Blockchain technology has long been a part of the revolution in global supply chain management and the agricultural business. However, as the world continues to face the adverse effects of global warming and the increasing need to change how companies approach natural resources, this technology has an even larger role to play.

Deforestation is one of the main contributing factors to the rapid increase in the net global temperature. Forests make up an essential part of the flora and biological diversity of the planet, and as industrialization and urbanization set in, deforestation is becoming an evident problem.

Blockchain technology and AgTech can play a significant role in helping slow down the rates of deforestation globally. What’s more, companies and businesses are starting to take notice, and more entrepreneurs are utilizing this type of technology at the very core of their operations.

Sustainable supply chains with added security

AgTech helps fight deforestation by supporting the development of sustainable supply chains. Through blockchain technology, AgTech can help business owners and farmers trace the origin of agricultural products, ensuring that they are produced using sustainable practices.

Importantly, AgTech can help boost sustainability across the supply chain through the use of precision agriculture tools such as sensor networks, drones and precision planting equipment. These tools can help farmers better understand their land’s conditions and make more informed decisions about planting, irrigation and other aspects of farming. This can lead to increased crop yields and lower production costs which, in turn, can reduce the need to clear new land for farming, and ultimately reduce the environmental impact of the agriculture sector.

What’s more, as refinements come to the blockchain tech sector, AgTech products are also becoming more advanced. AgTech pioneer Dimitra, a global leader in blockchain integrations in the agricultural industry, is using artificial intelligence, satellite imaging and mobile technology to help boost sustainability and increase transparency across supply chain management.

AgTech tools can also aid in implementing sustainable farming practices like crop rotation, cover cropping and agroforestry. In turn, these techniques can improve soil health, reduce erosion and increase the overall resilience of land.

This is just one example of how Web3 tools can help to reduce the demand for products created through deforestation and promote the use of sustainable products. Not only that, but AgTech also offers traceability solutions that can help companies prove the origin and end destination of their products in compliance with various local regulations.

Regulation and compliance

The European Union aims to lead the way in terms of regulation and compliance requirements for businesses and producers looking to help combat deforestation. The union’s regulatory body introduced rules requiring importers to provide documentation ensuring that goods brought to the local market are obtained sustainably and in compliance with deforestation regulations.

These regulations mean that the EU is banning the trade of products linked to deforestation worldwide and helping to combat the effects of climate change. Traders and operators have 18 months to adjust to the new regulations, while smaller companies will have two years to adapt. Still, all businesses will have to prove that the products do not originate on land deforested after Dec. 31, 2020. Operators must provide satellite evidence demonstrating that the origin farms have not been involved in deforestation as well as GPS evidence of the source of the products, operators will need to verify that their production also complies with the local laws of the producing country.

This is another sphere where blockchain technology and AgTech can play a pivotal role. As more and more companies are turning to distributed ledgers to improve their supply chains, the tracking and monitoring of all materials used throughout production have also become more transparent.

Moreover, Web3 companies are joining in the effort to limit deforestation. Building on its supply chain management tools, Dimitra has created a blockchain-based Deforestation Certification Module as an upgrade to its Connected Farmer and Livestock Guru platforms. This module makes deforestation assessments and confirms compliance for producers, traders, consumer goods firms and regulators based on data stored on the blockchain.

Fighting for a better future

While AgTech is still a relatively new sector and only a few agricultural companies have adopted blockchain-based solutions, this technology has a lot of potential to bring sustainability into the industry.

Companies like Dimitra are actively working toward bringing easy-to-use and accessible AgTech solutions that can be implemented into businesses of all sizes — from the smallest farm to the most significant agricultural conglomerate.

The fight against climate change is one of the ultimate challenges facing the human race at the moment, and blockchain-based solutions might just be the saving grace when it comes to factors like deforestation.