English source: Fooddive Author: Judy Fainor Translation: Young

For decades, the food industry has relied on inefficient paper-based record systems, resulting in issues such as low transparency and poor traceability. Counterfeit food, contaminated products, and pressure from the FDA (U.S. Food and Drug Administration) have prompted organizations across the supply chain to reassess current tracking and registration models. Some organizations have turned to blockchain applications as a solution. While blockchain application in the food industry is still in its infancy, it has already shown promise in manufacturing and finance, where the technology is widely adopted. From end-to-end visibility to tamper-proof data, many industries are slowly realizing the advantages blockchain offers.

Blockchain Image source: weibo

Advantages of Blockchain

By implementing blockchain, the food industry will more easily address current challenges, particularly those related to transparency. Not only do consumers demand to know the source of their food, but the FDA is also requiring supply chain transparency through the Food Safety Modernization Act. Blockchain enables easy data sharing and permanent storage, increasing the credibility of all food data and reassuring customers and regulators that food has detailed audit records from various agencies.

Food blockchain Image source: m.sohu

This complements the issue of traceability, or the need to track products through various manufacturing stages across the supply chain. Blockchain provides a record of each product to everyone in the system, allowing them to see the journey of each food item from farm to shelf. Furthermore, the technology requires consensus among network users to validate data in a read-only manner and distribute it to others in the network, preventing arbitrary tampering with food information.

The transparency and traceability of blockchain technology far exceed the cumbersome and inefficient paper systems currently used in most companies' supply chains. Paper systems are prone to confusion, data loss, and lack of end-to-end supply chain visibility. All these drawbacks can lead to fines from regulators or issues such as food contamination and counterfeit products endangering consumer health.

Barriers to Blockchain Adoption

Although some food and beverage industry leaders like Cargill are promoting the benefits of blockchain, many in the industry are still unfamiliar with the technology. A survey by Deloitte found that 40% of senior executives at large companies know almost nothing about blockchain, yet many believe the technology will be important in 2017. These data suggest that one of the main obstacles to widespread adoption in the food industry is educating companies about how they can benefit from blockchain.

Currently, there are no clear standards or regulations to guide food companies in the right direction. Blockchain platforms and their multifaceted features can be overwhelming for companies with little knowledge of the technology. The federal government has not enacted legislation to promote blockchain use in the food industry. Instead, it leaves legislative power to individual states, leaving strictly regulated enterprises seeking clear guidance in a dilemma about how to choose future development paths.

Additionally, the food supply chain involves many different companies and agents, requiring serious cooperation from all parties to gradually promote blockchain technology throughout the supply chain. For the technology to truly solve food industry problems, every role in the supply chain, from farmers to restaurant owners, must be seriously committed to building blockchain.

IBM blockchain Image source: jrzj

Ultimately, the food industry will adopt technologies that can immediately solve current challenges. However, before large-scale promotion, the real return on investment (ROI) of blockchain in this industry will remain difficult to estimate. Meanwhile, we can learn from the financial and manufacturing sectors, as well as the collaboration between IBM and Walmart, to use blockchain to improve food supply chain transparency.

Source: FBIF Food & Beverage Innovation (ID: FoodInnovation) -END-