Container firms create multiple blockchain applications
Israeli container shipping firm ZIM, in partnership with Sparx Logistics and Wave Ltd, announced at the end of November the successful trial shipment of containers from China to Canada with blockchain-enabled bills-of-lading. ZIM, based in Haifa, Israel, was founded in 1945 and has a capacity of over 344K TEUs, making it a top-20 global shipping firm. During the trial all participants issued, transferred, and received original electronic documents using the Wave Application.
Wave’s new blockchain bill-of-lading platform uses distributed ledgers to ensure that all parties in the supply chain can issue, transfer, endorse, and manage documents through a decentralized network. The application is free for shippers, importers, and traders, and requires no IT or operational changes. The video below explains what Wave does:
ZIM CIO Eyal Ben-Amram said, “promoting innovation and technology in our industry is an integral part of ZIM’s vision. While we are still in the process of evaluating the technology, we are confident that this type of forward-looking ideas will advance our industry as a whole towards a more efficient and modern phase.”
The ZIM-Sparx-Wave collaboration shows how smaller, more nimble companies have been able to embrace and implement blockchain technology to maintain their competitive edge against larger industry leaders. Earlier this year, Maersk, the world’s largest container shipping line, and IBM announced a partnership to use blockchain to digitize and streamline the paper trail of millions of shipping containers all across the world. Maersk’s fleet has a capacity of about 3.8M TEUs, more than ten times what ZIM holds.
In 2014, a Maersk study revealed that even a relatively uncomplicated shipment of refrigerated goods from East Africa to Europe can go through nearly 30 people and organizations, including 200+ interactions and communications between those parties. The costs of processing and administering trade documents are estimated to represent 20% of the actual physical transportation costs. Anglo-American shipping firm Marine Transport International (MTI) estimates that blockchain could save $300 per container in terms of labor and processing associated documents. For one ultra-large container ship, which carries up to 22,000 containers, the savings amount to $6.6M. Maersk and IBM’s solution is based on Linux’s open source Hyperledger Fabric and is hosted on the IBM Cloud.
Maersk and Microsoft, on the other hand, completed a 20 week blockchain proof of concept trial for marine insurance earlier this year. “Insurance transactions are currently far too tedious and frictional,” said Lars Henneberg, Maersk’s head of risk and insurance, in a statement about the trial. “Blockchain technology has the potential to facilitate the desired development that is long overdue.”
In August, MTI began a blockchain pilot to protect maritime supply chains against NotPetya-style cyberattacks. A month before, NotPetya had infected Maersk through a malicious update to the accounting software MeDoc, forcing Maersk to shut down operations at 76 port terminals and ultimately costing the firm between $200M-$300M. Maersk’s CEO, Soren Skou, said the firm’s communications networks were completely shut down and employees had to use WhatsApp on their private mobile phones to maintain the bare minimum of contact.
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