The diversity of blockchain applications has never ceased to surprise us. Initially known and used in the field of finance and virtual currency (i.e., Bitcoin), blockchain is set to revolutionize the food industry in many sectors. In 2020, more businesses are interested in adopting this game-changing technology. This article discusses different ways in which the blockchain will improve operations across this critical industry.
One of the most significant opportunities that are being recognized today lies in the traceability of food with a specific focus on food safety. Traceability is critical because lots of buyers require it. It is also a challenge in itself because the sheer implementation of the practice is cumbersome. Once a company implements blockchain, it will require the participation of every member of the supply chain. All the information regarding all parties involved in the process should be recorded.
The most profound use cases of leveraging blockchain for traceability of food are, for instance, in the tracking of one piece of fruit, a carton of milk, a bottle of wine, or cooking oil. The longer the supply chain, the more suspicious and doubtful the customers become of the reliability and transparency of the products’ information. Thus, in a complex supply chain, the benefits are more visible. Blockchain keeps track of where the product comes from and where it goes. In this case, the package acts as an intelligence. Customers can then match what they eat with the ingredients on the label.
By monitoring supply chain transactions, blockchain has the potential of dramatically improving food safety. In a 2015 report, the World Health Organization estimates that 1 in 10 people get sick every year due to contaminated foods. Food safety is crucially challenging among young people. Over 125,000 children die every year because of unsafe food. Most manufacturers and retailers are unable to figure out which carton the contaminated food comes from nor when it was received.
Experts confirm that the use of blockchain could reduce all these regrettable and preventable incidents. The system can track and store accurate data on every product and its components. Therefore, it could capture any event in which the food might have been tampered with. Besides, by recording information regarding the techniques, processes, and certifications, blockchain is expected to promote sustainable practices in the supply chain.
Big food markets as China are considering blockchain technology for its food business all over the world. The system’s transparency is the primary influence for farmers, suppliers, and buyers to endorse this new technology. It also allows buyers to demand any preferable changes in quality or size.
Based on an open-source technology that it is not owned by any particular company and doesn’t allow data to be compromised. Digital information is stored in blocks that can not be altered without making the change in all the blocks linked together. Each new transaction adds up a new block, and together, they form a chain. Data collected in blockchain technology is usually not approachable by a third party; thus, it halts any fraudulent activity.
As a retail strategy, blockchain provides a channel for brands to gather consumer feedback adding more value to the whole process. Implementing this technology gives products a high degree of visibility among consumers and provides an incentive to other companies to join the new trend.
Furthermore, this innovation is the answer to consumers’ growing concerns about quality management. Companies that offer data regarding their products’ origin and quality are expected to increase their sales. The more visibility and traceability you provide to your consumers, the more inclined they will be to buy your products.
Today, many food industry giants and food producers adopt this method to enhance their supply chains management, such as Nestlé, Raw Seafoods, Walmart, Albertsons, Kroger, and Tyson. Large e-commerce platforms such as JD.com are working with brands and manufacturers in tracking the origins and production processes. Let’s not forget the importance of blockchain providers such as IBM helping more than 170 companies.
In a nutshell, customer demand for transparency is expected to encourage further blockchain growth. Even countries like Malaysia, Australia, and Singapore are setting the grounds for the full adoption of the technology, starting with the food and beverage industry. They understand that such a trend will increase products’ competitiveness in the international markets and will also result in less food waste, which is a noteworthy problem in today’s world.