Certified Origins Italia hopes to transform consumer confidence in the source of Extra Virgin Olive Oil (EVOO) by using Oracle Blockchain in its supply chain. EVOO is one of a number of high value food products susceptible to consumer loss of confidence (another is wine – as My Story describes). One difference, however, between wine and EVOO is that accusations of fraud in the olive oil industry (selling inauthentic, cheap or adulterated olive oil as EVOO) are rife: Tom’s Mueller’s wonderfully named ‘Extra Virginity: The Sublime and Scandalous World of Olive Oil‘ describes what can happen.
“We believe that buyers and growers deserve a world in which authenticity and quality are not only valued but verified. Managing traceability with blockchain technology is the logical progression of the whole traceability process for our Bellucci Premium Extra Virgin Olive Oil. We are using Oracle Blockchain to track shipments of our EVOO from our bottling facility in Italy to the port of arrival in the US. Oracle Blockchain Platform easily integrates with our partners’ systems, and we can create smart contracts between supply and distribution actors, thus reducing operational costs.” Andrea Biagianti, Chief Information Officer, Certified Origins Italia Srl
Certified Origins Italia
Certified Origins Italia (COI) was born from a desire to protect the production and export of high-quality extra virgin Italian olive oil with the best possible certification, both at the level of individual raw materials and their processing. Over the years, COI has acquired much experience in managing the traceability of its products, including an app with which a buyer can trace each bottle of extra virgin olive oil produced back to its origin.
To satisfy increasing consumer demands, that high-quality food products possess some form of demonstrable certification, COI is now using the Oracle Blockchain Platform to track and trace its members’ EVOO:
- from the source Italian bottling facility
- to the port of arrival in the US.
This application of blockchain technology, a continuation of COI’s commitment to providing greater food supply chain transparency, is becoming increasingly common. Other examples include the IBM Food Trust, the Chinese Blockchain Food Safety Alliance, etc.
The challenges with EVOO
To meet evolving customer demands for EVOO provenance transparency is the main challenge. Consumers increasingly expect to be able check a single source of truth in which they can have confidence that it accurately portrays the origin of what they are buying. At present this tends to focus on high value foods. EVOO, which can cost as much as US$60 for a 250cl bottle of Italy’s finest EVOO, qualifies. After all, who wants to spend up to US$240/litre on a defective product.
Besides tracing shipments of EVOO, from bottling to the port of arrival in the US, the introduction of the Oracle Blockchain platform also:
- enables COI participants to streamline processes and information exchange between COI and its business partners, whether olive growers, processors, quality controllers, packagers or distributors
- reduces operational costs incurred by current certification procedures and paper-based processes for shipments from Italy to the US.
Portability of information across the COI supply chain, via connections between the companies’ diverse production and transportation management software, comes from using Oracle REST APIs to update and query information in the distributed ledger. In turn, this reduces operational costs and means fewer human errors. By automating each step of traceability – from the bottling facility in Italy to the US ports — there is increased mutual trust as well as information sharing – all in the pursuit of the common goal of ensuring customers have faith in the EVOO product.
Smart contracts
COI has exploited blockchain to implement smart contracts to:
- establish commercial terms
- provide interested parties access to an immutable record of their agreements
- reduce delays along the supply chain
- eliminate contract-related disputes and execution errors.
For example, for shipments of COI’s Bellucci Premium EVOO from Italy to the US, use the automation provided by Oracle Blockchain Platform to simplify the implementation of smart contract conditions – such as matching purchase orders, invoices and shipping information – prior to triggering payments. The added confidence and transparency should:
- improve collaboration between all the commercial parties
- provide the information which consumers value when looking for quality products
- support the credibility and excellence of COI’s small farm participants.
Enterprise Times: what does this mean
As described earlier, the olive oil industry – for those in the know – has a chequered history, not least in Italy. EVOO, the best olive oil, is a premium product commanding premium prices, which makes it attractive for those who wish to deceive.
A little understood contributing factor to EVOO being susceptible to fraud is that the expertise to discern between ‘good’ and ‘bad’ olive oil is an uncommon skill, even in the olive oil producer world. In consumers it is even more rare. Unlike wine, where there is a highly developed ‘quality tasting infrastructure’, there is no equivalent to Parker’s wine guides or evaluations. This means that EVOO and its good name is ‘too easy’ to malign with poor quality olive oil.
This COI initiative with EVOO on a blockchain makes sense, both in the supply chain simplifications and in confirming consumer confidence. But, arguably, it does not go far enough.
From bottling facility to the US port of entry leaves plenty of room for improvement. COI would further strengthen its quality assurances if there was more information:
- before the bottling – about the producer, the owner of the olive trees, and how long the olives took between picking and pressing
- about what happens between the US port of entry and the store shelf.
Enterprise Times hopes that such additions will come with time.
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The author has an ongoing interest in EVOO and olive oil, from research for his novel:
