The Future of Food Traceability: Innovations, Challenges, and Regulatory Strategies

Food information, transparency, and traceability have evolved into global culinary trends, growing in significance year by year. Today's consumers display heightened curiosity regarding the origins and production of their food, prioritizing ingredient quality. In fact, food traceability ranks as a leading trend for 2023, as noted by the IFIC (International Food Information Council) Foundation. According to the IMARC Group, global investments in traceability are projected to reach USD 31.7 billion by 2028, reflecting a robust continuous annual growth rate (CAGR) of 9.2% throughout the forecast period.

Source: Tridge, IMARC Group

The traceability journey commences in farms and fields, where primary production undergoes meticulous marking in adherence to local regulations. Examples include producer codes on eggs or ear tags on livestock. These codes encode critical information about the production process, facility, country of origin, and even details about the feed consumed by livestock. They accompany the product through all stages of production, remaining visible in the final product and offering consumers insights into its origin and production methods. It's essential to note that traceability serves a dual purpose: not only does it provide consumers with assurance regarding food safety and ethical production, but it also plays a pivotal role in enhancing food safety measures and operational efficiency. Traceability empowers food producers to operate precisely and confidently by enabling effective product recalls when necessary and identifying potential production process flaws.

The food traceability sector is undergoing a transformative phase, driven by the integration of cutting-edge technologies designed to enhance both efficiency and precision in tracking the food journey from farm to table. Innovations like smart labels, blockchain-enabled track-and-trace systems, and comprehensive, integrated platforms are reshaping the industry landscape. These tools not only ensure strict adherence to food safety standards but also bolster consumer confidence in the products they consume. With the aid of these emerging technologies, brands can swiftly address food safety concerns and offer enhanced transparency to their customers, resulting in a more secure and reliable food supply chain.

Source: VISIOTT

Although the potential benefits of traceability and sustainability are indeed promising, there are notable challenges to navigate. The adoption of new technologies necessitates substantial investments and the restructuring of existing operational processes. Consequently, the European Union (EU) and the United States (US) have adopted several strategies to financially support and encourage companies in this regard. The EU has primarily leaned on policy regulation, while the US has emphasized financial incentives and subsidies.

Under the EU Corporate Sustainability Reporting Directive (CSRD), companies operating in Europe are required to furnish CSRD reports to the EU, a mandate set to take effect between 2025 and 2029, depending on their size. This legislation explicitly demands traceability of a company's raw materials, stemming from businesses' local environmental impacts and their reliance on nature. Additionally, the EU Deforestation Free Regulation (EUDR) expands the scope of regulations targeting timber products derived from deforestation linked to illegal logging. It stipulates that any company involved in importing or exporting seven specific commodities (cocoa, coffee, soy, palm oil, wood, rubber, and cattle) and their derivatives to and from the EU must demonstrate that these products are not associated with deforested land post-2020.

Similar strategies have been adopted by the United States Department of Agriculture (USDA), such as the Partnerships for Climate Smart Commodities. This federal initiative marks a significant increase in funding for sustainable agriculture in the US. With a commitment of USD 3.1 billion in public investment and incentives, the program aims to support the development of commodity supply chains capable of verifying the adoption of climate-smart agricultural practices during crop production. The Food and Drug Administration (FDA) anticipates that implementing these measures will substantially reduce traceback time by 83%, translating into substantial cost savings projected to range between USD 2.5 billion and USD 18.8 billion over the next two decades.

In the coming five years, food traceability is expected to thrive through advanced technologies like blockchain and Internet of Things (IoT), empowering consumers with real-time information about their food's origins and sustainability. Global standardization and stricter regulations will ensure uniformity and safety across borders. Additionally, collaboration among supply chain stakeholders and a growing focus on sustainability will drive a more transparent, resilient, and cost-efficient food system.

For further reading, follow the links below:

1. Navigating the Food Safety Landscape in South Korea for Fresh Produce Suppliers

2. Webinar Recap: Trusted Digital Traces on ESG from Farm to Consumer

3. The EU Reaches Agreement to Ban Imports of Coffee from Countries Contributing to Deforestation