A shipment of soybeans has been hailed as the first of its kind using Blockchain technology.
The applications of Blockchain technology are potentially endless – and every year we are hearing more uses in business and trade. Cryptocurrencies remain in the limelight but that hasn’t stopped multinational companies from forging ahead with their own Blockchain solutions in an effort to streamline business.
As it so happens, a new milestone has been reached by mainstream industries in 2018. In a first for the global agricultural industry, a cargo shipment of soybeans has been completed using Blockchain technology. The trade was carried out digitally using Easy Trading Connect (ETC) Blockchain platform, according to Reuters. ETC incorporated a number of contracts and certificates needed for the international trade of agricultural products.
The shipment from America to China involved five different parties including Louis Dreyfus Co, Shandong Bohi Industry Co, ING, Societe Generale and ABN Amro.
The Louis Dreyfus Company, a multinational agricultural merchant, has hailed the use of Blockchain technology in trade due to its efficiency. The company’s head of trade operations, Robert Serpollet, estimated that the use of Blockchain to process the contracts and certificates greatly reduced the usual time it would take for a trade like this to be approved.
“We noticed very significant efficiency gains far beyond what we expected.”
Using the ETC platform, Bohi bought the shipment of soybeans from Louis Dreyfus – while various banks provided the credit certificates needed for the sale. The shipping companies took care of the necessary paperwork needed for the shipment and the US Department of Agriculture was involved in providing certificates for the sanitation requirements.
Anthony van Vliet, who heads up ING’s trade and commodity finance, believes the use of Blockchain in this specific industry could well be widely adopted due to its cost-saving benefits.
“This is key as we operate in a business that has high volumes and very low margins. If not months, then in a year or at max two, I think the world in this space will look quite different.”
A new use-case
Blockchain technology is mostly used as the backbone for transactions, like Bitcoin and other cryptocurrencies. However, as Ethereum pioneered, it can be used in more technical ways, like the inclusion of contracts that can be carried out by the Blockchain.
As this latest soybean use-case proves, a number of different parties can be involved in a complex business transaction. By using Blockchain technology, the process is sped up while becoming cheaper – which will no doubt be a draw for other businesses. Using a Blockchain platform also keeps all stakeholders involved and informed throughout the process.