Using blockchain could reduce deforestation — meat company says

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Using blockchain could reduce deforestation — meat company says

By Benson Toti - min read

JBS SA has repeatedly been called out for its connections to farms that have been sanctioned for deforestation — now they appear to be making amends

JBS SA, a major meat processing company has turned to blockchain technology to create a solution to their supply chain problem.

A report published yesterday by Reuters detailed the company’s plans to launch a traceability system based on blockchain for its meat supply chain. This will help the company ensure that it does not purchase its livestock from farms that are known to be illegally cutting trees.

Prior to this development, the company has only monitored the final link in the meat supply chain. This leaves room for any of the 50,000 ranches in Brazil that transact with JBS to receive cattle from indirect suppliers that engage in illegal deforestation.

According to a report published in July by The Guardian, the company has allegedly been in contact with at least one indirect supplier who had already been sanctioned for chopping down sections of the Amazon, as part of its efforts to increase the size of its pastures.

The CEO of JBS, Gilberto Tomazoni, stated that the company is hoping to expand its blockchain tracing system to monitor all of its indirect cattle suppliers by 2025.

“Currently, the company does not monitor indirect suppliers and no company does so,” he said. ”But we plan to close this gap using technology.”

The meat processing company hopes to start the implementation of the technology in 2021, in the Brazilian state of Mato Grosso. Research from the Trase Issue Brief series, which publishes research on commodity trading and supply chain sustainability, indicates that the state is responsible for 31% of deforestation in the Amazon throughout the last 20 years.

The implementation of the blockchain trading system is a part of a wider set of environmental actions that was announced by the company on Wednesday, September 23, during the launch of a one billion real ($182.77 million) fund for fostering social and economic development in the Amazon.

Tomazoni revealed that JBS plans on investing 250 million reals in the fund for the first five years, and is considering investing an additional 250 million by 2030 depending on the volume of donations. There are third-party companies that are expected to join the project and invest up to 500 million reals.