Blockchain Technologies can help companies in compliance Eudr

As the deadline for conformity of the EU Deforestation Regulation (EUDR) is approaching, it is crucial for companies to fill the critical knowledge gaps and to take advantage of advanced AI and Blockchain technologies to ensure reports and precise transparency. This proactive approach not only helps companies easily meet the requirements of the EUDR, but also provides continuous access to the EU market, by positioning them for long -term success in an increasingly regulated global landscape.

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By Jon Trask

On November 14, 2024, the European Parliament voted to modify and postpone the EU deforestation of the deforestation (EUDR) – originally to take effect on December 30 – per year for large companies and until June 30 2026 for small businesses. This decision aimed to guarantee that everyone has the time necessary to become in accordance with the EUDR.

On December 3, the Council concluded a provisional agreement with the European Parliament on a plan to modify the EU deforestation regulations, postponing its 12 -month request date. This provisional agreement must still be confirmed by the two institutions before going through the official adoption procedure.

But although this may be a relief for some, many still sail in the complexities of the regulation, in particular when it comes to understanding the requirements in their supply chains. Although the stage implementation of the EUDR aims to alleviate this transition, the lack of appropriate education and support leaves many companies at risk of non-compliance, penalties and even to lose access to the market EU.

This raises an important question: can the blockchain, combined with emerging technologies, really keep its promise to revolutionize agriculture and create resilient supply chains?

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The road to EUDR compliance

While companies include the importance of the complete transparency of the supply chain for EUDR compliance, the realization of this always presents significant challenges, in particular for those who obtain high -risk regions. To comply with the EUDR, geolocation data must be submitted in reasonable diligence declarations to regulatory organizations in a precise and verifiable manner. However, the collection and verification of these essential data is often difficult due to technological gaps which make it more difficult to verify the precision of geolocation data provided, suppliers often lacking in detailed knowledge of the exact origins of their products. This is particularly problematic when working with smaller suppliers who do not have digital tools for complete follow -up.

A Morningstar report published in April 2024 stressed that only 16% of companies in the food products sector have robust deforestation programs. In comparison, 32% have low programs and 27% have no program. These preparation gaps expose industries to significant risks, especially in sectors such as sustainable consumer goods, where 63% of companies lack adequate deforestation strategies. This highlights the urgent need for more vigorous compliance efforts, especially in high -risk sectors such as coffee, cocoa and palm oil.

Companies must proactively assess and manage risks in their supply chains, providing transparency on the quantity, origin and compliance status of each product in public reports to avoid regulatory sanctions. However, precise risk assessment and management become almost impossible when farmers, especially in remote areas, have limited access to reliable data. For some suppliers, products can go through several companies and countries, which adds a layer of complexity. It is rare that a single plot of a plot of land goes through an isolation supply chain. Instead, it is common for harvests to different plots to be combined for treatment, increasing the risk of goods from priming land mixed with those of non -deficient land.

Blockchain technology offers a powerful solution to these challenges, offering transparent and traceable recordings that allow companies to respond more easily to EUDR compliance. By integrating the blockchain into the supply chain, companies can safely follow the origin and environmental impact of products, guaranteeing real -time compliance and risk management. In the regions subject to deforestation, companies are required to proceed with a rigorous reasonable diligence and to subject declarations of compliance through a European register called “traces NT”. However, many farmers around the world find it difficult to understand and meet the complex requirements of the EUDR due to limited resources and knowledge. This lack of understanding can lead to gaps in documentation and difficulties in complying with regulatory standards, ultimately risking disturbances in the supply chain and non-compliance penalties.

Blockchain can fill this gap by providing a digital solution that simplifies monitoring, verification and data reports, which allows farmers to comply with these standards and strengthen the resilience of the whole supply chain against risks linked to Deforestation.

Take advantage of technology for effective compliance of the EUDR

Immutable blockchain files offer a secure and transparent means of checking the origins of the product and culture practices. When associated with an AI -focused analysis, companies can monitor data from the real -time supply chain, offering usable information that helps to mitigate the risks early. This combination of technologies not only improves data accuracy, but also rationalizes the compliance process, which facilitates satisfaction of regulatory requirements. However, many regions do not have the necessary infrastructure for reliable data collection, which can lead to gaps in land use information, delay risk identification and hinder effective monitoring.

To overcome this challenge, AI -centered systems that integrate satellite surveillance offer a solution for real -time surveillance, allowing companies to follow the use of land in high -risk areas and identify in a manner proactive potential deforestation. By giving access to precise and up -to -date data, companies can more effectively mitigate risks as they arise and reduce the need for manual surveillance. Real -time monitoring is aligned with the proactive EU approach to apply the compliance and prevention of unauthorized activities in the supply chain.

In addition to following the use of land, these technologies also support the automation of compliance reports, allowing companies to effectively generate EUDR documentation requirements. Technological platforms can further improve compliance by providing educational resources directly to suppliers and merchants, helping them understand the EUDR standards and apply the necessary measures to fill the compliance shortcomings. By clarifying false ideas and providing advice on the expectations of compliance, companies can ensure greater consistency in their supply chains, promoting a global network of more transparent and more resilient global supply chain.

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About the author:: Jon trask is CEO and founder of Dimitra and has been working with Blockchain since 2017. Before founding Dimitra, Jon had a large career building and in the development of business software solutions to revolutionize the processes of the supply chain and improve the immutable traceability. Recognized expert in his field, Jon is also a founder and CEO of Blockchain Guru and partner of the Blockchain Training Alliance. Jon’s mission is now to increase agricultural connectivity, in particular with those deprived of their rights around the world and to take advantage of the power of innovative technologies to fill agriculture and technology.

Featured image: Marcelo Perez del Carpio / Climate Visuals Countdown.