Food distribution is one of the biggest challenges in the modern world and blockchain could be the key to dealing with it.
Have you ever thought about the journey your food took to get to your plate? Your meal may have visited more countries than you have. By sourcing food from further afield, we are able to enjoy a greater variety of non-seasonal meals than ever before but this variety creates a logistical challenge.
The COVID-19 pandemic wreaked havoc on supply chains and exposed deep vulnerabilities. The supply and demand shocks disrupted markets, generating a new roster of winners and losers. Now, many leaders in the food sector are considering how advanced technologies can improve all aspects of the supply chain, including traceability and trust.
As our supply chains grow, it becomes increasingly difficult for us to track our food. This leads to recalls and waste. Blockchain technology could be the tool we need to solve this challenge.
A Circuitous Food Supply Chain Creates New Challenges
Consider: a food recall produces around $10 million in direct costs as well as significant costs due to reputational damage. For individuals not knowing where our food has been can have significant health or dietary consequences — particularly for those with religious requirements. Supply chain problems also lead to around 30% of our food being wasted before it is even sold. This contributes to global hunger and climate change as we use land needlessly.
The majority of these problems begin with the sheer number of entities and individuals involved in the food supply chain. This means that there are a lot of different stakeholders, all of whom need to communicate downstream. If one part of the supply chain fails, it can create significant problems later.
The key, as with most things, is clear communication. This is where blockchain technologies come into play. These technologies can create a trustless network that makes it easier for stakeholders to understand the status, and safety, of food in transit.
It also eliminates the need for direct communication between different supply chain players and provides an easily accessible database. This can even extend to the consumer, allowing them to see a detailed map of their products’ journey.
To understand how this works in practice, it is helpful to look at some real-world examples:
AgriLedger — Building a Level Playing Field for Developing Nations’ Farmers
AgriLedger is a UK based social enterprise focused on helping farmers in developing countries trace food origins and get the credentials they need to grow their businesses. The company provides a way for farmers to identify themselves digitally and prove their income, providing better access to financial incentives.
The company has been involved in a pilot scheme commissioned by Haiti’s Ministry of Commerce and Industry. The aim of the project is to use a blockchain-based “Transparent Trade Ledger” in order to level the playing field for around 600 small farmers trying to sell their mangos, avocados, and pineapples to developed markets.
The system ensures that producers are paid the spot price for their fruit, rather than being forced to go through intermediaries who would not pay them fairly. The same platform enables consumers to scan a QR code on their fruit before buying it, to show which farmer produced it and its journey through the supply chain.
The project helped farmers generate a 750% increase in revenue per kilo compared to previous years.
BITCLIQ — Making Fishing Sustainable
BITCLIQ is working on one of the most important areas for Europe today: sustainable fishing. European fish-stock is rapidly declining and tracking of legitimate catches is more important than ever.
To enable this, BITCLIQ has created Big Eye which helps fishing fleets more effectively track their activity. Most importantly, it enables consumers to easily identify that a fish has indeed been caught sustainably. App users can trace the fish back to the vessel it was caught by, find out the fishing gear used, the catch date, and more.
The company has also produced the first blockchain B2B marketplace for fishermen called Lota Digital. This helps connect fishermen directly with buyers once their catch is caught. The platform allows buyers and sellers to define what kind of fish they want. The fact that catches are sold before the boat has returned to port should help to reduce wastage and discourage fisherman from over-catching.
Ambrosus — Tracking Food From the Farm to Your Plate
Ambrosus is a blockchain-powered internet of things (IoT) network designed to track food and pharmaceutical products. The company’s product leverages a network of sensors and databases to improve supply chain transparency. It also creates a unique digital identifier for every item on the network and tracks the product’s entire journey.
Unlike the other projects on this list, Ambrosus also has a framework that developers can use to build new decentralized apps (DApps). The company is building a framework that will enable apps aimed both at consumer and enterprise customers.
Consumer apps would mostly be built around creating transparency and making it easier for customers to track the food they buy. In contrast, enterprise apps would be more data management focused, designed to make it easier for different players in a supply chain to communicate with each other.
Blockchain Could Help Solve Our Food Supply Problems
Properly targeted blockchain solutions could help solve most problems we currently face with our supply chain. By providing better transparency, we can cut down on food waste and reduce the environmental impact of farms.
We can also leverage IoT solutions to make it easier for different stakeholders to communicate with each other. This could help solve some of the other environmental problems and food shortages we are facing today. And at the very least, it should make us feel more secure about the food we are eating.