Blockchain is a relatively new concept in the technology industry, but it is already being picked up by food companies as a way to improve business. When most people think of blockchain they think of cryptocurrencies, but that is just one aspect of what blockchain technology can do. As I noted in an August 2017 post, blockchain provides a new way for food companies to track their products, both for food safety and overall transparency.
In the past year, food companies and retailers began realizing what an asset blockchain technology could be. The idea began to catch on in China particularly, when at the end of 2017 Chinese e-commerce company JD.com started using a traceability system with its brand partners on its blockchain platform, and Walmart, JD, IBM, and Tsinghua University National Engineering Laboratory for E-Commerce Technologies began a partnership to work together in a Blockchain Food Safety Alliance.
The trend is now spreading more into the U.S., as manufacturers begin to realize that adding blockchain tech to their operations can be a boon for business. At the end of December, Long Island Iced Tea Corp. changed its name to Long Blockchain Corp., in an effort to "shift its primary corporate focus towards the exploration of and investment in opportunities that leverage the benefits of blockchain technology."
The beverage company was facing delisting of its stock back before it made the change, with Nasdaq telling the company in October it would be delisted unless its market value rose above $35 million for 10 business days in a row, reported Bloomberg (Jan. 8). When it changed its name to feature blockchain, it saw its stock almost triple in a day, soaring to almost $70 million market capitalization, and it has stayed above the $35 million threshold since then.
Italian food manufacturer Romana Food Brands Corp. made a similar move, saying it would change its name to Romana Food Blockchain Corp. after announcing it would develop a next generation blockchain food traceability and control application. Romana's blockchain will include information on conditions at the production facilities, tracking of food items, and volumes in the supply chain, as well as other features.
Not surprisingly, Danish shipping giant Maersk is also looking to incorporate blockchain in its business, in a partnership with IBM. The two businesses will form a new jointly-owned company, with the aim of commercializing blockchain technology. The company intends to help shippers, ports, customs offices, banks, and other stakeholders in global supply chains track freight as well as replace related paperwork with tamper-resistant digital records, reported Fortune (Jan. 16)
This year will likely bring even more developments in blockchain, as more food companies discover its benefits. Stay tuned to The Food Institute updates as we track the progression of this new technology in the food industry.
[Editor's note: OFW Law Principal Attorney Michael J. O'Flaherty provided this blog piece regarding the need for federal oversight regarding the ongoing trend of class action lawsuits filed against food companies regarding product...read more
Jennette has been with The Food Institute since 2013. As Marketing Director, she is responsible for promoting all Food Institute books, seminars and webinars, as well as writing and editing the Food Institute’s annual publications. Additionally, she writes for and edits the daily news update, Today in Food, and contributes to the weekly Food Institute Report. She has a background in non-profit and environmental marketing, programming and writing, and graduated from Rowan University in 2012 with a degree in Communication Studies.
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