Blockchain impact on food and beverage labelling

Blockchain first rolled out as a cryptocurrency tool well over a decade ago and has been gaining prevalence in the food and beverage market for several years, with results in use cases showing increased accessibility to and quality of produce, and holds promise to reduce counterfeit. As the global supply chain becomes ever-more complex, the demand for transparency of origin, security, and safety of food and beverage is only increasing among retailers, as well as consumers, and the growing number of use cases confirms the benefits of blockchain coupled with the use of AI tools outweigh the effort to implement it.

What is blockchain?

Blockchain is a decentralised and reliable cryptographic mechanism that is able to securely, reliably, and efficiently document and analyse large-scale and complex data along the supply chain in real-time. Imagine a set of blocks connected in a chain, each containing a digitised fingerprint of a data set (a “hash link”). These hash links provide the ability of the cryptographic function to compare an input block of data with a previously generated hash value. This ensures no block can be modified without detection, making blockchain a high integrity and immutable tool. The data, often referred to as a “ledger”, is decentralised, meaning it is distributed across a series of secure computer nodes rather than stored in a single server.

This vast ledger logs the exact time and sequence of transactions along every step of the production of food and beverage products from its origin to its consumption. The decentralised and encrypted nature of blockchain allows the system to transmit, process, store, and exchange information from its database securely and efficiently, anywhere in the world, in real-time. Transactions recorded in this way are able to be accessed and validated by each stakeholder in the supply chain (e.g. by smartphones), from the producer, provider, processor, distributor, retailer, and ultimately, the consumer.

How is blockchain used in the food and beverage industry?

The food and beverage supply chain has long suffered from product recall issues, including challenges in communication and transparency, poor privacy and information sharing standards, counterfeit risk, and exposure to security risks.

Blockchain introduces a powerful way for stakeholders to ensure end-to-end traceability along the supply chain, including the identification of where products are made, produced, and who they are sold by, and can go as far as identifying the soil type and water usage for a particular crop. Traceability opens the gateway to many overall advantages in the industry. The table below provides some examples of how blockchain provides these overall advantages.

Blockchain in practice: overall advantages

What are the downsides?

Blockchain has been a disruptive technology in almost every major industry. The digitisation and decentralisation of data is no small task, and the costs to implement the changes from the grassroots require financial and regulatory backing. While the wide-scale implementation of the technology itself is not difficult, major changes in governance and standard regulation of the industry will be necessary.

IP Protection

Anti-counterfeit

As with any industry, counterfeit erodes brand trust and consumer confidence, costing the food and beverage industry €91 million last year alone, as reported by the EU IPO. The industry is unique in that original bottles can be reused and labels easily be re-printed by counterfeiters, making it particularly difficult to identify between original and fraudulent products. The wines and spirits sector is one of the most affected sectors, losing €2.28 billion in sales (plus €2 billion in taxes) and nearly 5,700 jobs annually in the EU, and €40 million lost in sales annually in Ireland. Products with GI (geographical indication) status are further affected, such as Scotch or Irish whiskey, Champagne, and Parmigiano Reggiano.

Blockchain protocols immutably maintain data integrity of high-end food and beverage products as they are recorded and verified automatically across the supply chain, and are proving to be increasingly effective in the industry’s anti-counterfeiting efforts. An October 2025 study reports that 92% of consumers reported increased confidence in product authenticity of Douro DOC wines after using the QR code verification implemented through blockchain. 65% of these consumers also reported the user-friendly nature of the QR interface. Douro reported a 60% reduction in manual record keeping overheads and 45% reduction in audit-related costs after implementing blockchain and smart contracts. While government efforts, such as the EU IPO’s “What’s on your table?” campaign are important to educate consumers about identifying ingenuine products, a recent study showed that producers adopting blockchain-technology-supported platforms provides better protection against counterfeit than government-led enforcement alone.

Smart contracts

The reason blockchain is so effective against counterfeit is that it has the ability to provide reliable product authentication through “smart contracts”, which are self-executing code that automatically enforce agreements, if certain conditions are met. Smart contracts can verify true products from counterfeit copies, no matter how indistinguishable from the original, by tracing a product’s digital fingerprint, for example, a QR code on a wine label, to its original maker. Such authentication is done in real-time and at a reduced cost. The automatic triggering of payments when a given product changes hands, i.e. when a shipment of food arrives to the distributer, makes it very difficult for counterfeiters to deviate from the blockchain protocol. This technology allow consumers and customs officials alike to verify product authenticity and origin by simply scanning the product codes, reducing counterfeit presence.

NFTs

Some of the top food and beverage brands such as McDonalds, Coca Cola, Starbucks, and Budweiser, are incorporating NFTs (non-fungible tokens) into their marketing strategies to monetise brand loyalty programs. This includes creating digital content to sell as NFTs and distributing NFTs in promotional programs. The NFTs can be redeemed on blockchain’s token platforms, or traded for meals, merchandise, and other perks. Vineyards followed suit offering NFTs for fine wine products, attracting non-traditional markets in an innovative and accessible way. NFT owners can trade or redeem the NFT for the product itself. The implications of NFT’s in the high-value wine and spirit market are yet to be seen. There has been some pull-back from the popularity of releasing NFTs, given the fall in consumer demand of such digital products.

Protection of trade secrets

IP assets can form a large part of the overall assets of any business, particularly in the food and beverage sector. Protection from breaches of trade secrets and confidential information can be done by bolstering security through recording and tracing ownership, digitising access and use of information, and generating alerts when security is breached, thus reducing the risk of theft or accidental exposure. The powerful ledger of blockchain can therefore provide strong and reliable evidence across the scope of IP creation. It is yet to be determined whether UK courts would be amenable to accepting such evidence in disputes around breach of confidentiality or trade secrets.

Use cases

Kraft-Heinz: For instance, Kraft-Heinz has implemented blockchain and AI tools across its business, aiming to create a “self-driving supply chain”, enabling its factories to know when a line will go down, and accurate forecasts to process and translate data collected from customers. ¹ The company is building its own AI engine to optimise manufacturing processing and streamline SAP rollouts, using machine learning to reformulate product nutritional profiles, and blockchain to enhance ingredient quality. Kraft-Heinz has also recently launched “PlantChat”, an AI product that gathers real-time insights from company strategists across the supply chain, offering visibility from operations to distribution. In February 2025, the company reported a 12% increase in efficiency of its pickle production through the use of blockchain technology and its bespoke AI engine. A 42% reduction in operator costs was reported in 2023 as a direct result of blockchain implementation. Last year, the company also started development of a generative AI app “KraftGPT”, with the assistance of Microsoft Azure OpenAI technologies, following suit with companies such as Colgate-Palmolive. The app, which is still in development, will offer Kraft-Heinz employees the ability to obtain real-time insights into product sales, risk, inventory management, operational efficiency, and recommendation systems to streamline data analytic tasks so they are able to focus on more on growth strategy. ²

Nestlé: Nestlé was one of the first major companies to implement blockchain technology using the OpenSC platform, allowing consumers to access and independently verify sustainability and supply chain data. The company has recently applied AI analysis to the contract base of its suppliers using smart contracts, currently covering over 80% of total spend and enabling consistency across hundreds of global contracts across markets. The Swiss company first piloted the process with the IBM Food Trust in 2017, with further developments in April 2019 in making its data available to customers, including the ability to track the origin of its luxury coffee Zoégas (with beans produced in Brazil, Rwanda and Colombia and roasted in Sweden), time of harvest, roasting date, certification with the Rainforest Alliance, shipment and distributer information etc. by simply scanning the QR code with a smart phone. It has further declared its aim to meet targets for recyclable or reusable packaging by 2025 – a reachable target thanks to blockchain.

This year, Nestlé launched an AI-powered concept generator combining consumer and market data with viability indicators, with over a thousand products in production in 2025. Partnering with NVIDIA Omniverse (Accenture Song) and OpenUSD, Nestlé is developing an AI-powered “digital twins” (exact 3D virtual replicas of the physical products) for brands like Nespresso and Nescafé to develop high-quality products at scale for eCommerce and digital media channels. Kraft-Heinz is also implementing digital twin technology to enhance its production. The new technology uses AI to allow ease of digital adjustment and localisation of packaging depending on seasonal campaigns or channel-specific formatting, without the need to start content-creation from scratch. The company aims to produce 10,000 digital twin products over the next two years, with an anticipated 70% reduction in time and cost.

Poultry companies: The two poultry giants, Tyson Foods and JBA SA based in the US and Brazil, respectively, have integrated blockchain into their operations since last year in response to increased public demand for ethically and sustainably sourced, organic certified chicken. Tyson Foods has partnered with software engineers, Trustwell to develop better food safety practices and transparency of the supply chain. JBS’s efforts continue from its parent company’s global launch of the Transparent Livestock Farming Platform aimed at extending livestock supplier monitoring and zero-forestation enforcement to all indirect suppliers by the end of this year.

InterCellar: InterCellar is a new Web3 platform which has, since June last year, marketed “Bordeaux en primeur” wines as NFTs through Crypto.com. As these wines are yet to be bottled, NFT owners can hold on to their NFTs, or, and later trade or redeem them against the physical bottled product. The NFTs (or digital twins) created are minted on a “Polygon” blockchain, a layer 2 of Ethereum, known as one of the least energy-consuming and fastest blockchains. Once the digital twins are minted, the bottles remain stored in optimal conditions in InterCellar’s secure warehouse, which owners can monitor in real time and access proof of reserve. The platform’s “Cellar Tokens”, which can be purchased from decentralised exchanges, can also be redeemed for exclusive access to private events or other premium perks.

Olive Oil Companies: Several olive oil producers joined the IBM’s Food Trust cloud network during the pandemic in 2020, implementing blockchain by joining in the monitoring of its product life cycle to improve the traceability, authenticity, and quality of its produce. Counterfeit olive oil is also recently on the rise, motivating use of blockchain further. In 2023, more than 5,000L (9,000 bottles) of counterfeit olive oil was seized in Italy and Spain. ³ Olive oil producers implementing blockchain include:

• Gruppo Grigi, an Umbrian leader in the livestock feed and consumer food sectors, including Aliveris brand organic pasta, Bendetti & Grigi wine, Birra Aména beer, and OVI eggs and egg products,
• Molitoria Umbra, a producer that mills durum wheat to make semolina for dry, fresh, artisanal pasta and for bread making (including its Flavum brand organic durum wheat semolina flour from Molitoria Umbra),
• Agribosco, and Umbrian company focused on the production of cereals, legumes and flours, including pearled spelt grain,
• I Potti de Fratini, an Italian oil farm producing organic olive oil,
• CHO, an olive oil producer based in Tunisia (and one of the first to adopt blockchain in the industry), with products including Terra D’Elyssa and Terra Di Olio olive oil, and
• Conde de Benalúa, a Spanish and Andalusian producer of high quality olive oil, employing over 2000 farmers overseeing its olive groves.

The work is carried out in collaboration with Sas Informatica and the Iktome Communication Agency based in Perugia, making the product process data accessible by key stakeholders. Blockchain and AI tools are also being leveraged by companies such as Grigi Group and CHO to optimise resource use and control production, processing, and distribution, particularly where harvests are increasingly unpredictable due to unpredictable climate changes. Last year, olive oil consumption dropped 2.5% in Spain, while prices quadrupled since 2021. ⁴

Rioja Vineyards: Vineyards in Rioja, Spain, are under increasing pressure from consumers and DOCa to reduce wine prices, decrease production, and even destroy existing vineyards due to a fall in consumption.⁵ In response, since 2023, 115,000 registered plots in Rioja’s vineyard area have had data captured by satellite technology processed and analysed using blockchain and AI tools, including climatic information, vine behaviour and phenological data. DOCa Rioja Control Board has since been able to identify patterns and trends in order to predict the yields of individual plots with a high degree of accuracy, take proactive measures to adjust parameters accordingly, and thus optimise production.

Diageo: The British spirits company that bought George Clooney’s Casamigos tequila brand has also, since 2021, implemented “track and trace” blockchain, as well as other digital initiatives, in answer to greater online presence, gaining real-time insights to anticipate supply chain blockages, track down theft and counterfeits, and optimise product availability, bottle fill rate and pricing. The resulting reduction in counterfeit has allowed the business to increase its more prestigious spirit brands by 10% in its first year of using blockchain technology.

The company has also recently published a Distilled Foresight 2025 report earlier this year, which acknowledges that blockchain technologies including NFTs, cryptocurrencies and Web3 continue to reshape the concept of ownership, banking, and traceability in the digital world. The paper reports on insights gained from the company’s adoption of its AI tool, “The Foresight System”, developed with Share Creative , which has tracked and monitored over 160 million conversations globally between July 2021 and July 2024 from a range of online sources. This tool has allowed Diageo to gain a deeper and more nuanced understanding of emerging cultural signals and expressions to assist with its long-term marketing strategies, such as neo-hedonism (where consumers evaluate how they spend their money, noting an 83% increase in interest in “Unique Products and Experiences”), and zebra-striping (where consumers alternate between alcoholic and non-alcoholic beverages, noting a 79% increase in consumer desire to moderate drinking).

Government and Regulation

FSA and HMRC Pilot schemes: In 2021, the Food Standards Agency (“FSA”), the relevant regulatory body in the UK, published an insights and learnings paper⁶ on the use blockchain in the food and beverage industry, recognising its many benefits and disclosing information regarding its pilot use cases in the Export Health Certification, Collection and Communication of Inspection Results (“CCIR”), and Australian Wine Imports, led by HMRC. The pilots showed real potential benefits to enable improvements, particularly in safety standards and quality of food, and stating that while the underlying technology is not a challenge to implement, the layers of policy, trust, legal frameworks, process and data definition and ease of interoperability between all stakeholders in the supply chain will be difficult.

In July 2025, the FSA completed its first blockchain pilot in cattle slaughterhouse in collaboration with CCIR, who recorded information on animal conditions against a unique ear tag number for cattle. Both the FSA and the slaughterhouse received access to the data provided by blockchain technology, which gave the benefit of improved transparency across the food supply chain. The feedback following the pilot is that blockchain does indeed work in this part of the food industry, with further pilots planned over the course of the next year to also give access to the database to farmers.

Conclusion

In conclusion, while the implementation of blockchain requires significant financial and regulatory efforts, its benefits—ranging from improved safety and reduced waste to better protection of intellectual property—far outweigh the challenges. As demonstrated by successful use cases from companies like Kraft-Heinz, Nestlé, livestock companies, olive oil producers, and wine and spirit makers, and innovative web-based platforms transforming the food and beverage sector, as well as pilot schemes by regulatory bodies like the FSA, blockchain is proving to be a transformative tool that is shaping the future of food and beverage, including setting new standards for quality, sustainability, security, brand-protection, and accountability, ultimately benefiting both businesses and consumers alike.

^{1 https://consumergoods.com/kraft-heinz-building-kraftgpt-ai-assistant-it-moves-toward-self-driving-supply-chain
2 https://rethinkretail.ai/kraft-heinz-develops-kraftgpt-to-revolutionize-data-analysis-and-employee-productivity/
3 https://www.theguardian.com/world/2023/dec/04/police-in-spain-and-italy-seize-5000-litres-of-adulterated-olive-oil-in-raids
4 https://www.surinenglish.com/spain/the-price-extra-virgin-olive-oil-falls-20241120081211-nt.html
5 https://www.thedrinksbusiness.com/2025/02/can-ai-save-riojas-next-vintage/
6 https://science.food.gov.uk/article/138489-insights-and-learnings-from-the-food-standards-agency-fsa-exploring-the-use-of-blockchains}