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Cell-Cultured Protein: Regulatory Considerations and Opportunities

Cell-Cultured Protein: Regulatory Considerations and Opportunities

Written By: Eve Pelonis, Natalie Rainer, and Connie Potter; Keller and Heckman, LLP

At the forefront of current food innovation and technology is the “cell-cultured protein” sector (also described as “cultured,” “cell-based,” “cultivated,” “lab-grown,” and “in vitro”). Cell-cultured protein technology essentially entails growing protein cells in a growth medium under controlled conditions. Manufacturers across the globe are rushing to culture proteins that have a taste, texture, and nutrition profile that is indistinguishable from their animal-based counterparts. With products ranging from beef to yellowtail to foie gras to lobster, the cell-cultured protein industry has the potential to revolutionize the food and agriculture industries.

While Singapore has taken an early lead in terms of regulatory approvals by becoming the first nation to approve a cell-based protein, the United States is poised to be a fertile ground for the growth of the cell-cultured protein industry. Below we discuss the future regulation of this industry in the U.S., what information will likely be required to seek regulatory approvals from the relevant regulatory agencies, and issues related to the labeling and marketing of cell-cultured proteins in the U.S.

To set the backdrop for the discussion below, we first discuss the basics of cell-based protein technology: biopsy, cell banking, growth, harvest, and food processing. After collecting a tissue sample from an animal in a biopsy, a laboratory team selects the cells with the most desirable traits and adds them to a cell bank. The selected cells are then multiplied using a bioreactor. The bioreactor uses a growth medium and controlled conditions to create an ideal environment for growing cells, which often grow attached to a scaffold or like structure that helps the cells grow in the proper pattern to create a finished product. Once a sufficient number of cells have accumulated, producers harvest the cells from the growth medium and bioreactor, either detaching the cells from the scaffold structure or removing the cells and scaffold together if the scaffold is edible. The cells are then prepared into a finished food product, often by blending the meat cells with a fat to create, for instance, a ground beef patty or meatball. With this background in mind, we discuss the regulatory framework for evaluating this technology, followed by potential labeling issues, below.

Regulatory Status of Cell-Cultured Protein Products in the United States

As the two agencies that oversee the safety of the U.S. food supply, the U.S. Food and Drug Administration (FDA) and Department of Agriculture (USDA) have both asserted regulatory authority over cell-cultured meats. Generally, USDA is responsible for oversight of meat, poultry, processed egg products, and catfish, while FDA oversees virtually all other domestic and imported foods, including all seafood products, sold in the U.S. In 2018, USDA’s Food Safety and Inspection Service (FSIS) and FDA hosted the first of several public meetings on cell-culture technology and discussed potential hazards, oversight considerations, and product labeling.

Following additional public comment periods, the agencies issued a formal interagency agreement in March 2019 that set out their respective roles in the oversight of cell-cultured meat products based on their respective strengths and expertise. Per the formal agreement, FDA will oversee the cell culturing process for meat and poultry products until the harvest stage, including cell collection and the development and maintenance of cell banks, and FDA will retain sole jurisdiction over seafood. Facilities will need to comply with FDA food safety requirements, including food facility registration, hazard analysis and risk-based preventive controls (HARPC), and current Good Manufacturing Practices (GMPs). Following harvest of cells from bioreactors, USDA assumes regulatory authority and is responsible for inspection of the meat cells and finished products derived from livestock and poultry under its authority from the Federal Meat Inspection Act and Poultry Products Inspection Act. FDA and USDA have agreed to collaborate to develop a more detailed joint framework on standard operating procedures, product labeling, and other issues. However, aside from FDA’s issuance of a Request for Information regarding the labeling of foods containing cell-cultured seafood products, as of the date of this publication, neither agency has published further details on these initiatives.

Industry is concerned by the lack of additional action on the part of FDA and USDA. In October 2020, the Alliance for Meat, Poultry, and Seafood Innovation joined the North American Meat Institute in urging FSIS to issue an Advance Notice of Proposed Rulemaking to initiate an

information collection process. The agencies have expressed a great deal of interest in collaborating with cell-cultured meat producers, but companies appear to be reluctant to participate, perhaps given the highly-confidential processes and proprietary information at stake.

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Where to Go from Here?

Cell-cultured meat products could pose safety concerns unique from those in traditional meat production. In fact, the technology is so new that it remains unclear just how FDA and USDA will approach the specifics of approving cell-cultured foods. The concerns highlighted in an April 2020 report by the Government Accountability Office (GAO) included the potential use of antibiotics at the cell growth stage and potentially new safety issues unique to this new technology (e.g., residues or constituents not seen in conventional meat or other foods). We expect regulators to evaluate the safety of cell-cultured proteins from all angles: microbial contaminants, cell growth media, scaffolding ingredients, bioreactors, etc. All inputs and impurities of potential concern will be explored.

While industry’s hesitation to be among the first in line to approach regulators is understandable, stakeholders should also recognize that there is an opportunity to be among the first to drive the dialogue, to focus regulators on specific issues, and to be the first entrants into the U.S. market. The more the agencies know about the process, the better they can create a regulatory framework that will most accurately capture the way the industry operates. 

Use of the Term “Meat” and Other Labeling Concerns

Another murky legal and regulatory area facing the cell-cultured protein industry is the marketing of cell-cultured protein products and in particular the naming of such products. Some current contenders for naming cell-cultured products include terms like “clean,” which critics argue reflects a bias for or against other products and affect how they are perceived in the market.

While both USDA and FDA are aware of this labeling question, neither entity has proposed a regulatory solution. Various pieces of legislation have been introduced (but have not passed) in Congress that seek to clarify when a “meat,” “milk” or other traditional term can be used, generally restricting such term to products from traditionally-raised livestock or requiring that non-traditional products use the term “imitation” in their product identity statement. 

Perhaps because of the lack of action by Congress or federal agencies, several states—including Arkansas, Arizona, Louisiana, Mississippi, Missouri, Oklahoma, Nebraska, North Dakota, South Dakota, Texas, and Wyoming—have passed laws restricting use of the term “meat” on cell-cultured meat or plant-based meat alternative products. Many of these laws have been challenged in court by companies in the meat-alternative space that argue the laws violate the First Amendment by limiting speech and are not necessary to protect the public from potentially misleading information in addition to being overbroad and impeding competition in the marketplace. Results of the suits have varied, with some successes for the meat alternative industry. For example, while an Arkansas federal district court granted a preliminary injunction preventing enforcement of a state law that restricted the use of meat claims on plant-based products in 2019—finding that the plaintiffs were likely to prevail on their First Amendment claims, a federal district court in Oklahoma upheld a similar challenge to a state law that required a disclaimer on plant-based foods using a meat term in the product identity statement. 

* * *

Cell-cultured products will be ready to enter the market soon, and USDA and FDA will need to act quickly to create a framework that manufacturers can work with if they want to assert leadership in this space. Even if cell-cultured meat products can overcome regulatory hurdles and enter the market, several recently-published studies show consumers may not yet be willing to embrace cell-cultured meat as an alternative to traditional meat products because of concerns over taste, food safety, and lack of knowledge about the process. Manufacturers will need to focus on consumer outreach and launch education initiatives to garner an understanding of their products to be successful.

(1) Cultured Meat: Shaping the Future of Foods, Keller and Heckman LLP (Feb. 1, 2021), https://www.khlaw.com/insights/cultured-meat-shaping-future-foods. Cell-culturing technology could be an intriguing option for countries like Singapore with limited capabilities for livestock production that seek to produce more food domestically. Other countries have frameworks in place to review cell-cultured products but have not yet approved any. In the European Union, cell-cultured meat products must be assessed as a novel food by the European Food Safety Authority under Regulation (EU) 2015/2283. Australia and New Zealand’s food regulatory agency, Food Standards Australia New Zealand, has a premarket approval system in place that would similarly encompass new cell-cultured products. Cell Based Meat, Food Standards Australia New Zealand https://www.foodstandards.gov.au/consumer/generalissues/Pages/Cell-based-meat.aspx (last visited Feb. 14, 2020).

(2) U.S. Gov’t Accountability Off., GAO-20-325, Food Safety: FDA and USDA Could Strengthen Existing Efforts to Prepare for Oversight of Cell-Cultured Meat 9–11 (2020), https://www.gao.gov/assets/710/705768.pdf.

(3) Technology is still improving to create more structured meat products, such as a filet. Aleph Farms, an Israeli start-up, recently announced it had developed a ribeye steak using bioprinting technology. Aleph Farms and The Technion Reveal World’s First Cultivated Ribeye Steak, Cision PR Newswire (Feb. 9, 2021), https://www.prnewswire.com/news-releases/aleph-farms-and-the-technion-reveal-worlds-first-cultivated-ribeye-steak-301224800.html. 

(4) Recordings of each USDA-FDA Joint Public Meetings are linked at FDA’s Food Made with Cultured Animal Cells page, https://www.fda.gov/food/food-ingredients-packaging/food-made-cultured-animal-cells.

(5) Formal Agreement Between FDA and USDA Regarding Oversight of Human Food Produced Using Animal Cell Technology Derived from Cell Lines of USDA-amenable Species, FDA (March 7, 2019), https://www.fda.gov/food/domestic-interagency-agreements-food/formal-agreement-between-fda-and-usda-regarding-oversight-human-food-produced-using-animal-cell.

(6) See FDA Seeks Input on Labeling of Food Made with Cultured Seafood Cells, FDA (Oct. 6, 2020), https://www.fda.gov/food/cfsan-constituent-updates/fda-seeks-input-labeling-food-made-cultured-seafood-cells. The Senate has twice introduced bills aimed at moving the regulatory process forward by formalizing the USDA/FDA formal agreement and prescribing a timeline for the agencies to promulgate regulations. See Food Safety Modernization for Innovative Technologies Act, S. 3053, 116th Cong. (2019), https://www.congress.gov/bill/116th-congress/senate-bill/3053 (codifying the division of authority for cell-cultured products between USDA and FDA as set forth in their 2019 formal agreement, providing guidelines for inspection of cell-cultured meat production facilities, and creating labeling guidelines specific to cell-cultured meat products); Cell-Cultured Meat and Poultry Regulation Act of 2019, S. 1056, 116th Cong. (2019), https://www.congress.gov/bill/116th-congress/senate-bill/1056 (codifying the USDA/FDA 2019 formal agreement and giving the agencies eighteen months to promulgate regulations regarding inspection frequency of relevant facilities and labeling guidelines).

(7) Meat Institute and AMPS Innovation Send Joint Letter to USDA on Mandatory Labeling for Cell-Based/Cultured Meat & Poultry Products, North American Meat Institute (Oct. 19, 2020), https://www.meatinstitute.org/ht/display/ReleaseDetails/i/180624/pid/287.

(8) U.S. Gov’t Accountability Off., supra note 2, at 8.

(9) See id.

(10) The U.S. Cattlemen’s Association submitted a petition to USDA in February 2018 requesting the agency limit the term “beef” to products from traditionally-harvested livestock, and the petition received over 6000 comments, but USDA has not moved on the issue to date. See Petition for the Imposition of Beef and Meat Labeling Requirements: To Exclude Products Not Derived Directly from Animals Raised and Slaughtered from the Definition of “Beef” and “Meat”, U.S. Cattlemen’s Association (Feb. 9, 2018), https://www.fsis.usda.gov/wps/wcm/connect/e4749f95-e79a-4ba5-883b-394c8bdc97a3/18-01-Petition-US-Cattlement-Association020918.pdf?MOD=AJPERES.

(11) See, e.g., Food Safety Modernization for Innovative Technologies Act, supra note 6; Cell-Cultured Meat and Poultry Regulation Act, supra note 6; Real Marketing Edible Artificials Truthfully Act of 2019, H.R. 4881, 116th Cong., https://www.congress.gov/bill/116th-congress/house-bill/4881/all-info.

(12) Elaine Watson, ‘Highly disingenuous…’ Plant-based labeling battle heats up as more states challenge use of meat, dairy terms, Food Navigator-USA (Feb. 3, 2021), https://www.foodnavigator-usa.com/Article/2021/02/03/Highly-disingenuous-Plant-based-labeling-battle-heats-up-as-more-states-challenge-use-of-meat-dairy-terms?utm_source=newsletter_daily&utm_medium=email&utm_campaign=03-Feb-2021.

(13) Turtle Island Foods SPC v. Soman, 424 F. Supp. 3d 552, 571 (E.D. Ark. 2019) (finding a state law that prohibits plant-based meat alternative products from using terms such as “burger,” “sausage,” and “roast,” even if the product identity statement contains a disclaimer phrase such as “plant-based” or “veggie”).

(14) Upton’s Naturals Co. v. Stitt, No. CIV-20-938-F, slip op. at (W.D. Ok. Nov. 19, 2020) (finding that a law requiring disclaimer terms on plant-based meat alternatives to be at least as equally prominent in size and color as the product name was not unduly burdensome and justified in preventing consumer confusion).

(15) In study published by the University of Sydney and Curtin University, 72% of the 227 surveyed Australian customers in “Generation Z” (born between 1995 and 2010) reported perceptions of uneasiness and discomfort with cultured meat products, even if they thought the product might be a more sustainable food option than traditionally farmed meat. Diana Bogueva & Dora Marinova, Cultured Meat and Australia’s Generation Z, Frontiers in Nutrition, Sept. 2020, at 6, https://doi.org/10.3389/fnut.2020.00148. See also Jo Anderson & Chris Bryant, Messages to Overcome Naturalness Concerns in Clean Meat Acceptance: Primary Findings, Faunalytics, July 2018, Clean-Meat-Acceptance-Primary-Findings.pdf (faunalytics.org) (surveying 1,185 American adults in 2018 and finding that while the majority of those surveyed had not heard of a cell-cultured meat product before, 66% of those surveyed would be willing to try it, but using biased terminology such as “clean meat” that would have legal risk if used in the market); Nearly One in Three Consumers Willing to Eat Lab-Grown Meat, According to New Research, Surveygoo (Jan. 2018), https://surveygoo.com/portfolio/cultured-meat-survey/ (surveying 1,000 U.S. and U.K. consumers and finding 29% would be willing to eat a cell-cultured meat product described as “cultured meat”). 4839-4212-9116, v. 4

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Industry Update: FDA Announces FSMA Food Traceability Proposed Rule

Written by Jon Kimble, Originally Published in Industry Updates

On September 21, 2020, the Food and Drug Administration announced the release of a draft rule for the food industry, “Requirements for Additional Traceability Records for Certain Foods” (also referred to as the Food Traceability Proposed Rule). This is one of the last remaining elements of the FDA’s Food Safety Modernization Act (FSMA), assigned to the FDA by congressional mandate. This draft rule requires that the FDA implement additional traceability expectations for the food industry based on risk.  This new rule is being billed by the FDA as part of its overall “Blueprint for the New Era of Smarter Food Safety”, which outlines several key elements, including enhanced traceability.

Our overall impression is that our customers, such as yourself, are already largely in compliance with the requirements as they’re currently written, perhaps with just a few minor gaps. The FDA has provided more information about the rule on their website. 

7 Key Takeaways Regarding This Rule:

  1. This is a draft rule. Now is the time to submit any feedback or concerns.
  2. Its scope is limited.  It pertains specifically to those who manufacture, process, pack, or hold specific types of foods on the FDA’s “Food Traceability List” (FTL).
  3. It requires tracking specific activities. The FDA refers to these as “Critical Tracking Events” (CTEs), and they include: growing, receiving, transforming, creating, and shipping.
  4. It requires tracking specific data. The FDA calls these “Key Data Elements” (KDEs), and they must be tracked for each Critical Tracking Event.  They include information such as grower location identifier; lot numbers and other traceability identifiers; business names, numbers, and points of contact; quantities and units of measure; and other key elements.
  5. It requires farms to communicate some basic information to customers. This includes location identifiers for the growing area and each location the product was processed or stored at, including business names and key contacts.
  6. The record format is flexible. Under the rule, the FDA allows either paper or electronic records.  However, it’s worth noting that, especially for finished companies who produce ready-to-eat foods, the FDA has made it clear that there is a preference for electronic records, where necessary to facilitate traceability (see the next requirement).
  7. Records must be readily available. The FDA requires that companies be able to provide a sortable electronic spreadsheet to the FDA containing any affected products, within 24 hours of any FDA request, to assist in the investigation of any outbreak or recall. 

If you’d like a member of our team to help you conduct an assessment of your company’s traceability programs, we’re ready to assist you, virtually or on-site! Reach out to us at foodsafety@safefoodalliance.com.

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Digital Traceability: Reducing Risks and Finding Efficiencies

Written by Alex Lewis, Parity Factory Corp.

The ongoing crisis has shed light on the need for innovation in the food space, even in the most fundamental processes.

If someone were to ask you which industries were most important to our daily lives, what would you say? Along with things like communications, construction, and clothing, one of the first things that likely comes to mind is also one of the most basic: food. The agricultural and food processing industries provide for our most key needs and enables our continued growth. It is unlikely anyone would argue against the importance of the food and beverage industry to our society, however 2020 has brought us a loud and clear reminder of just how crucial it is, in the form of the COVID-19 pandemic. 

In just a few short months, food and beverage manufacturers saw demand increases that haven’t been seen in a lifetime. At the time of writing, sectors of the food industry have experienced spikes in volume ranging from 32% in milk, 30-47% across the snack sector, and a staggering 77% increase in demand for meat, and this trend holds true for nearly every vertical within the industry.

The stay-at-home orders announced by most governments have sent consumers rushing to the store, clearing shelves and placing new strain on food and beverage processors. As they struggle to keep up with their order volume, many manufacturers are looking for new ways to improve their efficiency and reduce their liabilities. As it turns out, one of the most effective methods may also be the simplest: digitizing their lot tracing.

What is digital lot tracing?

All food and beverage manufacturers track their lots. In fact, it is one of the basic requirements for running a food processing business, with the specific standards and protocols defined at the federal level by organizations such as the FDA. By requiring tracking of all material that is involved in making a product, down to the packaging used, it ensures that recalls can be performed swiftly and protects the health of the public. Manufacturers manage their tracing using a variety of methods, from pen and paper, to Microsoft Excel, to fully integrated traceability software, with many using a combination of methods. Digital lot tracing simply means that a company is capturing and managing their tracing data on a digital platform, often integrating scanning and barcoding into the process. This approach has a drastically lower error rate than more traditional methods and tends to be significantly more efficient.

Despite tracing being a common daily task that all processors contend with, there has been surprisingly little momentum towards automated lot tracing in food. By some metrics, only 1 in 5 operations have fully automated their lot data capture, with a bit more having partially implemented the process. The food industry has always been slow to adopt new processes, but as demand and competition skyrockets, many are finally feeling the need for an upgrade.

The risks of a recall

Executing recalls, specifically executing them quickly and efficiently, is one of the biggest challenges that food and beverage manufacturers face. Under current FDA guidelines, food and beverage processors need to be able to perform a recall within four hours. Many of the major retailers demand even more of their suppliers; if you want your product on the shelves in a Walmart or Costco, you must be able to perform the same process in as little as two hours. The unfortunate reality is that for processors tracing on paper, particularly those producing at scale, these targets are difficult to hit. Also, the human element involved in manual tracing can allow errors to find their way into data, and this has become especially true for those who are dramatically increasing their throughput to keep up with new demand caused by COVID-19. Without true, reliable data, a recall can quickly go from difficult to impossible.

The consequences of a botched recall can be dire: the average recall costs a manufacturer $10 million, not including possible fines from regulators, or losing the aforementioned Walmart or Costco contract. One of the biggest losses is one that may not be immediately obvious: consumer confidence. Over half of consumers will quit purchasing a product once it has been recalled, and studies have shown that a company’s stock price will typically drop as much as 22% following a major recall. Once that confidence is gone, it can take months or even years to get it back, if it can be regained at all.

All these problems can be mitigated, if not completely prevented, through digital lot tracing. With a capable solution in place, recall times can be measured in minutes, not hours, as a few quick searches replaces shuffling through endless forms to find the lot in question (if it was recorded correctly at all). This guarantees compliance with even the most demanding of rules and regulations and eliminates all fear when inspectors and auditors show up for routine recall tests. In addition, the ability to execute a speedy yet thorough recall when problems arise minimizes the risk to both consumers, and the manufacturer’s reputation. The bottom line: most food manufacturers are going to face a recall at some point. It is crucial to have the systems in place to react appropriately when that time comes.

How does it increase efficiency?

Due to the huge importance of lot tracing, manufacturers using manual systems often have some of their most competent and experienced employees devoted to the task. Even if these staff would be better suited to other areas, it’s just not worth taking the risk of assigning less experienced employees to the job. Digital lot tracing solves this by drastically simplifying the tracing process. Scanning a barcode and letting software do the rest is far quicker, easier, and less error-prone than meticulously creating and tracking hundreds of lot codes by hand. Meaning that you end up spending less time on tracing, and therefore less money, while winding up with data that is significantly more reliable. This both frees up an operation’s most capable employees to pursue new opportunities and allows anyone in the operation to take part in the tracing process. New employees can be trained and onboarded quickly, which is particularly useful for processors hiring huge amounts of new labor in the wake of COVID-19. 

All of this allows for greatly increased flexibility when it comes to staffing, and as COVID-19 turns the industry on its head the value of that flexibility has become crystal clear. While many of us have had the luxury to transition into working from home, that’s just not an option for many working in the food space. When employees are unable to attend work, for example if they are sick, someone else must step in. This can be a major threat to efficiency when the few people in your operation qualified to handle lot tracking are missing. In dealing with turnover and staff redistribution, there’s tangible benefit to having a system that allows employees to be effective, regardless of their experience level. 

For those looking to digitize their lot tracing, there is no shortage of solutions to accomplish that task. However, a sufficiently robust solution should go beyond just traceability. If you are tracking each lot as it moves through your facility, it creates great possibility to capture additional data such as yields, storage locations, and quality information. In this way, digital lot tracing can be viewed as a foundation on which to build even more extensive efficiency improvements. These additional features are some of the most important considerations for any manufacturer to make when choosing between available systems.

Preparing for an uncertain future

COVID-19 has proven that swift, unpredictable changes can happen in any industry, even one as foundational as food and beverage. With new issues such as shifting demographics, climate change, and the variable nature of trade on the horizon, it is likely that changes will become more frequent and even the smallest efficiencies will be essential to thrive.

Customer consciousness is also changing rapidly, and businesses that want to stay competitive have no choice but to change with it. As consumers and regulators demand ever more transparency and accountability from the food industry, reliable tracing data is becoming ever more crucial.

Manufacturers will undoubtedly rise to these new challenges in the future, just as they are rising to the challenges of today. And along the way, many will find a comprehensive digital lot tracing system to be one of their most valuable tools. 

Sources/Further Reading:

Acorn Surfaces & Treatments
for Concrete Restoration Products and Services

Breaux, Randy. “COVID-19 Shows the Need for Automation.” Foodprocessing.com, Food Processing Magazine, 2020, http://www.foodprocessing.com/articles/2020/power-lunch-covid-19-shows-the-need-for-automation/. 

Deloitte. Recall Execution Effectiveness: Collaborative Approaches to Improving Consumer Safety and Confidence. 2010.

Demetrekakes, Pam. “How the Coronavirus Is Affecting Food Processing.” Foodprocessing.com, Food Processing Magazine, 2020, http://www.foodprocessing.com/articles/2020/how-the-coronavirus-is-affecting-food-processing/.

Lelieveld, H. L. M. Hygiene in Food Processing. Woodhead, 2017.

Stier, Richard F. “How Food Processors Can Create a Plan for Traceability and Recalls.” Food Engineering RSS, Food Engineering, 11 May 2020, www.foodengineeringmag.com/articles/98026-how-food-processors-can-create-a-plan-for-traceability-and-recalls.

Torero, Maximo. “How to Stop a Looming Food Crisis.” Foreign Policy, 14 Apr. 2020, foreignpolicy.com/2020/04/14/how-to-stop-food-crisis-coronavirus-economy-trade/. 

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Safety – Blockchain: What is it and does it live up to the hype?

Written by Hillari Bynum
Originally published in Innovation
20 July 2019

 

Hand touching global network connection and data exchanges on sky sunset background. Technology and telecommunication concept.

 

Blockchain Fundamentals

 

The easiest way to understand blockchain technology is to think of it as an electronic notary. A notary protects the integrity of a document by verifying the signer’s identity, making sure they aren’t being forced to sign under duress or intimidation and making sure they’re aware of the contents of the document or transaction. So, when a document is notarized, you can feel confident the document is legitimate.

 

Blockchain serves a very similar function.

 

A blockchain is a growing list of records, called blocks, which are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. By design, a blockchain is resistant to modification of the data. It is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.”

 

Therefore, like a notary, Blockchain protects the integrity of the information stored within each block.

 

Why is Blockchain such a buzzword in the Food Industry?

 

During a foodborne illness outbreak, one of the biggest challenges is determining where the contaminated food originated from and where it was distributed/served/sold. There is not an easy way to track down this information; which makes managing a recall, or an outbreak, incredibly tricky, time-consuming, and dangerous.

 

Blockchain could change all of that.

 

Blockchain technology can keep a record of the entire supply chain. If Blockchain were implemented across the food industry, it would be possible to see everywhere a single piece of produce has been — from farm to plate. Consumers and food industry professionals alike would be able to see if a recall had impacted their produce or if it was from the same farm that is being investigated for a foodborne illness outbreak. Cool, right? It doesn’t stop there! This enhanced traceability could also help protect against food fraud by providing a verifiable record or every stage in the supply chain.

 

Okay great, let’s do it.

 

It isn’t that easy. There are a lot of very real obstacles in the way, and there is no easy solution.

 

Slow Supply Chain Adoption

 

In a dream world, when helpful technology is created, people rush to adopt it because they know it is valuable. In the world we actually live in, the reality is much different. Many key stages of the food supply chain operate with very low margins. Growers, packers, slaughterhouses, wholesalers, and harvest companies have very manual processes – and they don’t always have the capital to invest in technology. The other thing these companies are short on is time for training. Successful implementation of a new system requires time, money, and desire. When you’re operating with a shortage of time and money, desire is hard to come by as well. Transparency and traceability are popular ideas throughout the food industry, but when it comes time to actually turn that idea into reality, many companies have an “if it ain’t broke, don’t fix it”attitude.

 

The unfortunate reality is that people often pay the cost of food traceability at the early stage of the supply chain (growers, packers, processors) and the benefit is felt the strongest by those at the end of the supply chain (retailers and consumers). What this means is that we are asking the companies with the smallest margins to make the most significant investments – which they are often unwilling or unable to make. It is a fair point, outside of altruism, there is not a clearly defined business benefit to growers — so we are asking them to complicate their process, invest time and money, for little direct benefit.

 

This is particularly damaging because Blockchain won’t be revolutionary if it is only protecting part of the food supply chain. To be completely effective, every piece of the food supply chain needs to be on board.

 

 

Food Fraud is big business

 

Experts estimate that food fraud is now a $40 billion-dollar business. Unfortunately, the people committing food fraud are making a lot of money, and they are likely to be involved at some point in the supply chain. Blockchain and traceability technology threaten this business because of the technological ability to sound alarm bells and alert the world to food fraud. So, to protect their business model, these criminals will fight traceability implementation tooth and nail.

 

Too many independent systems

 

There are a lot of small-to-mid-sized companies offering traceability solutions, but unfortunately, these systems don’t always talk to each other. Blockchain success is heavily dependent on private tech companies being open to working together and sharing their data — which historically, they are not.

 

Traceability is different for different groups

 

Traceability varies by industry and product. For example:

 

  • Agriculture/Farming: Identification starts with the birth of livestock or planting and moves through the growth process, use of pesticides, nutritional records, vet records, and transportation records;
  • Food Processors: Identification starts at the source of each ingredient and follows through the processing, packaging, distribution, and transportation process;
  • Retail and Food Service: Identification starts with receiving receipts/invoices to identify the lot and batch information with regulations not requiring tracking “one-up” to the final consumer;
  • Transportation and Distribution: Commingling points of contact are vectors for the spread of disease. Waybills should contain source party and target party identification. Specific locations are needed for livestock in most countries. If products are disaggregated for smaller shipments, then records need to reflect lot/batch codes of the manufacturer or processor.

 

Different groups have different motivations, and it may be difficult for a system to accommodate the needs of each industry or product.

 

So, does it live up to the hype?

 

The short answer is maybe. Blockchain represents immense possibility, but it also comes with equally immense challenges. If the food industry doubles down on Blockchain and can secure engagement at every phase of the supply chain, the results would be revolutionary. However, if there is only partial adoption of traceability technology, it will be far less successful.

 

There is a reason to be optimistic, however! The FDA recently launched the New Era of Food Safety program that looks ready to move the food industry forward into new traceability technologies.