Nestlé SA is putting some of its Gerber baby food products on a food-tracking blockchain to test whether the technology can trace the fruits and vegetables that go into its purées and squeezable pouches. Nestlé’s effort is part of a wider food-industry exercise aimed at improving food recalls by using the technology behind bitcoin to trace a worldwide ingredient supply chain.
Food recalls can diminish consumer confidence and lead to lost sales. News of tainted baby food hits an especially sensitive nerve – stakes that in part prompted Nestlé to choose a popular variety of its Gerber linefor its blockchain test, said Chris Tyas, global head of supply chain at the Swiss company. Nestlé offers more than 2,000 brands, including Haagen-Dazs, Stouffer’s and Poland Spring.
Nestlé also sees the move as a way to generate customer trust everyday and during recalls. “People want to know, quite rightly, where ingredients they give to their baby have come from,” he said. “We wanted a product in which trust meant something.”
Nestlé technology and Gerber business experts have discovered that putting blockchain technology to use in a corporate supply chain takes some grunt work, mainly centered on moving data from the company’s SAP SE enterprise software onto the shared digital ledger. Another wrinkle, Mr. Tyas said, is dealing with the mix of paper and electronic data in different formats, from farmers, processors and others in Nestlé’s supply chain.
Nestlé is working with nine other large food companies, including rival Unilever PLC and Walmart Inc., as well as International Business Machines Corp. on a blockchain system called Food Trust, to trace food and ingredients worldwide. The theory is that having partners and competitors share a single record-keeping system can speed up investigations of bad food and make recalls more accurate and less expensive.
Blockchain technology, in concept, can help companies keep the food system safer, Mr. Tyas said, but only if major players collaborate. Single food giants working with individual suppliers and retailers would result in siloes of data, he said.
“We work very closely with Walmart and IBM on this whole project. There’s a lot of proving that needs to be done,” he said.
Food Trust, based on IBM’s blockchain technology, can govern transactions with many hand-offs, preserving one consistent history, said Frank Yiannas, vice president of food safety at Walmart. Blockchain, best known for supporting bitcoin cryptocurrency, establishes authorship or ownership that experts say can’t be faked and eliminates costly middle layers because of its peer-to-peer structure. The encrypted data stays up-to-date on all participants’ systems.
Nestle traced the ingredients of its sweet potato, apple and pumpkin puree on the Food Trust blockchain in test whether the technology could speed up product recalls.
For companies using Food Trust, data about harvests, processing, packaging and shipping is stored electronically on the blockchain system, which can allow trace-backs in seconds compared to days and weeks, Mr. Yiannas said.
Food Trust members in the past year or so have tested various segments of the food supply chain, including Walmart’s mango logistics, aiming ultimately for a farm-to-grocery aisle view of how food moves.
A challenge for Nestlé in adopting the Food Trust blockchain is having to build interfaces to connect its many shipping, trucking, processing and other software systems related to managing its fruits, vegetables and other ingredients to the new technology, Mr. Tyas said.