Already the global leader in sustainable palm oil production, Malaysia is reinforcing its commitment to accountability and traceability with the pioneering of a blockchain app specifically for the country’s palm oil industry. The program was introduced during the recent World Economic Forum in Davos, Switzerland.
Blockchain is the encrypted storage of digital ‘blocks’ of verified information using a computer network. New blocks are stored linearly and chronologically. The goal is for digital information to be entered and distributed, without the ability to be altered or edited. Once used exclusively in the financial industry, blockchain technology has now been adopted by agriculture, fisheries and other industries.
The Malaysian Palm Oil Council (MPOC) supported BloomBloc Sdn. Bhd, a strategic advisory and blockchain development company focused on sustainable supply chains. The objective was to design and develop a blockchain app and web interface based on blockchain technology specifically for the Malaysian palm oil industry. Using a smartphone, each tree and related information are uploaded into the system. After that, most of the checkpoints are done via the smartphone app.
The app automatically creates an end-to-end digital ledger, providing irrefutable transparency, accuracy and credibility for stakeholders and end customers. Now tested on a pilot scale and shown to work as designed, the app will be made available through a user agreement to all Malaysian oil palm growers and palm oil processors.
“The MPOC’s pioneering venture into blockchain technology demonstrates our commitment to maintaining our industry’s sustainability and enhancing its marketability. It speaks volumes about our trust in our supply chain. And it is yet another way Malaysia is showing the world that we value our people and our planet,” says Malaysian Palm Oil Council CEO, Datuk Dr. Kalyana Sundram. “We hope that by creating this platform and demonstrating the benefits of using blockchain technology, we will encourage others who are practicing sustainable agriculture to follow our lead.”
According to BloomBloc Sdn Bhd, the mobile app and web interface are ready for pilot implementation in plantations and among oil palm smallholders. For the industry’s family owned smallholders, this blockchain app could enable them to gain more control over their processes. These efficiencies we hope could lead to increased production while reducing costs.
Palm oil sustainability is a major priority for Malaysia, which has implemented the mandatory, nationwide Malaysian Sustainable Palm Oil (MSPO) certification standard. This new blockchain app development is in addition to an available supply chain certification that links the sustainable palm oil (product) from the mill to the final product, proving near real-time provenance of the certified palm oil products, thus ensuring the value of certification right through the value chain to the customer.