The Future Of Food Distribution And Energy Consumption With Blockchain

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By Pawel Tomczyk

According to the World Health Organisation (WHO), every year almost 1 in 10 people fall ill and over 33 million healthy life years are lost due to foodborne illnesses. Thankfully, increasing awareness about the source and quality of our food is bringing about new and innovative ways to think about the food supply chain and food distribution. Blockchain technology is one such innovation that many believe will transform the food industry, making food safer and keeping us healthy.

Is Blockchain Technology The Future For Food Chain Distribution?

According to a UN survey in 2011, almost one-third of the food produced across the world is wasted. In fact, the food that perishes before it can be eaten in Sub Saharan Africa alone is enough to feed 300 million people across the world. That’s the massive scale at which food wastage and inefficiencies are built into food chain distribution.

The major issues that plague food chain distribution include:

Unsafe food

According to a WHO report, “unsafe food containing harmful bacteria, viruses, parasites, or chemical substances, causes more than 200 diseases – ranging from diarrhoea to cancers.” The recent problem of E. Coli in lettuce in May 2018 proves that food safety continues to be a worldwide problem with serious consequences.

Unethical Practices

This includes practices from slave labor on cocoa plantations to passing off non-organic food as organic. Unethical practices are a major problem in the industry and very hard to catch because of a complex supply chain.

Lack Of Transparency

Due to the complexity of the supply chain and the perishable nature of food items, it’s very difficult to create and promote transparency in the industry, be it in cost or production practices.

Inefficiency In Distribution

Most of the major problems in food chain distribution occur because of supply chain inefficiencies. Much of the food perishes before it can reach the right people.

So what is blockchain and can it really help transform food chain distribution? The fact of the matter is that most of the problems in food chain distribution can be attributed to the fact that the supply chain itself is archaic, complex, and opaque. If the supply chain were to become more streamlined, faster, and transparent, many of these issues could be tackled effectively.

This is where blockchain technology comes in.

Advantages Of Blockchain In Agriculture And Food Distribution

According to one article, the blockchain “is based on a shared ledger or DLT (Distributed Ledger Technology). In more simple words — it is ‘one big ledger in the cloud’.”

This ledger contains information in blocks. Any data or information contained in these blocks is highly tamper-resistant. This helps make the data on the blockchain authentic, transparent, and trustworthy. All elements of food chain distribution, whether it’s farmers, retailers, or consumers can add data to the blockchain. Once the data is verified, it’s pretty much permanent. This has tremendous potential for a faster and more transparent supply chain in both agriculture and food distribution.

The most prominent example of blockchain’s application in agriculture and food distribution is Walmart’s Farm to Fork project that they implemented using IBM’s Hyperledger fabric. Walmart put mangoes on the blockchain and the blockchain technology now takes less than 2 seconds to trace the origin of mangoes. This used to take at least 6 days using the traditional supply chain data.

Another interesting example is that of Coca-Cola. Coca-Cola is using blockchain to tackle another important problem in food chain distribution - unethical food production. They are using a blockchain platform to ensure that the sugar they use is being produced by farms that adhere to ethical labor standards.

Disadvantages Of Blockchain In Agriculture And Food Distribution

Here are some concerns with using blockchain in agriculture which may eventually affect its adoption and efficacy.

  • Many projects are still at a proof-of-concept stage and it remains to be seen whether they can actually be implemented at scale.

  • Interoperability is another concern. Right now there are many projects, each coming with a slightly different angle and it will be critical to integrate them with each other to create a systemic transformation.

  • The success of many blockchain projects depends on tools like sensors and tagging technologies. This makes it even harder to ensure adoption in all parts of the supply chain whether it’s the farmer or the retailer.

The Correlation Between Energy Consumption And The Food Chain

Energy consumption varies widely in various stages of the food chain. The energy consumed in different stages is a reasonable indicator of the kind of environmental impact the production of that particular food can have. Moreover, in most cases, the higher the energy requirement throughout the food chain, the greater the market value.

The variation in energy consumption is mainly due to:

  • The season of consumption (fresh vs storage)

  • The scale of preparation

  • Consumer preference (non-vegetarian food vis-a-vis vegetarian food).

The transparency and authenticity that blockchain can bring about in food chain distribution can really help pinpoint where the most energy consumption is taking place:

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How Blockchain Technology Could Affect Food, The Food Chain, And Agriculture

As discussed, blockchain is still very nascent in its applications to agriculture and the food chain. Moreover, it would be wrong to look at blockchain as the only disruptive technology in the sector because there are many other technological experiments going on, like robot farming, hydroponics, vertical farms, etc. that are set to change the course of agriculture in the coming decades.

Having said that, blockchain experiments definitely have huge potential when it comes to transforming the supply chain in this industry. While the experiments are still small and localized, it’s easy to see that many problems with food chain distribution can actually be highly mitigated when blockchain technology in this sector scales up.

About the Author: Pawel Tomczyk is a marketing enthusiast (7 years running), who’s passionate about technology. He is the founder of Gaia.Solar, which specializes in renewable energies, and also founded Cyberius in 2016, which is a digital marketing company. We help create content for our clients such as articles, infographics, and social media posts, as well as help them with creating digital communities, launching crowdfunding projects, and more.