Blockchain Update: Its Use Accelerates in Food Traceability, Auto Finance, Pharmaceuticals, Global Shipping

Since we ran our first blockchain update article in January, key areas of supply chain and logistics operations in multiple industries have continued to implement successful blockchain trials and projects. The open traceability of a blockchain system has proven especially popular in the food security marketplace, where it is being used both to fight infectious outbreaks of bacteria like E. coli and drive revenue in French supermarkets by giving customers access to sourcing data on dozens of fresh products. In markets like automotive, pharmaceuticals, coffee, and global shipping, blockchain innovations continue to make headlines in a growing array of industry supply chains and applications.

IBM Food Trust Keeps Growing

Since the last update at the end of January, IBM’s food trust initiative has added major players like Nestle, Tyson Foods, French supermarket chain Carrefour, Dole Foods, Unilever, and U.S. grocery conglomerates Kroger and Albertsons. The financial website CoinTelegraph reported IBM had conducted over 500,000 traces within the blockchain based food traceability program by mid-April, substantially reducing the time required to find the source of food-borne illness outbreaks like E. coli cases that have affected U.S. supplies of leafy greens and meats over the past several years. The program hopes to pinpoint the source of infection outbreaks with much greater accuracy, so individual lots from contaminated sources can be recalled instead of all products as has been customary in past cases. Carrefour has already reported via Reuters an increase in sales for products tracked on the blockchain like eggs, meat and fruit.

More Automakers Join In

After Ford began its pilot program this year to track cobalt in their supply chain, General Motors has contributed to a $23 million funding round spearheaded by GreatPoint Ventures in the blockchain startup Spring Labs. CoinTelegraph reports Spring Labs will use the funds to continue development of their blockchain-based fraud prevention software, built specifically for the automotive industry where financing fraud has grown tremendously over the last five years. GM joined the Spring Founding Industry Partners Program in February as a precursor to the recent investment. In March, BMW joined a partnership with Intel, Nielsen and the Singapore government-backed blockchain accelerator Tribe with the intent to increase blockchain adoption in the region and around the world. BMW Group Asia will provide education on implementing blockchain solutions in a mass market context, while Intel will provide technical mentorship to startups, and Nielsen aims to provide a consistent test environment for new technologies.

Pharmaceuticals on Chain

MedCity News reports that the U.S. FDA has brought together Walmart, IBM, KPMG and Merck & Co. for a program to evaluate blockchain technology in the pharmaceutical industry. A shared, permissioned blockchain will be used to trace inventory, share data across institutions and verify product integrity, including detecting counterfeit products and monitoring the conditions under which products are stored and shipped. The technology could also be used to monitor compliance in complex clinical trials that in later stages can take place in multiple locations around the world.

Don’t Forget the Coffee!

Coffee comes up regularly when discussing supply chains for consumer products, and the impact of blockchain technology is beginning to be felt in this industry as well. In May, Starbucks announced it will use Microsoft’s Azure Blockchain Service to trace their coffee supplies on the blockchain “from bean to final bag,” allowing customers to use the Starbucks mobile app to see how their coffee made it into their cup from countries all around the world. Freight Waves also reports that Dutch startup Moyee Coffee is working to create an Africa-focused blockchain ecosystem with the intent of increasing pay and living standards for Ethiopian coffee farmers. In March, the Indian government voiced support for the Coffee Blockchain Initiative that aims to reduce redundancy and bring coffee supplies to market with greater transparency across the Indian subcontinent.

Blockchain in Ocean Shipping Lumbers Forward

Danish shipping leader Maersk announced on June 6 an agreement had been reached allowing the IBM-backed TradeLens platform to begin operating in the Russian port of St. Petersburg. The program will allow shipments to and from the port to be registered and viewed in TradeLens, greatly reducing the amount of paper-based approvals and other documents required for import and export with the goal of significantly decreasing processing times for these shipments. Since the last update, TradeLens has also begun integration with Mediterranean Shipping Company and CMA-CGM, with the platform now processing over 10 million shipping events each week. In the Middle East, Dubai-based Landmark Group and HSBC have connected two independent blockchain platforms to allow real-time tracking of shipments and employing a digitized letter of credit, ultimately leading to a reduction in shipping times by 40%. The event marked the first time HSBC has issued a digital letter of credit between Hong Kong and the UAE, and one of the first programs in the region to reap the benefits of streamlined processing using blockchain technology.