As the internet connects multiple entities, it seems like a world where every object can tell a story of its own. When these wonderful manifestations of the internet combined with blockchain, a revolution took place in Supply Chain management.
The introduction of blockchain in the food supply chain:
- simplified tracking the journey of a food item from the producer to the seller, and
- became a trust-building measure, and
- increased transparency.
Let’s see how blockchain is influencing food supply chains.
Impact #1: Transparency and traceability of food
Blockchain enables real-time and mutual collaboration between all the stakeholders of a food supply chain. As a result, it maintains extreme transparency and keeps them informed of the process.
The transparency of blockchain makes food products traceable. Whenever there is an outbreak of an illness due to the consumption of some edibles, you have to capture the exact source of the issue.
If uncertainty remains, there will be thousands of others who will succumb to these illnesses.
There is no such mechanism by which we can find the exact source of any perishable food item in the current system. But secure information exchange is the most common blockchain use case; this transparency ensures that every stakeholder adds elaborate data points that you can analyze to find any loopholes.
Impact #2: Resolution of market access problems
The hallmark of blockchain technology is to add public ledgers within a given network. Now, this has become beneficial for the food supply chain.
A public ledger can help balance market access for the pricing models within the food supply networks. Here, the entire value chain gets connected in a single transparent place.
Thus, the dynamic pricing of food and edible goods does not occur away from the eyes of other chain members. Otherwise, usually, the producers and sellers used to predict the prices arbitrarily.
Impact #3: Waste monitoring and reduction
Supply chain management highly leverages decentralization, an active part of the blockchain. For example, when we decentralize the food supply chain information, it becomes easier to track all utilization trends of food items.
It becomes beneficial for government undertakings where the body organizes food distribution camps. For example, if we connect the entire camp with blockchain, the wastage and improper use of food can be tracked easily.
Once we have the information, we can divert the distribution to other areas where people need it the most.
Impact #4: Nabbing illegal food producers
Unlicensed food item producers (who become part of the supply chain illegitimately) are the root cause of foodborne illnesses and adulteration.
There are shocking examples of how common the illegal food producers have become in the seafood supply chain across the globe.
A report claimed that 22,000 tons of fish meal are produced in the illegal factories of Peru annually.
Transparency in transactions and engagement is a big virtue of blockchain technology. Thus, we can perform a quick background check of all key players within the supply chain by leveraging blockchain, thereby eliminating such illegal acts.
Impact #5: Cost reduction
Blockchain can play a significant role in reducing the costs involved in the food supply chain. It processes transactions efficiently and makes the reporting process more accessible.
As a result, it creates a less capital-intensive supply chain for the food industry.
Blockchain helps in reducing costs by eradicating the functioning of mediators. Without the involvement of a third party, all stakeholders can collaborate directly with each other by ensuring maximum transparency. It prevents unwanted expenditures from disturbing the vendor budgets.
The bottom line
We have only listed the existing benefits blockchain technology is rendering to food supply chains. In the future, extensive collaborations between blockchain and other technologies can render a more significant advantage to the food industry.