European Grocer Carrefour Expands Blockchain For Supply Chain

On Tuesday, Carrefour announced the extension of its blockchain-based supply chain system, which is currently used to track free-range chickens from farm to table. By the end of 2018, the company will add provenance for a handful of other food products.

  • On March 6, 2018, Carrefour – Europe’s largest public grocer by sales (market cap: $13.5 billion) – announced that it will soon implement blockchain-based systems to trace additional food products in its supply chain.

    Presently, the French multinational retailer uses blockchain technology to keep tabs on its free-range chickens, but the company will add traceability features for a wider array of products including eggs, cheese, milk, oranges, tomatoes, salmon, and ground beefsteak. The company aims for the tracking systems to be in place by the end of 2018.

    In its announcement, Carrefour explained that blockchain technology “can be used in the food sector so that each and every party along the length of the supply chain (producers, processors and distributors) can provide traceability information about their particular role and for each batch (dates, places, farm buildings, distribution channels, potential treatments, etc.).”

    In practice, using smartphones, consumers will be able to scan QR codes on product labels. “This will provide them with information about the product and the journey it has taken – from where it was reared right up to when it was placed on the shelves,” Carrefour explained.

    “For example, for free-range Carrefour Quality Line Auvergne chicken, consumers will be able to find out where and how each animal was reared, the name of the farmer, what feed was used (whether or not they were fed on French cereals and soya beans, on GMO-free products, etc.), what treatments were used (antibiotic-free, etc.), any quality labels, where they were slaughtered, etc.”

    Benefits highlighted by the company included consumers’ need for transparency and opportunities for producers to showcase their expertise. The company asserted that its secure blockchain system will help “guarantee higher levels of food safety for its customers.”

    It’s not immediately apparent how this blockchain-based provenance system is supposed to function. Even if data on the blockchain itself cannot be altered, how much oversight is there at the local level? Is the system impervious to falsified information?

    We must ask ourselves tough questions about the cost of compliance. Are consumers meant to trust that farmers really fed their chickens vegetables? What’s to stop a farmer from reporting events differently than they occurred? We must consider whether there are incentives to game the system and whether there are punishments for bad behavior.

    Altogether, it would appear that Carrefour’s blockchain-based provenance system relies on a high degree of trust, and there isn’t a fundamental change to its business structure.

    European grocers have faced increasing competition from companies like Amazon (which purchased Whole Foods last year). Perhaps Carrefour hopes to distinguish itself with blockchain-based provenance.

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