Blockchain Poised to Bite into the Food System

Blockchain technology is all the rage these days. From industry leaders to disrupters, organizations are seeking to capitalize on the potentially revolutionary technology. In February, CBInsights outlined 36 industries that could be transformed by blockchain tech, including retail, health care, energy management, politics, and academia. One area that could experience enormous impact is supply chain management, specifically in agriculture.

What is blockchain tech? A simple explanation from the Wall Street Journal describes blockchain as “a secure database, or ledger, spread across multiple computers. Everybody has the same record of all transactions, so tampering with one instance of it is pointless. ‘Crypto’ describes the cryptography that underlies it, which allows agents to securely interact … while also guaranteeing that once a transaction has been made, the blockchain remains an immutable record of it.”

Agriculture production systems impact everyone, not only those working in the ag industry. From seed to store, producers need to track an increasingly complex chain while consumers want to understand and verify their food source. Blockchain’s decentralized record-keeping system could improve transparency for farmers, traceability for producers, and information for consumers.

Take the example of a tomato: A farmer records and tracks data from machinery, testing equipment, and drones, from seed to harvest of a tomato plant. This could include soil content, inputs used, and plant location – information that helps the farmer make better decisions around fertilizing, spraying, and harvesting. This data is written in the blockchain before tomatoes leave the farm. The recording and tracking continues as each tomato makes its way to the store, allowing for others along the supply chain to submit new inputs of data. Once the tomato is available to buy, a customer can scan a QR code to access information about the origins of their food.

One benefit of integrating this tech would be increased food safety. A high-profile collaboration was announced in August 2017 between IBM and leading retailers and food companies, including Nestle and Walmart, to use blockchain to make the global food supply safer. It can take weeks to pinpoint the source of food-borne illnesses and contamination that lead to sick consumers and food waste from disposal of products for fear of contamination. According to a Forbes article, “By using blockchain, when a problem arises, the potential is to quickly identify what the source of contamination is since one can see across the whole ecosystem and where all the potential points of contamination could be – using the data to pinpoint the source.”

Another benefit is increased transparency and information. I grew up on a farm and can attest to the challenge for a farmer or rancher to feel connected to the end consumer. Farmers alter and improve practices to ensure they are being environmental stewards and meeting both consumer and market need. This is a tricky balance that can lead to frustrated consumers, markets, and farmers when one party feels that their (or the environment’s) best interest is not at heart. In a time when end consumers are disconnected from their food source, it’s critical to have accurate, unembellished information all along the supply chain. Blockchain could facilitate an honest conversation between farmers and consumers by creating an unbiased flow of information between them.

Today, companies are faced with a question: Do we take the risk to integrate a new technology into our business model? Blockchain offers the opportunity to improve the food system’s transparency and safety, to educate producers and consumers, and ultimately, to increase a company’s financial bottom line. In an industry that relies on consumer trust and taking care of the environment, ag companies are poised to take a risk that would be advantageous for all stakeholders – from farmer to producer to consumer.


Contributed by Jacklyn Ward, Associate Consultant.