee that they purchase from Zoégas, Nestlé’s luxury coffee brand, back to its source (from Forbes article here). Companies like BeanLedger have developed ways to apply blockchain technology to provide traceability for coffee supply chain companies (BeanScene article here), while Starbucks launched their ‘Digital Traceability’ tool to allow consumers to track where their coffee is from and introduce them to the farmers and roasters (Starbucks article here).
While blockchain is still a relatively new technology, its benefits for transparency and accountability for a range of food businesses are beginning to be realised – whether it will have a major impact on food security and traceability worldwide remains to be seen.
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