Nine global shipping industry players have agreed to create a blockchain consortium that will “enable the shipping industry to digitally transform and to prepare for innovative supply chains.”
Five ocean carriers—CMA CGM, COSCO Shipping Lines, Evergreen Marine, OOCL, and Yang Ming—and four terminal operators—DP World, Hutchison Ports, PSA International, and Shanghai International Port—signed November 6, 2018 a formal statement of intent for a memorandum of understanding (MOU) to form a consortium to develop the Global Shipping Business Network (GSBN), an open digital platform based on distributed ledger technology
The new platform, to be developed by software solutions provider CargoSmart, will “establish a digital baseline that aims to connect all stakeholders, including carriers, terminal operators, customs agencies, shippers, and logistics service providers to enable collaborative innovation and digital transformation in the supply chain,” a CargoSmart statement said.
The container shipping industry is often characterized by disparate processes that take place across both physical and digital domains. Companies are increasingly looking towards digital technologies to resolve siloed shipment management procedures and disruptive information gaps. The consortium will offer a forum to address these challenges, explore cross-industry opportunities, and empower future innovation and insights, the statement continued.
“The consortium’s leading members intend to collaboratively develop the platform and establish standards to facilitate the seamless sharing of documents and data across all stages of the shipping lifecycle,” it explained.
Based on blockchain technology, the new platform will offer the following benefits:
- Open and extensible – A cooperative network enables members to develop applications and connect to other consortium networks to increase the speed of data integration and improve business performance.
- Transparency and instant validation – Peer-to-peer networking allows data owners to share immutable records to other shipment stakeholders, enabling them to take quick action regarding critical milestones and to keep cargo moving throughout the supply chain.
- Digital baseline for standards – An industry-wide common, trusted, and expansive digital model provides a foundation for highly collaborative initiatives and market intelligence.
The GSBN provides the foundation for new applications that can transform documentation flow for shipment management including dangerous goods documents, invoices, and cargo release.
The first planned application will allow shippers to digitize and organize their dangerous goods documents and automatically connect with relevant parties to streamline the approval process. The application is scheduled to be available in December 2018.
“The GSBN blockchain consortium has the potential to enable faster, more accurate processing of cargo information and more transparency of terminal operations to cargo owners,” said Yan Jun, president of Shanghai International Port.
“With the vision of a truly open blockchain platform for the industry, the GSBN will be key to the success of establishing a sustainable blockchain ecosystem for all stakeholders in the supply chain,” said Andy Tung, co-chief executive officer of OOCL.
Ivor Chow, director of corporate finance of Hutchison Ports said blockchain technology has the potential to be the key game changer with far-reaching impact on global supply chains, bringing immense benefits to all aspects of operations and end-to-end visibility throughout the entire supply chain.
“This collaboration brings together major industry players who strive to develop an open digital platform that will deliver efficiency gains and reduce costs of transactions,” said Chow.
“We are pleased to provide an industry-wide forum for collaboration based on blockchain technologies to transform the shipping and logistics industry and elevate supply chain processes,” said Steve Siu, chief executive officer of CargoSmart.
Photo courtesy of CargoSmart
