Globally tracking, tracing and monitoring food from farm to fork is no longer a pipe dream. As the Internet of things moves into the food and logistics chain, a Dutch technology firm is revolutionizing the most basic building block of world trade.
They have been called the “single most important object in the global economy.” There are around 10 billion of them moving around the planet at any one time: the pallet. A Dutch logistics start-up has upgraded this world trade workhorse – the ubiquitous wooden platform used for transporting goods – by giving it a brain.
“The traditional pallet was designed about 100 years ago,” says Erik de Bokx, CEO of Ahrma Group. “We thought if you digitize the pallet itself, then you can monitor the goods stacked on them.” So, De Bokx and his team got around the drawing board to redesign the humble pallet into a smart monitoring system for goods and shipments.
Ahrma’s pallets, built from wood and plastic, have built-in battery-powered transponders which communicate via Bluetooth to the company’s central system.
“Our clients want more information than where their goods are”- Erik de Bokx, Ahrma
More than “where’s my stuff?”
“The first thing our clients want to know is where their goods are,” says De Bokx. “But they want other information too: the weight of the goods on the pallet, the temperature and the humidity levels.” Ahrma monitors all this data on its pallets 24/7 from what De Bokx calls a ‘control tower.’ Officially this is called the Supply Chain Big Data System (SCBD), and clients access it through a dashboard on a smartphone app.
“If an alert comes in to the control tower that something’s not quite right – goods are staying in one place too long, or the temperature has risen above a certain threshold – we report this immediately and our clients can intervene,” De Bokx explains.
Daylight sensors also establish whether or not a shipping container has been opened during transport. “One can warn the port authorities that the shipment may have been tampered with,” says De Bokx.
“Logistics has a large role to play in improving food waste”- Tjard Westbroek, Rabobank
Reducing food waste
Between 30 to 35 percent of all food produced on the planet is thrown away. “We have limited resources and we currently use between 1.5 and 1.7 times the earth’s available natural resources each year. The ecosystems just can’t regenerate in time” says Tjard Westbroek, Rabobank Global Sector Head for Supply Chains.
“Logistics has a very large role to play in improving this situation,” he explains. “The integrity of the entire value chain – monitoring collection, and subsequently being able to track, trace and monitor products all the way to the final consumer – is going to become increasingly important.”
With the sensors on Ahrma’s pallets, clients can track temperatures of perishable goods to know when they might be most vulnerable to spoilage, for example. Knowing the weight of a shipment could reveal a loss of moisture in produce, another sign of freshness. More broadly, a traceable supply chain can eliminate roadblocks and delays in shipping, ensuring consumables arrive while they are still fresh.
Loaded with wireless sensors, Ahrma’s pallets monitor details like location, weight, humidity and temperature.
Traceability: a consumer demand
Rabobank was an early funder of Ahrma. Westbroek is convinced logistics technology has a part to play in the reduction of food waste, but also in answering the increasing demand for accurate information on origin, traceability and more about products on the move.
“Not a day goes by without another sustainability theme related to a food or beverage corporation published somewhere. Be it on reduction of food waste, packaging waste, circularity, water usage, etc.,” says Westbroek.
Young consumers in particular are very concerned about sustainability, he adds. “Companies that can demonstrate what they are doing about food wastage, logistics being a part of that, will be in the driving seat.” If companies fail to act on this issue, Westbroek thinks governments will increasingly be urged to step in.
“Our challenge is to get all parties in the food chain on board”- Erik de Bokx, Ahrma
Linking up the chain
“We provide full traceability,” says Ahrma’s De Bokx. “But our biggest challenge is to get all parties involved in the food chain on board. It’s hugely complex: you have to unite retailers, fast-moving consumer goods manufacturers and suppliers, as well as logistics companies.” Ahrma is currently concentrating on smaller parts of the chain, but ultimately hopes to get all players, from the farm to the supermarket, tracing and sharing information.
Rabobank’s Westbroek concurs, seeing a potential role for the bank in helping to unite diverse actors in the food value chain: “Not just in the straightforward financing of investments in new technology, but we should also bring together ecosystems of clients and, supported by our food and agriculture knowledge, have them discuss how to implement smart logistics sooner rather than later.”
“Our system can find a recalled chocolate bar within two minutes”- Erik de Bokx, Ahrma
“Safety is very important to us,” says De Bokx. “Should there be a product recall – say, a chocolate bar – with the standard system it takes up to two weeks before the product is identified and located in a given supermarket. With our system you could find that same chocolate bar within two minutes.”
Ahrma is in currently in talks with a major candy bar maker, who aims to monitor the entire chain via Ahrma’s system.
“We can follow the cacao in Africa, know when it is loaded on a boat, when it reaches port, which container it is in, which lorry is carrying the container and when the lorry arrives at the factory,” explains De Bokx. “In an ideal world, we should know which cacao goes into which chocolate bar, to which supermarket chain it is delivered and which store it is delivered to, but we’re not there yet,” he admits.
Cocoa can be tracked meticulously: in Africa, on a boat, on a specific truck and into the factory.
A chemical reaction
Ahrma’s pallets are not only valuable to the food industry. They also service chemical, pharmaceutical and other industries transporting sensitive products or raw materials. For sectors like these, product safety guarantees are as important as accurate ETAs.
In a move which appears to back that up, German chemicals group BASF invested €5 million in Ahrma shares in December 2017. “There is great interest in the smart use of logistics data as companies in all industries look for transparent, reliable information in real-time to optimize their supply chain,” said Raimar Jahn, President of BASF’s Performance Materials division at the time of the deal.
“We believe strongly that digital tracking and tracing of products gives industry the opportunity to improve products and packaging,” says De Bokx. “It’s really not simply sticking a transponder onto a package, it’s about integrating transponder technology into that packaging, such as a pallet. You can then manage them like an airline manages its aircraft: they should always be on the move.”
“We can manage pallets like an airline manages its aircraft”- Erik de Bokx, Ahrma
Not just the big guys
Farmers benefit not only from being able to trace and monitor their own products on the move, but also the inputs they use on the land. “We can provide farmers with information about the origins of the products which they are using,” says De Bokx. “Fertilizers and pesticides are also part of the food chain and farmers need to know that their origins have a high degree of integrity.”
The humble smart pallet won’t solve all the world’s food security and waste problems on its own. Moving forward, industry-wide measures are required to enhance the traceability and safety of our food. But as we draw ever closer to 2050, when there will be roughly 9 billion mouths to feed globally, advances like the smart pallet will provide support as we face this most immensely human of challenges.