Do you take your coffee with cream, sugar or blockchain?
Denver’s Coda Coffee Co. this week is offering what it calls “the world’s first blockchain-traced coffee,” giving customers access to a cloud-based ledger that tracks every stop along their coffee’s supply chain. By scanning a QR code associated with the batch of coffee they bought, customers can see the date and location of every transaction—from collection at the farm to washing and drying, milling, export, roasting and retail.
“A lot of people put information on their bags that they haven’t personally verified,” said Tommy Thwaites, co-founder of Coda Coffee. “This allows the customer, right there, on demand, to trace their coffee back to the farmer.”
The new tool comes as tech-savvy consumers are seeking more information about the products they consume and businesses are looking for more efficient ways to track their relationships with suppliers.
Companies in many industries—from finance to food and real estate—are testing blockchain technology, best known as the ledger behind cryptocurrencies like bitcoin, to improve data-sharing and conduct transactions more quickly.
Agriculture conglomerate Cargill Inc. is testing an application of blockchain that would let shoppers trace turkeys from the store to the farm that raised them. Real-estate technology firm Knotel is using it to list office space for short-term lease in 45 buildings in New York, San Francisco and London.
Coffee production, with far-flung suppliers around the world and complicated supply chains involving wholesale markets and regional distributors, is an ideal commodity for a system meant to make transparency more robust.
Starbucks Corp. last month said it was launching a two-year pilot program to develop “traceability technology” for farms in Costa Rica, Colombia and Rwanda. “This could be a seismic change in an industry that hasn’t had much innovation in the way coffee moves across borders and oceans,” Starbucks Director of Traceability Arthur Karuletwa said in the announcement.
Coda Coffee’s traceable beans—a bright, lemony coffee grown in Eastern Uganda—were funneled through a new machine at farms that analyzes the beans and assigns them a lot number that customers can trace. Designed by Denver-based startup bext360, the “bextmachine” can process about 50 kilograms of coffee a minute.
The bextmachine also furnishes better information to the businesses along the supply chain, like Coda, by conducting a three-dimensional scan of the outer fruit of each bean. In providing more detail on quality and characteristics of the coffee beans at the farm level, the machine helps wholesalers and roasters learn which attributes produce certain tastes—helping them adjust future sourcing decisions.
Bext360 charges coffee producers and roasters between 1% and 2% of the wholesale price of the beans to use the machine and bext360’s blockchain program. The company says its service ultimately reduces costs in the supply chain by eliminating paperwork and other routine processes. Coda Coffee is charging $14.25 for 12 oz. of its blockchain-traceable Ugandan coffee beans—roughly the same price tag as its other 12-oz. bags of bulk coffee.
Bext360 founder Daniel Jones said it also eliminates uncertainty for farmers in coffee-producing regions, who often rely on middlemen to assess the coffee quality and give them a fair price.
“We can pay them more for a higher-value crop,” Mr. Jones said. “And if you can get more capital in hands of the people who produce the goods, you’ll have better supply chains.”
Corrections & Amplifications
The founder and chief executive of bext360 is Daniel Jones. A previous version of this article referred to him incorrectly.
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