Chinese liquor wholesaler trials blockchain tracking

Chinese liquor wholesaler Oranco has turned to a blockchain-based technology to try to drive counterfeit alcohol out of its supply chain.

The Fenyang City company – which specialises in premium Fenjiu liquor and imported wines – has teamed up with Guangzhou Silicon Technology to develop the distributed ledger technology (DLT) and laser recognition platform for the “identification and anti-counterfeiting” of its alcoholic beverages.

DLT or blockchain can replace manual paper records with electronic blocks of data that are secure, unalterable and can be used to record and track each transaction as a product moves through the supply chain.

Oranco’s Fengyuang Huaxin Liquor Development subsidiary signed an agreement with the technology provider last August to get the ball rolling on the project, and have agreed to deploy the platform to collectible liquor and other premium product ranges. It took a 20 per cent stake in Guangzhou Silicon Technology as part of the deal.

The aim is to make sure products are not altered or replaced through physical means, by creating a unique digital identification for each bottle, recorded on an unmodifiable blockchain.

In theory, that should prevent fraud, improve the information available to the consumer and protect customers from exposure to potentially harmful counterfeits. The major driving force behind adopting blockchain – and increasing transparency in the supply chain – is product safety.

“We believe the verification capabilities of blockchain will enable us to credibly assure the origins and authenticity of our premium alcoholic beverages,” said Oranco president Peng Yang.

“This technology will assure the authenticity and further build the value of our premium products.”

In March, spirits company William Grant & Sons said it would deploy a blockchain-based system for its Ailsa Bay Scotch whisky developed by Arc-Net to track the distilling and production process from source to store.

Meanwhile, accounting firm EY has built a blockchain platform called TATTOO (traceability, authenticity, transparency, trade, origin, and opinion), designed to facilitate promotion and sales of new and vintage wines, on behalf of Blockchain Wine Pte.

TATTOO is backed by The House of Roosevelt – one of the largest wine cellars in Asia – which will use it to secure wines sold directly from vineyards to hotels, restaurants, cafes and individual customers.

The food sector is also getting on board. Earlier this month, food giant Nestle announced a plan to allow customers to track sustainability and provenance throughout its milk supply chain, focusing on suppliers in New Zealand shipping to the firm’s production facilities in the Middle East.

It plans to extend the platform to palm oil from the Americas, as part of a drive to increase transparency and accountability for production standards throughout its supply chain.

Meanwhile, other food producers turning to blockchain platforms to shore up their supply chain security include Tyson Foods, French supermarket chain Carrefour, Dole Foods, Unilever, and Kroger and Albertsons grocery stores in the US.