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Blockchain Technology in The Food Industry

Blockchain, Are We There Yet?

Blockchain is an incredible technology because it is a secure, immutable record of transactions. This is important as it makes it impossible to fraudulently change and manipulate data.

Some critics have doubts about the provenance of the data entered on a blockchain. Whilst this is a valid point there are technologies available which focus on this issue. For example, most people have digital identities, and a vast number of people, machines, computers, devices, and appliances have a digital footprint, even a digital fingerprint. Therefore, the identity problem with digital ledgers is universally solvable. Banks already solve this problem by using 2 factor authentication (2FA) when conducting financial transactions by relying on the digital identity of your personal cell phone.

Blockchains, otherwise known as Digital Ledger Technology (DLTs), are a secure database technology made up of cryptographically verified and locked ‘blocks’ of data. Any kind of data can be stored, or referenced, in a blockchain and the data itself is used to create a cryptographic key. This cryptographic key (crypto-key) means that if the data in a ‘block’ was changed then the crypto key of that data would not match with the data itself.

This simple concept means that the data is secured by its crypto key and because the crypto key is extremely difficult to crack it becomes impossible to change data on a DLT, thus, its immutability.

The blocks of data are then ‘chained together’ using their crypto keys, thus the name blockchain. This means that if one block of data was changed, the block before and after this block would also need to be changed. This makes the entire chain of data unchangeable as you would need to de-crypt the entire chain of data, making it an impossibly long and difficult task to complete. It is like having to crack the code of every safe in the world at the same time just to steal the money inside the safe which you are trying to break into.

Computer code called Smart Contracts are used to validate blockchain transactions by validating the entity which submitted the data. Smart Contracts are also used for a variety of tasks, like verifying data to be added is valid. This is called Consensus and it helps ensure that the data stored on a blockchain is accurate, verifiable, and propagated throughout the digital ledger to all its copies.

Blockchain And Food Traceability

The diagram below illustrates how a DLT blockchain works in the context of traceability:

The above represents the concept that Frank Yiannas (then at Walmart) pioneered together with IBM in their pilot of Food Trust, enabling traceability of Mangoes and Pork throughout the supply chain and reducing the time to trace products from days to seconds.

Moving anything from paper-based systems to digital systems will get this kind of speed improvement, blockchain or not. The main point is that the length of time taken to trace where a product came from, and went to, is highly correlated to hugely increased costs and consumer damage. In other words, the longer it takes to trace an adulterated product the higher the cost of recall and the health effects. The average direct financial cost of a food recall in the US was estimated at $10m by the GMA, and this was in 2011.

What is different about DLT blockchains is that they cannot be easily tampered with whereas a database or piece of paperwork can be easily changed and manipulated by unscrupulous parties. This is important if food supply chain data is to be trusted and is why blockchain technology has value.

'With food fraud costing the world economy a minimum of $15bn pa, trust on its own can be risky. This is especially the case when buying food products, ingredients, and packaging from the other side of the world and you may receive fake, adulterated products, ingredients, or raw materials.

Detailed Ledgers in the Food Industry

Digital Ledgers therefore have solid use cases for traceability, movement of money and goods and are set to be a major factor in the digital revolution. Many solutions are already available and making significant impact on global food supply chains. Here are just a few examples:

  • IBM Food Trust - “IBM Food Trust is a collaborative network of growers, processors, wholesalers, distributors, manufacturers, retailers, and others, enhancing visibility and accountability across the food supply chain. Built on IBM Blockchain, this solution connects participants through a permissioned, immutable and shared record of food provenance, transaction data, processing details, and more.”

  • Ripe.IO - “ uses blockchain to increase transparency in the food supply chain. The blockchain ecosystem has a variety of tools to map the food journey, including supply chain tracking, secure data aggregation, brand quality verification and sensor and IoT integration.”

  • GreenFence - “The Greenfence platform uses ledger technology to authenticate and trace all actors in the food chain-of-custody process. The software identifies and certifies the people, locations, distributors, equipment and anything else involved in the farm-to-table process to ensure that quality standards are being met every step of the way.”

  • OriginTrail - “OriginTrail is an ecosystem dedicated to making supply chains work - through championing standards supporting a universal data exchange (interoperability), connecting rather than replacing legacy IT systems (interconnectivity) and ensuring data immutability by utilizing the blockchain technology (integrity).”

  • Ambrosus - “Ambrosus is a public permissioned blockchain ecosystem with more than 500 decentralized node operators securing the network. Robust and scalable by design, the Ambrosus blockchain is optimized for interconnectivity with IoT devices, sensors, existing ERP systems, and other enterprise management software.”

Blockchain v Tangle

Not all blockchains are the same and can be broadly classified into two types at present; Linear blockchains and Tangle’s.

The main differences between the two blockchain technologies are that Linear blockchains hold data in a Linear chain, whereas Tangle blockchains can store information in a hierarchical (and directional) way. In principle, a hierarchical Tangle blockchain would be a better fit for the hierarchy of a food supply chain, whereas linear blockchains are potentially limited to ‘straight lines’ of data. Tangle based DLT’s therefore have greater possibilities for the complexities of food supply chains.

Nonetheless, all current blockchain technologies are silo’d due to a lack of interoperability. They are the equivalent of Betamax technology in the movie industry. Just as Netflix evolved to largely destroy the VCR, DVD, Blue Ray, and Cable TV markets. The same is likely to happen with existing blockchain technology as it is still early in its evolution.

Could Blockchain Help Your Food Supply Chain?

The urgency and disruption of COVID-19 may have dampened the hype around blockchain and DLTs a little as the world focuses on the important and urgent COVID-19 pandemic but DLT blockchain technology has not gone away. DLT companies are working in the background building traction, becoming mature and gaining acceptance. It is therefore highly likely that the wider food industry will be interacting with them more very soon.

If you would like to learn more about block chain and its novel uses in the food industry, please feel free to get in touch for a quick demo.



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