TWELVE Clare Valley-based wineries will this summer participate in the world's largest blockchain wine trial.
Local winemaker Jeff Grosset and grapegrower David Travers will test their prototype, which combines QR code and blockchain technology to prove a wine's authenticity, integrity and provenance.
In March, the pair was awarded $50,000 through the Premier's Blockchain Innovation Challenge to further the invention they hope will enhance Australia's reputation as leaders in wine authentication.
Mr Grosset said the main form of counterfeit in the local wine industry came from misrepresenting the wine producer, variety or region of origin on the bottle label.
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He said through eliminating chinks in the initial production chain, from picking grapes to winery delivery, 70 per cent of false labelling cases would be solved.
"Our platform is already able to ensure the provenance of the grapes, the authenticity of the winemaking and the integrity of the final bottle," he said.
"We provide consumers assurance over the end to end provenance of the wine chain delivered directly via their mobile phone.
"The combination of blockchain event management, automation and physical authentication methods is already turning heads."
If most producers adopted this technology, which captures all the details along the winemaking process, it would make wine fraud virtually impossible.
Mr Grosset said a QR code on winegrape bins would record the vineyard, the variety, the time picked and its weight, fulfilling the demands of Wine Australia's label integrity program.
"If most producers adopted this technology, which captures all the details along the winemaking process, it would make wine fraud virtually impossible," he said.
"During the trial, we want the 12 wineries to use it and to openly give feedback about the system."
Mr Grosset said the Australian wine community had been a world leader in innovation, from using satellites and remote sensing to identifying individual vineyard blocks, grape varieties and disease, to the adoption of a reliable wine bottle closure.
"It makes perfect sense that we should lead in the assurance of wine authenticity using blockchain," he said.
"Our aim is to conduct this Clare Valley trial and then to commercialise with partners in China and other major markets."
Mr Travers said beyond the trial, he saw the platform eventually supporting a complete range of services to the wine industry; an end to end management of the entire production process.
"We have designed a trial with all sectors joining: growers, wineries, distributors, regulators, service providers, wholesalers and the research community," he said.
"This will help us to understand what we should build in there."
Mr Grosset and Mr Travers, who are both members of the Clare Valley Wine & Grape Association, hope to release a commercial product by June next year.
Mr Grosset said wine authentication was particularly important for Australian export markets such as China.
In 2017, a Forbes article noted that in China up to half of all wine priced over US$35 a bottle was counterfeit.
More recently, the Drinks Business reports that in a crackdown in central Henan province near Beijing in November 2018 police in China seized more than 50,000 bottles of fake wine bottled as Australia's Penfolds and China's Changyu.
The total value of wine involved in this case is reported to exceed RMB 100 million (US$14.4m).
To develop the technology, Mr Travers and Mr Grosset partnered with an Estonian-based company, Guardtime.
Guardtime chief executive officer Mike Gault said it was a "fantastic" use for his company's supply chain services platform.
"We see the wine industry facing the same challenges that most global supply chains face today," he said.