Odourless fish oil and dairy products are among the first products to be ordered from Australia using Chinese ecommerce giant Alibaba’s blockchain based ‘Food Trust Framework’.
Vitamin and supplement maker Blackmores and dairy brand Fonterra are the first companies to use the framework which aims to achieve end-to-end supply chain traceability to boost consumer confidence in the provenance of their purchases.
As well as utilising blockchain technology the framework – delivered via Alibaba’s business to consumer platform Tmall Global – incorporates various controls such as products getting tagged with unique QR codes.
“These technologies are designed to authenticate, verify, record and provide ongoing reporting of the transfer of ownership and provision of products and goods,” Alibaba said.
“Once the pilot is complete and if successful, the framework could form the basis of a global supply chain model applied across all of Alibaba Group’s e-commerce markets. The framework represents the next step in Alibaba’s vision to build the future infrastructure of commerce and will help give confidence to producers, merchants, logistics providers and consumers alike,” the company added.
Australia Post and New Zealand Post are also involved in the pilot, which has been set up with the help of PwC.
Supply chain networks are touted as a prime use case for blockchain technologies. It is proposed that since each stakeholder in a blockchain-supported network can access an authenticated ledger of a product’s journey, this allows parties to more easily keep track of where goods are and speed up shipping and payment reconciliation processes. It also makes it quicker and easier to trace the source of contaminated products
Consumers benefit from being able to view where their food or goods came from, and the journey of their purchase. If a product was marketed as organic, potentially the buyer could view the item’s provenance via a blockchain to see if it really came from an organic farm.
Blockchain does not however solve the issue of a farmer, say, lying about whether they used a pesticide. Nor would it stop a product simply being mislabeled.
PwC estimates that 40 per cent of food companies find food fraud difficult to detect with current methods, and 39 per cent think their products are easy to counterfeit.
In August last year, IBM announced it had formed a blockchain consortium including the likes of Dole, Driscoll’s, Nestlé, Unilever and Walmart, to explore the technology’s potential in the global food supply chain.
In December, QUT Professor Marcus Foth revealed his distributed ledger-based food provenance solution for Australian beef products dubbed the BeefLedger Blockchain.
“Blackmores goes to extraordinary lengths to have visibility over our supply chain and each of our products passes 30 tests and checks before it is released for sale. So we’re exploring ways to leverage the technology and data that can provide our consumers with assurance that their trust in our products is well-placed,” said Blackmores CEO Richard Henfrey.
“Our commitment to quality doesn’t end in our distribution centre and we need to give consumers confidence in the products they purchase on e-commerce platforms.”
Fonterra China president Christina Zhu said consumers increasingly want to trace what they eat.
“In China and many other markets, we know consumers want to be able to trace the products they purchase online, so we welcome being a part of creating a globally respected framework that protects the reputation of food companies and gives greater value and consumer confidence,” she said.