Finding Nemo

How Provenance, a supply chain company, uses blockchain to track sustainably caught fish from small Indonesian fishing villages to consumer’s plates half-way around the world.

Do you know where your food comes from? Traceability is a major challenge in the food industry as food often travels thousands of miles and passes through many hands to make it to our plates. Consumers today rely on traceability initiatives run by 3rd party NGOs which perform audits on food supply chain stakeholders to check for attributes such as Organic, Fair Trade, and Non-GMO. But audits only go so far. These 3rd parties work off of unverified receipts stored in different ways across partners (paper, excel, online). Even within the supply chain, parties often do not know how their food products move outside of their direct partners.

To encourage sustainable agriculture practices and connect consumers with their food, Provenance, a supply chain company, has created a solution that leverages blockchain technology to provide each stakeholder in the supply chain a full and transparent record of how a product has moved through a supply chain that is unable to be fraudulently altered.  The company applied this technology to the opaque Indonesian fishing industry, which supplies fish that often ends up in canned tuna in an effort to help consumers properly identify sustainably sourced fish. Indonesia’s fish industry is plagued by overfishing, environmentally threatening fishing techniques and inadequate labor standards.(1) In a six-month time frame, Provenance was able to connect all stakeholders in the supply chain through blockchain to maintain traceability of sustainably caught fish products from the Indonesian waters to consumers plates.(2)

Blockchain 101

Initially conceptualized alongside bitcoin, blockchain is a digital public ledger that maintains an ever-growing record of all transactions that took place on the platform.(3) The initial idea was spurred by inefficiencies in banking; in the current banking system, two parties rely on a third party, the bank, to verify and support a transaction.(4) Using the blockchain, bitcoin transactions are verified by miners, blockchain community members, who compile transactions into blocks and timestamp the transaction.*(5) The food supply chain offers a great use case for blockchain because similar to banking, it relies on third parties (traceability initiative NGOs) to verify transactions.  

Connecting the dots

To track sustainably caught yellowfin tuna, Provenance involved all members of the supply chain and leveraged mobile blockchain technology and smart tagging. The company’s platform runs through an app that is built on top of the blockchain and allows everyone in the supply chain to see the series transactions that have occurred for each fish product, logged as a batch id.(6) The network can be run on basic smartphones and provides each party information about the identity, attributes, certifications and information associated with a specific batch id. To ensure no party is able to tamper with the data, all of it is stored using blockchain technology – enabling a globally auditable format to protect the identity of each fish product.(7)

Exhibit 1

How it Works

  1. Fisherman catches fish and uploads the fish as a blockchain asset on Provenance’s app which generates a unique id for the fish that is stored as a QR code or RFID tag.(8) The fisherman becomes the first asset owner in the chain and when he or she sell the fish to a distributor, the transaction is recorded in the blockchain.
  2. As the fish move from one party to the next in the supply chain, a transaction is recorded. To verify the chain of events, anyone with the unique id can access how the fish has moved along the supply chain.(9)

The actual supply chain is substantially more complex, much of the fish caught in Indonesia ends up split or combined with other fish products. To ensure the traceability of a fish across product types, Provenance ties the attributes of the fish to each product. Eg. if 3 fish go into a can of tuna, one blockchain transaction occurs where the three fish batch ids are transacted into a can of tuna; if one of the fish batch ids then ended up in another product, the blockchain would show that something fishy had occurred (see Exhibit 2).(10) Prior to blockchain, tracking fish and verifying that a factory did not combine sustainably caught fish and unethically caught fish was near impossible.

Exhibit 2

Looking Forward

As traceability becomes a consumer expectation, Provenance’s technology can be leveraged in numerous settings. Firstly, Provenance can be used in the produce and dairy industry to better inform recalls in the event of a Listeria or E Coli outbreak. It is very hard for companies to identify and notify consumers in the case of one of these outbreaks, but Provenance’s technology would make it easy for a consumer to check if they have a purchased a potentially poisonous food item. Outside of food, Provenance’s technology could help major fashion houses control for counterfeit goods by providing a stamp of authenticity stored on the blockchain.

Exhibit 3: A customer checks where their fish came from through the Provenance app

 

(792 words)

  1. “From Shore to Plate: Tracking Tuna on the Blockchain”, Provenance 2016, https://www.provenance.org/tracking_tuna_on_the_blockchain. Accessed 16 November 2016.
  2. Ibid.
  3. “How Do Bitcoin Transactions Work”, Coindesk, March 2015. http://www.coindesk.com/information/how-do-bitcoin-transactions-work/. Accessed 16 November 2016
  4. Nakamoto, Satoshi, “Bitcoin: A Peer-to-Peer Electronic Cash System”, https://bitcoin.org/bitcoin.pdf, Accessed 16 November 2016.
  5. “How Do Bitcoin Transactions Work”, Coindesk, March 2015. http://www.coindesk.com/information/how-do-bitcoin-transactions-work/. Accessed 16 November 2016
  6. “Tracking Tuna on the Blockchain”, Provenance, 2016. https://www.provenance.org/tracking_tuna_on_the_blockchain. Accessed 16 November 2016
  7. Ibid.
  8. “UK Technology Company Provenance Puts First Fish on the Blockchain” IBTimes, September 2016, http://www.ibtimes.co.uk/uk-technology-company-provenance-puts-first-fish-blockchain-1580047 Accessed 16 November 2016
  9. Ibid.
  10. “Tracking Tuna on the Blockchain”, Provenance, 2016. https://www.provenance.org/tracking_tuna_on_the_blockchain. Accessed 16 November 2016

*For more information see: https://bitcoin.org/bitcoin.pdf

Images

Title: https://www.provenance.org/tracking_tuna_on_the_blockchain

  1. http://www.forbes.com/sites/ibm/2016/11/01/how-blockchain-could-help-to-make-the-food-we-eat-safer-around-the-world/#85c835b67dfa
  2. https://www.provenance.org/tracking_tuna_on_the_blockchain
  3. https://www.provenance.org/tracking_tuna_on_the_blockchain

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3 thoughts on “Finding Nemo

  1. Thank you for your post! This platform could really help with the overfishing and pirate fishing that happens even though quotas are put in place by fisheries. By holding suppliers accountable for each batch of fish they catch, purchasers and fisheries can both better police and prevent overfishing. This platform also provides benefits to the consumer as well. By having insight into where one’s food comes from, it is easier for customers to make more informed decisions about the food that goes into their bodies. This can also help food retailers fully understand their supply chains to make sure that if an outbreak of a food borne illness does occur, they know exactly which supplier it came from and act swiftly.

  2. LS – great post and very interesting application of tech along supply chains. I’m curious if/how/to what extent it has gained traction across various groups. At what scale are they operating? Have fishermen bought into the system? Is their connectivity reliable enough to load information accurately and consistently? What about the other players in the supply chain? This seems like a very high value tool, but also one where incentivizing everyone to take the time to use it would require strong understanding of that value well–not always an easy message. Would love to learn more!

    Kristen

  3. Really like the idea of using blockchain to track food through a supply chain, but I’m struggling with two main points. The first is similar to Kristen’s post on the buy-in of the primary suppliers, the fishermen. From my understanding, fishing is a very decentralized industry with a lot of small producers (e.g. the soya farmers with their choupals); without a body that has the market weight to enforce this new behavior (e.g. a giant buyer like ITC), how sustainable is this new model? Second, from a customer perspective, this feels like it would only be relevant to a small subset of the population that really cares about their food sources. The vast majority of the US would probably not pay for this if any cost were to be passed on to the consumer–despite growth in the organic category (a proxy for people who care about their food), it is still a small percentage of the overall food market.

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