Global supply chain partners use blockchain to trade safely during COVID-19
Cargill, Agrocorp and Rabobank worked together via a blockchain solution to ensure intercontinental agricultural trade could take place during the COVID-19 pandemic, and did so in five days.
Cargill and Agrocorp, in partnership with Rabobank and other logistics partners, have completed a cross-continent commodity trade transaction of wheat from North America to Southeast Asia on a blockchain platform provided by Singapore-based software company dltledgers.
In the wake of the COVID-19 pandemic, the transaction is said to demonstrate the power of partnerships to help ensure the global agriculture supply chain delivers food to where it is needed in a time of uncertainty.
The shipment, valued at $12 million and settled on 1 April 2020 from North America to Indonesia, occurred with six trading partners participating on a common blockchain platform.
The blockchain platform provided a repeatable framework for end-to-end digital trade executions, digitalising the document and trade execution process. The trade took a total of five days to settle, whereas traditional trading processes can reportedly take up to a month. The platform created a shared, immutable record of the transaction – ‘a single source of truth for all parties’.
“We are constantly seeking ways to work with our partners to help make food and agricultural supply chains more inclusive and respond to demands,” said Jennifer Davidson, Trade Execution Lead, Cargill. “We see this transaction as the latest example of how working together and using technology to solve challenges can improve trade, as well as traceability, food safety, nutrition and more.”
“It’s our mission to digitise trade finance operations,” said Rabobank’s key facilitators, Mario Cortinhal in North America and Olivier De Jong in Singapore. “Consensus-driven smart contracts in this deal minimised our time spent on processing documents by more than half. Riding on the success of this test-case, Rabobank is excited to advance the $10 trillion trade-finance industry.”
“We have been engaging in digital trade execution using blockchain for over 18 months now and have been able to increase efficiency internally and externally,” said Abhinav Vijay, Sustainability Manager, Agrocorp International. “Considering the current world climate and the logistical challenges to move physical documents around the globe, this is just a start and we hope to execute more trades via the platform in the near future.”
“What’s interesting here is that each transaction can include multiple unconnected counterparties, represent tens of millions of dollars, and involve the registration of hundreds of different data points into the platform,” said Brian Behlendorf, Executive Director of the Hyperledger Consortium. “The numbers are truly impressive, but what’s more remarkable is that this is not a proof-of-concept, but real production use.”