Track timber supply chains using chain-of-custody records
Sector: Primary sector · Industry: Forestry · Organisation: Preferred by Nature · Maturity level: Pilot
The organisation Preferred by Nature launched a pilot project using blockchain technology to verify timber supply chains and strengthen chain-of-custody documentation. The platform is designed to make traceability records tamper-proof and facilitate compliance with forestry due diligence requirements. Participating timber traders and processors can thus demonstrate the lawful origin of their wood products transparently.
Documentation status
- Project status: Pilot (as of 26 March 2021) — Preferred by Nature presented the pilot project for traceability of timber supply chains in March 2021.
- Evidence: Evidence medium
- Editorial review: pending
Description
Preferred by Nature conducted a blockchain pilot project to secure international timber trade through immutable chain-of-custody data. In global timber supply chains, reliable traceability has often been endangered by incomplete or forged paper documents. The blockchain solution enables all involved actors to transparently view and securely verify origin and transport data.
The non-profit organisation Preferred by Nature tested a blockchain-supported platform for tracing timber products in 2021 together with a timber trading company. The pilot project's goal was to significantly strengthen the integrity of chain-of-custody certification compared to traditional methods. Through decentralized logging, every handover point in the supply chain is recorded tamper-proof and promptly. This facilitates importers and traders in demonstrating due diligence according to international legal requirements. Although no detailed technical specifications or quantified metrics were published in the initial announcement, the project demonstrates the significant potential of distributed ledgers for the forestry sector.
Perspectives
B2B — organisations perspective
In the B2B sector, the solution enables timber wholesalers and processors to provide tamper-proof proof of the legal origin of their raw materials. Business partners can verify certificates and handover protocols in real time, minimising audit costs and delays during import.
B2C — consumers perspective
End consumers receive more reliable assurance when purchasing timber products that the processed material does not come from illegal logging. The system supports trust in sustainability labels through a fully traceable digital history.
Employees perspective
Employees in purchasing and compliance benefit from automated verification processes for accompanying documents, eliminating tedious manual sampling. However, digital recording requires a change in existing documentation habits in day-to-day operations.
Benefits
General
- Increased tamper resistance of origin proofs
- Complete transparency along complex supply chains
- More efficient fulfilment of legal due diligence obligations
B2B — organisations
- Faster verification of chain-of-custody certificates
- Reduced reputational and sanction risks in timber trade
B2C — consumers
- Higher credibility of certified timber products
Employees
- Relief from manual document verification
- Structured and uniform data collection
Challenges
General
- Ensuring correct assignment of physical timber batches to digital data records
- Willingness of all supply chain actors to participate in the system
B2B — organisations
- Effort required to connect existing inventory management systems
Employees
- Need for training to operate new interfaces
Technology foundation
Distributed ledger technology for tamper-proof logging of chain-of-custody events and accompanying documents along the timber supply chain. The cryptographic linking prevents any subsequent alteration of proof of origin.
Implementation examples
Preferred by Nature timber supply chain pilot
In forestry, global trade routes carry a high risk of forged proof of origin and illegal timber, which can result in severe penalties and reputational damage for traders.
In 2021, Preferred by Nature tested a blockchain solution together with a timber trading company for seamless traceability of timber batches. The pilot project served to practically test tamper-proof chain-of-custody proofs.
Preferred by Nature launched a pilot project in March 2021 to test the traceability of timber supply chains using blockchain. In cooperation with a timber trading company, it was examined how digital registers can enhance the integrity of chain-of-custody certificates. The project aimed to demonstrate whether fraud risks and paperwork in complying with forestry due diligence obligations can be effectively reduced.
Elimination of opacity in ownership transfers and protection of chain-of-custody documents against subsequent manipulation.
Tags
Supply chain, Traceability, Timber industry, Chain of custody, Sustainability