Tracing food on blockchain
Technology

Tracing food on blockchain gains momentum, with shoppers willing to pay big bucks

As new innovations continue to emerge in the industry, an IBM report says some shoppers would be willing to pay a premium of 35% for fully traceable produce

Food safety has come along leaps and bounds in recent years as blockchain technology is used to provide traceability—and it seems the coronavirus pandemic has hastened efforts to enhance consumer confidence in the often embattled industry.

The agri-tech and data company HerdX initially offered tools that help farmers record their herds, monitor animal movement, and enhance the wellbeing of their livestock. Now, it has shown how this technology can benefit the public, too.

In a one night only event, the company invited Washington, D.C. locals—along with food industry executives and legislators—to order curbside meals from Brazilian steakhouse Fogo de Chão featuring produce that was traced by HerdX’s blockchain system. Diners were then able to see where their beef had come from—in this case, the Dean and Peeler Meatworks farm in South Texas.

HerdX’s chief business development officer Lauren Jones spoke powerfully about the power of blockchain in an Aug. 4 news release.

“My children will have the ability to know where their food comes from, and how it was raised. Their everyday life will consist of making buying choices based off of the knowledge given to them by actual verified data, not just shiny marketing claims and polished sales pitches. My children will know blockchain tracking as a norm in the food industry.”

Gaining momentum

The U.S. Food and Drug Administration has said it is “looking into new technologies that include, but are not limited to, artificial intelligence, the Internet of Things, sensor technologies and blockchain.”

Thousands of miles away, private partnerships are also being forged so improvements can be made to existing blockchain tools that champion food safety. The traceability platform VeChain recently teamed up with Avery Dennison Intelligent Labels, one of the world’s largest packaging solution providers.

Avery Dennison’s smart tags could pave the way for greater automation through the supply chain—eliminating the need for information to be uploaded manually to the blockchain at each stage. It’s even possible that advanced smart tags could be used to monitor specific metrics such as the temperature of refrigerated goods.

An Aug. 4 news release from VeChain highlighted how COVID-19 could drive demand for safe, traceable food—with levels of public awareness rising substantially. It cited research that blockchain is expected to track 10% of food industry products by 2023.

Crunching numbers

Some food executives will undoubtedly regard burgeoning technologies such as blockchain and the Internet of Things as expensive investments that will eat into already-razor-thin profit margins. However, research suggests that there could be some tantalizing incentives for manufacturers and producers who get on board early.

Figures from Cointelegraph Consulting recently predicted that the industry could save a delicious $155 billion a year if IoT and blockchain solutions were jointly implemented.

And that’s just for starters. An IBM report released in June 2020 featured a poll of almost 19,000 consumers in 28 countries. It found that 71% of those surveyed said traceability is important to them, and that they’d be willing to pay a premium for it. Of those who said traceability was very or extremely important, more than 70% said that they’d be willing to pay a premium of about 35% on current prices. Looks like those profit margins just started to look a little healthier.

For dessert, the report added that many consumers are likely to base their brand loyalties and purchasing decisions on the product information that’s available to them, with the authors urging businesses to “employ the latest technologies to provide transparency of production methods and traceability of source materials.”

An unignorable issue?

In some parts of the world, food manufacturers have already had to act fast after noticing dramatic declines in the sales of pre-packaged products that offer generic information.

As reported by Modern Consensus back in June, a supermarket chain the well-heeled Chinese city of Shenzhen recently announced plans to start offering tech-savvy consumers instantaneous details about the provenance of pork through the blockchain.

It seems that the details shoppers desire extends beyond the journey that produce makes from field to fork. Increasingly, shoppers also expect details about the feed that livestock is given to assuage the fears of those concerned about unwanted ingredients such as steroids.

Food safety is an international concern that ends far beyond China. The U.S. has frequently grappled with sometimes deadly outbreaks of E.coli that have been linked to greens such as romaine lettuce and clover sprouts. Without blockchain, investigations are often time consuming, meaning it can take weeks to detect the epicenter of an outbreak. In that period, tons of perfectly fine food is often discarded.

Back in April, Dole confirmed that it plans to use the IBM Food Trust’s blockchain technology to ensure all its products are fully traceable by 2025. Looking at the direction that this massive industry is heading in, it won’t be long before other big players follow suit.

C Sephton is a journalist with an interest in cryptocurrencies, personal finance, and financial inclusion—as well as the challenges the crypto industry faces in achieving mainstream adoption. He owns cryptocurrencies.

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