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Note: This blog is written by an external blogger. The views and opinions expressed within this post belong solely to the author.
One of the few things that everyone on the planet can relate to is food. Food is essentially required to keep the human ecosystem alive and is one of our most basic needs, as well as one of the world’s most valuable industries.
Thanks to several new blockchain-powered innovations, it appears that the food industry is next in line to be revolutionized by this disruptive technology, ushering in a new era that is more transparent, ethical, and gives consumers greater control.
An industry kept under wraps
Most of us understand food and the food industry solely from the perspective of a final consumer, i.e., the end of the food supply chain. However, a global network is in place to transport food from its point of origin to our tables.
While this system appears to be effective on paper, it has numerous flaws in practical terms. To begin, the majority of consumers have no idea where their food comes from. The only information available is that – it comes from a farm somewhere on the planet. While this lack of transparency does not affect all consumers equally, certain concerns have been raised.
For example, in 2018, meat was found in meat-free products that were sold in supermarkets. Again, the lack of transparency between food manufacturers and consumers proved counterproductive over time, particularly those with dietary restrictions or who wish to consume only ethically sourced food.
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Blockchain – the missing piece in the Puzzle
Blockchain technology may hold the key to closing the accessibility gap in the food industry. A prominent example of how a retailer is utilizing blockchain in their supply chain is Carrefour, a French supermarket. The company ran multiple food supply lines across blockchains such as Cauralina tomatoes, Rocamadour cheese, and Gillot fresh milk. Consumers could access information about the origin of the food, its supply chain, and whether antibiotics or pesticides were used during the process by scanning the barcodes on these items.
Nestlé partnered with OpenSc, a blockchain platform, to track milk from New Zealand farms and producers to Nestlé factories and warehouses throughout the Middle East. Meanwhile, Cermaq salmon and Labeyrie teamed up to leverage the IBM Food Trust platform to ensure traceability and transparency throughout their supply chain.
Blockchain provides a secure environment for every supply chain participant to access all data, and this data cannot be modified once it has been entered and validated. A farmer who produces an organic food certificate that is certified by an authorized organization, for example, cannot have that certificate tampered with later.
According to Juniper Research’s latest study, “Key Vertical Opportunities, Trends, and Challenges 2019-2030,” blockchain paired with IoT sensors and trackers will have various advantages. These include streamlining the supply chain, reducing retailer costs, offering simpler regulatory compliance, and enabling $31 billion in food fraud savings globally by 2024.
A boon for India
A simple, smart contract can significantly reduce the number of intermediaries in a supply chain’s network. These smart contracts can help farmers/producers minimize transaction costs, increase margins, and efficiency, thereby directly transferring a sizable portion of profits to the farmer/producer.
This is a major problem, particularly in India, where millions of citizens and the Indian economy rely heavily on agriculture. In most cases, these honest, hard-working farmers are left out given the multitude of intermediaries that exist between farm and table, leading to reduced profits for farmers and increased costs for buyers.
According to a 2018 policy paper published by the United Nations Food and Agriculture Organization (FAO), blockchain technology has the potential to transform India’s food supply chain significantly. Blockchain technologies can assist in establishing an immutable contract between the various players in the supply chain, thereby increasing system transparency.
Tech IBM is also playing a major role in reducing food wastage in India using blockchain tech. Not merely wastage. IBM anticipates that billions of home cooks will be able to detect dangerous contaminants in their food effortlessly within five years. They would only require a cell phone or a countertop equipped with Artificial Intelligence (AI) sensors.
The broader implications
Beyond supply chain efficiency, the use of blockchain in the food industry will have ramifications. This means that consumers can have greater trust in the products for which they pay and greater control over the food they consume. Simply put, blockchain will revolutionize the way we consume food daily.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
