Cosco To Use Blockchain Technology In Tracking Goods Across Seaborne Supply Chains

China’s state-run container line Cosco Shipping Holdings Ltd. will work with Alibaba Group Holding Ltd. and Ant Financial Group, the e-commerce giant’s financial technology affiliate, on using blockchain technology to track goods across seaborne supply chains.

Under the deal announced late Monday, the companies will cooperate on the initiative, the latest in a string of agreements in the shipping sector aimed at connecting cargo owners, vessel operators, ports and logistics companies through digital platforms that use blockchain technology.

Blockchain allows trusted participants to share information as goods move through supply chains. The system promises to reduce the cost of administering shipped goods, cut down on paperwork and speed the flow of goods by letting companies transmit information quickly and reliably.

Ant Financial Services runs the biggest business-oriented blockchain platform in China, processing payments and other services for as many as a billion users a day.

“We look forward to supporting the digital transformation of the global shipping industry, and working with Cosco Shipping to make it easier and more efficient to trade globally,” said Eric Jing, executive chairman of Ant Financial Group.

Alibaba signed a similar deal in May with shipping conglomerate China Merchants Holdings to create a digital platform for port operations.

Denmark’s A.P. Moller-Maersk A/S, which runs container shipping giant Maersk Line, and International Business Machines Corp. in 2016 introduced a blockchain platform for container ships called TradeLens, which other big operators such as Switzerland-based Mediterranean Shipping Co., France’s CMA CGM SA and Germany’s Hapag-Lloyd AG have since joined.

It’s unclear so far whether significant freight flows have been handled through the platform. TradeLens participants have said use of the blockchain platform has waned during the coronavirus pandemic because global trade flows have fallen sharply while shipping lines have dropped hundreds of port calls, paring down and effectively simplifying many supply chains.

Large companies such as Walmart Inc. and Procter & Gamble Co., along with hundreds of ports, have been testing the technology to get a better view of their supply chains, from raw materials to finished goods.

Source: Wall Street Journal