{"id":14404,"date":"2022-03-08T10:30:40","date_gmt":"2022-03-08T18:30:40","guid":{"rendered":"https:\/\/thisfishstaging.local\/?post_type=blog&p=14404"},"modified":"2023-05-29T20:23:11","modified_gmt":"2023-05-30T03:23:11","slug":"ai-guide-data-verification-and-analytics-to-drive-competition","status":"publish","type":"blog","link":"https:\/\/this.fish\/nn\/blog\/ai-guide-data-verification-and-analytics-to-drive-competition\/","title":{"rendered":"Data verification and advanced analytics driving competition among traceability tech providers"},"content":{"rendered":"

Pioneering seafood traceability<\/h2>\n\n\n\n

On April 22, 2010, at exactly 12:53 Eastern Time, Patrick McMurry, World Champion Oyster Shucker and owner of Starfish Oyster Bar & Grill in Toronto, made social media history. McMurry (aka @ShuckerPaddy<\/a>) likely made the first-ever post of a traceable fish on Twitter.<\/p>\n\n\n\n

It was a momentous event, at least for me. McMurry tweeted a picture of a lingcod tagged with a traceable code and a website link to discover its story. The tweet is still online (click here<\/a>) although all the links are dead.<\/p>\n\n\n\n

The fish had been caught by my cousin Ryan, a groundfish longliner from Vancouver Island. What\u2019s more, I was part of a small team at the nonprofit Ecotrust Canada in Vancouver that had launched this traceability experiment. McMurry\u2019s tweet marked our first market validation. We were elated.<\/p>\n\n\n\n

From that simple tweet, we began a journey to build a seafood traceability platform that launched nationwide the following year with Sobey\u2019s, Canada\u2019s second largest grocery chain. The year 2011, in fact, proved pivotal. Several pioneering traceability systems launched besides our own:  Pacific FishTrax<\/a> in Oregon, Gulf Wild<\/a> in the Gulf of Mexico, and John West Australia<\/a> with the first traceable canned tuna. Before these initiatives, only Traceall Global and Trace Register had been tracing fish for a few years.<\/p>\n\n\n\n

It was a period of experimentation. In the ensuing years, I participated in seafood traceability pilots around the world. At one point, I found myself in the tangled, muddied jungles of the Brazilian Amazon trying to trace mangrove crab. Artisanal fishermen were lathering themselves in engine oil to ward off mosquitos infested with the Zika virus. Scaling these many pilots proved challenging.<\/p>\n\n\n\n

The rise of blockchain in traceability<\/h2>\n\n\n\n
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48% of traceability software providers were lauched in the last 5 years with about 50% using blockchain tech. The average age is almost 8 years. <\/figcaption><\/figure>\n\n\n\n

Today, there are 47 companies providing traceability software to the seafood industry* (See footnote.). Much has changed since those nascent days. Indeed, half of these traceability providers have been launched in the last five years alone. And 25 companies are powering traceability with blockchain.<\/p>\n\n\n\n

\"Pie
Half (50%) of the seafood traceability providers presently deploy new blockchain technology. Most other businesses uses centralized databases.<\/figcaption><\/figure>\n\n\n\n

Blockchain hype has certainly driven some traceability adoption in the past few years. Indeed, according to Gartner, blockchain hit the peak of its \u201cHype Cycle<\/a>\u201d in 2021.<\/p>\n\n\n\n

\"Curve
According to Gartner’s hype chart, blockchain and A.I. are 5 to 10 years away from reaching the “plateau of productivity”.<\/figcaption><\/figure>\n\n\n\n

My own view is that blockchain will have limited value compared to the potential of artificial intelligence. So how many traceability providers offer AI-powered solutions? The answer: only three. I\u2019ll return to this question a little later and describe how AI could help drive traceability adoption.<\/p>\n\n\n\n

Market and regulatory drivers of traceability<\/h2>\n\n\n\n

Up until now, the seafood industry has been reluctant to fully embrace electronic traceability. External forces have been pushing change. In the past two decades, there have been 19 major regulator food traceability changes such as E.U. Catch Certificates, U.S. Seafood Importation and Monitoring Program and stricter COOL (Country Of Origin Labelling) laws in various countries. Some 26 market initiatives including new NGOs, certifications, eco-ratings, campaigns, and pilot projects have also been pressing for improved traceability.  <\/p>\n\n\n\n

\"Bar
In the past 20 years, 19 major regulatory changes and 26 market initiatives helped drive adoption of new traceability technologies in the seafood industry.<\/figcaption><\/figure>\n\n\n\n

About 42 percent of the traceability providers specialize in seafood, 29 percent focus on food more broadly and 29 percent trace a variety of commodities, such as coffee, chocolate, minerals, timber, palm oil, fashion, etc.<\/p>\n\n\n\n

\"Pie
About 40% of the 52 seafood traceability software providers specialize in seafood alone. The remainder focus more broadly on food, or a variety of commodities.<\/figcaption><\/figure>\n\n\n\n

Pandemic accelerates supply chain investment<\/h2>\n\n\n\n

In fact, the pandemic has driven an explosion of investment in supply chain management tech, including traceability. In 2021, Crunchbase reported 450 deals worth 11.3 billion USD<\/a>.

\u201cNo one cared about this space just a few years ago,\u201d Teddie Wardi, managing director at Insight Partners<\/a>, told Crunchbase. \u201cNot just investors, but I mean, everyone. Now, we have seen about 10 years of transformation in two.\u201d<\/p>\n\n\n\n

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Due to the pandemic, 2021 was a record year for funding tech companies focused on supply chain management. <\/figcaption><\/figure>\n\n\n\n

Functionally, many of these traceability platforms are very similar. Most offer both B2B and B2C (business-to-consumer) traceability and white labelling solutions for branding. And most seem to target mid-stream operators such as processors, distributors, and CPG brands, as their paying customers.<\/p>\n\n\n\n

Given Europe\u2019s strong interest in food provenance, it\u2019s unsurprising that some 34 percent of traceability software providers are located there. About 40 percent are in North America and 19 percent in Asia.<\/p>\n\n\n\n

\"Pie
Europe houses about 33% of food industry traceability providers, unsurprising to the author.<\/figcaption><\/figure>\n\n\n\n

Data verification to drive tech differentiation<\/h2>\n\n\n\n

Where we could see growing market differentiation among tech providers is around data. About 55 percent of traceability software providers have committed to the new Global Dialogue for Seafood Traceability data standards and six percent track carbon. Traceability providers are well placed to help track a product\u2019s carbon footprint which is largely determined by its harvest or farm method, transportation mode and distance travelled\u2014all data typically collected for traceability.<\/p>\n\n\n\n

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Of 52 traceability providers, 81% enable consumer transparency, 52% have committed to the GDST data standards and 44% make verification claims.<\/figcaption><\/figure>\n\n\n\n

In my view, competition is likely to focus on data verification. About 40 percent of traceability providers make a claim about data verification. Boston-based Legit Fish<\/a>, for example, verifies data electronically against government catch records. EVRYTHNG<\/a>, which has been working with Mowi, uses an \u201cintelligent digital identity\u201d along with machine learning and analytics.  Likewise, OpenSC<\/a> in Sydney, Australia, uses \u201cimmutable\u201d blockchain technology and continuous, automated analysis of data to verify low-carbon and sustainable food. Truthful, accurate and validated data is traceability\u2019s Holy Grail.<\/p>\n\n\n\n

In general, manual data entry is more vulnerable to manipulation than sensors and machines automatically collecting or analyzing data. But data verification comes in many forms. Here\u2019s a list from the simplest to most technologically advanced:<\/p>\n\n\n\n