New York Times "China’s Long Food Chain Plugs In"

March 2, 2015

HONG KONG — The smartphone tells the story of a kiwi fruit in China.

With a quick scan of a code, shoppers can look up the fruit’s complete thousand-mile journey from a vine in a lush valley along the upper Yangtze River to a bin in a Beijing supermarket. The smartphone feature, which also details soil and water tests from the farm, is intended to ensure that the kiwi has not been contaminated anywhere along the way.

“I have scanned some electronic products before, but never any food,” said Xu Guillin, who recently tested the tracking function at the supermarket while shopping with her 3-year-old grandson. “We pay lots of attention to food safety. Most families with young kids would.”

Controlling China’s sprawling food supply chain has proved a frustrating endeavor. Government regulators and state-owned agriculture companies have tried to tackle the problem in a number of ways — increasing factory inspections, conducting mass laboratory tests, enhancing enforcement procedures, even with prosecutions and executions — but food safety scandals still emerge too often.

Chinese technology companies believe they can do it better. From the farm to the table, the country’s biggest players are looking to upgrade archaic systems with robust data collection, smartphone apps, online marketplaces and fancy gadgetry.

The founder of the computer maker Lenovo started Joyvio, the agricultural company that tracks kiwis and other fruit from planting to delivery. The Internet giant Alibaba directly connects consumers with farmers via an online produce-delivery service. A gaming entrepreneur is running a pig farm on the side. And Baidu, the country’s leading search engine, is developing a “smart” chopstick that tests whether food is contaminated.

“In the food production and agriculture industry, transparency is fundamental,” said Chen Shaopeng, chief executive of Joyvio. “But in China this is not the case.”

While technology companies may not have the scandal-tainted past of the traditional food industry, they will still have to earn customers’ trust. A shopper at another Beijing supermarket, BHG Market Place, tested the trackable kiwi and was intrigued, although not enough to buy it.

“This looks impressive. But the thing is, I don’t really trust any certificate,” said Ms. Jiang, who declined to give her full name, looking closely at a three-page report on the fruit. “We all know that certificates can be faked.”

The size of the problem alone is daunting. With more than a billion mouths to feed, China has one of the world’s most complex food chains. At almost every link, there have been problems.

In one of the country’s biggest food scares, in 2008 dairy producers sold milk formula laced with melamine, which put 300,000 babies in the hospital and killed six. Last year, a supplier to McDonald’s and KFC was caught putting rotten and expired meat into products. Penny-pinching chefs cook with waste oil from fryers and sewers, a toxic ingredient known as gutter oil that generally goes unnoticed until diners get sick.

Such food scandals have shaken consumer trust and spurred outcries and protests. The cynicism is so visceral that jokes about food contamination are standard fare on social media and online video shows.

Baidu’s smart chopsticks were supposed to be a joke for April Fools’ Day. The search engine giant published a fake advertisement for a set of chopsticks that would determine whether food had been cooked with gutter oil. The ad struck a chord, and it quickly went viral on Chinese social media sites.

With such a strong response, Baidu decided to create a real product. Embedded with sensors, the chopsticks primarily test for gutter oil, but they also indicate pH levels and temperature. The product’s charger allows consumers to identify different fruits and vegetables as well as where they were grown and the calories they contain. The company is debating whether to add a feature that would indicate salinity, allowing users to determine whether mineral water is fake.

Baidu is currently manufacturing a small batch of prototypes for testing. The company says it has not yet decided when to release the product or how much it will cost. Even so, it has already generated interest.

“With Baidu smart chopsticks, I don’t have to worry about gutter oil any more,” one person recently commented on Weibo, a Chinese microblog. “I will definitely buy one once it is on shelves.”

City dwellers can buy directly from farmers through Jutudi, a pilot program created by Alibaba that has about 10,000 users. An e-commerce twist on the “buy local” movement, Jutudi lets users buy regular deliveries of vegetables and fruits from farms across China. Consumers can even pick their own plots in a sort of virtual farming, although deliveries may come from multiple places.

Alibaba is tapping into consumers’ nostalgia for their rural roots with a heavy dose of marketing. The site features a Socialist Realist illustration of two women in a field of golden grain — harking back to the days of Mao Zedong, when farmers were lionized by propaganda. With images of shiny, red tomatoes, well-groomed pigs and other succulent fruits and vegetables, the program also promotes quality. Higher-end packages include tours of the farms.

The idea of having one’s own plot of land is attractive to Jiang Hui, a 27-year-old web editor. Typical for her generation, Ms. Jiang goes online to buy just about everything, so produce was an easy next step.

“The increasing number of food scandals is turning everyone into a food safety expert,” said Ms. Jiang, who lives with her parents in Beijing. “The more we read, the more scared we are and the more careful we are.”

Alibaba has set ground rules for farmers. Farmers are required to separate the crops and treat them with lower amounts of pesticides.

“I am only allowed to spray pesticide on that piece of land once for every harvest. So I hire workers to pick pests by hand,” said Zhang Zhaohui, a 38-year-old farmer in the program. Samples of the mangoes are also independently tested before being shipped, he added.

Despite the extra costs, Mr. Zhang says he makes more on the mangoes he sells to Jutudi. “To me, they all seem really rich,” Mr. Zhang said of the customers.

Joyvio is taking on a bigger challenge: the entire food chain.

Started in 2009, it is now the largest provider of kiwis and blueberries in China. It controls everything, picking what seeds are planted, then tracking and collecting data each step of the way.

Its nurseries are the stuff of science fiction. The room temperature and irrigation schedules are automatic and can be controlled remotely via a mobile phone or a computer. Seeds are grown in greenhouses, and plant tissue is cultivated in research labs.

Taking a similar approach to Lenovo’s, Joyvio focused on acquiring technology and know-how to build its business.

Executives studied foreign agriculture businesses. Joyvio hired a top American agronomist who specialized in the development of preservatives and microorganisms that work as natural pesticides. The company bought farms in Chile and Australia and partnered with two large Chilean fruit companies.

“We’ve leveraged our global capacity to bring a lot of new technology to China,” said Mr. Chen. “We continue to eye buying companies or farms in other countries, and also in China to give more scale to our ability to provide high-quality products and goods.”

Source: http://www.nytimes.com/2015/03/02/business...

 

 

 

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