Major Agribusinesses Seek To Transform Global Trade Operations Using Blockchainbr>
Four largest agribusinesses have joined forces to digitize international grain trading by using blockchain technology and artificial intelligence (AI).
Archer Daniels Midland (ADM), Bunge, Cargill, and Louis Dreyfus Company (LDC), announced in a joint press release that they are investigating ways to standardize and digitize global agricultural shipping transactions for the benefit of the entire industry. Initially, the companies will be focusing on automating grain and oilseed post-trade processes, as they represent a highly manual and costly part of the supply chain.
“We expect an industry-wide initiative of this nature to be able to accelerate improvements in data management and business processes, and bring much-needed automation to the industry,” said Soren Schroder, Bunge’s CEO. “Promising technologies will not only provide synergies and efficiencies for ourselves, we believe they will prove vitally important to serving customers better by laying the foundation to enable greater transparency.”
By leveraging blockchain, AI and other cutting-edge technologies, the companies will seek to eliminate inefficiencies that would lead to shorter document-processing times, reduced wait times and better end-to-end contracting visibility. In the long-term, the goal is to digitize other manual, paper-based processes involving contracts, invoices and payments.
“We’re pleased to join the effort to foster modernization and standardization of data and documents in the global agribusiness value chain,” said Juan Luciano, ADM’s Chairman and CEO. “By working together to design and implement a digital transformation, we will bring hundreds of years of collective knowledge and experience to simplify processes and reduce errors for the benefit of the entire industry.”
Two of the participating companies have already trialed blockchain technology. In January of this year, LDC completed the first agricultural commodity transaction through blockchain, which showed the technology’s capacity to generate efficiencies and reduce the time usually spent on manual document and data processing. While in May, Cargill teamed up with HSBC and ING to trial R3’s Corda blockchain platform to finance a shipment of soya from Argentina to Malaysia.
“By working with the industry to adopt standardized data and processes, we can truly harness the full potential of emerging technologies to improve global trade,” said Ian McIntosh, LDC’s CEO.
David MacLennan, Cargill’s Chairman and CEO, said that agriculture has always been a technology industry and their customers expect them to deliver innovations that make them more efficient, effective and profitable.
“We embrace this as an opportunity to better serve the industry and ignite innovation through new products, processes and partnerships,” MacLennan said.