Inside Walmart's Secret Plan to Unleash Blockchain Technology In China

Armed with little more than their smartphones, Chinese shoppers may soon be able to trace the entire supply chain of the food they buy, from farm to store, by simply scanning quick-response codes, thanks to a blockchain technology-enabled food traceability solutions being developed by Walmart (WMT) , the world's largest retailer.

The company has a 400-strong network of stores across the mainland, is "in active conversation to accelerate the progress" of using blockchain - the technology behind bitcoin - to trace the genuine origins of its food products after holding a successful pilot project in the country, said Frank Yiannas, Walmart's vice-president for food safety.

"Blockchain technology is a game changer in the food industry and China is probably the place to scale its adoption as the Chinese government is already interested in tracing (the supply chain of food) and Chinese consumers are so tech-savvy," Yiannas told South China Morning Postat a forum in Beijing celebrating the first anniversary of Walmart "Food Safety Collaboration Center" in the country.

Walmart launched the food quality collaboration a year ago, promising to invest US$25 million by 2020 to encourage technological innovation in Chinese food safety.

Chinese shoppers remain skeptical of the quality of domestic food products, after various food-related scandals, such as one involving baby milk formula tainted with industrial chemical melamine, dominated headlines for weeks a couple of years back.

Wal-Mart is using blockchain technology co-developed by tech giant IBM. In May, it successfully validated the use of the technology by being able to successfully trace pork products from one farm owned by Chinese meat producer Jinluo, to a Walmart distribution centre in the capital, Beijing. It has also run similar pilots in the US to trace mango from plant to store shelf.

By digitalising and documenting details into a unified storage platform, the technology significantly reduces the time it takes to trace a product back to farm, it claims, which is expected to help achieve rapid and accurate product recalls, if needed, and significantly reduce exposure by contaminated products.

"The process of finding out where the food is first produced, how many times it changes hands between different wholesalers, brokers before reaching our dinner tables, can be very complex," said Yiannas.

"By tracking how and where the food we sell is produced, blockchain provides new levels of transparency and accountability - responsible systems result in safer food," he added.

Blockchain technology, which is used to track to bitcoin transactions and other cryptocurrencies, for instance, is already being widely tested by companies in the healthcare industry too.

The Australian operation of Alibaba Group (BABA) announced in May it was already exploring the use of blockchain technology to curb counterfeit food sold online.

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