Inefficiency and fragmentation in the seafood industry along with a 90% increase in consumption result in business and environmental challenges. Namely, overexploitation and illegal practices damage consumer trust, threaten resource depletion, impede responsible companies’ efforts and the seafood industry’s reputation. Herein, blockchain enables tracking the catch throughout an integrated supply chain, eliminating illegal operations, attests for brand values, and other benefits.
Currently, participants within a supply chain maintain their own records, wherein data management incompatibility makes exchanging information time-consuming and costly. Consequently, utilizing analytics for improvements is difficult, but blockchain technology introduces methodologies to share data between all supply chain members. In turn, this facilitates predictive modeling, from planning shipments and inventory in advance to quick adjustment to unexpected conditions.
End-to-End Supply Chain Traceability
By attaching reusable RFID chips to each seafood specimen, data is uploaded through sensors on fishing boats and processing facilities. Whereas traditional systems can trace product data to international transporters or distributors, blockchain allows for traceability to buyers. Although this requires the downstream supply chain actors to maintain and ensure traceability, multiple corporations already implemented the scenario full-circle.
Additionally, tagging every fish counteracts theft of catch onboard fishing vessels and provides detailed analytical data for fishing companies. Furthermore, blockchain supports replacing RFID tags by NFC chips storing the original information at processing facilities and attaching QR codes. Scanning the QR code at each supply chain checkpoint and entering new pieces of data creates the products journey.
Reducing IUU Fishing
Illegal, unreported, and unregulated fishing result in 26 tonnes of seafood leaking out of the supply chain, threatening sustainable fishing. Since the industry is difficult to regulate, immutable blockchain records present foolproof methods for verification and validation. Moreover, with 70% of consumers interested if seafood is sourced sustainably, it allows retailers and buyers to understand where their food comes from.
Auditing & Recalls
Seafood trade has limited buyer visibility, with downstream parties able to change the identity, purity and authenticity of the ingredients. Without a shareable record of transaction specifics, companies expose themselves to financial losses and losing credibility. However, blockchain enables every party to audit the full scope of a product’s information and identify fraudulent actors.
Hence, this discourages illicit behavior and malpractice, reinforcing the supply chain and promotes trust between parties. Conversely, tagging each item helps producers and distributors to determine the exact batch of affected produce and minimize withdrawals.
Seafood supply chain operations are still often manual, even paperwork and sending certificates by e-mail. With issuers transferring certificates to blockchain, using it to handle them instead could save a lot of labor and time. Moreover, more complicated systematic tasks such as manual inventory management, conflict resolution and tracking pose a risk for human error.
Smart contracts could alleviate potential mistakes and enhance seafood supply chain dynamics by executing tasks automatically under pre-approved conditions. More so, by applying smart contracts to asset transactions, companies can bypass intermediaries, save costs and increase profits.
Apart from lack of systematic conformity, the globalized seafood supply chains encounter difficulties in reconciling cross-organizational decisions and changes. Consequently, their impact is hard to forecast and understand, where blockchain technology provides consolidating data to a single point. Thus, the parties involved can utilize analytics for risk mitigation, avoiding disruption and quick adjustments of processes.
Transparency & Sustainability
Tracking seafood from “bait to plate” preserves information on origin, freshness and post-processing quality, displayable to customers through QR codes. In addition, retailers can assure consumers on meeting social and environmental criteria and increase reputability, easing compliance with ESG criteria. Regarding the downstream supply chain, fisheries and producers can align and prove aligning their catch and output with license quota.
Blockchain adoption by major retail corporations promotes sustainability by making market entry harder for illegal and unreported seafood. For consumers, making the right choice is easier, which coupled with increased awareness drives seafood in an ethical, sustainable direction. Lastly, responsible companies gain brand value and a price markup, discouraging IUU practices from a financial standpoint.
With verifiable and extensive data on the blockchain, can manage risks, create financial forecasts, derive loans and beneficial insurance conditions. Further, by connecting operational and equipment sensor data unveils service and equipment price cuts. Concerning financial institutions, data transparency creates value, opening new service opportunities in collaboration with banks, insurers and equipment providers.