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Can blockchain make food safer in China?

Thor Olavsrud | Oct. 20, 2016
Aiming to secure the food supply chain and improve traceability, IBM is working with Walmart and Tsinghua University to use blockchain to enhance food safety in China.

China is the world's leading consumer of pork. According to the University of Pennsylvania's Penn Wharton Public Policy Initiative, China consumed 57 million metric tons of pork in 2014, more than half of global pork consumption in that year. Although the country accounts for half of the world's pork production, in recent years it has begun importing pork to meet consumers' demands — in 2014, Mainland China was the world's third-largest importer of pork (13 percent), behind Japan (21.1 percent) and Mexico (13.1 percent).

In fact, pork is so popular in China that fluctuations in its price have the potential to send the country's economy into a tailspin. According to The Economist, in 2007, an estimated 45 million pigs in China died from "blue ear pig disease." The resulting shortage caused the price of pork to skyrocket, in turn causing the annual rate of increase of the consumer price index to hit a 10-year high.

Getting strategic about pork

Recognizing that food security was a vital national interest, the Chinese government implemented the world's first strategic pork reserve, a combination of frozen and live pork that can be used to soften the effects of vicissitudes in the market. The Chinese government tapped the reserve earlier this year, releasing 6.1 million pounds of frozen pork into the market over a period of two months in an effort to ease prices that had surged by more than 50 percent.

The concerns aren't just economic. Those economic pressures can lead unscrupulous suppliers to cut corners. In 2011, according to Penn Wharton, China's largest processed pork manufacturer was discovered using illegal feed additives that contaminated its product. In the wake of many other such food safety scandals, the government has been blamed for its inability to ensure a safe food system.

The collaboration between Walmart, IBM and Tsinghua University aims to change that perception. IBM Research - China brings its expertise in rapidly evolving blockchain technology to the table (the IBM Blockchain is based on the open source Hyperledger Project fabric from the Linux Foundation). Top experts in safety transaction security and authentication technology from Tsinghua University are working alongside them, while Walmart brings is team of supply chain, logistics and food safety experts to the project.

"As advocates of promoting greater transparency in the food system for our customers, we look forward to working with IBM and Tsinghua University to explore how this technology might be used as a more effective food traceability solution," Frank Yiannis, vice president, Food Safety, Walmart, said in a statement Wednesday.

 

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