The IBM blockchain supply chain solution just proved its’ mettle in a pilot project. The project, involving a shipment of 28 tons of Mandarin Orange showed significant improvement in the bill of lading process.
IBM, the container shipping operator Pacific International Lines (“PIL”), and the Singapore-based importer Hupco Pte Ltd. collaborated in this project. The pilot tracked the shipment using the blockchain-powered “e-BL” solution.
The global logistics market is already massive, moreover, it’s expected to reach US $ 12.25 trillion by 2022, as estimates show. Container shipping is a key component here, accounting for 60% of global seaborne trade. Container ships transport US $ 4 trillion worth of goods annually, as reports indicate.
The industry could use some efficiency though. An important document in this industry is the “Bill of Lading” (BoL). BoL is a legal document between a shipper and carrier detailing the shipment. The document is also the shipment receipt, therefore, authorized parties must sign it and the document accompanies the shipment.
The container shipping industry is using the BoL process since long, and the process involves significant paperwork. The inefficiencies in the traditional BoL process adds to the shipping delay.
The delay from an inefficient BoL process has a more pronounced impact when the shipments involve perishable goods like fruits and venegatable. Experts have pointed out these inefficiencies and advocated electronic BoLs.
The BoL process certainly needs technology solutions to make it more efficient. However, the technology solution also needs to be robust enough. The high-value shipping industry must have a secure BoL process. It should also be transparent and free from interventions from middlemen.
The blockchain technology fits the bill. It offers security, transparency, and immutability of records. Stakeholders with access to the distributed ledger can immediately see the latest status of their transaction. Tamper-proof records build trust among shippers, carriers, and recipients.
Port authorities will find it easier to inspect the documentation. Smart contracts can make it easier for the stakeholders to transfer the BoL seamlessly.
IBM, PIL, and Hupco just concluded a pilot of e-BL, i.e., IBM blockchain supply chain solution. The consignment of 28 tons of Mandarin Orange was delivered before the Lunar New Year celebrations commenced. Many people take these oranges during this celebration since these are considered signs of prosperity.
The pilot project saw a significant reduction in the BoL processing time from 5-7 days to just one second! IBM also reports additional benefits, for e.g.:
- Reduced electricity costs due to reduced refrigeration duration;
- A reduction in storage cost;
- Real-time visibility of BoLs;
- Better security against fraud.
IBM blockchain supply chain solution offerings are making considerable strides. IBM is working with the container shipping giant Maersk to reduce the shipping time. The technology giant is also helping the jewellery buyers with their supply chain assurance solution. Walmart is using IBM blockchain solutions to track green leafy produce.