THE BLOCKCHAIN PANACEA

Akila Wijerathna asserts there’s a need for more secure food supply chains

The global food supply chain is a complex network that faces numerous challenges including inefficiencies, food fraud, a lack of transparency and sustainability issues. With increasing consumer demand for traceability and accountability, the food sector is looking for innovative solutions that can improve these systems.

One such solution is blockchain technology, which is gaining traction due to its promise of creating more transparent, efficient and secure food supply chains.

Blockchain is a decentralised and distributed ledger technology. It records transactions across multiple computers in such a way that the registered transactions can’t be altered retroactively without the alteration of all subsequent blocks and the consensus of the network.

Its key features include transparency, immutability and security, which make it an ideal candidate for addressing the problems faced by food supply chains.

Each block in the blockchain contains a record of transactions; and once a block is added to the chain, it is permanent. This ensures that data is trustworthy, verifiable and tamper proof, creating a system where intermediaries aren’t needed to verify the authenticity of transactions.

Food supply chains today are fraught with inefficiencies due to their complexity and fragmentation. A typical supply chain involves multiple intermediaries ranging from producers to distributors, retailers and consumers.

The lack of transparency makes it difficult to track products accurately, and leads to issues with food safety and authenticity. Food fraud such as mislabelling, adulteration and the inclusion of counterfeit products is a serious concern, and costs the global food sector billions of dollars annually.

Traceability is another major issue. In the event of a food recall, tracing the origin of contaminated products can be slow and cumbersome, could jeopardise public health and lead to unnecessary food waste.

Environmental concerns also arise with inefficiencies in transportation, storage and packaging contributing to food waste and higher carbon footprints.

Given these challenges, there is an urgent need for better solutions to improve the transparency, security and sustainability of food supply chains.

Blockchain enables real-time tracking of food products from farm to table, and ensures transparency throughout the entire supply chain. With every transaction recorded in the blockchain, stakeholders can trace a product’s journey at any point in the supply chain.

In the event of food borne illness for example, blockchain enables rapid tracing of contaminated products to their sources, and ensures quicker response times and minimal public health risks.

By recording every step of a product’s life cycle, blockchain ensures that food products are not adulterated or misrepresented. For instance, in the seafood sector where mislabelling is rampant, blockchain can guarantee the proof of fish and seafood, reduce the prevalence of fraud and improve consumer trust.

Blockchain can also greatly improve the efficiency of food supply chains by providing real-time information on product availability, inventory levels and demand.

This can help prevent overstocking or understocking.

By integrating blockchain with IoT devices such as temperature sensors in cold storage, supply chain participants can monitor and manage products more effectively.

Sustainability is another area where blockchain can make a substantial impact.

Through enhanced transparency, it can provide consumers with detailed information about the environmental impact of their food including carbon footprints, water usage and ethical sourcing practices.

One of the most promising aspects of blockchain is the use of smart contracts – self-executing contracts where the terms of an agreement are written into code and automatically enforced once predetermined conditions are met.

There is also resistance from stakeholders who may not understand blockchain’s capabilities or be wary of its potential disruption to existing business models.

Furthermore, regulatory challenges related to data privacy and food safety standards must be navigated carefully as different regions have varying regulations regarding the use of blockchain technology in food traceability.

Looking ahead, blockchain technology holds immense potential for revolutionising food supply chains. The integration of blockchain with emerging technologies can enhance the transparency, efficiency and sustainability of food production and distribution.

As businesses adopt blockchain, it is likely that the technology will become more cost-effective and accessible with broader adoption.

However, overcoming the barriers to the adoption of blockchain will require collaboration among sectoral stakeholders, regulatory bodies and technology developers to ensure that it can reach its full potential in the food sector.