Trace agricultural commodities across supply chains
Sector: Secondary sector · Industry: Food and beverage industry · Organisation: Nestlé, OpenSC (WWF-Australia & BCG Digital Ventures) · Maturity level: Pilot
Nestlé piloted an open blockchain platform with OpenSC to achieve end-to-end traceability for dairy and palm oil supply chains. During the initial phase, the food corporation tracked milk from farms in New Zealand directly to company processing plants and warehouses. Additional pilot applications focused on palm oil sourcing to verify sustainability claims and transparently demonstrate responsible procurement practices.
Documentation status
- Project status: Pilot (as of 02 July 2019) — Nestlé announced the pilot trial for tracking milk and palm oil via the OpenSC platform in July 2019.
- Evidence: Evidence medium
- Editorial review: pending
Description
Nestlé launched a pioneering pilot project to map raw material flows from producers to industrial processing via the OpenSC platform. The system immutably records every transaction step in a shared data ledger, creating a common data basis for all partners. This enables food manufacturers to comprehensively prove sustainability and origin claims to partners and consumers.
In July 2019, Nestlé initiated the trial of open blockchain technology in cooperation with OpenSC, a venture founded by WWF Australia and BCG Digital Ventures. The initiative aimed to make the flow of critical agricultural raw materials independently verifiable and to securely record data about cultivation locations and processing stations. In the first phase, the pilot focused on milk transports from New Zealand farms to the company’s processing facilities and warehouses. In parallel, feasibility studies for palm oil supply chains were conducted to digitally verify deforestation risks and procurement policies. The technology allows data points from various actors along complex supply chains to be combined without a central party claiming absolute data sovereignty.
Perspectives
B2B — organisations perspective
The process creates uniform inspection paths for raw material qualities and certificates of origin between producers, logistics providers, and manufacturers. B2B partners exchange delivery data digitally, reducing duplicate checks and significantly speeding up traceability in the event of recalls or complaints.
B2C — consumers perspective
End consumers are given the opportunity to independently verify sustainability claims for products such as milk or palm oil through transparent supply chain evidence. This increases the credibility of brand promises and strengthens trust in fair and ecological farming methods.
Employees perspective
Procurement teams and auditors access verified origin data directly, greatly reducing manual document checks. This shifts operational working hours towards strategic control and supplier development tasks.
Benefits
General
- Complete documentation of raw material origins and delivery routes
- Enhanced tamper resistance of sustainability certificates
- More efficient verification along multi-stage supply chains
B2B — organisations
- Faster resolution of quality issues at interfaces
- Reduction of manual coordination processes between suppliers and processors
B2C — consumers
- Transparent traceability of raw material origins
- Increased trust in ethical production standards
Employees
- Reduced bureaucratic inspection effort in operational procurement
- Direct insight into shipment and raw material status
Challenges
General
- Capture of reliable primary data at the interface with agricultural producers
- Standardisation of data formats across diverse international suppliers
B2B — organisations
- Integration effort into existing ERP and inventory management systems of supply chain partners
Employees
- Training in new digital documentation systems at the operational level
Technology foundation
The OpenSC platform is based on permissioned DLT architectures such as Hyperledger Besu and links decentralized ledgers with digital tracking technology. It allows immutable storage of origin and transaction data across distributed actors.
Implementation examples
Pilot project for traceability of milk and palm oil
Lack of transparency and the risk of mislabelling in agricultural supply chains jeopardise sustainability goals and the trust of business partners as well as consumers.
Nestlé tested the OpenSC platform to digitally secure the origin and transport routes of New Zealand milk and global palm oil.
In July 2019, Nestlé announced as the first major food corporation a partnership with OpenSC, a joint venture of WWF Australia and BCG Digital Ventures. As part of the pilot project, the system recorded milk transports from farms in New Zealand to company-owned production sites and intermediate storage facilities. The aim was to securely record environmental and origin parameters and to evaluate the practical suitability of open DLT concepts in global supply chains for raw materials such as palm oil.
Difficulties in seamless monitoring of raw material flows across multiple national borders and intermediate stops.
Tags
Supply chain, Traceability, Sustainability, Proof of origin, OpenSC