The Halal meat scandal in Malaysia that was uncovered last month has outraged the Muslims in the country. A national newspaper has uncovered that not only was the beef was falsely labeled as Halal, but they might not even be beef at all.
This is just the tip of the iceberg; this food fraud is happening globally, but exposed first in Malaysia. Just wait a few days or weeks, more will be exposed around the world.
Imported fake beef
Malaysia, as well as other Muslim countries around the world, typically import their meat supply from abroad. Malaysia’s Islamic Development Department provides Halal accreditation to meat processing plants in Australia, Argentina, Brazil, India, Japan, New Zealand, Pakistan, South Africa, and the United States.
The fake Halal meat was instead imported from countries such as Colombia, China and Ukraine. Then it was packaged with a fake halal logo.
However, the issue is beyond just Halal certification; it is outright fraud. Horse or kangaroo meat, or just tainted poor quality, or even diseased beef has been repackaged as quality meat products with Halal logo.
Once the fake Halal meat arrives at ports in Malaysia, the shipment would bypass inspection courtesy of corrupt officials at the ports collaborating with smugglers.
They would then relabel the meat as Halal using existing brands that have Halal certification and distribute them together with authentic brands. Simply put, it is just like buying a counterfeit designer brand.
The only difference is with counterfeit designer brands the only thing that at stake is the buyer’s ego. In Halal food, scandal buyers have no idea the meat is not halal, unsafe, and are putting their health at risk. It is suggested that the Halal food fraud has been going on for 40 years.
Technology solutions to combat food fraud
The issue of food fraud is not new, globally. Countries such as China and the US have faced this issue before.
Food fraud becomes possible as the gap from farm to fork grows, meaning that as we no longer buy food directly from farmers, there are now more players involved in the food supply chain.
It is estimated that there are at least six players involved in the food supply chain before we can consume our food. These are the farmers, food production, food processing and packaging, storage, wholesale distribution, and finally the supermarkets.
There is now a technology that can combat food fraud is blockchain, which is also the technology behind bitcoins.
Blockchain is essentially decentralised ledgers distributed across many parties, recording every single transaction which is secured with cryptography technology. This means that no hacker can change the data, as the data are not stored by one centralised system but across multiple parties.
By using blockchain technology, the food industry can now ensure that the food sold is traceable back to the source. Food fraud typically involves mislabeling or using fake labels, as in the case of the Malaysian Halal meat scandal.
Global startups using blockchain technology for Halal marketplaces
The real problem is until now, there is no affordable solution that can trace our food from farm to fork. In the past, because of traceability, labour conditions have improved and human trafficking has taken a nosedive.
Big brands had to face consumer backlash when their product was made by people under extremely poor working conditions. It is all because somebody was able to trace where the product came from. Today, there is a technology that can detect whether a package of food back to its origins in an instant.
OneAgrix, a global startup, appears to have a solution to mitigate the problem of food fraud significantly if not eradicate it totally. They provide a B2B cross-border marketplace platform for Halal food, agricultural and nutraceutical products using blockchain technology and food DNA tracing.
OneAgrix has the technology to ensure transparency, traceability and trust in the food supply chain. The CEO and founder Diana Sabrain has been advocating food traceability and Halal authenticity well before the Malaysia meat scandal was exposed. The company started its operations in 2018.
According to OneAgrix’s CEO, Diana Sabrain, “The agri-food sector is one of the last sectors to use advanced technology.”
OneAgrix works with a number of Halal certification bodies across the world to ensure the foods’ Halal authenticity as well as laboratories to ensure that the products are not tainted with non-Halal content, such as pork or alcohol.
To ensure the company’s success, OneAgrix founders also waited for the right time to launch their startup. Sabrain said in an interview with Halalop earlier than three years ago, technology wasn’t available like it is now. So, they did not go into the market immediately, but worked quietly in the background to build the platform by making contacts and looking into which technologies to integrate.
The global Halal food is estimated to be worth US$1.17 trillion of spending by 1.9 billion Muslims in 2019, according to the Dinar Standard’s report on the State of the Global Islamic Economy.
If anything is to be learned from this scandal on a national level, it is that the time is now ripe for Malaysia to use blockchain in its food supply chain, especially for the Halal food sector. If not, the trust issue will remain against the Halal Malaysia certification and its impact on Malaysia US$9 billion worth of Halal trade exports.
The market is big enough for other startups to contribute and play a role in ensuring food traceability from farm to fork.
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