PALMOILMAGAZINE, JAKARTA – Deforestation remains a pressing environmental concern globally, with millions of hectares of forests disappearing annually due to factors like illegal logging, agriculture, and development. Addressing deforestation is crucial for mitigating its adverse impacts on climate, biodiversity conservation, and indigenous communities.
In response to this challenge, innovative solutions in Agricultural Technology (AgTech) and Blockchain technology are expected to play pivotal roles in promoting sustainability and combating deforestation in palm oil plantations. These technologies offer opportunities to enhance transparency, traceability, and accountability throughout the palm oil supply chain, facilitating the identification and mitigation of deforestation risks.
The European Union (EU) has taken regulatory measures to address deforestation, notably through the European Union Deforestation Regulation (EUDR). This regulation mandates due diligence and risk assessment for all consumers and producers within certain commodity supply chains to ensure that their products are not linked to deforestation.
Also Read: Sustainability Spotlight: Indonesian Palm Oil Production After EUDR
EUDR is poised to have significant implications for smallholder palm oil plantations in Indonesia, given the country’s status as the world’s largest palm oil producer. Palm oil is closely associated with deforestation, making Indonesia a high-risk country under EUDR. Smallholders in Indonesia are required to adhere to stringent terms and conditions outlined in the regulation, with potential penalties for non-compliance.
Through the integration of AgTech and Blockchain solutions, stakeholders in the palm oil industry can enhance transparency, promote sustainable practices, and mitigate the risk of deforestation, contributing to a more sustainable future for palm oil production.
According to Jon Trask, the founder and CEO Dimitra Inc. at Nasdaq[1], only 1% smallholders in Indonesia got sustainable certificate based on nowadays available regulation. it means, EUDR implementation would make smallholders in Indonesia not have market access in the continent. This would raise worry for the other smallholders in southern world including Indonesia. They thought the regulation would ignore every effort to balance natural conservation by protecting sources of living.
Besides, the regulation would raise unexpected consequences: potentially relocate the products that were produced by having deforestation to the markets (countries) where the regulations are not too close, such as, India and China. It would also raise worry about the effectiveness of EUDR to realize deforestation mitigation goals in the global level.
Take Advantage on AgTech and Blockchain
The solution on AgTech and Blockchain – base is ready to play the significant roles to encourage sustainability and fight deforestation in every palm oil plantation scale, starting from the smallholders to big corporates. The technology would have potential to significantly solve environmental challenges and would contribute for more sustainable future.
For instance, blockchain can be used to trace the material origins of palm oil and would help confirm that the products derived not from deforestation.
AgTech, on the other hand, can be usd to escalate agricultural productivity and minimize every environmental impact.
The sophisticated AgTech solution took advantages on artificial intelligence and satellite images to escalate sustainability and supply chain transparency. For instance, artificial intelligence (AI) can be used to develop model that would predict environmental damages because of palm oil plantations. Satellite images can be used to monitor area and forest condition and would help identify and prevent deforestation. Such technology would support sustainable practices, for instance, to escalate soil fertility, and reduce land erosion.
The Helps of Technology and Trainings
But smallholders’ plantations always have small scale and limited sources of data and they might be difficult to qualify the expensive and complex terms and conditions in EUDR. For instance, smallholders could not have access of precious agricultural technology or natural resources needed to track down their materials.
That is why it needs the help of technology and development to help them in qualifying EUDR terms and conditions. The government and non-government organizations should play their significant roles to deliver the helps.
[1] https://www.nasdaq.com/articles/facilitating-accessibility-and-empowering-smallholder-farmers-in-a-changing-regulatory
