Commodity news

Bunge, CP Foods partner to develop blockchain solution for sustainable soy traceability

The agreement involves grain sourced by Bunge in Brazil and destined for several countries in Asia, where CPF produces and sells feed and food.

Soybean_Image by jcomp on Freepik
Credits: Jcomp, Freepik
October 30, 2023

Bunge and Bangkok Produce Merchandising Public Company Limited (BKP), a subsidiary company of Charoen Pokphand Foods Public Company Limited (CPF), signed a memorandum of understanding to collaborate on developing a blockchain solution for the traceability of soy and deforestation-free products. The agreement involves grain sourced by Bunge in Brazil and destined for several countries in Asia, where BKP and CPF produce and sell feed and food.

This partnership will enable both companies to carry out technical, commercial and operational feasibility studies to build a sustainable supply chain and integrate digitization. The agreement aims to transform traceability data from the field to final customers.

Paisarn Kruawongvanich, chief executive officer of BKP, said “blockchain technology will improve the traceability of the agro-industry and the company’s food supply chain, providing transparency and ensuring product quality and safety for customers. The agreement with global business partners aligns with BKP’s commitment to achieving a net zero supply chain in 2050.”

“Tracing raw materials around the globe, including soy, back to the source is key to ensuring both directly and indirectly sourced raw materials do not come from encroachment areas or areas of deforestation,” Kruawongvanich added.

“Bunge strives to be the preferred sustainable solutions partner for producers and customers. The partnership with BKP reflects our business vision that leverages technology as an important tool. Over the past few years, we have built a robust social and environmental verification system that includes advanced traceability and monitoring of our suppliers. We believe that, together with our customers, we will build sustainable supply chains with an additional layer of reliability guaranteed by blockchain,” explained Rossano de Angelis Jr., Bunge's vice president of agribusiness for South America.

Monitoring currently carried out by Bunge covers more than 16,000 farms, or up to 20 million hectares in South America, and relies on state-of-the-art satellite technology, capable of identifying changes in land use and soybean planting on each monitored property. In Brazil, Bunge currently monitors all of its direct supply chains in areas subject to deforestation and is moving toward fully covering the indirect supply chain by 2025. More than 97% of the volume of soy purchased by Bunge is verified free from deforestation and conversion, progressing the company closer to its deforestation-free value chain goal, the company said.

By involving two global companies, the scale of the initiative has the potential to raise standards of transparency in the Brazilian soy value chain and increase the confidence of end consumers in soy-derived products around the world.

Through the memorandum, both companies also commit to discussing the possibility of future collaboration on other services, such as exploring opportunities for further integration among systems, with a focus on enabling real-time data transfer, measuring the carbon footprint of the volumes traded with BKP, and improving the digital traceability solution to be compatible with sustainability certification standards, such as the Round Table on Responsible Soy (RTRS), and the International Sustainability & Carbon Certification (ISCC).