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Decentralised Trust in Agri-Food Supply Chains: Trace Labs

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SmartAgriHubs (SAH Project)n recently announced the Flagship Innovation Experiment #28 (FIE) called “Decentralized Trust in Agri-Food Supply Chains”. The main purpose of FIE #28 was to demonstrate the value of data exchange between stakeholders in the agri-food supply chains by decentralizing trust with the use of blockchain technology and other distributed ledger technologies (DLTs), primarily the OriginTrail protocol.

Within FIE #28, core developers from Trace Labs and OriginTrail worked on two case studies:

  1. The poultry value chain where the objective was to show food provenance to the end consumers using trusted data.
  2. The dairy value chain where the objective has to use the trusted data to optimize the payment process for the milk collected from the farmers by a farmers cooperative and then sold to a local dairy.

The Poultry Value Chain

Trace Labs partnered with Perutnina Ptuj, the largest poultry producer in Southeastern Europe, to launch a web-based provenance application for their premium poultry range. In the spring of 2019, Perutnina Ptuj launched the first version of the application using the OriginTrail Decentralized Network (ODN), a public permissionless DLT network, to exchange and store data as well as blockchain technologies to secure overall data immutability.

With this mobile application, consumers purchasing Perutnina Ptuj’s packaged products from their Natur Premium poultry breeding range could be certain of the local origin of the products and learn more about breeders and conditions on the farms by using their smartphones as each product was equipped with a QR code. Trace Labs further developed the application and integrated it with a Kakaxi remote sensing IoT device and camera. This provided the food brand with additional data and information (humidity, temperature, rainfall, sunlight, time-lapse pictures from the farms) that can be used as tools for marketing and communication with the consumers.

© OriginTrail

The Dairy Value Chain

In terms of the dairy value chain, Trace Labs partnered with Agricultural Cooperative Šaleška Dolina (KZŠD) in Slovenia, an agricultural cooperative with 200+ member farmers delivering milk to one of the largest dairies in the region. In their previous payment process, it was the dairy they delivered the milk to that calculated the price of milk-based on laboratory test results and shared that input with KZŠD together with the test results. The cooperative then manually validated the input received from the dairy before entering the inputs into their ERP. After that, the terms for each farmer were validated with the contract provisions, the cooperative’s margin was deducted, and the final compensation was created.

Although the cooperative had the data on milk volumes and received the laboratory test results, they lacked a fully trusted and automated system that would perform verifiable calculations and produce an integrity-assured data provenance log. This created a trust gap among the farmers, the cooperative, and the dairy. The issue was effectively overcome with decentralized technology, based on the OriginTrail DKG and Oracle Hyperledger Fabric. Using the two systems, the milk payment mechanism that Trace Labs developed enabled an automatic calculation of payments due to each of the farmers based on the trusted milk data stored on the ODN and the contractual data stored in a Hyperledger Fabric smart contract deployed using Oracle Blockchain Platform (OBP).

Combining all components, Trace Labs was able to entirely automate the payment system by simultaneously increasing the integrity level of the entire process and the accountability of each supply chain partner for the parts that they are responsible for.

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