Agribusiness giant Bunge is teaming up with one of the world's largest producers of animal feed to develop a blockchain technology for ensuring soy and other products are deforestation-free.
The grain trader said last week it will work with Bangkok Produce Merchandising Public Company Limited (BKP), a subsidiary of Thailand-based Charoen Pokphand Foods Public Company Limited, to enhance supply chain traceability and "integrate digitization." The agreement involves Bunge-sourced grain from Brazil destined for countries in Asia where BKP and CP Foods produce feed and food.
Deforestation in Brazil reached a record in 2022 as producers cleared land to meet international demand for soy and beef. Although the country has made some strides in conservation, a recent study found deforestation remains linked to soybean farming and trade.
Bunge has made a multi-year effort to better map out its purchases from areas in higher risk of deforestation like Brazil. In 2021, the company launched the Bunge Sustainable Partnership Program to help grain resellers assess their suppliers’ performance on climate and social issues.
The company uses satellite technology to monitor changes in land use on more than 16,000 farms across up to 20 million hectares in South America. Over 97% of soy volumes purchased are verified to be free from deforestation, Bunge said.
"Over the past few years, we have built a robust social and environmental verification system that includes advanced traceability and monitoring of our suppliers," Rossano de Angelis Jr., Bunge vice president of agribusiness for South America, said in a statement. "We believe that, together with our customers, we will build sustainable supply chains with an additional layer of reliability guaranteed by blockchain."
The memorandum of understanding with BKP is meant to "transform traceability data from the field to final customers," according to the announcement. The agreement also involves the possibility of future collaboration on other services, including further integration with a focus on real-time data transfer and measuring the carbon footprint of traded volumes.
“Bunge strives to be the preferred sustainable solutions partner for producers and customers," de Angelis Jr. said. "The partnership with BKP reflects our business vision that leverages technology as an important tool."