Alibaba is working with a consortium of companies to introduce a food-tracking system into the supply chain that is based on blockchain technology.
The Food Trust Framework consortium, which is made up of four companies from New Zealand and Australia, will use Alibaba’s cross-border marketplace Tmall Global to control the supply-chain process.
New Zealand-based dairy exporter Fonterra and the state-owned postal service New Zealand Post will combine forces with Australia’s Blackmores, a natural health company, and the country's postal service Australia Post to achieve end-to-end supply-chain traceability.
Tmall Global will use standards and controls to manage the supply-chain process, including blockchain — a public, digital ledger, and unique QR codes to give the Food Trust Framework transparency for cross-border trade.
The technologies will authenticate, verify, record and provide an open report on the transfer of ownership and provision of products and goods.
For food producers, the use of blockchain could assist in stopping the use of fake ingredients by detecting it much faster.
In the event of food-contamination issues, such as the recent romaine lettuce scandal in the US, retailers can quickly retrace the supply chain and remove the specific batch instead of recalling the entire shipment.
The launch is a follow-up to Alibaba’s collaboration with multinational professional services network PricewaterhouseCoopers (PwC) in Australia and New Zealand, which involved implementing a framework to ensure product authenticity and provide a trusted marketplace for consumers.
Watch Alibaba use blockchain to ensure food safety:
The Food Trust Framework will use an immutable central ledger to achieve end-to-end supply-chain traceability and transparency to enhance consumer confidence and build a trusted environment for cross-border trade. Blockchain for food safety? Read more at https://t.co/4eyb6gMXUa pic.twitter.com/NJ8fhvS052
— Alibaba Group (@AlibabaGroup) May 1, 2018
Read the 'Blockchain Technology for Ports' technical paper by Wolfgang Lehmacher, World Economic Forum, to understand why blockchain is important to the port, harbour, and terminal industries
Alvin Liu, General Manager of Tmall Import & Export, said: “Food fraud is a significant global challenge, particularly with the growing complexity of supply chains.
“In response, we have created a coordinated, world-leading and robust framework that involves stakeholders from across the supply chain to improve visibility and enhance the confidence of both consumers and merchants.”
According to Michigan State University, fake food products drain $40 billion from the global food industry each year.
PwC has stated that an estimated 40% of the food companies find the traditional approach insufficient to counter fraudulent activities, and 39% say their items are easy targets for counterfeiters.
To combat bad actors, many companies are rolling out extra measures, including blockchain technology.
Lukas Paravicini, the Chief Operating Officer of Global Consumer and Foodservices at Fonterra, commented: “Given the potential of emerging tech, including blockchain, we want to be at the forefront of developing food-quality and safety standards across the supply chain.”
David Walsh, New Zealand Post CEO, stated: “Consumers will be able to track their purchase from paddock-to-plate, with full and complete knowledge of its origin and journey with us.”