Alpha channel and shadows not working as intended

Could you guide me into what could be wrong? I am even not sure what part of code is responsibile for it, shadows? effects?

Trees and gras have PremultAlpha set and they both cast and receive shadows.

Thanks for any help.

you have to set the AlphaDiscardThreshold parameter on the material.

that’s the threshold where the pixel will be discarded and not written to color or depth.

A value 0.1 often work very well.