Container weight blockchain shows tech’s potential

Container weight blockchain shows tech’s potential

The much-hyped technology blockchain is slowly making its way into industrial use.

A UK-based logistics software provider is set to launch software designed to make it easier to store, access, and manage container weight information throughout the supply chain using the much-discussed but relatively-unused blockchain technology.

The software, created by Marine Transport International (MTI) to facilitate the sharing of container weights required by international regulations, offers a way to connect a blockchain system with a variety of existing, or legacy, technologies, and so provides “interoperability,” or a universal way to input information into the technology from multiple supply chain sources, including suppliers, shippers, customs, and terminals.

Mike Simon, principal consultant with DefinedLogic and a long-time analyst of technology in the container shipping field, said the MTI pilot appeared to be a good one, and it provides “a significant stepping-stone” toward proving the effectiveness of blockchain. He said MTI’s goal to create software that would make blockchain usable with a variety of industry stakeholders and their legacy systems is an industry “holy grail.”

Blockchain supporters say the technology could prove significant in sending cargo around the world because it stores information on numerous computers, enabling users to access information individually while providing a constant and secure record because the information cannot be retroactively altered. So, for example, a bill of lading could not be secretly altered during the shipping process, because the original is always visible.

MTI also argues that the fact information is stored in a blockchain “on each node in a decentralized network” makes it more resistant to a cyber attack.

The software will be released in the coming weeks, after a pilot period that was the subject of a white paper by a University of Copenhagen information technology professor, and the Blockchain Labs for Open Collaboration, also based in Copenhagen. The paper concluded that the software “brings forward a value proposition that is quite unique.”

Jody Cleworth, MTI’s CEO, a former trade manager for Maersk and Kuehne + Nagel, said 256 companies have used the MTI system in the pilot period, mostly from the commodity sector, with the bulk of transactions coming from 11 of them. He said the system handles about 6,000 containers per month, but expects that to rise to 50,000 per month once the product is officially launched.

If it proves effective, the MTI software — known as SOLAS VGM — could offer a significant advance to the effort to harness the power of blockchain, the distributed ledger technology behind Bitcoin that some analysts believe could help transform the administration of cargo shipments.

“All parties involved in the supply chain benefit from automated data flows as the system allows complete interoperability of data sources, even including legacy systems,” the company said in release Wednesday.

So far, however, although there is growing interest in blockchain among the transport and logistics sector, there has been no widespread use of it. Pilot projects being undertaken include Maersk Line and IBM teaming up to study how to deploy the blockchain system, and a project by terminal operator PSA International documenting cargo coming in and out of the Port of Antwerp, after it found that getting a container from point A to point B often involved more than 30 different parties, with an average of 200 interactions between them.

MTI says that the fact that its software is “interoperable” makes it easier to use than previous attempts to harness blockchain technology.” The software provides a data adapter that can translate information from sources such as container weights from weighbridges, electronic data exchange, or enterprise resource management systems into a format that can be used with blockchain.

MTI’s adapter software was developed to manage cargo weight information required under Safety of Life at Sea rules enacted by the International Maritime Organization 13 months ago. The adapter enabled the creation of a “one stop shop communications platform” that allowed for the capture, storage, and transmission of verified gross mass data. Without the adapter, the process would require “significant uploading and re-formatting of data, often manually,” MTI said.

The company then developed a “container streams ecosystem” that would connect the adapter to the blockchain, in a way that “connected supplier, load point, customs, and terminal on a shared blockchain ledger,” MTI said.

The pilot program focused on connecting shippers, freight forwarders, load points, shipping lines, and trucking companies, with the adapter acting as a “bridge between the distributed ledger storing the data and the various legacy systems and formats of the clients,” the white paper said.

“The system allows for automation of messaging while simultaneously providing privacy, transparency, security and interoperability with existing legacy systems,” the paper said.

Contact Hugh R. Morley at Hugh.Morley@ihsmarkit.com and follow him on Twitter: @HughRMorley_JOC.